Case Note & Summary
The case arises from a motor accident claim where the original claimant (since deceased) sought compensation for injuries sustained in a vehicular accident on 14/06/2006 at 20:45 hrs. The Motor Accidents Claims Tribunal (MACT), Mapusa, partly allowed the petition and awarded Rs. 17,31,514/- with interest, but fastened liability on respondents no.1 and 2 (the driver and owner) and absolved respondent no.4 (the insurer) on the ground that the insurance policy was effective from 15/06/2006 and did not cover the accident. The registered owner (appellant) appealed, challenging both the award and the order dated 10/10/2008 dropping the insurer from proceedings. The appellant contended that the policy, though effective from 15/06/2006, commenced from midnight of 14/06/2006, thus covering the accident. The High Court analyzed the policy and held that the policy period was from 15/06/2006 to 14/06/2007, meaning it commenced at midnight of 14/06/2006, thereby covering the accident that occurred at 20:45 hrs on 14/06/2006. The court allowed the appeal, set aside the impugned judgment and award to the extent it absolved the insurer, and held the insurer liable to indemnify the owner and pay the compensation. The court directed the insurer to pay the awarded amount with interest within eight weeks.
Headnote
A) Motor Accident Claims - Insurance Policy - Commencement of Coverage - Section 147 Motor Vehicles Act, 1988 - The issue was whether the insurer was liable when the policy was effective from 15/06/2006 but the accident occurred on 14/06/2006 at 20:45 hrs. The court held that the policy commenced from midnight of 14/06/2006, thus covering the accident, and the insurer could not escape liability. (Paras 1-10)
B) Motor Accident Claims - Liability of Insurer - Dropping of Insurer from Proceedings - The MACT had dropped the insurer from proceedings on the premise that there was no insurance cover on the date of accident. The High Court reversed this, holding that the policy covered the accident and the insurer was liable. (Paras 2-10)
Issue of Consideration
Whether the insurer is liable to indemnify the owner when the insurance policy was effective from 15/06/2006 but the accident occurred on 14/06/2006 at 20:45 hrs.
Final Decision
The appeal is allowed. The impugned judgment and award dated 27/08/2009 and the order dated 10/10/2008 are set aside to the extent they absolve the insurer (respondent no.4). The insurer is held liable to indemnify the owner and pay the compensation awarded. The insurer shall pay the awarded amount with interest within eight weeks.
Law Points
- Insurance policy effective from a future date covers accident occurring on the same day before midnight
- Motor Vehicles Act
- 1988
- Section 147
- liability of insurer
- interpretation of policy commencement time
Case Details
2017 LawText (BOM) (06) 125
FIRST APPEAL NO.93 OF 2012
Shri J. Godinho for Appellants, Shri D. Gaonkar for Respondent No.1, Shri D. Pangam for Respondent No.3, Shri U.R. Timble for Respondent No.4
Shri Laxman Vithu Majik (since deceased) through LR's Mrs. Laxmi Laxman Majik, Mr. Anil Laxman Majik, Mr. Prashant Laxman Majik
Shri Anant Suryakant Wadkar, Mulkkanna Shivaji Pujari, Shri Dilip Dnyaneshwar Chawan, National Insurance Company Ltd.
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Nature of Litigation
Appeal against judgment and award of MACT in a motor accident claim, challenging the absolving of insurer from liability.
Remedy Sought
Appellants (registered owner and legal heirs) sought to set aside the order dropping the insurer from proceedings and to hold the insurer liable to pay compensation.
Filing Reason
The MACT held that the insurance policy was not in force on the date of accident (14/06/2006) as it was effective from 15/06/2006, and thus absolved the insurer.
Previous Decisions
MACT, Mapusa, partly allowed the claim petition and awarded Rs. 17,31,514/- with interest, but held respondents no.1 and 2 liable and absolved respondent no.4 insurer.
Issues
Whether the insurance policy effective from 15/06/2006 covers an accident that occurred on 14/06/2006 at 20:45 hrs.
Whether the insurer can be absolved from liability on the ground that the policy commenced after the accident.
Submissions/Arguments
Appellant argued that the policy was effective from 15/06/2006, but the accident occurred on 14/06/2006 at 20:45 hrs, and as per the policy, it commenced from midnight of 14/06/2006, thus covering the accident.
Respondent no.4 insurer contended that the policy was not in force at the time of accident as it was effective from 15/06/2006.
Ratio Decidendi
An insurance policy effective from a future date (15/06/2006) commences from midnight of the preceding day (14/06/2006), and therefore covers an accident occurring on that day before midnight. The insurer cannot escape liability under Section 147 of the Motor Vehicles Act, 1988.
Judgment Excerpts
This is an appeal by the registered owner and later his legal heirs challenging the judgment and award dated 27/08/2009 passed by the learned MACT, Mapusa pursuant to which she partly allowed the petition and held the original claimant entitled to the sum of `17,31,514/- with interest while fastening the liability on the respondents no.1 & 2 and absolving the respondents no.4 insurer of the liability arising therefrom.
It was the contention of Shri Godinho, learned Advocate for the appellants that the accident had taken place on 14/06/2006 at 20.45 hrs. and as per the case of the respondents no.4, the Policy was effective from 15/06/2006 till the midnight of 14/06/2007 i.e. not covering the accident which had taken place on the night of 14/06/2006.
Procedural History
The original claimant filed a claim petition before MACT, Mapusa, which was partly allowed on 27/08/2009 awarding Rs. 17,31,514/- with interest, but absolving the insurer. The MACT had earlier passed an order on 10/10/2008 dropping the insurer from proceedings. The registered owner appealed to the High Court of Bombay at Goa against both the order and the award.
Acts & Sections
- Motor Vehicles Act, 1988: Section 147
