# MINU B. MEHTA AND ANOTHER v. BALKRISHNA RAMCHANDRA NAYAN AND ANOTHER

- **Citation:** [1977] 2 S.C.R. 886
- **Court:** Supreme Court of India
- **Decided:** 1977-01-28
- **Bench:** A. N. Ray, M. H. Beg, P. S. Kailasam
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/minu-b-mehta-and-another-v-balkrishna-ramchandra-nayan-and-another-7118
- **Pages:** 15

## Headnote

Motor Vehicles Act, 1939-S. 95(v)(b)(i) and (ii)-Scope of -Claim for
compensation in motor vehicle accidents-Proof of negligence of drilf15r-lf
necessary.
Torts-Claim for compensation in motor vehicle accidents-Proof of negligence of drriver-lf necessary.
While the respondent was travelling in his car, the appellant's truck, driven
by a driver, hit the car and caused injuries to the respondent and damaged the
car.
The Claims Tribunal awarded compensation to the respondent, and the
High Court upheld the Tribunal's award.
In the course of the judgment the
High Court, however, observed that every person has a right to security and
safety of his person irrespective of the fault or negligence or carelmsness and
that every person hlli> a right to claim compensation. irrespective of proof of
negligence on the part of the driver.
It further observed that the perimeters
of liability in els. (i) and (ii) of s. 95(i)(b) must be held to he the same
because in both, the liability of the owner of the driver exists and is made compulsorily insurable and that it could not be said that the legislature intended
absolute liability in cases covered by cl. (ii) and not in cases
covered
by
cl. (i).
HELD : Proof of negligence is necessary before the owner or the insurer
could be held liable for payment of compensation in motor vehicle accident
claims.
The High Court's views are opposed to basic principles of the owner's
liability for negligence of his servant and are based on a compkte misreading
of the provisions of Chapter VIII of the Motor Vehicles Act. [900 Fl
1. Before a person can be made liable to
pay
compensation
flilr
any
injuries and damage caused by ms action. it is necessary
tha>
the·
perso'Il
injured should be able to establish that he has some cause of action
against
the party responsible.
In order to succeed in an action for
negligence
the
plantiff must prove ( 1) that the defendanb had, in the circumstances, a duty
to take care and that duty was owed by him to the plaintiff
and (2)
that
there was a breach of that dut<y and that as a result of the breach
damage
was suffered by the plaintiff.
The master also becomes liable for the conduct
of the servant when the servant is proved to have acted negligently
in
the
course of his employment. f895 C-Dl
~
2(a) The puri:ose of making i'Ilsurance compulsory
is
to
protect
the
interests of the successful claimant from being defeated by the owner of the
vehicle who has not enough means to meet his liability.
The1 safeguard
is
provided· by imposing certain statutory duties, namely, the duty not to drive
or permit a car to be driven unless
the car is
covered
by
third
party
insurance. f895 Fl
(b) Under s. 95(1) (b )(i) of the Act, the policy of insurance must be a
i:nlicy which insures against any liability which may be incurred
in
resp~c'
of death or bodily injury to any person or damage to any property of a third
party caused by or arising out of the use of the vehicle in a public place. The
accident to which the owner or the person insuring is liable is to the extent of
his liability in respect of death or bodily injury and that liability is covered by
the insurance. It is. therefore, obvious that if the owner has not incurred any
liab;lity in respect of death or bodily injury to any person there is no liability
and it is not intended to be covered by the insurance. The liability contemplated arises under the law of negligence and under the principle of _vicarious
liability.
The provisions of the section do not make the owner or the rnsurance
compa.ny Iia·bk for any bodily iniurv caused to a third party arising out of the
use of the vehicle unless the liability can be fastened on him. [896 D-F]
MINU B. MEHTA v. B. R. NAYAN (Kailasam, J.)_
887
(c) Under sub-cl. (ii) of s. 95(1)(b) of the Act the policy of insurance must
insure a person against death or bodily injury to any passenger of a
public
service vehicle caused by or arising out of the use of the vehicle in a public
place.
So far as the bod

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886
MINU B. MEHTA AND ANOTHER
v.
BALKRISHNA RAMCHANDRA NAYAN AND ANOTHER
January 28, 1977
[A. N. RAY, C. J., M. H. BEG AND P. S. KAILASAM, JJ.]
Motor Vehicles Act, 1939-S. 95(v)(b)(i) and (ii)-Scope of -Claim for
compensation in motor vehicle accidents-Proof of negligence of drilf15r-lf
necessary.
Torts-Claim for compensation in motor vehicle accidents-Proof of negligence of drriver-lf necessary.
While the respondent was travelling in his car, the appellant's truck, driven
by a driver, hit the car and caused injuries to the respondent and damaged the
car.
