Gujarat High Court
Valiben Laxmanbhai Thakore (Koli) Wd/O ... vs Kandla Dock Labour Board on 27 June, 2018
Author: Akil Kureshi
Bench: Akil Kureshi, B.N. Karia
C/FA/3907/2017 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL No. 3907 of 2017
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VALIBEN LAXMANBHAI THAKORE (KOLI) WD/O LATE
LAXMANBHAI RAMSINGBHAI THAKORE (KOLI)
Versus
KANDLA DOCK LABOUR BOARD
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Appearance :
Mr. MTM HAKIM for Mr HEMAL SHAH, Advocates for PETITIONER(s) No. 1,2,3,4
Mr. MAULIK J SHELAT(2500) for the RESPONDENT(s) No. 2
Mr. YOGI K GADHIA(5913) for the RESPONDENT(s) No. 1
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CORAM: HONOURABLE Mr. JUSTICE AKIL KURESHI
and
HONOURABLE Mr. JUSTICE B.N. KARIA
27th June 2018
ORAL ORDER (PER : HONOURABLE Mr. JUSTICE AKIL KURESHI)
This Appeal is filed by the original claimants whose claim petition came to be dismissed by the Motor Accident Claims Tribunal [Auxiliary-3], Gandhidham [Kachchh] [hereinafter referred to as, "the Claims Tribunal"] by the impugned award dated 28th July 2017. The claimants are dependants of one Laxmanbhai Ramsinghbhai Thakore, who died in a vehicular accident on 23rd April 2003. He was himself driving an Ambulance which was owned by the respondent no. 1- Kandla Dock Labour Board. He was the paid driver employed Page 1 of 12 Downloaded on : Sat Nov 23 02:05:43 IST 2019 C/FA/3907/2017 ORDER by the said Board. While driving the ambulance, the vehicle overturned causing injuries to the driver to which he later on succumbed. His widow, minor children and aged mother therefore filed a claim petition before the Claims Tribunal seeking compensation from the opponents ie., the owner of the vehicle and his employer, and the insurance company which had insured the vehicle in question. The Claims Tribunal dismissed the claim petition on the ground that the deceased who was driving the vehicle was solely negligent and that therefore, his dependants cannot claim any compensation from the opponents on account of his death.
The claimants have filed this appeal in which heavy reliance is placed on the terms of the insurance policy. It is pointed out that the employer had paid extra premium of Rs. 30/= for covering additional liability of the paid driver and two workmen. According to the learned counsel for the appellants, therefore, the Insurance compnay was liable to cover the risk of the employer and consequently pay compensation to the claimants. This is the bone of contention between the two sides. Counsel for the Insurance company would argue that the additional premium would not cover a Page 2 of 12 Downloaded on : Sat Nov 23 02:05:43 IST 2019 C/FA/3907/2017 ORDER case where the driver himself was negligent leading to his death. According to the Insurance company, the additional premium was paid to cover the risk of the insured. In view of the fact that the driver himself was found to be solely negligent in causing the death, the employer would have no liability; of course outside of the statutory liability arising under the Workmen's Compensation Act, and that therefore, the liability cannot be fastened on the Insurance company.
Both sides have relied on certain decisions. Brief reference to which would be necessary. Before doing that, we may record that the claimants-appellants have not challenged findings of the Claims Tribunal that the deceased-driver was solely negligent in causing the accident. We may, therefore, proceed on such basis.
On behalf of the claimants, heavy reliance is placed on two judgments of this Court. Firstly, the Division Bench judgment in case of Saberabibi Hisammiya Umarvmiya & Anr. v. Yakubkhan Abdulkhan Kherwaji & Ors. dated 15th October 1993 rendered in First Appeal No. 124 of 1984 and connected appeals. It was a case in which the driver of a truck involved in an accident was found solely negligent in Page 3 of 12 Downloaded on : Sat Nov 23 02:05:43 IST 2019 C/FA/3907/2017 ORDER causing the accident which resulted into his death. The Claims Tribunal had dismissed the claim petition of his dependents. The dependents had therefore filed appeal before the High Court and relied on the insurance policy which showed that the owner ie., the employer of the driver had paid additional premium to cover the risk of the injuries to the driver. In short, the facts in the said case were almost identical to the facts of the present case. In the said case also, case of the insurance company was that the payment of additional premium would cover the risk of the owner-employer. In absence of any liability of the owner-employer to pay any compensation, the Insurance company cannot be asked to discharge the burden. The Division Bench of this Court negatived such a contention, making following observations :
"22. Looking to the provisions of Section 95 of the Act and the policy, Exh. 288, it is clear that the policy covers the risk of driver and cleaner and additional payment of Rs.16/- was paid. In view of payment of additional premium of Rs.16/-, the Insurance Co. is liable as per the terms of policy and the ratio laid down in Minu Mehta's case (supra) cannot be attracted and pressed in service by the Insurance Co. because of payment of additional premium, the Insurance Company has extended the coverage for the risk of driver and Page 4 of 12 Downloaded on : Sat Nov 23 02:05:43 IST 2019 C/FA/3907/2017 ORDER cleaner. In our opinion, therefore, the Insurance Co. cannot be absolved from liability by contending that the claimants were not entitled to compensation since there was 100% negligence on the part of the driver. The claimants are entitled to get compensation from the Insurance Co. for the death of driver on the ground that the case is covered under the terms of policy irrespective of negligence on his part.
