Kerala High Court
Jaleel vs M/S. Oriental Insurance Company Ltd on 22 September, 2016
Author: A.Muhamed Mustaque
Bench: P.N.Ravindran, A.Muhamed Mustaque
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR.JUSTICE P.N.RAVINDRAN
&
THE HONOURABLE MR. JUSTICE A.MUHAMED MUSTAQUE
THURSDAY, THE 22ND DAYOF SEPTEMBER 2016/31ST BHADRA, 1938
MACA.No. 873 of 2015
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O.P.(MV)NO. 1012/2008 OF MOTOR ACCIDENTS CLAIMS TRIBUNAL,
MUVATTUPUZHA
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APPELLANT(S)/1ST RESPONDENT :
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JALEEL,
S/O. KOCHUNNI, KOTTEPARAMBIL HOUSE, PALLICHIRANGARA
BHAGOM, PAIPRA KARA, MULAVOOR VILLAGE, MUVATTUPUZHA.
BY ADVS. SRI.T.K.KOSHY
SRI.ABE RAJAN
RESPONDENT(S)/3RD RESPONDENT :
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M/S. ORIENTAL INSURANCE COMPANY LTD.,
REPRESENTED BY DIVISIONAL OFFICER, D.O.T.H TOWERS,
MARKET ROAD, MUVATTUPUZHA, PIN-686 661.
BY SRI.GEORGE CHERIAN THIRUVALLA (SENIOR ADVOCATE)
ADV. SMT.K.S.SANTHI
THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY
HEARD ON 16-08-2016, ALONG WITH MACA. NO. 871 OF 2015 AND
CONNECTED CASES, THE COURT ON 22-09-2016 DELIVERED THE
FOLLOWING:
Msd.
P.N.RAVINDRAN & A.MUHAMED MUSTAQUE, JJ.
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M.A.C.A.Nos.871, 872, 873, 874, 876, 889, 890, 911, 912, 913,
914, 915, 916, 917, 918, 919 and 920 of 2015
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Dated this the 22nd day of September, 2016
JUDGMENT
A.Muhamed Mustaque, J.
The owner of a lorry, which was involved in a motor accident resulting in the death of seven persons and causing injuries to several persons and also damage to property has come up in this appeal challenging the award of the tribunal permitting the insurer to realize the award amount from him, on finding breach of policy conditions by the insured. Since a common issue is involved in all these appeals, these cases are being disposed of by a common judgment. The brief facts involved in the cases are as follows:
2. The lorry owned by the appellant bearing Registration No.KL 7/AG 2330 driven by the second respondent before the tribunal rammed into a procession held by the Congress party workers near Pothanikkadu-Chathamattom Panchayat Office Junction. The lorry also hit against the building situated by the side of the public road. 19 persons were injured and taken to different hospitals immediately after the accident. Out of the 19 injured, seven persons succumbed to the injuries on the same day. Claim petitions were filed by the dependents MACA 873 of 2015 -:2:- of the deceased persons as well as injured and also the owner of the property, which had been damaged in the accident.
3. The driver and the insured (appellant) remained ex parte.
In the statement filed by the insurer, it was contended that there was a breach of the policy conditions. Accepting the uncontroverted averments in the written statement, tribunal passed an award on 17.6.2013, directing the insurer to pay the amount and granting liberty to realize the award amount from the insured. This ex parte award was challenged by the insured/the appellant in O.P.(M.A.C) 118 of 2014 before this court. This court set aside the ex-parte award to the extent, it exonerated the insurer and gave an opportunity to the insured to raise his pleadings and contest the case against the insurer. Thereafter, the tribunal after affording an opportunity to raise pleadings and adduce evidence passed the impugned award. The tribunal found that the policy conditions have been breached by the insured and passed the revised common award on 2..2.2015. Challenging this award these appeals have been filed.
4. Before proceeding further, it is appropriate to refer the specific contentions raised by the insurer as to the breach of policy. Ext.B1 is the policy produced and marked on the side of the insured. It stipulates as follows:
MACA 873 of 2015 -:3:- "Use only for carriage of goods within the meaning of Motor Vehicle Act. The policy does not cover (a) Organised racing. Pace making, reliability trials or speed testing (b) drawing a trailer except the towing (c) carrying passengers in vehicles except for employees not exceeding the number permitted in registration document and coming under purview of WC Act, 1923."