The Claims Tribunal awarded compensation to the respondent, and the
High Court upheld the Tribunal's award.
In the course of the judgment the
High Court, however, observed that every person has a right to security and
safety of his person irrespective of the fault or negligence or carelmsness and
that every person hlli> a right to claim compensation. irrespective of proof of
negligence on the part of the driver.
It further observed that the perimeters
of liability in els. (i) and (ii) of s. 95(i)(b) must be held to he the same
because in both, the liability of the owner of the driver exists and is made compulsorily insurable and that it could not be said that the legislature intended
absolute liability in cases covered by cl. (ii) and not in cases
covered
by
cl. (i).
HELD : Proof of negligence is necessary before the owner or the insurer
could be held liable for payment of compensation in motor vehicle accident
claims.
The High Court's views are opposed to basic principles of the owner's
liability for negligence of his servant and are based on a compkte misreading
of the provisions of Chapter VIII of the Motor Vehicles Act. [900 Fl
1. Before a person can be made liable to
pay
compensation
flilr
any
injuries and damage caused by ms action. it is necessary
tha>
the·
perso'Il
injured should be able to establish that he has some cause of action
against
the party responsible.
In order to succeed in an action for
negligence
the
plantiff must prove ( 1) that the defendanb had, in the circumstances, a duty
to take care and that duty was owed by him to the plaintiff
and (2)
that
there was a breach of that dut<y and that as a result of the breach
damage
was suffered by the plaintiff.
The master also becomes liable for the conduct
of the servant when the servant is proved to have acted negligently
in
the
course of his employment. f895 C-Dl
~
2(a) The puri:ose of making i'Ilsurance compulsory
is
to
protect
the
interests of the successful claimant from being defeated by the owner of the
vehicle who has not enough means to meet his liability.
The1 safeguard
is
provided· by imposing certain statutory duties, namely, the duty not to drive
or permit a car to be driven unless
the car is
covered
by
third
party
insurance. f895 Fl
(b) Under s. 95(1) (b )(i) of the Act, the policy of insurance must be a
i:nlicy which insures against any liability which may be incurred
in
resp~c'
of death or bodily injury to any person or damage to any property of a third
party caused by or arising out of the use of the vehicle in a public place. The
accident to which the owner or the person insuring is liable is to the extent of
his liability in respect of death or bodily injury and that liability is covered by
the insurance. It is. therefore, obvious that if the owner has not incurred any
liab;lity in respect of death or bodily injury to any person there is no liability
and it is not intended to be covered by the insurance. The liability contemplated arises under the law of negligence and under the principle of _vicarious
liability.
The provisions of the section do not make the owner or the rnsurance
compa.ny Iia·bk for any bodily iniurv caused to a third party arising out of the
use of the vehicle unless the liability can be fastened on him. [896 D-F]
MINU B. MEHTA v. B. R. NAYAN (Kailasam, J.)_
887
(c) Under sub-cl. (ii) of s. 95(1)(b) of the Act the policy of insurance must
insure a person against death or bodily injury to any passenger of a
public
service vehicle caused by or arising out of the use of the vehicle in a public
place.
So far as the bodily injury caused to a passenger is concerned it need
not
be due
to
any
act
or liability
incurred
by
the
person. The
expression "liability which may be incurred by him" in sub.-cl. (i) is meant to
cover any liability arising out of the use of the vehicle. Therefore, the person
must be under a liability and that liability alone is covered by ihe insurance
policy. [896 F-H]
·
(d) The owner's liability arises out of his failure to discharge a duiy cast
on him by law. The right to receive compensation can only be
against
a
person who is bound to_ compensate due to the failure to perform
a
legal
obligation.
Ji a person is. not liable legally he is under no duty to compensate
any one else. The Claims Tribunal is a tribunal constituted
by
the
State
Government for expeditious disposal of the motor vehicles claims. The general
-~ law applicable is only co.mmon law and the law of ~orts.
~ ~n~er ~he lf!:W a
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- - person becomes legally !table then the person suffermg the m1unes 1s enhtled
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to be compensated and the tribunal is authorised to determine the amount of
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compensation which appears to be just. The plea that the Claims Tribunal is
en.titled to award compensation which appears to be just when it is satisfied on
proof of injury to a third party arising out of the use of a vehicle on a public
place without proof of negligence, ·if accepted, would lead to strange results.
[897 E-F]
3. The po\ver to constitute one or more Motor Vehicle Claims Tribunals
under s. 110(1) is optional and the State Government may not constitute a
Claims Tribunal for certain areas. When a claim includes a claim for compensaD
tion, the claimant has an option to make his cfa.im before the Civil Court. In
claims for compensation, therfore, in certain cases, Civil
Courts
also
have
iurisdiction. If the contention put forward is accepted so far as the Civil Court
is concerned, it would have to determine the liability of the owner on the basis
of common law or torts while the Claims Tribunal can award compensation
without reference to common law or torts and without coming to the conclusion that the owner is liable The concept of owner's liability
without
any
negligence is opposed to the principles of law.