24. Mr. Nanavati then submitted that in that case, the provisions of Section 95 (1) of the Act would apply, and the claimants will be entitled to get compensation in respect of death or bodily injury arising out of and in the course of employment as payable under the provisions of the Workmen's Compensation Act of Harivadan Maneklal Modi & Anr. Vs. Chandrasinh Chhatrasinh Parmar & Ors., reported in 28 (2) GLR 1274, Mr. Nanavati submitted that the compensation can be claimed either under the Motor Vehicles Act or under the Workmen's Compensation Act, but not under both. He submitted that, in the instance case, since the driver was 100% negligent, he could not have claimed compensation under the Motor Vehicles Act. At the most, therefore, an application could have been filed under the Workmen's Compensation Act before the Commissioner for Workmen's Compensation. Since it is not done, the claim is liable to be dismissed. In our opinion, the contention has no merit. Reliance placed on Harivadan's case (Supra) is also ill-founded. What the Division Bench in Harivadan's case (Supra) held was that a person cannot file a petition in both the forums, namely, by Page 5 of 12 Downloaded on : Sat Nov 23 02:05:43 IST 2019 C/FA/3907/2017 ORDER invoking provisions of the Motor Vehicles Act as well as the Workmen's Compensation Act. At the sametime, however, if the driver could have made claim under the Motor Vehicles Act and is otherwise entitled to get compensation under that Act, such application cannot be rejected on the ground that the application could have been made before the Commissioner for Workmen's Compensation. In our opinion, when the policy has covered the risk of driver, a petition under the Motor Vehicles Act is maintainable. Sub-Section (1) of Section 95 merely provides the extent of liability. It clearly lays down that if the case falls under Sub-Section (1) of Section 95, the extent of liability would be to the extent to which it would arise under the provisions of the Workmen's Compensation Act. From that it cannot be said that such a person will have to approach the Commissioner for Workmen's Compensation and file an application only before that forum. Since the additional coverage is given in policy Exh.282, the liability of the Insurance Co. arises. In our opinion, if the application is made before the Commissioner for Workmen's Compensation as also before the Motor Accident Claims Tribunal, the person is not entitled to get benefit from both the forums. In the instant case, no such application was filed before the Commissioner for Workmen's Compensation under the Workmen's Compensation Act, and hence, the claimants are entitled to claim compensation under the Motor Vehicles Act. In our view, the claim petition requires to be allowed and the Insurance Co. must be held liable to pay compensation to the claimants for the death of driver Riyajuddin." Page 6 of 12 Downloaded on : Sat Nov 23 02:05:43 IST 2019 C/FA/3907/2017 ORDER
Second judgment heavily relied on by learned counsel for the appellants was of the Division Bench of this Court in case of Maniben S Pandya v. Shashikank P Shrigalore, reported in 2004 [3] GLR 1878. In such judgment, Division Bench followed the judgment in case of Saberabibi Hisammiya Umaravmiya [Supra]. It was a case in which the claimants were dependents of the deceased, who was driving the truck which met with an accident and collided with another vehicle causing his death. The finding of the court was that the drivers of both the trucks were equally responsible for causing the accident. The Division Bench, relying on the judgment in case of Saberabibi [Supra], held that the claimants would receive compensation from the Insurance company.
On the other hand, learned advocate Shri Shelat for the Insurance company relied on the following judgments :
[a] Division Bench judgment of Madras High Court in case of National Insurance Company Limited, Tirupur v. R. Mohan & R. Murthy, reported in II [1995] ACC 484 [DB] in which despite the Insurance company having paid additional premium for the liability of the paid driver, it was held that the Page 7 of 12 Downloaded on : Sat Nov 23 02:05:43 IST 2019 C/FA/3907/2017 ORDER Insurance company cannot be asked to pay compensation, when the driver himself was negligent in causing the accident. [b] In case of United India Insurance Company Limited v. Jagatsinh Valsinh, reported in 1986 [2] GLR 1423 in which the Division Bench of this Court observed that when the claimant is held to be a tort-feasor, it is beyond comprehension as to how a tort-feasor can be awarded compensation for the tortious act committed by him.
