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Dhanaraj v. Therasa
Judgment Summary — Kanakaraj, J.
Factual and Procedural Background
The appellants are the parents of the deceased, Ethiraj. They filed Claim Petition M.O.P. No. 370 of 1982 before the Motor Accident Claims Tribunal, Chengalpattu, seeking Rs. 11 lakh as compensation for the death of their son in an accident on 24.3.1982. The factual case, as alleged by the appellants, was that Ethiraj had parked his Ambassador car on the left side of G.S.T. Road and was standing outside it with the right‑hand door open when a vehicle bearing registration T.M.V. 8481, coming in the opposite direction and driven rashly and negligently, struck and fatally injured him.
The first respondent (owner of T.M.V. 8481) remained ex parte before the Tribunal. The second respondent (the Insurance Company) filed a counter‑statement contending, inter alia, that the driver of T.M.V. 8481 had no endorsement permitting him to drive a tourist taxi and therefore the insurer was not liable under the policy. The Tribunal found, on the evidence (including P.W.3 as an eye‑witness and respondents' witnesses regarding registration and licence records), that the accident was caused by the rash and negligent driving of T.M.V. 8481 and that the vehicle was a tourist taxi; the Tribunal concluded that the Insurance Company was not liable because the driver lacked the required endorsement. The Tribunal held the owner liable and awarded total compensation of Rs. 20,000 (Rs. 10,000 to each claimant).
The appellants appealed to this Court seeking enhancement of compensation and a decree against the Insurance Company.
Legal Issues Presented
- Whether the driver of a tourist car is required under the Motor Vehicles Act to have a special authorization/endorsement in addition to the usual licence to drive a light motor vehicle in order to be covered under the vehicle's insurance policy (i.e., whether lack of such endorsement absolves the insurer of liability).
- Whether, on the facts and on the wording of the insurance policy before the Court (including the blank "Business/profession" entry and the particular "driver" clause), the Insurance Company is liable to pay compensation despite the driver not having an endorsement to drive a tourist taxi.
Arguments of the Parties
Appellants' Arguments
- The appellants contended that the accident was caused by the rash and negligent driving of T.M.V. 8481 (supported by eye‑witness evidence), and sought contribution from both respondents.
- Counsel for the appellants relied on rule 5(b) of the Motor Vehicles Rules to submit that eligibility for a licence to drive a tourist vehicle requires only one year’s experience as a driver.
- The appellants argued that the policy wording (notably a blank entry against "Business/profession" and the wording of the "driver" clause) did not require that the driver hold an endorsement to drive a tourist taxi and that ambiguities in the policy should be resolved in favour of the insured. They also relied on authorities which, they submitted, required the insurer to prove breach of policy conditions and which held that absence of proof should not relieve the insurer of liability.
Respondents' Arguments
- The second respondent (Insurance Company) contended that T.M.V. 8481 was a tourist taxi and that its driver did not have an endorsement to drive a tourist taxi; therefore, under the Insurance Policy, the insurer was absolved of liability.