The mere fact that a party
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received an injury arising out of the use of a vehicle in a public place,
~annot
justify fas1ening liability on the owner. It may be that a person bent upon
committing suicide may jump before a car in motion and thus
get
himself
kille.d.
In such cases, the owner cannot be made liable.
Proof of negligence
remains the lynch pin to recover compensation. [897 H; 898 A-Bl
Haji Zakaria and others v. Naoshir Cama and others A.I.R. 1976 A.P. 171
and New India Assurance Co. Ltd. v. Sumitra Devi and others, 1971 A.CJ. 58
not approved.
·
Kesavan Nair v. State Insurance Officer, 1971 A.CJ. 219 and Afls. Ruby
[nsurance Co. Ltd. v. V. Govindaraj and others, A.A.O. 607 of 1973 and 296
of 1974 decided by the Madras High Court on December 13, 1976 referred to.
CIVIL APPELLATE JURismcnpN : Civil Appeal No.
1249
of
1976.
Appeal by Special Leave from the Judgment and Order dated . the
23-3-1976 of the Bombay High Court in C. No. 449/75 from Onginal
Decree.
F. S. Nariman, J. M. Patel and B. R. Agarwala for the Appellants.
R. D. Hattangadi, George Kurien and (Mrs.) Urmila Sirur for
Res. No. 1.
K. K. Singhvi and V. N. Ganpule for the applicant/Intervener.
The Judgment of Court was delivered by
KAfLAAAM, J. This appeal is by special leave under Article 136 of
the Constitution by the two appellants against the judgment of the
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SUPREME COURT REPORTS
[1977] 2 S.C.R.
Bombay High Court dismissing their appeal against the judgment of
the Additional Motor Accidents Claims Tribunal for Greater Bombay and confirming the award passed by the tribunal in favour of the
r.es~~ndents and directing the Tribunal to decide the question of the
liability of the Insurance Company on its application that its liability
is limited to Rs. 20,000 under section llOE of the Motor Vehicles
Act, } 939 referred to as the Act after giving opportunity to the parties.
The applicant in .t\pplication No. 727 of 1969 before the Motor
Accidents Claims Tribunal for Greater Bombay is one Dr. Balkrishna
Ramchandra Nayan practising in Bombay and is the respondent
in
this appeal.
On 14th April, 1969 at about 1.00 p.m. the respondent
was driving his car No. MRC-4450 towards Fort side on Dr. Annie
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Besant Road. With him was sitting on the left side in the front seat Mala ti -
M. Deshmukh, his nurse.
The road has stone dividers in the middle
of the road.
When the car approached Lotus cinema the truck
owned by the appellants and insured with
the Insurance Company
who we<e opposite parties 1 to 3 before the Motor Accidents Claims
Tribunal came from the opposite direction at a high speed and da~hed
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against the right side of the car.
Due to the impact the car was
damaged and the 1st respondent and Malati M. Deshmukh were injured.
Respondent 1 had to undergo treatment.
He was operated
on the day of the accident itself and was patient in his own Nursing
Home for a month till 15th May, 1969.
According to him his right
arm was operat~ and kept in plaster and that he had become permanently disabled in discharging his duties as a surgeon and that he had
incurred a loss during the closure of the Nursing Home and loss of
income due to permanent injury along with other claims. He claimed
a sum of Rs. 3 lakhs by way of general and special damages
with
interest thereon from the date of his application.
The owners of the
vehicle filed a written statement refuting the claim of the applicant.
According to them while the motor lorry was proceedin~ from Haji
Ali towards \Vorli, they had taken all precautions to keep the lorry in
road W0fthy condition and that at the. material time the axle brake
ring of the motor lorry came out and the driver therefore lost control
of the vehicle and because of this defect which can develop in a ruRning car the driver lost control of the steering wheel.
According to
them the lorry prior to the accident was being driven at a moderate
spied with due care and caution.
They contended that the accident
did not occur on account of rash and negligent driving on the part of
the driver.
They also denied the claim of various items of compensation made by the applicant.
The Motor Accidents Claims Tribunal framed four issues.
The
first 2 issues were whether the applicant had proved that the driver of·
the lorry was driving the vehicle in rash and negligent manner and
whether the opposite party had proved that at the time of the accident
the axle brake ring of the motor lorry came out and the driver Jost
control of the motor lorry.
The other 2 issues related to the question as to whether the applicant received the in juries as a result of
this accident and whether he was entitled to the compensation claimed
by him.
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MINU B. ]\,fEHTA v. B. R. NAYAN (Kai/asam, J.)
