R IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 2ND DAY OF APRIL, 2019 PRESENT THE HON’BLE MRS. JUSTICE B.V. NAGARATHNA AND THE HON’BLE MR. JUSTICE H.T. NARENDRA PRASAD M.F.A. No.6342 OF 2016 (MV) BETWEEN:
THE CLAIM MANAGER, CHOLAMANDALAM MS GENERAL INSURANCE COMPANY LIMITED, UNIT NO.4, 6TH FLOOR, LEVEL-6, GOLDEN HEIGHTS COMPLEX, NO.59, ‘C’ CROSS, INDUSTRIAL SUBURB, RAJAJINAGAR, 4TH ‘M’ BLOCK, BANGALORE – 560 010.
BY IT’S MANAGER. ... APPELLANT (BY SRI O. MAHESH, ADVOCATE) AND:
1. SMT. EDNA LEMUEL MABEN, AGED ABOUT 56 YEARS, W/O. LEMUEL DEVADATTA MABEN, 2. SRI LEMUEL DEVADATTA MABEN, AGED ABOUT 58 YEARS, S/O. GILBERT JOSEPH MABEN, BOTH ARE RESIDING AT NO.471, 2ND FLOOR, 9TH CROSS, 29TH MAIN ROAD, B.T.M. LAYOUT, 2ND STAGE, BANGALORE – 560 076.
NATIVE ADDRESS:
FLAT NO.B-14, NIRUPAM SOCIETY NO.3, AKRUDI ROAD NEAR URSULA SCHOOL, AKRUDI PUNE CITY, PUNE, MAHARASTRA – 411 035.
3. SRI CHANDRA SHEKAR C., MAJOR, S/O. SRI CHINNANNA, R/AT NO.2/160 B, DINNUR, B-MUDUGANAPALLI, HOSUR TLAUK, KRISHNAGIRI, TAMILNADU DISTRICT – 635 103.
4. SRI M. MANI, MAJOR, AMBULATY VILLAGE, THORAPALLI POST, HOSUR TALUK, KRISHNAGIRI TAMILNADU DISTRICT, PIN CODE – 635 109. ... RESPONDENTS (BY SRI SRIDHAR D.S., ADVOCATE FOR C/R-1 & R-2; SRI H.M. CHIDANANDA, ADVOCATE FOR R-3 & R-4) ***** THIS M.F.A. IS FILED UNDER SECTION 173(1) OF M.V. ACT AGAINST THE JUDGMENT AND AWARD DATED 15.07.2016 PASSED IN M.V.C. NO.4340/14 ON THE FILE OF THE MEMBER, PRINCIPAL M.A.C.T., BENGALURU, AWARDING COMPENSATION OF RS.19,57,950/- WITH INTEREST AT 9% P.A. FROM THE DATE OF PETITION TILL REALISATION.
THIS M.F.A. COMING ON FOR ADMISSION THIS DAY, NAGARATHNA J., DELIVERED THE FOLLOWING:
JUDGMENT Though this appeal is listed for admission, with the consent of learned counsel on both sides, it is heard finally.
2. The insurance company has preferred this appeal, assailing the judgment and award passed by the Principal Motor Accident Claims Tribunal at Bengaluru (hereinafter referred to as the ‘Tribunal’ for the sake of brevity) dated 15.07.2016 in M.V.C.No.4340 of 2014.