- To prove lack of endorsement and the tourist taxi status, the insurer produced witnesses from transport authorities and an investigator whose evidence included a xerox copy of the driving licence.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Anjanadevi v. Arumigham and Another (1983 A.C.J. 625 = 96 L.W. 413) | Held that a driver of a tourist taxi did not have a valid licence to drive a tourist taxi and, on those facts and policy wording, the insurer was not liable. | The Court distinguished Anjanadevi on the facts: in that case the policy and the insured's business clearly involved running a tourist taxi; in the present case the policy's "Business/profession" column was blank and the driver clause differed, so Anjanadevi did not apply directly. |
| M/s National Insurance Company Ltd. v. Mahadevayya & others (1984 C.J. 467) | Held that words referring to a licence to drive the motor vehicle in the policy refer more to the type of vehicle rather than the mode of its user. | The Court noted a difference of opinion between this Court and the Bombay High Court but did not decide which view is correct; on the facts here the Court was satisfied the policy did not insist on a tourist‑taxi endorsement. |
| Houghton v. Trafalgar Insurance Co Ltd. (1954 1 Q.B. 247) | Established that ambiguities in policy documents are to be resolved in favour of the insured. | The Court relied on this principle in interpreting the ambiguous aspects of the policy (blank "Business" entry and wording of the "driver" clause) in favour of the insured/claimants. |
| Savitri and Others v. Lakhmichand and Others (1988 A.C.J. 909) | Holds that an Insurance Company must prove violation of a condition of the policy to escape liability. | The Court cited this authority to support the proposition that the insurer must establish breach (or absence of a valid licence/endorsement) and that absence of conclusive proof weighs against the insurer. |
| National Insurance Company Ltd. v. A.B. and 3 Others (1990 1 L.W. 188) | Holds that the insurer must establish the plea that the vehicle was driven by a person with only a temporary licence; in absence of proof the insurer cannot escape liability. Also supports view that a permanent licence previously held and absence of disqualification may suffice. | The Court relied on this authority to reinforce that the insurer bears the burden of proof regarding licence status and that in absence of satisfactory proof the insurer cannot escape liability. |
| New India Insurance Co. Ltd. v. C.B. Shankar and Others (1986 S.C.J. 82 = 96 L.W. 431) | Observation that if the driver is not shown to be a person who could not hold any driving licence at all (e.g., a minor), and no evidence negating his ability to hold a licence is produced, insurer's liability should stand. | The Court cited this observation to support the appellants' position that nothing showed the driver could not hold a licence and therefore the insurer should remain liable. |
Court's Reasoning and Analysis
The Court proceeded by first accepting the Tribunal's factual findings that the accident was caused by the rash and negligent driving of T.M.V. 8481 and that the vehicle was registered/authorized as a tourist taxi on the date of the accident (supported by evidence of R.W.2). The Tribunal had also found, on the respondents' evidence, that the driver did not have an endorsement to drive a tourist taxi.
The pivotal legal analysis focused on whether the insurance policy in this case required the driver to hold a licence to drive a tourist taxi (i.e., whether absence of such an endorsement operated to absolve the insurer). The Court examined the policy (Ex. 7) and noted:
- The policy's "Business/profession" column was left blank, so an endorsement that usage was "in connection with the insured's business" had no clear meaning on these facts (unlike Anjanadevi where the insured's business was shown to be running a tourist taxi).
- The "driver" clause in the policy stated that the vehicle could be driven by the insured or by any other person in the insured's employ "provided that the person driving holds a valid driving licence at the time of the accident or had held a permanent driving licence (other than a learner's licence) and is not disqualified from holding or obtaining such a licence." The Court observed that the clause's plain words could be satisfied if the driver held a valid driving licence to drive a light motor vehicle, and that the clause expressly contemplated a scenario where a driver who had previously held a permanent licence (and was not disqualified) might suffice.
- The Court noted that the evidence before it as to licence status included only a xerox copy of the driving licence produced by the insurer's investigator; the original licence was not produced, and the Court recognized that absence of the original made it difficult to conclusively determine whether the driver had a tourist‑taxi endorsement.
Applying established principles and the cited authorities, the Court reasoned:
- On the wording of the policy and the facts before the Court, the policy did not, in express terms, insist on a special endorsement to drive a tourist taxi as a condition for insurer liability.
- Ambiguities in the policy should be resolved in favour of the insured (Houghton v. Trafalgar Insurance Co. Ltd.).
- The burden of proving that a policy condition has been violated lies on the insurer; in the absence of satisfactory proof (notably the original licence or conclusive proof of endorsement absence), the insurer cannot successfully escape liability (Savitri; National Insurance v. A.B.).
- Given these considerations, and distinguishing the facts from Anjanadevi (where the policy and insured's business clearly involved tourist‑taxi operation), the Court was satisfied that the insurer could not avoid liability on the present facts.