889
The applica~t ex.amined hll?-selj and Mal.ati M. Des?mukh :Wh?
was travelling with bun at the tune_ of the accident regardmg the mc1-
.dent.
He also examined P. Ws 2 and 3, P. W. 2 a nurse to prove
his income from his profession and P.W. 3 a doctor who treated
him. On behalf of the appellant 6 witnesses .were examined in support
of their case that the accident was due to a 'mechanical failure and
not due to any rashness or negligence on the part of the driver.
The Tribunal after elaborately discu~sing the oral' aml'documentary
evidence adduced before it found that the accident was due to ;the
rash and negligent driving of the driver of the lorry and the _cjffence
set up that the accident was due to mechanical failure of th<'. fof ry was
unacceptable.
The Claims Tribunal accepting the evidence of the applicant and
a Customs Officer, Mr. Jawa.kar, who was examined as D.W.4 on the
side of the appellants, came ,,t-0 the conclusion. that when the doctor
was in the traffic lane nearer· to the road divider the lorry crossed the
road divider and hit the car. · The defence witness himself stated that
the lorry came after crossing the central barricade.
The lorry went
@ff the track and went on the wrong side and collided with the oncoming car of the applicant who was in his car. Referring to his
notes the witness stated that the right side of the lorry went and hit
the right side of the car of the applicant.
The portion of the lorry
upto the driver's seat collided with the right side of the car.
Both
the wheels of the front side of the lorry had crossed the central reservation tract and so also the right rear wheel was on the wrong side
and only the left rear wheel was just near the edge of the central
reservation tract
towards Lotus cinema.
On the face of the evi--
dence of the doctor and their own witness D.W.4 who was travelling
in the lorry there could be no denying the fact that the lorry crossed the
middle of the road.
Relying on the evidence of the two witnesses as well as the
doctrine of res ispa loquitur the Claims Tribunal rightly found that
the applicant had established rash and negligent driving on the part
of the driver and the lorry.
The Accidents
Claims
Tribunal
has also discussed elaborately the defence set up on behalf of
the
owners of the lorry and rejected it.
The plea that was taken in the
pleadings was that at the time of the accident "Axle Brake Ring" of
the lorry came out.
The expert examined on behalf of the owner,
Jimmy Dara Engineer, D.W. 6, stated that he had never heard of any
such part as axle brake ring and he has never seen such a part. The
owners subsequently explained that what they meant by "Axle Brake
Ring" was drag link on the rod· enll.
The Claims Tribunal also
referred to the evidence of the expert examined on behalf of the owners
a11d remarked that the nut on the pin could not be blown on' all of
a sudden and that the driver, unless he was negligent, could feel the
change if t11ere was anything wrong with the drag link end and can
stop the vehicle immediately.
Rejecting the evidence of the driver
and relying on the evidence of the expert on tlle side of the defence that
even if there was any defect the vehicle could be stopped within 4 or 5
red and need not cover the distance which it did, the Claim Tribunal
also found tllat the' defect which tlle defence witness, Motor Vehicle
Illspector J>artapsingh Chavan, D.W.I. saw
when he examined the
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890
SuI'REJ\JE COURT REPORTS
[ l 977] 2 s.c.R.
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lorry on 22nd April, 1969, could not be accepted as the owners of
the lorry could have played mischief and created evidence before
inspection on 22nd April, 1969. Criticising the conduct of the owners
as unworthy of their status the Claims Tribunal totally rejected the
defence.
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Regarding the compensation the Claims Tribunal fixed the amount
at Rs. 1,43,400i-together with interest at 6 per cent.
This sum was
apart from a sum of Rs. 500 which was
found payable to Malati
M. D"5hmukh who had sustained injuries.
The Claims
Tribunal
directed the owners as well as the insurers jointly to pay the amount,
to the respondent Dr. Balkrishna Ramachandra
Nayan.
It alSo
directed the op?Osite parties and insurers to pay Rs. 1000 as costs and
Rs. 100 as costs of Malati M. Deshmukh.
The Claims Tribunal fixed a sum of Rs. 73,779 as the loss sustained by the doctor for a period of 4 years from the date of the accident.
It also for a subsequent period of 7 years fixed the future
loss at Rs. 9,000 a year and a total amount of Rs. 63,000. In addition it awarded a sum of Rs. 5,000 for discomfort and inconvenience
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suffered by the doctor. Thus the total compensation that was granted
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amounted to Rs. 1,43,400.
As already stated the interest was
awarded from the filing of the application till payment.
The insurance company as well as the owners of 'the lorry preferred appeal against the award of the Tribunal iii'i;.ppeal No. 449 .of
1975 before the High Court of Bombay.
Though the appeal was
filed on behalf of the insurance company and the owners of the lorry,
during the hearing of the appeal it was contended on behalf of the
insurance company that in any event the liability of the insurance
company under the policy could not exceed Rs. 20,000.