3. For the sake of convenience, the parties shall be referred to in terms of their status before the Tribunal.
4. The respondent – claimants filed the claim petition under Section 166 of the Motor Vehicles Act, 1988 (hereinafter referred to as the ‘Act’, for the sake of brevity) claiming compensation of Rs.20,00,000/- on account of the death of their son Crispin Hubert Maben @ Maben Crispin Hubert Lemuel in a road traffic accident that occurred on 01.08.2014 at about 3.00 p.m., opposite 8th cross, 29th Main Road, B.T.M. 2nd stage, Bengaluru - 560 076. According to the claimants, on the said date, Crispin Hubert Maben was riding motor cycle bearing No.KA- 01/HF-8853 on 29th Main Road, B.T.M. 2nd stage, Bengaluru-76. When he was in front of 8th Cross, at that time a Tipper Lorry bearing Reg. No.TN-39/BZ-2469 came in the same direction in a rash and negligent manner and dashed against the motor cycle from behind. Due to the impact, Crispin Maben sustained fatal injuries. He was shifted to Fortis Hospital for treatment, but he succumbed to his injuries on the same day at 8.00 p.m. Thereafter, his dead body was shifted to St. John’s Hospital for post mortem. Contending that Crispin Maben was 21 years of age, hale and healthy and a brilliant student of Bachelor of Hotel Management and that on account of his untimely death in the road traffic accident, they had suffered hardship, his parents filed the claim petition seeking compensation on various heads.
5. In response to the notices issued by the Tribunal, the respondents appeared through their respective counsel. But respondent Nos.1 and 2 before the Tribunal, namely, the owner and insurer of the Tipper Lorry did not file any statement of objection. While respondent No.3 / appellant herein, the insurance company, filed its statement of objection contending that the policy was not in force on the date of the accident and hence the insurer was not liable to indemnify respondents No.1 and 2, that there was no privity of contract between the owners of the vehicle respondents No.1 and 2 and that the question of indemnifying them by the insurer did not arise. It was contended that the policy was obtained bearing No.3381/00346248/000/00 in respect of lorry bearing Reg. No.TN-39-BZ-2469 and that the policy was with effect from 02.08.2014 to 01.08.2015 and that the risk in respect of the lorry in question had not been assumed by the insurer as the accident had occurred on 01.08.2014 at 3.00 p.m. Therefore, the insurance company sought dismissal of the claim petition by denying all other material averments made in the claim petition.
6. On the basis of the rival pleadings, the Tribunal framed the following issues for its consideration :
1. Whether the petitioners prove that the deceased succumbed to injuries in a Motor Vehicle Accident that occurred on 01.08.2014 at about 3.00 p.m., opposite to 8th Cross, 29th Main Road, BTM 2nd Stage, Bengaluru City within the jurisdiction of MICI Layout Traffic Police station on account of rash and negligent driving of the tipper lorry bearing Reg. No.TN-39-BZ-2469 by its driver?
2. Whether the respondent No.3 proves that the accident occurred on account of negligent act of the deceased himself?
3. Whether the petitioners are entitled for compensation? If so, how much and from whom?
4. What order?
7. In support of their case, the claimants let in the evidence of three witnesses namely, P.W.1, the father of the claimant and produced 22 documents which were marked as Exs.P-1 to P-22. The insurance company let in the evidence of R.W.1, Sunil Ramesh and produced four documents which were marked as Exs.R-1 to R-4. On the basis of the said evidence on record, the Tribunal answered issue No.1 in the affirmative, issue No.2 in the negative and issue No.3 partly in the affirmative and awarded compensation of Rs.19,57,950/- with interest at the rate of 9% p.a. from the date of claim petition till realization and directed the insurance company to satisfy the award. Being aggrieved by the liability being fastened on the insurance company, it has preferred this appeal.
8. We have heard learned counsel for the appellant – insurer and learned counsel for respondent claimants and learned counsel for respondents No.3 and 4 and perused the material on record.
9. Appellant’s counsel contended that the policy in respect of the offending vehicle commenced with effect from 02.08.2014 up to 01.08.2015. That the accident in question occurred on 01.08.2014 i.e., prior to the commencement of the policy. This is evident from the copy of the proposal form which is produced at Ex.R-2. That Ex.R-1 is the policy copy. When the accident had occurred on 01.08.2014 at 3.00 p.m., it is prior to the period of issuance of the policy or the assumption of the risk by the appellant insurer. Therefore, the Tribunal could not have answered issue No.3 against insurance company. He contended that the policy of insurance is a contract of insurance, which is like any other contract and it has to be construed strictly and in the instant case when the policy was issued from 02.08.2014 onwards and the accident in question occurred on 01.08.2014 at 3.00 p.m. the insurance company, not having assumed the risk, could not have been fastened with any liability in the instant case.
