Judgment related to Pay and Recover under MV Act

 Judgment related to Pay and Recover under MV Act

1.  Jeep driven by father of the owner. Policy covers only six passengers actually 11 passengers were travelling jeep fell in to ditch resulting death of all passengers. IC is liable not for all claimant. IC is directed to pay compensation and further ordered to recover from the owner and driver 2011 AIR SCW 2802K. M. Poonam

2.  Order of ‘pay and recover’ whether HC or Tribunal can direct the IC to pass an order of pay and recover? – question referred to Larger Bench for consideration 2009 (3) GLH 377 (SC) N.I. Com v/s Parvathneni.

Please Note: Hon'ble Apex Court has dismissed the said SLP being No.22444 of 2009 on 17/09/2013 (from the judgment and order dated 12/12/2008 in MACMA No.1211 of 2007 of the High Court of A.P. at Hyderabad on 18/09/2013).

3.  Respondent No.2 was the owner of a Mini Bus. An insurance policy in respect of the said vehicle was sought to be taken by him. For the said purpose, the second respondent issued a third party cheque towards payment of insurance premium. The Development Officer of the appellant by inadvertence issued a cover note. However, when the said mistake came to his notice, the respondent No.2 was contacted by the Development Officer. He was asked to pay the amount of premium. It was not tendered and instead the respondent No.2 said to have returned the original cover note and took back the cheque. The original cover note as also all the duplicate copies thereof was cancelled. The said insurance cover was issued for the period 3.9.1991 to 2.9.1992. On or about 12.9.1991, the said vehicle met with an accident. First respondent who suffered an injury therein filed a claim petition in terms of the provisions contained in Sec. 166 effect liability of insurer when vehicle met with accident within the period under cover note held, no premium could be said to have been paid no privity of contract between insurer and insured Supreme Court in jurisdiction under Art. 142 of Constitution, directed insurer to recover the paid compensation from insured owner appeal allowed.

       2008(7) SCC 526

4.  Constitution of India Art. 136 Motor Vehicles Act, 1988 S.149 Tractor plying on hire Labourer sitting on the mudguard of Tractor Falling down Getting crushed under the wheels Driver not possessing a valid license Tribunal awarding compensation of Rs. 2 Lakhs High Court summarily dismissing the appeal of Insurance Company Held : It was not a fit case for any interference under Article 136 of the Constitution of India, however, it is open to the Insurance Company to recover the amount from owner by filing application before the Tribunal without filing a separate execution petition against the owner 2008 (2) GLH 393 (SC) –N.I.A Com v/s Darshan Devi IC held not liable2013 ACJ 2108 (P & H), 2014 ACJ 1792 (MP)

5.  Motor Vehicles Act, 1988 u/s. 149, 163A, 166 and 170 Vehicle was used as a commercial vehicle Driver was holder of licence to drive LMV Driver not holding licence to drive commercial vehicle Breach of contractual condition of insurance Owner of vehicle cannot contend that he has no liability to verify as to whether driver possessed a valid licence Extent of third party liability of insurer Death of a 12year girl in accident Claimants are from poor background After having suffered mental agony, not proper to send them for another round of litigation Insurer directed to pay to claimants and then recover from the owner in view of Nanjappan's case [2005 SCC (Cri.) 148]. 2006(2) GLH 15 (SC) – N.I.A Com v/s Kusum Rai. Following Kusum Rai judgment, Delhi High Court in the case of O I Com. v/s Shahnawaz,reorted in 2014 ACJ 2124 has held that driver of offending vehicle was possessing lincence to ply LMV (Nontransport)  but was plying Tata Sumo registered as Tourist Taxi and, therefore, IC is not liable to pay compensation.

6.  Order of ‘pay and recover’ whether HC or Tribunal can direct the IC to pass an order of pay and recover? – question referred to Larger Bench for consideration 2009 (3) GLH 377 (SC) N.I. Com v/s Parvathneni

7.  Jeep driven by father of the owner policy covers only six passengers actually 11 passengers were travelling jeep fell in to ditch resulting death of all passengers IC is liable not for all claimant IC is directed to pay compensation and further ordered to recover from the owner and driver 2011 AIR SCW 2802K. M. Poonam

8.  Respondent No.2 was the owner of a Mini Bus. An insurance policy in respect of the said vehicle was sought to be taken by him. For the said purpose, the second respondent issued a third party cheque towards payment of insurance premium. The Development Officer of the appellant by inadvertence issued a cover note. However, when the said mistake came to his notice, the respondent No.2 was contacted by the Development Officer. He was asked to pay the amount of premium.

It was not tendered and in stead the respondent No.2 is said to have returned the original cover note and took back the cheque. The original cover note as also all the duplicate copies thereof was cancelled. The said insurance cover was issued for the period

3.9.1991 to 2.9.1992. On or about 12.9.1991, the said vehicle met with an accident. First respondent who suffered an injury therein filed a claim petition in terms of the provisions contained in Sec. 166effect liability of insurer when vehicle met with accident within the period under cover note held, no premium could be said to have been paid no privity of contract between insurer and insured Supreme Court in jurisdiction under Art. 142 of Constitution, directed insurer to recover the paid compensation

from insured owner appeal allowed.