The High
Court on the question of whether there was negligence on the part of
the driver of the lorry or not found itself in complete agreement with
the Claims Tribunal and observed that it was for the lorry driver and
owners to establish as to how the lorry crossed the road dividers, went
on the wrong side and mounted on the Fiat Car coming frG;'.11
the
opposite direction.
Agreeing with the Tribunal it found that the
driver was negligent. The High Court concurred with the reasons and
findings of the Tribunal.
It also held in the cjrcumstances of the
case that the principle res ipsa loquitur applied.
The High Court
also rejected the defence taken by the owners that the injury was due
to a mechanical defect and not due to the negligence.
After referring
to the evidence and the reasoning of the Tribunal on the defence set
up by the owners the High Court came to the conclusion that the plea
about the breaking of the tie rod was not proved satisfactorily by the
owners.
The High Court regarding the defence raised found itself in
complete agreement with the conclusion arrived at by the Tribunal
observing that the Tribunal rightly disbelieved the defence plea and
came to the conclusion after careful consideration of the evidence of
the driver, Customs Officer and other evidence in the case that it was
the driver who was negligent.
,
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MINU B. MEHTA v. B. R. NAYAN (Kailasam, J.)
. 891
Regarding the quantum of damages the High Court expresseu its
opinion tliat the Tribunal had made best efforts and tri~d to determin~
the compensation in a iust manner on the facts and circumstances of
the case. It confirmed the amount as awarded by the Tribunal and
dismissed the appeal':"
The High Court dismissed the appeal of the
owners and the insurance company and confirmed the award passed
by the Tribunal.
But it gave..Jiberty to the insurance company to
apply to the Claims Tribunal on depositing Rs. 20,000 with interest
from the date of the application to the date of the deposit for determination of the question that the liabiliy of the insurance company is
limited only to Rs. 20,000.
The High Court directed the Tribunal
to decide the question of the liability of the insurance company on its
application under section 11 OE by giving opportunity to the parti!:S
.to put forward their cases.
Insurance company was directed to pay the costs of all the parties.
It also provided that the claimant was at liberty to withdraw
Rs. 20,000 with interest when deposited by the insurance company.
The order also made it clear that the right of the applicant to recover
the balance of the awarded amount from the other party or from the
insurance company will not in any way be affected.
The appeal to this court is preferred by the owners.
The insurance company is impleaded as the second respondent in the appeal
before us.
·Mr. Nariman, the learned counsel appearing for the owners submitted that the High Court did not hear arguments on the question
whether the accident took place due to rash and negligent driving of
the lorry a,nd therefore the question will have to be gone into by this
Court or remanded for fresh disposal.
We find that the High Court
has given a clear finding in paragraph 30 of its judgment that the Tribunal rightly disbelieved the plea and held that it was the driver who
was negligent and that they fully concur with the reasons and findings
of the learned Member of the Tribunal.
In the face
of the clear
finding we are unable to accept the plea of the learned counsel that
this question was not gone into by the High Court. We find ourselves
in complete .agreement with the finding of the Tribunal and the High
Court.that it was due to rash and negligent driving of the lorry that
the car in which th<> applicant and Malati M. Deshmukh were travelling was hit causing injuries to both of them.
We accept the testimony of the doctor and D.W. 4 Jawakar that the lorry crossed the
Toad dividers, ran into the wrong side and hit the car which was
driven by the applicant.
We have no hesitation in accepting the
concurrent findings of the High Court and the Claims Tribunal that
the accident was due to the rash and negligent driving of the lorry
driver.
We have also no hesitation in rejecting the testimoney of
the defence that there was some mechanical defect which resulted
in the tie rod end breaking.
We find ourselves in agreement with
the reasoning of the Claims Tribunal that the evidence on the side
of the owners is contradictory and the testimony of the expert destroys the plea ·of any mechanical defect set up by them.
Jn this
· connection we may also point out that in order to succeed in a
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SUPREME COURT REPORTS
[1977] 2 s.c.R.
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defence that the accident was due to a mechanical defect the owners
will have to prove that they had taken all necessary precautions
and kept the lorry in a roadworthy condition.
No such attempt
was made to establish that all necessary precautions were taken to
keep t~e lorry in a roadworthy condition and that the defect occurred
in spite of the reasonable care and caution taken by the owners .
In order to sustain a plea that the accident was due to the mechanical defect the owners must raise a plea that the defect was latent ·and
not discoverable by the use of reasonable care.
The owner is not
liable if the accident is due to a latent defect which is not discoverable
by reasonable care.
The law on this subject has been laid down in
Henderson v. Henry E. Jenkins & Sons.(').
In that case the lorry
driver applied the brakes of the lorry on a steep hill but they failed
to operate.