On the question of compensation quantum, the Court found that the Tribunal had applied correct principles: the deceased's salary was Rs. 253 per month, the Tribunal properly accounted for uncertainties of life and applied an appropriate multiplier for age; therefore, there was no reason to interfere with the amount awarded.
Holding and Implications
APPEAL PARTLY ALLOWED
Holding (direct effect): The Court allowed the appeal in part by holding that the compensation awarded by the Tribunal is payable jointly and severally by both respondents (the owner and the Insurance Company). In other respects the appeal was dismissed. There was no order as to costs.
Implications: The immediate consequence is that the Insurance Company is held liable (jointly and severally with the owner) to pay the compensation already assessed by the Tribunal; the quantum awarded by the Tribunal (total Rs. 20,000; Rs. 10,000 each to the claimants) remains undisturbed. The Court distinguished prior authority on differing facts and relied on policy interpretation principles (including resolving ambiguity in favour of the insured) and on authorities placing onus on the insurer to prove breach; the judgment does not purport to lay down a new general rule beyond its application to the facts of this case. The decision therefore determines liability between the parties in this case but does not establish a broad new precedent beyond the reasoning expressly applied here.
End of summary (based exclusively on the provided opinion).
Judgment
Kanakaraj, J.
1. The parents of the victim in a motor acci dent are the appellants before this Court. The appellants filed a claim petition M.O.P No. 370 of 1982 on the file of the Motor Accident Claims Tribunal, Chcngalpaltu, claiming a sum of Rs. 11 lakh as compensation, arising out of the accident on 24.3.1982 resulting in the death of their son. The case of the appellants is that on 24.3.1982 at about 11 A.M their son Ethiraj had parked an Ambassador Car driven by him on the left hand side of the G.S.T Road and was standing out side the car by keeping the right hand side door open. At that time, the Ambassador car, bearing Registration No. T.M.V 8481 coming in the opposite direction and driven rashly and negligently, ad dashed against the deceased Ethiraj causing fatal injuries. The first respondent owner of the car T.M.V 8481 remained exparte, The second respondent Insurance Company fled a counter statement contending inter alia that the driver of the tourist car T.M.V 8481 had no licence to drive a taxi vehicle and therefore the Insurance company is not liable to pay any amount. The other particulars regarding the quantum of compensation were also generally denied.
2. P.W 3 was examined as an eye-witness to the occurrence. He spoke to the facts as set out in the claim petition that the maroon colour Ambas sador car bearing No. 6161 was standing on the left hand side of the road near the Pakkam Railwav Station in G.S.T Road. The car T.M.V 8181 com ing in the opposite direction from Tindivanam to Madras was being driven at a high speed and in a rash and negligent manner. It hit the driver of the parked car 6161 who was standing out side the car with the door open. The respondents did not seriously dispute the fact that the accident was caused due sic of T.M.V 8481. In fact they did not elicit any useful information in the cross-examination of P.W.I nor did they examine any witness to the contrary. The Tribunal, therefore, rightly held that the accident was due to the rash and negligent driving of the car T.M.V 8481.
3. However, the second respondent sought to escape liability on the ground that the Car T.M.V 8481 was a tourist taxi and the driver did not have an endorsement permitting him to drive a tourist taxi. Therefore, under the Insurance Policy, the second respondent is absolved of liability. To prove the above facts, R.W 2 was examined. R.W 2 is an Assistant in the office of the Transport Authorities, Chepauk, Madras. He maintains the tourist taxi Register. According to this witness, T.M.V 8481 was permitted to run as a tourist taxi from 13.9.1978 till 13.9.1983 It was also stated that the vehicle had been transferred to and in favour of the first respondent on 29.9.1981 He marked Exhibits B-1 to B-4 in support of the above contention. The Tribunal, therefore, rightly concluded that the car T.M.V 8481 was a tourist taxi on the date of the accident. To prove the fact that the driver of T.M.V 8481 had no endorsement the second respondent examined R.W 3 who is the Motor Vehicles Assistant in Tiruvarur. He deposed that the driver of T.M.V 8481 had a licence only to drive light motor vehicles and he had no licence to drive a tourist taxi. The Insurance claim Investigator was examined as the 4th witness. He deposed that he obtained the driving licence of the driver of the Car T.M.V 8481 at the time of the accident and look a xerox copy of the same. The said xerox copy was marked as Ex. B. 8. From these documents and the oral evidence of Respondents' witnesses 2 to 4, the Tribunal came to the conclusion that the Insurance company is not liable to pay any compensation because the driver of the insured did not have the necessary licence to drive a tourist taxi.