5. In the goods carriage permit produced and marked as Ext.B3, it is stipulated as follows:
"6. Maximum load permitted to be carried 03 persons in all and 10115 kgs. of goods"
6. The contentions of the insurer regarding the breach of policy conditions as stated in Paragraph 6 of its written statement are as follows:
"Without prejudice and without admitting any liability, this respondent admitted that this respondent had issued a policy in favour of MR.Jaleel (1st respondent) covering the goods carrying commercial vehicle bearing registration No.KL-7-AG-2330 for the period 30/7/2007 to 29/07/2008." At the time of the accident, five persons including the driver were carried in the cabin of the vehicle while another was carried on the platform. The permit issued under section 66 of the Motor Vehicle Act allows only three in all to be carried in the vehicle. The number permitted by the registration document is also three in all. Due to the carriage of two excess persons in the cabin, than permitted number of three persons in all, the driver could not ply the steering wheel properly which resulted in the accident. The contract of insurance entered into will not cover the risk when the vehicle is used in violation of the terms and conditions of the policy MACA 873 of 2015 -:4:- knowingly and willfully committed by the insured. The breach is so fundamental and has contributed to the cause of the accident. The contract of insurance entered into will not indemnify the insured when there is a violation of the conditions of the policy. Hence this respondent is neither statutorily nor contractually liable to compensate the claimant."
7. The tribunal, relying on the final report filed in the criminal case registered in connection with the accident accepted the contention of the insurer that five persons were traveling in the offending vehicle at the time of the accident. It was found that the vehicle was used for carrying passengers in contravention of Ext.B3 permit. Taking note of the stipulations in the policy as noted above, the tribunal found that the insured had committed a breach of the policy conditions by allowing to carry more persons exceeding the number of persons permitted in the policy and permit. Accordingly, the tribunal directed the insurer to satisfy the award and also permitted the insurer to realize award amount from the insured.
8. We heard Sri.T.K.Koshy, learned counsel appearing for the appellants and also Sri.George Cherian, learned senior counsel appearing for the respondent insurer.
9. The main challenge raised by the learned counsel for the appellant is that the insurer has failed to prove the breach of policy conditions and the tribunal erred in relying on the final report filed in MACA 873 of 2015 -:5:- the criminal case against the driver of the vehicle. It is also argued by the learned counsel for the appellant that the insured had adduced evidence to disprove the contention of the insurer that more than three persons had been carried in the vehicle by examining RW1 to RW4. It is submitted that the tribunal over looked the evidence of those witnesses.
10. The learned counsel further contended that the onus is on the insurer to prove the breach of policy conditions and the insurer has failed to adduce any evidence to prove their contentions. It is further argued that even if the contentions are accepted, there is no breach of the policy conditions as alleged, and merely because the vehicle was carrying more persons than the permitted capacity itself will not result in a breach of the terms of the policy. The learned counsel referred to a large number of precedents of the Hon'ble the Supreme Court and of this court to substantiate his contention.
11. Per contra, the learned senior counsel appearing for the insurer would submit that the insured has failed to controvert the specific pleading raised by the insurer in the written statement as to the number of persons traveling in the vehicle, and therefore, the insurer has discharged their burden. It is further contended that when the policy stipulates and limits the number of persons who can be MACA 873 of 2015 -:6:- carried in the vehicle, any breach thereof amounts to a violation of the policy conditions.
12. The Hon'ble the Supreme Court in National Insurance Company on 2004 3 SCC 297 held as follows:
"Insurance companies, however, with a view to avoiding their liability must not only establish the available defence (s) raised in the said proceedings but must also establish "breach" on the part of the owner of the vehicle; the burden of proof therefore would be on them."
13. In a recent judgment of the Hon'ble the Supreme Court in Lekshmi Chand Vs. Reliance General Insurance [2016 (3) SCC 100, it was held as follows:
"Held to avoid liability, Insurance Company must not only establish defence claimed, but also establish that breach of policy was so fundamental that it ended contract/that breach concerned caused the accident - Mere factum of carrying more passengers than permitted capacity in goods carrying vehicle by insured does not amount to fundamental breach of terms of policy - Further held, burden of proof to establish such breach on part of insured rests with Insurance."
14. The burden, therefore, rests on the insurer to plead and prove breach of policy conditions. No doubt, in this case, the insurer has put forward a specific contention in paragraph 6 of its written statement raising a plea of breach of policy conditions. The insurer's MACA 873 of 2015 -:7:- case is that the insured has not chosen to raise any plea in the written statement filed by him before the tribunal after the ex parte award was set aside, regarding the number of persons carried in the vehicle and therefore, there is no requirement to adduce any evidence on their side. We have also gone through the written statement filed by the insured before the tribunal after setting aside the award. As rightly contented by the learned senior counsel for the insurer the insured has not chosen to controvert the specific pleading raised in the written statement filed by the insurer as to the number of persons carried in the vehicle.
15. However, the question is, is the insurer absolved from proving its a contention regarding breach of policy conditions on account of the failure of the insured to controvert a specific statement in this regard in the written statement filed before the tribunal by the insurer. We are of the view that the answer to this question would depend on upon the facts and circumstances of each case.