10. In support of his submission, he placed reliance on two judgments of the Hon’ble Supreme Court in the case of Oriental Insurance Co. Ltd., vs. Porselvi and Another reported in 2009(6) SCR 289 and M/s.
Industrial Promotion & Investment Corporation of Orissa Ltd., vs. New India Assurance Company Ltd., & Another reported in (2016) 15 SCC 315. He also placed reliance on a judgment of learned Single Judge of this Court in the case of The Divisional Manager, Oriental Insurance Co. Ltd., vs. Honnappa & Another [M.F.A. No.4070 of 2011 c/w. M.F.A. No.6866 of 2011] disposed off on 04.10.2016.
11. Learned counsel for the appellant insurer next contended that the compensation awarded on various heads is exorbitant, and therefore, the appeal would call for a reduction of the same. In this regard, he drew our attention to the details of compensation awarded at paragraph 38 and the discussion preceding it and contended that the deceased being a student and not an earning member, the compensation of Rs.16,20,000/- on the head of loss of dependency is on the higher side. He further submitted that the award of compensation of Rs.1,00,000/- on the head of loss of love and affection is also exorbitant, and therefore, the quantum of compensation may be reduced in this case.
12. Per contra, learned counsel for the respondent – claimants as well as respondents No.3 and 4 being the owners of the vehicle supported the judgment and award of the Tribunal and contended that the Tribunal has rightly fastened the liability on the insurance company and this is in consonance with the dictum of the Hon’ble Supreme Court in the case of Oriental Insurance Co. Ltd., vs. Dharam Chand and Others reported in 2010 ACJ 2659, wherein the Hon’ble Supreme Court has categorically stated that the insurance company cannot disown its liability on the ground that the accident took place before the commencement of insurance, when it has received the cheque or cash, as in the instant case, as the risk must be deemed to have been assumed from the time it has been received. Reliance is also placed on two other judgments of a co-ordinate Bench of this Court in the case of National Insurance Co. Ltd., vs. Bhadramma and Others reported in 2010 ACJ 1687 and The United India Insurance Co. Ltd., vs. B.S. Prasad & Another reported in 2011 (2) AIR Kar R 688 in support of their submission. Further reliance is also placed on another decision of a co-ordinate Bench of this Court in Zameer Ahamed vs. B.R. Narayana Shetty and another reported in 2012 ACJ 1322.
13. Learned counsel for the respondent – claimants further submitted that the award of compensation on various heads is neither unreasonable nor exorbitant; that no compensation is awarded on the head of loss of estate and hence the appeal would not call for any interference at the hands of this Court as it is devoid of any merit and the same may be dismissed.
14. Having heard learned counsel for the respective parties, the following points would arise for our consideration:
i) Whether the Tribunal was justified in fastening liability on the insurance company on the premise that it had assumed the risk in respect of the offending lorry in question?
ii) Whether the quantum of compensation awarded by the Tribunal calls for any modification?
iii) What order?
15. The respondent – claimants have established before the Tribunal that on 01.08.2014 at about 3.00 p.m., Crispin Hubert Maben who was riding motor cycle bearing Reg. No. KA-01/HF-8853 on 29th Main Road, B.T.M. 2nd stage, Bengaluru, died in a road traffic accident on account of the tipper lorry bearing Reg. No.TN-39-BZ-2469 hitting against the motor cycle from behind. However, the controversy is with regard to the fastening of the liability on the appellant – insurance company.
