Professional Documents
Culture Documents
1.motor Accidents-Compensation No Fault Liability
1.motor Accidents-Compensation No Fault Liability
NO FAULT LIABILITY
PRESENTED
BY
Y V RAMA KRISHNA
VICE CHAIRMAN(RETD)
AP ADMINISTRATIVE TRIBUNAL.
DOCTRINE OF NO FAULT LIABILITY
BACK DROP
• JUDICIAL HISTORY
Claims for compensation - based on law of Torts.
• Fault is ‘Sine Qua Non’ to claim damages under the law of Torts.
• Sri Justice Fazalali in Manjusri Raha Vs B.L.Gupta(AIR 1977 SC
1158) in view of faster growth o f vehicular traffic and loss of life
and limbs due to frequency of motor accidents, observed :
• “The time is ripe for serious consideration of creating no-fault
liability. Having regard to the directive principles of State policy ,
the poverty of the ordinary run of victims of automobile
accidents, the compulsory nature of insurance of motor vehicles,
the nationalization of general insurance companies and the
expanding trend towards nationalization of bus transport, the law
of torts based on no-fault liability needs reform”
Sri Justice V.R.Krishnayyar in Concord of India
Insurance Co. Vs Nirmala (AIR 1979 SC 1666)
observed:
“The jurisprudence of compensation for motor
accidents must develop in the direction of
no-fault liability and the determination of the
quantum must be liberal, not niggardly since the
law values life and limb in a free country in
generous scales.”
STATUTORY HISTORY:
In the light of observations of Supreme
Court and the recommendations of Law
Commission, Motor Vehicles Act 1939 was
amended and Chapter X was introduced and
under sec 95 no-fault liability was provided.
M V Act 1988 replaced 1939 Act. Chapter X
of Act 1988 deals with it.
• Sec 140 speaks about liability to pay
compensation in case of death or
permanent disability.
• Sec 141 speaks about other right to claim
compensation.
• Sec 142 defines permanent disability.
• Sec 143 states about the applicability of
chapter X to Workmen’s Compensation Act.
• Sec 144 speaks about overriding effect.
NO FAULT LIABILITY – SEC.140
• Death or Permanent Disability of any person in
an Accident arising out of use of Motor
Vehicle(s).
Owner(s) - jointly and severally liable to pay :
In case of – Death: Rs 50,000/
– Permanent Disability: Rs 25,000/-
• Need not plead
– fault on the part of owner or driver and
– fault of Deceased or injured is not a defense
• Entitled to compensation u/other laws except
u/sec 163 A.
• Compensation u/sec. to be deducted from
other compensation awarded.
• Accident – not defined under MVAct.
• Distinction between Murder and
Accidental Murder is drawn in Smt. Rita Devi
Vs New India Assurance co.(2000) 5 SCC 113
by the Supreme Court. It is held:
• “ If the dominant intention of the act of
felony is to kill –it is a murder simplicitor.
If the murder was not originally intended
and same was caused in furtherance of any
other felonious act then such murder is an
accidental murder”.
• Accident arising out of use of motor vehicle :
• The word ‘use’ has a wider connotation to cover
the period when the vehicle is not moving and
stationary, became immobile due to breakdown
or mechanical defect or accident.
• The accident should be connected with the use
of the motor vehicle. The connection need not
be direct and immediate. The expression used
enlarges the field of protection made available
to the victims and is in consonance with the
beneficial object underlying the enactment.
Vide Sivaji Dayanu patil Vs Smt. Vatschala Uttam
More 1991 ACJ 777 (SC). It is followed in Smt.
Rita Devi (supra).
• DEFENCES available for Claims U/S 140 to
the Insurance Companies :
• The burden is on the Insurance Co. to prove:
a) Owner committed willful breach of
conditions of policy,
b) Insurance Companies can take all
defenses available u/s 149.
National Insurance Co.vs Tumu Guruva Reddy
-2001 ACJ 542 (A.P);
Yellawwa Vs Nat. Ins. Co. AIR 2007 S.C.2582.
• Willful breach of conditions of policy:
• Mere violation of conditions of policy by
insured is not sufficient to get over the
liability by the insurer.
• The insurer must prove that the insured is
guilty of negligence and failed to exercise
reasonable care in fulfilling the conditions of
policy . The burden is on the insurer to
establish willful breach.
• Fundamental breach :
• The breach of conditions of policy must be so
fundamental as are found to have
contributed to the cause of the accident.
• The rule of ‘main purpose’ and concept of
‘fundamental breach’ have to be kept in mind
in interpreting the policy conditions and the
defenses available to the insurer.
• These niceties are extensively considered by
a three Judge bench of Supreme Court in
National Insurance Co.Ltd. Vs Swaran Singh
2004 ACJ 1=(2004) 3 SCC 297.