4. The Tribunal proceeded to find that the first respondent owner is liable. Regarding the quantum of compensation, the deceased Ethiraj was shown to have received a salary of Rs. 253/-per month at the time of the accident. He was aged about 25 years. The first appellant was aged 58 years on the date of the accident and the second appellant was aged 50 years at the lime of the accident. Taking 65 years as the period of longevity, the Tribunal held that the claimants were legitimately entitled to contribution from the deceased for a period of 15 years, Deducting Rs. 103/- for the personal expenses of the deceased the contribution was fixed as Rs. 150/- per month. Assuming that the deceased would have remained unmarried for a period of 5 years, a sum of Rs. 9,000/- was arrived at. For the balance of 10 years, the Tribunal took only Rs. 50/- as monthly contribution and worked out the total amount at Rs. 6,000/-. for the shock and mental pain, a sum of Rs. 5,000/- was awarded. The total compensation was arrived at Rs. 20,000/- and the claimants were awarded Rs. 10,000/- each.
5. The appeal by the claimants is not only for enhancing the compensation but also for a decree against the Insurance Company. A similar question arose before this court in Anjanadevi v. Arumigham and Another 1983 A.C.J 625. = 96 L.W 413 This court posed the following point for determination:
The substantial question that arises in this case is to determine whether driver of a tourist car is required under the Motor Vehicles Act, to have a special authorization in addition to the usual licence to drive a light Motor Vehicle to enable him to drive the tourist car as contended by the learned counsel for the Insurance Company.” The Insurance company in that case showed that the Vehicle had been registered as a tourist taxi and it can be used only in connection with the insured's business of running it as a tourist Vehicle. Further under the head ‘driver’ the policy in that case had stated that the vehicle could be driven by the insured or by any other persons in his employ. Holding a Licence to Drive The Vehicle. Relying on S. 3(1) of the Motor Vehicles Act, it was held that the driver did not have a valid licence to drive a tourist taxi. It was, therefore, held that the Insurance company was not liable to meet the compensation, In the case before us, there is some proof that the driver of T.M.V 8481 did not have a licence to drive a tourist vehicle. But the question that still remains is whether the policy in this case insisted on the drive having a licence to drive a tourist vehicle. It is not disputed that the driver did have a licence to drive light motor vehicle like the car T.M.V 8481. Exp. 7 is the policy issued by the second respondent company for the period from 20.9.1981 to 27.9.1982 As against the column. Business profession, the policy is left blank. Therefore, the endorsement in the policy that usage in connection with the insured's business does not convey any meaning, because the business is not indicated. This is a vital point of difference between the judgment in Anjanadevi v. Arumugliam and Another because in that case, it is seen from the judgment that the insured's business was running a tourist taxi. Secondly, as against the word “driver” it is staled as follows:
“(a) The insured;
(b) any other person provided he is in the insured ‘s employ and is driving on his order or with his permission:
Provided that the person driving holds a valid driving licence at the time of the accident or had held a permanent driving licence (other than a learners licence) and is not disqualified from holding or obtaining such a licence.”
