M/S.United India Insurance Co. … vs Mrs.Parukutty Amma on 14 August, 2007

       

  

  

 
 
  IN THE HIGH COURT OF KERALA AT ERNAKULAM

MFA No. 710 of 2001()



1. M/S.UNITED INDIA INSURANCE CO. LTD.
                      ...  Petitioner

                        Vs

1. MRS.PARUKUTTY AMMA
                       ...       Respondent

                For Petitioner  :SMT.P.A.REZIYA

                For Respondent  :SRI.THAMPAN THOMAS

The Hon'ble MR. Justice J.B.KOSHY
The Hon'ble MR. Justice V.GIRI

 Dated :14/08/2007

 O R D E R
                    J.B.KOSHY & V.GIRI, JJ.
            -------------------------------------
                    M.F.A.No.710 OF 2001
            -------------------------------------
                    Dated 14th August, 2007

                           JUDGMENT

Koshy,J.

This appeal is filed by the insurance company

contending that the driver of the vehicle insured by it had no

effective driving licence on the date of accident and hence

insurance company is not liable to pay the compensation. It

is submitted that a petty case was charged against the driver,

but, there is no evidence to show that he was convicted.

Further, the Tribunal also found as follows:

“There is no evidence to prove that R1
was not possessed of D.L. to drive the
offending vehicle. So also there is no
evidence to prove that R2 knowingly
entrusted the vehicle for driving by an
unlicenced driver. 3rd respondent has
validly insured the vehicle. So it is
liable to indemnify the claim.”

In National Insurance Co. Ltd. v. Swaran Singh and others (AIR

2004 SC 1531) the Apex Court has considered the matter in

detail and at paragraph 105 the points were summarised. Point

Nos.1, 3, 4, 5 and 6 are as follows:

“1. Chapter XI of the Motor Vehicles
Act, 1988 providing compulsory insurance of
vehicles against third party risks is a

MFA.710/2001 2

social welfare legislation to extend
relief by compensation to victims of
accidents caused by use of motor
vehicles. The provisions of compulsory
insurance coverage of all vehicles are
with this paramount object and the
provisions of the Act have to be so
interpreted as to effectuate the said
object.

xx xx xx xx

3. The breach of policy condition,
e.g., disqualification of driver or
invalid driving licence of the driver, as
contained in sub-section (2)(a)(ii) of
Section 149, have to be proved to have
been committed by the insured for
avoiding liability by the insurer. Mere
absence, fake or invalid driving licence
or disqualification of the driver for
driving at the relevant time, are not in
themselves defences available to the
insurer against either the insured or the
third parties. To avoid its liability
towards insured, the insurer has to prove
that the insured was guilty of negligence
and failed to exercise reasonable care in
the matter of fulfilling the condition of
the policy regarding use of vehicles by
duly licensed driver or one who was not
disqualified to drive at the relevant
time.

4. The insurance companies are,
however, with a view to avoid 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.

5. The court cannot lay down any
criteria as to how said burden would be
discharged, in as much as the same would
depend upon the facts and circumstances
of each case.

6. Even where the insurer is able to
prove breach on the part of the insured

MFA.710/2001 3

concerning the policy condition regarding
holding of a valid licence by the driver
or his qualification to drive during the
relevant period, the insurer would not be
allowed to avoid its liability towards
insured unless the said breach or
breaches on the condition of driving
licence is/are so fundamental as are
found to have contributed to the cause of
the accident. The Tribunals in
interpreting the policy conditions would
apply “the rule of main purpose” and the
concept of “fundamental breach” to allow
defences available to the insured under
Section 149(2) of the Act.”

Here, there was no evidence to show that the owner

(insured) was negligent in entrusting the vehicle to first

respondent knowing that he was not having proper licence

and insurance company has not proved that the driver was

not having valid driving licence and the matter was

considered by the Tribunal. In view of the above decision

of the Apex Court, we see no ground to interfere with the

award.

The appeal is dismissed.

J.B.KOSHY
JUDGE

V.GIRI
JUDGE

tks