As a result the Jorry struck and killed a man who was
emerging from a parked vehicle.
The defence was that brake failure
was due fo a latent defect not discoverable by reasonable care
on
driver's part. It was found· that the lorry was five years old and had
done at Jcast 150,000 miles.
The brake9 were hydraulically operated.
It was also found after the accident that the brake failure was due to
a steel pipe bursting from .7mm. to .lmm.
The corrosion had
occurred where it could not be seen except by removing the pipe completely from the vehicle and this had never been done.
Expert evidence showed that it was not a normal precaution to do this if, as was
the case, the visible parts of the pipe were not corroded.
The corrosion was unusual and unexplained.
An expert witness said it must
have been due to chemical action of some kind such as exposure to
salt from the roads in winter or on journeys near the sea.
The
House of Lords held that the burden of proof which lay on the defendants to show that they had taken all reasonable care had been
discharged.
The defect remained undiscovered despite due care
As the evidence had shown that something unusual had happened to
cause this corrosion it was necessary for the defendants to show that
they neither know nor ought to have known of any unusal occurrence
to cause the breakdown. (See Bingham'? Motor Claims Cases Seventh
Ed., p. 219).
The burden of proving that the accident was ijue to a mechanical
defect is on the owners and it is their duty to show that they had taken
all reasonable care and that despite such care the defect remain~d
hidden.
In this case in the written statement all that is pleaded
is that the axle brake ring of the lorry came out and the driver lost
control of the motor lorry and that the defect can develop in a runnincr vehicle resulting in the driver's losing control of the steering
wh;el.
Though it was stated that all precautions were taken to keep
the lorry in a roadworthy condition it was
not specifically pleaded
that the defect i.e. the axle brake ring coming out, is a latent defect
and could not have been discovered by the use of reasonable care.
This lack of plea is in addition to the Jack of evidence and the fact
that the defence set up has been rightly rejected by the Tribunal.
(1) (19701 A.C.282(1969] 3 All E.R. 756
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MINU Jil, MEHTA v. B. R. NAYAN (Kailasam, !.)
893
Mr. Nariman then submitteQ_ that the quantum of compensation
awarded was very high.
He submitted that even according to the
figures relied on by the High Court it was in error in coming IC? the
conclusion that for. a period of 4 years from the date of the accident
the claimant has suffered a
damage
of Rs. 73,779.
The learned
. counsel submitted that though during the first year there was a loss
of Rs. 3,530 in subsequent years he earned various amounts and in
one year he earned Rs. 7,981 which would mean that during subsequent years his loss would not have been more than Rs. 10,000 and
as admittedly the Nursing Home was kept as a going concern the award
of Rs. 10,000' per year for the four years would be very high.
We
have considered this contention carefully but taking all the drcumstances into account we do not feel called upon to interfere with the
quantum arrived at by the Tribunal and confirmed by the High
Court.
·
The learned Counsel also submitted that the provision for Rs.
63,000 for the 7 years as the likely loss due to the doctor's disability
is also very high.
In this case also we po not feel called upon
to
interfere with the quantum arrived at by the Tribunal as wel! as the
High Court. Lastly,
the learned counsel submitted that in any event
the interest awarded from the date of the application is not justified.
We do not think we will be justified in interfering with the amount of
interest awarded by the High Court from the date of the filing of the
application.
On the above findings we confirm the award passed by the Claims
Tribunal in favour of the applicant/respondent No. 1 for Rs. 1,43,400
with interest at 6% per annum from the date of the filing of the application and also a sum of Rs. 500 granted to Malati M. Deshmukh
. and the costs awarded.
The liability of the owners and the insurance
company will be joint and several and the respondent would be
at
liberty to proceed against either or both of them to realise the amount
awarded in his favour.
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We have now to consider the direction given by the High Court
regarding the determination of the liability as between the insurance
F
company and the owners.
The owners and the insurance company
were represented by the same counsel before the Tribunal and before
the High Court the learned counsel on behalf of the insurance company pleaded that its liability is limited to Rs. 20,000 only.
The
High Court has given liberty to the insurance company to apply on
depositing Rs. 20.000 with interest as directed for determination of
the question that the liability of the insurance company is limited to
G
Rs. 20,000.
The High Court also dire~ted the Tribunal to decide
the liability of the insurance company on the insurance company filing
such an application after giving notice to all the parties.
The insurance company has not appealed against the judgment and decree of
the High Court and we see no reason for interfering with the order.
On the insurance company complying with the directions of the High
Court by depositing Rs. 20,000 with interest as specified the matter
H
will be remitted to the Tribunal for determination
of the question
whether the liability of the insurance company is
limited to
Rs.