16. It is the case of the insurer that the policy was issued for the period from 02.08.2014 to 01.08.2015; that the risk commenced from mid-night of 02.08.2014 to mid- night of 01.08.2015, and therefore, in the absence of there being coverage of the risk of the offending vehicle, the liability could not have been fastened on the insurer. Ex.R-1 is the policy which has been issued in respect of the offending tipper lorry. Ex.R-2 is the Proposal Form wherein it has been stated that the policy commenced from 02.08.2014 10.00 a.m. to midnight on 01.08.2015. But, it is evident from Ex.R-2 that on 01.08.2014 cash of Rs.18,607/- had been received and no such timings were mentioned. Under such circumstances, the Hon’ble Supreme Court in the case of Dharam Chand (supra) has held that the insurance company cannot disown its liability, that, as and when the cheque or cash is received, the risk is deemed to have commenced from that time. In the said case premium cheque was received by the insurer on 07.05.1998 at 4.00 p.m. and the cover note was issued. The policy was to commence on the next date i.e., on 08.05.1998 up to 07.05.1999. Accident occurred at 8.30 p.m. on 07.05.1998. It was held that the coverage must be deemed to have commenced from the time when the cheque was received and hence the Hon’ble Supreme Court held that the Tribunal and High Court were right in fastening the liability on the insurer.
17. Similarly a co-ordinate Bench of this Court in the case of Bhadramma (supra) has noted that in the said case the premium was paid on 13.07.1994 and the policy was effective from 12.00 midnight of 13/14.07.1994 to midnight of 13.07.1995. The accident occurred at 11.15 a.m. on 13.07.1994. The co-ordinate Bench held that the insurance company cannot postpone the assumption of risk after receipt of premium otherwise it would be guilty of abetting use of vehicle in a public place without a policy which is prohibited by Section 146 of the Motor Vehicles Act, 1988. To the same effect are the judgments of two other co-ordinate Benches of this Court in the case of B. S. Prasad (supra) and Zameer Ahamed (supra), wherein it has been held that if the premium is paid, the insurance policy becomes effective upon receipt of premium and that the insurance company cannot postpone assumption of liability after receipt of premium on the pretext of verification of vehicle documents which should be done before receipt of premium. In the case of Zameer Ahamed, the judgment of the Hon’ble Supreme Court, in the case of Dharam Chand and another co-ordinate Bench of this Court in the case of Bhadramma referred to above have been followed.
18. As opposed to the aforesaid judgments, in the case of Porselvi (supra), it has been stated that if a time is mentioned in the policy then the insurance policy would be operative from that time and not from the previous midnight as was held in the case of New India Assurance Co. Ltd., vs. Ram Dayal & Others reported in (1990)2 SCC 680. That when a specific time is mentioned in the contract of insurance for assumption of the risk, it becomes a special contract and the policy becomes effective from the time mentioned, which is not so in the instant case, as no specific time for assumption of the risk was mentioned in Ex.R-2 the proposal form. Hence, the judgment in Dharam Chand’s case is applicable. M/s.Industrial Promotion & Investment Corporation of Orissa Ltd., is not apposite to the facts of the case at hand, as in the said case the question was whether a forcible entry was required for a claim to be allowed on the policy of burglary or house break. On the other hand, the observations of paragraph 11 of the Hon’ble Supreme Court in the said judgment to the effect that a contract of insurance being a contract of uberima fides, i.e., good faith on the part of the insured and the contract is likely to be construed contra proferentes, i.e., against the company in case of ambiguity or doubt, are relevant for the purpose of this case.
19. The Contra Proferentem Rule has an ancient genesis. When words are to be construed, resulting in two alternative interpretations then, the interpretation which is against the person using or drafting the words or expressions which have given rise to the difficulty in construction against the party, who has drafted them, applies. This Rule is often invoked while interpreting standard form contracts. Such contracts heavily comprise of forms with printed terms which are invariably used for the same kind of contracts, also such contracts are harshly worded against individuals and not read and understood most often, resulting in grave legal implications. When such standard form contracts ordinarily contain exception clauses, they are invariably construed contra proferentum against a person who has drafted the same.