The words” holds a driving licence at the time of the accident” is definitely satisfied in this case because the driver of T.M.V 8481 did have a licence to drive a light motor vehicle, in the judgment quoted above, it is seen that as against the word “driver”, it was stated that the vehicle could be driven by the insured or by any other person in his employ Holding a Licence To Drive the Vehicle. The reference to the vehicle is missing in the policy before us. Further, the words” or had held a permanent driving licence (other than a learner's licence) and is not disqualified from holding or obtaining such a licence” suggest that even if the driver had a permanent driving licence and is subsequently not disqualified from holding such a licence, the Insurance company cannot escape liability. The words seem to suggest that even if on the date of the accident, the driver did not have a licence the fact that he had earlier a permanent licence and is not disqualified on the date of the accident is sufficient t@ fasten the liability on the Insurance company. Learned counsel for the appellants relied on rule 5(b) of the Motor Vehicles Rules to say that the eligibility for getting a licence to drive a tourist vehicle is only one year experience as a driver.
6. Therefore, on facts, we are of the opinion that the judgment in Anjanadevi v. Ammugham and Another will not apply to the present case. To the same effect is the judgment in M/s National Insurance Company Ltd. v. Mahadevayya & others 1984 C.J 467 In that case, it was no doubt held, that the words” held as licence to drive the motor vehicle” appearing in the policy refers more to the type of vehicle rather than the mode of its user. There is thus difference of opinion between our Court and the Bombay High Court in this aspect. We do not propose to go into the question as to which view is acceptable because in this case on facts we are satisfied that the policy does not insist on the driver having a licence to drive a tourist taxi. However, we may refer to Houghton v. Trafalgar Insurance Co Ltd. 1954 1 Q.B 247. In that case, it has been held that if there is ambiguity in the policy documents, the ambiguity will be resolved in favour of the insured.
7. In this case we have a further difficulty because the driving licence as such was not produced. What is produced before this court is a xerox copy of the driving licence, said to have been obtained from the owner of T.M.V 8481 by the Investigator R.W 4 There is evidence to say that unless the original is produced, it may not be possible to correctly find out whether the driver had an endorsement for driving a tourist taxi. In this connection, learned counsel for the appellants relies on the decision in Savitri and Others v. Lakhmichand and Others 1988 ACJ 909, wherein it was held that the Insurance Company filed to prove that there was any violation of the condition of policy. Similarly, in National Insurance Company Ltd. v. A.B and 3 Others 1990 1L.W 188 (to which one of us was a party), it was held that the plea of the Insurance Company that accident was caused by a person driving a vehicles with a temporary licence has to be established only by the Insurance company and in the absence of proof, the insurance company cannot escape liability. That judgment also supports the view expressed by us that on the date of the accident, the driver need not have a licence provided it is established that he had a permanent licence and he was not disqualified on the date of the licence from holding or obtaining a licence.
8. In New India Insurance Co. Ltd. v. C.B Shankar and Others 1986 SCJ 82 = 96 L.W 431 the following observations support the case of the appellants:
“It is not the case of the insurance company that the nature of things is such that we can presume that the driver could not have had any licence at all. The driver was not shown to be a minor or any “other person with legal infirmity who could not hold any driving licence at all for any reason. In the circumstances, therefore, we agree with the order of the Tribunal that the Insurance Company is liable for the amount awarded.”
9. Having regard to all the facts and cir cumstances of the case and on the basis of that terms of the Insurance Policy in this case, we are satisfied that the Insurance Company cannot es cape liability.
10. so far as the question of quantum of com pensation is concerned, we are satisfied that the Tribunal has taken note of the correct principles. The salary of the deceased was only Rs. 253/- per month. The argument is that the salary would not have remainedthe same for ever and the Tribunal should have taken note of the higher salary that the deceased would have secured in course of time. We are unable to accept this contention because there is no evidence on that aspect and we have to take note of the other uncertainities in life while determining the compensation. The multiplier applied by the Tribunal is also correct, having regard to the age of the appellants. We are, therefore, not inclined to interfere with the quantum of compensation.
11. In the result, the appeal is partly allowed holding that the compensation as awarded by the Tribunal is payable jointly and severally by both the respondents. In other respects, the appeal is dismissed. There will be no order as to costs.
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