Owner to be held vicariously liable for the negligence on the part of his driver : JAMMU AND KASHMIR HIGH COURT
If the owner has given charge of his vehicle to a duly licensed driver and the said driver, without express or implied knowledge consent of the owner, puts an unauthorized person in charge of the vehicle resulting in an accident, it would amount to negligence on the part of the licensed driver appointed by the owner and for this act of negligence, the owner will become vicariously liable. This was held in the judgment passed by a single judge bench comprising of HON’BLE MR. JUSTICE SANJAY DHAR,, in the matter United India Insurance Company Ltd v. Mst. Hanifa and others [IA No. 07/2009 [556/2009]], dealt with an issue where the petitioner filed a petition seeking setting an the Award dated 23.04.2009 passed by the Motor Accidents Claims Tribunal, Srinagar, whereby the Tribunal has awarded a sum of ₹5,03,000/- in favour of the claimants and against the respondents. Out of the awarded sum, an amount of ₹10,000/- each has been made payable by the driver and conductor of the offending vehicle, whereas the balance amount has been made payable by the insurance company. It is also provided that the awarded sum shall carry interest @ 6% per annum from the date of institution of the claim petition till realization of the awarded sum and if the awarded sum is not paid within two months, the interest has been made recoverable @ 9% per annum from the date of the default. Riyaz Ahmed Dar, a driver by profession, had parked his vehicle and was standing by the side of his vehicle. In the meanwhile, a truck that was being driven rashly and negligently by its driver knocked the deceased down, resulting in his death. The claimants happen to be the mother and siblings of the deceased. In the claim petition, compensation in the amount of ₹36 Lacs was sought. The insurance company contended that the vehicle in question, at the time of the accident, was being driven by its conductor, who was not authorized to do so and as such, the insurance company is not liable to pay any compensation to the claimants. On account of this, it is urged that there has been breach of policy conditions on the part of the insured and as such, the appellant-insurance company is not liable to indemnify the insured. After hearing both sides, the Hon’ble High Court of Jammu and Kashmir dismissed the petition and held that that the owner of the vehicle is vicariously liable for the accident caused by the conductor of the vehicle, provided the owner had appointed a duly licensed driver to take charge of the vehicle, who in turn allowed the unlicensed conductor to drive the vehicle. It also held that the insurer in such a case cannot escape its liability to indemnify the insured because there is no willful breach of policy condition on the part of the insured inasmuch as the insured himself has not put an unlicensed or unauthorized person incharge of the vehicle.
HIGH COURT OF JAMMU AND KASHMIR AT SRINAGAR Reserved on: 24.06.2020 Pronounced on: 03.07.2020 CMAM No. 170 2009 IA No. 07 2009United India Insurance Company Ltd. Through : Mr. N.A.Beigh Advocate. on Video conferencing from Srinagar) Mst. Hanifa and others. Through : None. Coram: HON’BLE MR. JUSTICE SANJAY DHAR JUDGE The instant appeal is directed against the Award dated 23.04.2009 passed by the Motor Accidents Claims Tribunal Srinagarwhereby the Tribunal has awarded a sum of ₹5 03 000 in favour of the claimants and against the respondents. Out of the awarded sum an amount of ₹10 000 each has been made payable by the driver and conductor of the offending vehicle whereas the balance amount has been made payable by the insurance company. It is also provided that the awarded sum shall carry interest @ 6% per annum from the date of institution of the claim petition till realization of the awarded sum and if the awarded sum is not 2 CMAM No. 170 2009 a w connected IA. paid within two months the interest has been made recoverable @ 9% per annum from the date of the default. The facts that have led to the filing of the claim petition are that on 28.04.2014 the deceased namely Riyaz Ahmed Dar a driver by profession had parked his vehiclebearing Registration No. JK019 3255 near a workshop at Rawalpura Srinagar and was standing by the side of his vehicle. In the meanwhile a truck bearing Registration No. JK01E 5552 that was being driven rashly and negligently by its driver knocked the deceased down resulting in his death. The claimants happen to be the mother and siblings of the deceased. In the claim petition compensation in the amount of ₹36.00 Lacswas sought. Respondent No. 1 in the claim petition happens to be the insurer respondent No. 2 happens to be the owner respondent No.3 happens to be driver whereas respondent No. 4 happens to be the conductor of the offending vehicle. Only respondent No. 1contested the claim petition by filing its objections whereas other respondents were set ex parte. In its reply before the Tribunal the insurance company contended that the vehicle in question at the time of the accident was being driven by its conductorwho was not authorized to do so and as such the insurance company is not liable to pay any compensation to the claimants. On the basis of pleading of the parties the Tribunal in terms of order dated 19.05.2006 framed the following issues: 3 CMAM No. 170 2009 a w connected IA. i) Whether on 28.4.2004 Riyaz Ahmad Dar while standing sumo bearing No.JK0IG 3255 at by his parked mechanical shop near Govt. High School Bye Pass Rawalpora was hit by a truck bearing No. JKOIE 5552 being driven rashly and