20,000 only. It is inade clear that so far as the award made in
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favour of the ~pplicantlrespondent is concerned he will be at liberty
to proceed agamst t_he owners as well as the insurance company jointly
and severally.
With these directions the appeal is dismissed with the
cost of the first respondent.
This should normally conclude the judgment but we feel it desirable that we must deal with the question of law that has been
dealt with at considerable length by the High Court as to whether it
is incumbent on the claimant to prove negligence before he would
become entitled to compensation.
The High Court after concurring
with the findings of the Tribunal and holding that the driver was
negligent proceeded to state that it would not have been necessary
for them to say anything more but for the fact that taking into
account the importance of matter and in public interest it would be
appropriate to express its view that it is not necessary to prove negligence on the part of a driver before claiming compensation.
Both the learned Judges have written lengthy judgments
fuJ~y
discussing the matter and have come to the conclusion that the fact
of an injury resulting from the accident involving the use of a car
on the public road is the basis of a liability and that it is not necessary to prove any negligence on_the part of the driver. We find that
a Bench of the Andhra Pradesh High Court has held in Haji Zakaria
and Others v. Naoshir Cama and others (1) that the liability of the insured and consequently of the insurer· to compensate a third party
dying or being injured on account of the use of the insured vehicle
is irrespective of whether the death, injury etc. has been caused by
rash and negligent driving.
Though this question does not arise in
this appeal as the two High Courts have expressed an opinion which
in our view has no basis either in the Legislative history or on a
construction of the relevent provisions of the Motor Vehicles Act we
feel it necessary to state the position of law.
The liability of the owner of the car to compensate the victim in
a car accident due to the negligent driving of his servant is based on
the law of tort.
Regarding the negligence of the servant the owner
is made liable on the basis of vicarious liability.
Before the master
could be made liable it is necessary to prove that the servant was
acting during the course of his employment and that he was negligent.
The number of the vehicles on the road
increased
phenumenally leading to increase in road accidents.
To· remedy the defect
various steps were taken.
In England the owners of the
vehicle
voluntarily insured against the risk of injury to other road users.
With
the increase of traffic and accidents it was found that in a number of
cases hardship wa~ caused where the person inflicting the injury was
devoid of sufficient means to compensate the person afflicted.
In
order to meet this contingency the Road Trame Act, 1930, The
Third Parties (Rights against Insurers) Act, 1930 and the Road
Traffic Act 1934 were enacted in England. A system of compulsory
msurance ~as enacted by the Road Traffic Act, 1930. Its object was
to reduce the number of cases where judgment for personal injuries
(!) A.I.R. 1976 A.P. 171.
MINU B. MEHTA v. B. R. NAYAN (Kailasam, J.)
895
obtained against a motorist was not met owing to the lack of means
of the defendant in the running,dciwn action and his failure to insure
against such a liability. · It is sufficient to
state that
compulsory
insurance was introduced to cover the liability which the owner of the
vehicle may incur.
The Indian law introduced prov1s10ns relating
to
compulsory
insurance in respect of third party insurance by introducing Chapter
VIII of the Act.
These provisions almost wholly adopted the provisions of the English law.
The relevant sections found in the three
English Acts, Road Traffic Act, 1940, the Third Parties
(Right
against Insurers) Act, 1930 and the Road Traffic Act, 1934 were
incorporated in Chapter VIII.
Before a person can be made liable
. to pay compensation
for any
injuries and damage
which
have
been caused by his action it is necessary that the person damaged or
iniured should be able to establish that he has some cause of action
against the party responsible. · Causes of action may arise out
cif
actions for wrongs under the common law or for breaches of duties
laid down by statutes.
In order to succeed in an action for negligence
the plaintiff must prove ( 1) that the defendant had in the circumstances a duty to take care and that duty was owed by him to the
plaintiff, and that (2) there was a breach of that duty and that as a
result of the breach damage was suffered by the plaintiff. The master
also becomes liable for the conduct of the servant when the :;ervant is
proved to have acted negligently in the course of his employment.
Apart from it in common law the master is not liable for as it is often
said that owner of a motor car does not become liable because of his
owning a motor car.
The purpose of enactment of Road Traffic Acts and making insurance compulsory is to protect the interests of the successful claimant
from being defeated by the owner of the vehicle who has not enough
means to meet his liability.
The safeguard is provided by imposing
certain statutory duties namely the duty not to drive or permit a car
to be driven unless the car is covered by the requisite form of third
party insurance.
Section 94 of the Act, provides that no person shall
use except as a passenger or cause or allow any. other person to use
a motor vehicle in a public place unless there is in force in relation
to the use of the vehicle by that person or that other person, as the
case may be, a policy of insurance complying with the requirements
of the Chapter. Section 95 of the Act is very important and that
specifies the requirements of policies and limits of liability.