[c] In case of Tamil Nadu State Road Transport Corporation, Tanjore v. Natarajan, reported in 2003 [6] SCC 137 in which the Supreme Court considered a case where the bus of Tamil Nadu State Road Transport Corporation met with an accident with another bus. Drivers of both the busess were held negligent in equal measure. Division Bench of the High Court suo motu joined the State Road Transport Corporation which was till then not a party to the proceedings and thereafter held that the driver of the bus of the Corporation would receive compensation which would be borne equally by the insurer of the private bus and the Corporation. In such a case, the Supreme Court held that the liability of the insurance company which had insured the other Page 8 of 12 Downloaded on : Sat Nov 23 02:05:43 IST 2019 C/FA/3907/2017 ORDER bus involved in the accident would be only to the extent of 50% of the total compensation determined. The Court held that the Division Bench of the High Court overlooked the fact that the claimant himself was the driver of the Corporation and was negligent to the extent of 50% in causing the accident. In view of the finding attributing negligence on the part of the claimant himself, the Corporation as an employer cannot be held to be vicariously liable for the negligence of the claimant himself.
From the judgments cited before us it would emerge that the issue stands squarely covered by the judgment of Division Bench of this Court in case of Saberabibi Hisammiya Umarvmiya & Anr. [Supra] which was also followed in another Division Bench decision in case of Maniben S Pandya [Supra]. However, in our opinion, certain important aspects of the issue need to be reconsidered. As is well-settled, insurance is a contract of indemnity. The insurer upon the insured paying the agreed premium and otherwise complying with the terms of the insurance police, would cover the risk of the insured. In other words, the insurance company indemnifies the insured to the extent of his legal liability Page 9 of 12 Downloaded on : Sat Nov 23 02:05:43 IST 2019 C/FA/3907/2017 ORDER arising out of specific instances. Fundamentally therefore, the liability of the insurance company would arise when the insured is saddled with a certain liability. Consequently, if in a given case, the insured does not have the liability to pay the compensation by virtue of the contract of insurance, the insured cannot be asked to discharge such a burden. There being no privity of contract between the insurance company and the third party, the insurance company cannot be directed to pay compensation outside the insurance policy.
As noted, the Supreme Court in case of Tamil Nadu State Transport Corporation, Tanjore [Supra] emphasized that in case of contributory negligence on the part of the claimant-driver, the Corporation as an employer cannot be held vicariously liable for his own negligence. If this principle is applied in the present case, it would appear that the deceased driver himself was 100% negligent in causing the accident. The owner of the vehicle who also is the employer of the driver, would have no liability to pay compensation to his dependants or legal heirs. If the owner therefore cannot be fastened such liability, it is difficult to appreciate how the insurance company can be asked to discharge such liability. Page 10 of 12 Downloaded on : Sat Nov 23 02:05:43 IST 2019 C/FA/3907/2017 ORDER The fact that the owner did pay additional premium to cover the liability of the driver and two workmen is not in dispute. However, this additional premium by itself would not bring the liability of the insurance company which otherwise in law does not exist. Fastening liability on the insurance company on such ground would amount to treating the insurance policy as being one of the personal accident policy of the driver which admittedly is not the present case.
Counsel for the claimants relied on the terms of the India Motor Tarrif; in particular Condition 19 thereof, which pertains to legal liability to paid driver employed in connection with the operation of motor vehicle. This condition provides that, "in consideration of the payment of an additional premium, it is hereby understood and agreed that notwithstanding anything contained herein to the contrary, the Company shall indemnify insured against his legal liability as under."
Thus, it provides that upon payment of additional premium, the Company would indemnify the insured against the legal liability under the Workmen's Compensation Act or at common law in respect of personal injury to the paid driver. Page 11 of 12 Downloaded on : Sat Nov 23 02:05:43 IST 2019 C/FA/3907/2017 ORDER This clause also refers to the insurance company indemnifying the insured against his legal liability. Once again, if the insurance company had no legal liability to pay the compensation, this condition would not make the insurance company liable for the same.
In view of the above discussion, we are of the opinion that the issue is required to be referred to the Larger Bench. We, therefore, make such reference for deciding the following question:
Whether the Division Bench of this Court in the case of Saberabibi Hisammiya Umarvmiya & Anr. [Supra] laid down correct law by holding that in view of insured paying additional premium for the liability of the paid driver, the Insurance company is liable to pay compensation under the Motor Vehicles Act computed upon the death or injury caused to the driver out of an accident which arises solely on account of driver's own negligence.
[Akil Kureshi, J.] [B.N Karia, J.] Prakash Page 12 of 12 Downloaded on : Sat Nov 23 02:05:43 IST 2019