negligently by respondent No.3 Ab. Latief Khan and causing his death on spot whereas the vehicle belonged to respondent No.3 as its prospective owner In case the issue No. I is proved in affirmative whether the petitioners as the legal heirs of the deceased are entitled to compensation and if so to what extent and from whomiii) Whether the respondent No.1 is not liable to pay the compensation for the reason that the offending vehicle was actually driven by Showkat Ahmad Wani respondent No.4 who not having a driving license Relief. On the basis of the evidence led before the Tribunal the impugned award dated 23.04.2009 came to be passed by the Tribunal whereby compensation in sum of the ₹5 03 000 was awarded in favour of the claimants and the insurer was held liable to pay awarded sum minus ₹20 000 which was made payable by respondents No. 3 and 4 the driver and conductor of the vehicle in equal proportions. Aggrieved of this award the insurance company has come up by way of instant appeal mainly on the ground that the offending vehicle at the time of accident was being driven by its conductor respondent No. 6 herein who was not authorized to drive the vehicle and further he did not possess a driving licence. On account of this it is urged that there has been breach of policy conditions on the part of the insured and as such the appellant insurance company is not liable to indemnify the insured. 4 CMAM No. 170 2009 a w connected IA. I have heard learned counsel for the appellant and the claimants. I have also gone through the grounds of the appeal the impugned award and the record of the Tribunal. As already stated the only ground urged before this Court is that the vehicle in question at the time of the accident was being driven by an unauthorized person who was not holding a driving licence and as such the insurance company is not liable to indemnify the insured. The quantum of compensation awarded by the Tribunal in favour of the claimants is not in dispute and the policy of the insurance is also not in dispute. The finding of the Tribunal that Showkat Ahmad Wani respondent No. 6 herein of the offending vehicle was driving the said vehicle at the time of the accident and that he had been permitted by the driver of the offending vehicle namely Abdul Lateef Khan respondent No. 5 herein to do so is also not in dispute. In the backdrop of the aforesaid admitted position the question arises as to whether the insurer in this case is liable to indemnify the insured given the fact that the licensed driver appointed by the insured had permitted an unauthorized person to take charge of the vehicle as a result of which an accident was caused. The Tribunal has relied upon the judgment of the Allahabad High Court rendered in case titled “Baldeo Raj vs Smt. Deowati And Ors. reported as(1) ACC 390” to support its conclusion that the owner of the vehicle is vicariously liable for the accident caused by the conductor of the vehicle 5 CMAM No. 170 2009 a w connected IA. provided the owner had appointed a duly licensed driver to take charge of the vehicle who in turn allowed the unlicensed conductor to drive the vehicle. The Hon’ble Supreme Court has in a number of cases examined the issue at hand. In “Skandia Insurance Co. Ltd. Vs. Kokilaben Chandravadan ors. reported as 1987SCC 654” the Hon’ble Supreme Court held that the owner becomes vicariously liable in a case where accident is caused by an unauthorized person when the owner had employed a duly licensed driver and the driver had left the vehicle unattended. The Hon’ble Supreme Court further went on to hold that the exclusion clause in the contract of insurance making the owner absolutely liable irrespective of the circumstances leading to driving by unlicensed driver must be ‘read down’ being in conflict with the main statutory provision. In “Kashiram Yadav & Anr vs Oriental Fire & Gen. Insurance Co. reported as 1989 SCC128” the Hon’ble Supreme Court reiterated the views expressed by it in case of Skandia Insurance Co. Ltd.’s casehad committed a breach of the condition incorporated in the certificate of insurance since the cleaner operated the vehicle on the fatal occasion without driving licence. This Court expressed the view that it is only when the insured himself entrusted the vehicle to a person who does not hold a driving licence he could be said to have committed breach of the condition of the policy. It must be 6 CMAM No. 170 2009 a w connected IA. established by the Insurance Company that the breach is on the part of the insured. Unless the insured is at fault and is guilty of a breach of the condition the insurer cannot escape from the obligation to indemnify the insured. It was also observed that when the insured has done everything within his power inasmuch as he has engaged the licensed driver and has placed the vehicle in his charge with the express or implied mandate to drive himself it cannot be said that the insured is guilty of any breach. We affirm and reiterate the statement of law laid down in the above case. We may also state that without the knowledge of the insured if by driver s acts or omission others meddle with the vehicle and cause an accident the insurer would be liable to indemnify the insured. The insurer in such a case cannot take the defence of a breach of the condition in the certificate of insurance." In “Sohan Lal Passi vs P. Sesh Reddy & Ors. reported as 1996 SCC21” the Hon’ble Supreme Court reiterated and reaffirmed the views expressed by it in case of Skandia Insurance Co. Ltd.’s caseSANJAY DHAR) JUDGE Whether the order speaking: Whether the order is reportable: Yes No 