Section
95 ( 1) (a) and (b) of the Act arn extracted. They run as follows :
"95. (1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which-
(a) is issued by a person who is an authorised insurer
or by a co-operative society allowed under section 108 to
transact the business of an insurer, and
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SUPREME COURT REPORTS
[1977) 2 s.c.R.
(b) insures the person or .classes of persons specified in the
policy to the extent specified in sub-section (2)-
(i) ~gainst any liability which may be incurred by him
m respect of the death or of bodily injury to any
person or damage to any property. of a third party
caused by or arising out of the use of the vehicle in
a public place;
(ii) against the death of or bodily injury to any passenger
of a public service vehicle caused by or arising out
of the use of the vehicle in a public place :
*
*
*
*
*"
Under section 95 ( 1) (b) (i) of the Act it is required that policy of
insurance must be a policy which insures the person
against
any
liability which may be incurred by him in respect of death or bodily
injury to any persOJ! or damage to any property of a third party
caused by or arising out of the use of the vehicle in a public place.
It may be noted that what is intended by the policy of insurance is
insuring a person against any liability which may be incurred by him.
The insurance policy is only to cover the liability of a person which
he might have incurred in respect of death or bodily injury.
The
accident to which the owner or the person insuring is liable to the
extent of his liability in respect of death or bodily injury and
that
liability is covered by the insurance. It is therefore obvious that if
the owner has not incurred any liability in respect of death or bodily
injury to any person there is no liability and it is not intended to be
covered by the insurance.
The liability contemplated arises
under
the law of negligence and under the principle of vicarious liability.
The provisions as they stand do not make the owner or the insurance
company liable for any bodily injury caused to a third party arising
out of use of the vehicle unless the liability can be fastened on him.
It is significant to note that under sub-clause (ii) of section 95(1) (b)
of the Act the policy of insurance must insure a person against the
death or bodily injury to any passenger of a public service vehicle
caused by or arising out of the use of the vehicle in a public place.
Under section 95 ( 1) (b) clause (ii) of the Act the liability of j:he
person arises when bodily injury to any passenger is caused by or use
of the vehicle in a public place.
So far as the bodily injury caused
to a passenger is concerned it need not be. due to any act or liability
~·
incurred by the person. It may be noted that the provisions of section 95 are simHar to sectionf36h( ~ )h C!f the Ehngliffsh Rohad Traffi
1
~ Actf, .
1930, the rele.vant portion o w 1c
1s to t e _e ect t at a po icy o
insurance must be policy which insures a person in respect of any
liability which may be incurred by him in respect of death or bodHy
injury to any person caused by or arising out of the use of the vehicle
on road.
The expression "liability" which may be incurred by him"
is meant as covering any liability arising out of the use of the y~hicle.
It will thus be seen that the person must be under a liability and that
liability alone is cover~ by the insurance policy.
> •
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MINU Il. MEHTA v. B. R. NAYAN (Kai/asam, 1.)
897
Section 96 of the Act also makes the position clear. It provides
that when a judgment in respect of such a liability as is required to
be covered by a policy is obtained against any person insured by the
policy, then the insurer shaμ -pay to the person e~titl_e~ t~e bene~t <;>f
the decree as if he were a Judgment-debtor. The liability ts thus !itruted to the liability as is covered by the policy.
.
The main contention of Mr. Hattangodi, who supported the view
of the High Court that negligence -need not be proved is that Chapter
VIII of th_e. Act is a consolidating and amending Act relating to motor·
vehicles and their use on a public place and as such it contains the
entire ·Jaw, procedural as well as substantive, and that the co=on
law or law of torts is no more applicable and if death or bodily injury
arises out of the use of motor vehicles in a public place a liability
arises. Strong reliance was placed by him on section llOA of the Act
which provides for application for compensation arising . out of an
accident to the Claims Tribunal. The learned counsel would submit
that under section 11 OB the Claims Tribunal, after holding an inquiry, may make an award determiuing the amount of compensation ·
·which appears to i_t to be just _and specifying _the person or persons
to whom the compensation shall be paid. According to counsel when
an injury is caused by the use "of the vehicle in a public place the
Claims Tribunal is at liberty to award an amount of compensation
which appears to it to be just.
This plea ignores the basic requirements of the owner's liability
and the claimant's right to receive compensation. The owner's liability· arises out of his f'!ilure to discharge a duty cast on him by law .
.The right to receive compensation can only be against a person who·
is bound to compensate due to the failure to perform a legal obligation. If a person is not liable legally he is under no duty to compensate any one else..
The Claims Tribunal is a tribunal constituted by
the State Government for expeditious disposal of the motor claims.
The general law applicable is only common law and the law of. torts.
If under the law a person becomes legally liable then the person
suffering the injuries is entitled to·be compensated and the Tribunal
· is authorised to determine the amount of compensation which appears
to be just.