S.163A MV Act | Borrower Of Vehicle Can't Claim Compensation From Insurer In Absence Of Personal Accident Coverage: Kerala HC

The Kerala High Court on Friday held that compensation could not be awarded to the heirs of the deceased, who 'stepped into the shoes of the owner', by borrowing the vehicle and whose rash and negligent driving brought about his own death.

Justice Sophy Thomas, while setting aside the order of the Motor Accident Tribunal granting compensation to the heirs of the deceased, observed,

"Since he himself was the tortfeasor, his legal heirs cannot maintain a claim against himself who stepped into the shoes of the owner".

The deceased in the instant case had been involved in a road accident on 19th February 2007. He had been driving a motorcycle owned by the 5th respondent herein. It was on seeing a bus from the opposite direction, that he swerved the vehicle and met with his death.

When the legal heirs of the deceased (the claimants/respondents 1-4 herein) approached the Motor Accidents Claims Tribunal, Alappuzha, claiming compensation under Section 163A of the Motor Vehicles Amendment Act, 1994 read with Rule 371 of the Kerala Motor Vehicles Rules, 1989, the Tribunal awarded compensation of Rs.3,41,802/-. Hence, the instant appeal.

On behalf of the appellants, it was contended by Advocates Lal George and Lakshmi V. Parameswaran that since the accident had occurred due to the negligence of the deceased himself and he was the tortfeasor, no compensation ought to be provided to the legal heirs under Section 163 MV Act. It was assailed by the counsels that the deceased himself had 'stepped into the shoes of the owner' upon borrowing the vehicle, and hence could not be regarded as a third party.

The Court in the instant case relied upon the position in Ramkhiladi & Anr. v. United India Insurance Company & Anr (2020), whereby the Apex Court held a claim under Section 163A of the Motor Vehicles Act is not maintainable against the owner and insurance company of the vehicle which was being driven by the deceased himself.

In this light, the Court has observed in the instant case, 

"The owner of the vehicle or his legal representative or the borrower of the vehicle cannot raise a claim for compensation from the insurer of that vehicle as he is not a third party".

The Court found that the owner of the vehicle and the insurer are the parties privy to contract of insurance, and that had the contract of insurance specifically provided for the personal accident cover of the owner, the insurer would be liable. 

However, in this case, although the existence of the insurance policy is an undisputed fact, the Court found that it could not be ascertained as to whether there was personal accident coverage for the owner. 

"If the insurance policy had personal coverage for the owner of the offending vehicle, the Company is liable to the extent of that coverage. But, since the appellant or the respondents failed to produce the insurance policy of the offending motorcycle, this Court is unable to fix the compensation, if any, payable to the legal heirs of the deceased who stepped into the shoes of the owner".

It was in this light and on noting that the deceased was himself the tortfeasor who had put himself in the shoes of the owner, that the Court allowed the appeal and set aside the award of the Tribunal. 

Case Title: The New India Insurance Co. Ltd. v. Rajeswari & Ors. 

Citation: 2022 LiveLaw (Ker) 500

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