20. In General Assurance Society Ltd., vs.
Chandmull Jain and another reported in AIR 1966 SC 1644, it has been held that where there is an ambiguity in the contract of insurance or doubt it has to be construed contra proferentem against the Insurance Company.
21. In Delhi Development Authority vs. Durga Chand Kaushish reported in AIR 1973 SC 2609, it has been observed that “in construing a document one must have regard, not to the presumed intention of the parties, but to the meaning of the words they have used. If two interpretations of the document are possible, the one which would give effect and meaning to all its parts should be adopted and for the purpose, the words creating uncertainty in the document can be ignored.”
22. Further, in Central Bank of India vs.
Hartford Fire Insurance Co. Ltd. reported in AIR 1965 SC 1288, it was held that “what is called the contra proferentem rule should be applied and as the policy was in a standard form contract prepared by the insurer alone, it should be interpreted in a way that would be favourable to the assured.”
23. In Md. Kamgarh Shah vs. Jagdish Chandra reported in AIR 1960 SC 953, it has been held that where there is an ambiguity it is the duty of the court to look at all the parts of the document to ascertain what was really intended by the parties. But even here the rule has to be borne in mind that the document being the grantor’s document it has to be interpreted strictly against him and in favour of the grantee.
24. Similarly we do not think that learned Single Judge was right in the case of Honnappa (supra) to hold that the risk had not been assumed especially having regard to the facts of that case which are similar to the facts of the present case. In the circumstances, point No.1 is answered against the appellant insurer and in favour of the respondents and the finding arrived at by the Tribunal is confirmed.
25. As far as the quantum of compensation awarded by the Tribunal is concerned, the details are as
5 Tuition fee paid Rs. 91,887.00 Total Rs. 19,57,950.00 26. Tribunal has taken into consideration the fact that the deceased was studying in V Semester of Bachelor of Hotel Management Course at Garden City College, North Bangalore; that he was a bright and meritorious student, but he was not an earning member. Therefore, notional monthly income of Rs.15,000/- has been taken into consideration; 50% has been deducted towards personal expenses of the deceased and the same has been converted into annual income and multiplier of ‘18’ has been applied and compensation of Rs.16,20,000/- towards ‘loss of dependency’ has been awarded. There is no separate calculation made with regard to loss of future prospects. If the same had been done so compensation on the head of dependency would increase.
27. On the head of loss of love and affection, deprivation of protection, social security to the parents of the deceased a sum of Rs.1,00,000/- has been awarded.
Having regard to the latest judgment of the Hon’ble Supreme Court in the case of Magma General Insurance Company Limited vs. Nanu Ram and Others, reported in 2018 ACJ 2782, on the head of loss of love and affection, loss of filial consortium a sum of Rs.40,000/- each could be awarded to the parents and hence the same would be Rs.80,000/-. But we do not wish to interfere with award of Rs.1,00,000/- on the said head as no calculation has been awarded towards future prospects.
28. Further the cost incurred towards the funeral expenses is assessed at Rs.15,000/-, medical expenses of Rs.1,36,063/- awarded by the Tribunal is confirmed. Tuition fee of Rs.91,887/- is also confirmed and loss of estate of Rs.15,000/- is awarded. In the circumstances, we do not find any good reason to interfere with the quantum of compensation awarded by the Tribunal. Thus, the total compensation assessed at Rs.19,57,950/- with interest at 6% per annum by the tribunal is confirmed.
29. In the result, the appeal filed by the insurance company is dismissed.
Parties to bear their respective costs.
The amount in deposit to be transmitted to the Tribunal.
Office to transmit the LCR to the Tribunal forthwith.
Sd/- JUDGE Sd/- JUDGE hnm