16. Learned counsel appearing for the appellant points out that written statement was filed in response to the claim petition and the tribunal did not afford an opportunity to the insured to raise an objection to the contention raised in the written statement of a co- respondent. Learned counsel further drew our attention to Rule 378 of MACA 873 of 2015 -:8:- the (2) of the Kerala Motor Vehicle Rules and submitted that the insurer cannot pretend ignorance as to the stand of the insured, as the insured had questioned the ex parte award in O.P.(MAC) NO.118 of 2014 mulcting liability on the insured
17. Considering the facts and circumstances of the case, we are of the view that failure to raise a pleading by the insured as to the number of persons carried in the vehicle is inconsequential as regards the discharge of burden by the insurer. Firstly, it is to be noted that the insured challenged the ex parte award passed originally contending that there is no breach of the policy conditions. Therefore, the insurer was aware of the stand of the insured. Secondly the insured had chosen to adduce evidence by examining the persons who had allegedly travelled in the vehicle. The testimony of the insurer would show that three persons alone had travelled in the vehicle. When the tribunal allowed the insured to adduce evidence to disprove the contention in the written statement filed by the insurer as to the number of persons who had travelled in the vehicle, the insurer is necessarily expected to adduce rebuttal evidence. There is nothing wrong on the part of the insured to challenge the contention in the written statement filed by the insurer, even though the insured had failed to raise specific pleading as to the number of persons who had MACA 873 of 2015 -:9:- travelled in the vehicle in his written statement. When the dispute is alive, which is known to both parties before going for trial, the rule as to strict pleadings gets diluted. The absence of pleadings would arise only when prejudice is caused to the opposite party on account of the sudden and surprise contention taken by the other side. In this case, the insured was disputing the claim of the insurer as to the breach of policy conditions from the very beginning itself. This was known to the insurer before the trial commenced.
18. In such circumstances, the burden squarely falls on the insurer to prove its contention that the number of the persons carried in the vehicle was in excess of the permitted capacity.
19. The tribunal relied upon the final report filed by the police in the criminal case registered against the driver. The finding of the tribunal is that in the final report, which is marked as Ext.A4, it is specifically stated there were four persons in the cabin, and one person on the platform of the lorry. It is further noted that the insured was aware of the registration of a criminal case against the driver and had not chosen to challenge the final report filed in the criminal case. This finding is in our opinion is palpably wrong. The insured is not a party to the criminal case. The insured cannot challenge the final report in which he is not implicated. It is to be noted that the MACA 873 of 2015 -:10:- witnesses examined on the side of the insured are the witnesses in the criminal case. They did not support the prosecution case before the Sessions Court. They were also examined before the tribunal. They denied the suggestion that more than three persons were carried in the cabin. Learned counsel for the insurer had cross-examined them. Nothing has been brought out to discredit their testimony. Therefore, the point is, whether any reliance can be placed on the final report to find that persons in excess of the capacity were carried in the cabin of the lorry. As noted above, final report only implicates the accused therein who is the driver, and it cannot be taken as a substitution of proof as against persons, who are not involved in the criminal case. The final report at the best can be used in a claim petition as a prima facie proof of the allegation of negligence on the part of the tortfeasor and not beyond that. The insurer has to adduce the evidence as to the factum of the number of persons carried in the vehicle. In the light of the fact that the insured has chosen to adduce evidence to controvert the final report, we find there was no other material before the tribunal to conclude that the driver of the vehicle had carried persons in excess of the capacity. In view of the facts and finding as above, we need not answer the legal question raised by the appellant, namely whether carrying persons exceeding the permitted capacity would amount to a MACA 873 of 2015 -:11:- breach of the policy conditions or not. This question is left open. Accordingly, these appeals are allowed setting aside the impugned award of the tribunal allowing the insurer to realise the award amount from the insured.
20. Before parting with this case, we would like to remind all tribunals in Kerala to allow the claimants and respondents to raise pleadings whenever necessary on account of the contention put forward in the written statement filed by the respondents Rule 378 (2) of the Kerala Motor Vehicle Rules, 1989 stipulates as follows:
"No pleading subsequent to the written statement filed under sub- rule (1) shall be presented except by the leave of the Claims Tribunal and upon such terms as the Claims Tribunal thinks fit, but the Claims Tribunal may at any time require a written statement or additional statement from any of the parties and fix a time for presenting the same."
We find invariably the written statements are filed by the respondents only to controvert the allegations in the claim petitions. We also find there is no exchange of pleadings between the co- respondents before the tribunal. Therefore, the tribunals shall ensure that the written statement filed by any of the respondents be served on the co-respondent and endorsement in this regard shall be obtained. The tribunal wherever required shall direct the claimants or respondents to raise the pleadings by way of additional statements MACA 873 of 2015 -:12:- based on the written statement filed by such respondents. Registry shall forward the copy of this judgment to all tribunals in the State.
Sd/ P.N.RAVINDRAN JUDGE Sd/ A.MUHAMED MUSTAQUE JUDGE jm/ \\ true copy P.A. TO JUDGE