2008(7) SCC 526

9.  Constitution of India Art. 136 Motor Vehicles Act, 1988 S.149 Tractor plying on hire Labourer sitting on the mudguard of Tractor Falling down Getting crushed under the wheels Driver not possessing a valid license Tribunal awarding compensation of Rs. 2 Lakhs High Court summarily dismissing the appeal of Insurance Company Held :It was not a fit case for any interference under Article 136 of the Constitution of India, however, it is open to the Insurance Company to recover the amount from owner by filing application before the Tribunal without filing a separate execution petition  against the owner 2008 (2) GLH 393 (SC) –N.I.A Com v/s Darshan Devi IC held not liable2013 ACJ 2108 (P & H), 2014 ACJ 1792 (MP)

10.              In this case since the person riding the motorcycle

at the time of accident was a minor, the responsibility for paying the compensation awarded fell on the owner of the motorcycle. In fact, in the case of Ishwar Chandra V/s. Oriental Insurance Co.

Ltd. [(2007) 3 AD (SC) 753], it was held by this Court that in case the driver of the vehicle did not have a licence at all, the liability to make payment of compensation fell on the owner since it was his obligation to take adequate care to see that the driver had an appropriate licence to drive the vehicle. Before the Tribunal reliance was also placed on the decision in the case of National Insurance Co. Ltd. V/s. G. Mohd. Vani & Ors. [2004 ACJ 1424] and National Insurance Co. Ltd. V/s. Candingeddawa & Ors. [2005 ACJ 40], wherein it was held that if the driver of the offending vehicle did not have a valid driving licence, then the Insurance Company after paying the compensation amount would be entitled to recover the same from the owner of the vehicle Motor Accident Claims Tribunal quite rightly saddled the liability

for payment of compensation on the Petitioner and, accordingly, directed the Insurance Company to pay the awarded amount to the awardees and, thereafter, to recover the same from the Petitioner. The said question has been duly considered by the Tribunal and was correctly decided. The High Court rightly chose

not to interfere with the same.

2011(6) SCC 425 – Jawahar Singh v/s Bala Jain Death in motor accident liability of Insurance Company Tribunal observed that driver of bus was not possessing valid driving license compensation of Rs. 2,68,800 awarded respondent no. 3 and 4 were driver and owner of bus respondent no. 3 and 4 were liable to make payment direction issued to appellant/IC to deposit amount and that it can recover the same from respondents – appellant/IC deposited necessary amount recovery of amount Execution Petition(EP) filed by IC whether civil suit was required to be filed instead of filing execution petition – held ; no when such direction to file suit instead of filling EP issued by Tribunal

same is not sustainable. EP is held to be maintainable whenever

order of ‘pay and recover’ is passed by Tribunal, then it must be held to have been done in exercise of inherent power of Tribunal Section 168 of the Motor Vehicles Act, 1988, in terms whereof, it is not only entitled to determine the amount of claim as put forth by the claimant for recovery thereof from the insurer, owner or driver of the vehicle jointly or severally but also the dispute between the insurer on the one hand and the owner or driver of the vehicle involved in the accident in as much as can be resolved by the Tribunal in such a proceeding many SC ratios considered.

2009(8) SCC 377 – N.I.A. Com v/s Kusum

11.              Motor Vehicles Act, 1988 u/s. 165, 149(2), 168, 174

The Tribunal in interpreting the policy conditions would apply "the rule of main purpose" and concept of "fundamental breach" to allow the defences available to the insurer Further held that powers of Tribunal are not restricted to only decide claims between claimants and insured or insurer and/or driver, it has also powers to decide the disputes between insured and insurer and when such dispute is decided, it would be executable u/S. 174 as it applies to claimants No separate proceedings are required Even when insurer is held not liable, it will satisfy the award in favour of claimants and can recover from the insured u/S. 174 of the Act.2004(1) GLH 691(SC)N.I.A. Com v/s Swaran Singh.

12.              U/s 147Pay and recover Guideline. 2012 AAC 3151(ALLAHBAD). N.I.Co., Varanasi v.s.Smt. Abhirajji Devi.

13.              Pay and Recover' Whether Tribunal can direct the IC

to first pay and then recover the amount of compensation? Held No.I.Com. v/s K.C. Subramanayam, reported in CDJ 2012 Karnataka HC 339.

14.              Execution whether IC has right to recover an amount

of compassion in the same proceedings or it has to file the separate suit for recovery? Held in the same proceeding.

2013 ACJ 2233 (P&H)2004 ACJ 1093 (SC)Pramod Kumar Agrrawal and 2001 ACJ 843 (SC) Kamla

15.              Pay and recover Accident by negligent driving of Minor Liability of Financier – order of pay and recover only against owner/financier and not against minor 2014 ACJ 660 (Del), IC is held liable to pay and recover as same is liable under the contractual liability. 2014 ACJ 2298 (Del)

16.              Minor aged a6 years was plying the bike and his sister aged about 12 years was pillion rider – accident occurred and sister of the rider sustained injuries – IC disputed its liability on the count that principle Volenti non fit injuria is applicable in the present case and therefore, minor girl may also be held negligent – whether sustainable? Held – No.

        2017 ACJ 2533 (Ker)

17.              When an order of pay and recover is passed against

IC in such situation IC is said to be aggrieved party held ; no. SC

ratios followed 2011 ACJ 2498 para 12

18.              Pay and recover order by Tribunal when deceased was

admittedly a gratuitous passenger whether valid Held ; yes as

gratuitous passenger is held to third party. 2012 ACJ 1661(J&K).

19.              Which directions are required to be ordered in the

operative portion of the award, while passing and order of Pay and Recover? Directions given.

Pramod kumar Agrawal 2004 ACJ 1903 (SC) also see

2015 ACJ 1602 (Bom).