Case Note & Summary
The appeal was filed by the owner of a Maruti Omni vehicle (Reg.No.KA-01-M-7359) under Section 173(1) of the Motor Vehicles Act, 1988, challenging the judgment and award dated 01.03.2014 passed by the I Additional District Judge and MACT, Chikmagalur in MVC No.392/2010. The Tribunal had awarded compensation of Rs.59,500/- with interest at 6% p.a. to the claimant (respondent No.1) and held the owner (appellant) and driver (respondent No.2) jointly and severally liable, while dismissing the claim against the insurance company (respondent No.3). The accident occurred on 13.04.2010 at about 10.00 p.m. when the claimant was proceeding in the vehicle driven by respondent No.1. The vehicle overturned due to rash and negligent driving, causing injuries to the claimant. The insurance company contended that the driver did not possess a valid driving license at the time of the accident. The Tribunal accepted this contention and exonerated the insurance company. The owner appealed, arguing that the insurance company should be liable to pay compensation to the third-party claimant and then recover it from the owner. The High Court allowed the appeal, holding that the insurance company is liable to pay the compensation to the claimant and then recover the same from the owner in accordance with the principle of 'pay and recover' under Section 149(2)(a)(ii) of the MV Act. The court set aside the Tribunal's order exonerating the insurance company and directed the insurance company to pay the awarded amount to the claimant within four weeks, with liberty to recover it from the owner.
Headnote
A) Motor Vehicles Act - Third-Party Liability - Invalid Driving License - Pay and Recover - The issue was whether the insurance company is liable to pay compensation to a third-party claimant when the driver had no valid driving license. The court held that the insurance company is liable to pay compensation to the third party and then recover the same from the owner, following the principle of 'pay and recover' as per Section 149(2)(a)(ii) of the Motor Vehicles Act, 1988. (Paras 1-10) B) Motor Vehicles Act - Appeal by Owner - Liability of Insurance Company - The owner appealed against the Tribunal's order holding him jointly liable with the driver and exonerating the insurance company. The court allowed the appeal, directing the insurance company to pay the compensation to the claimant and recover it from the owner. (Paras 1-10)
Issue of Consideration
Whether the insurance company can be absolved of liability to pay compensation to a third-party claimant when the driver of the offending vehicle did not possess a valid driving license at the time of the accident.
Final Decision
The appeal is allowed. The judgment and award of the Tribunal dated 01.03.2014 in MVC No.392/2010 is modified. The insurance company (respondent No.3) is directed to pay the compensation amount of Rs.59,500/- with interest at 6% p.a. to the claimant (respondent No.1) within four weeks from the date of receipt of a copy of this judgment. The insurance company is at liberty to recover the said amount from the owner (appellant) in accordance with law.
Law Points
- Motor Vehicles Act
- 1988
- Section 149(2)(a)(ii)
- Section 166
- Section 173(1)
- third-party liability
- invalid driving license
- pay and recover
- insurance company liability
