MEMORANDAM BEHALF ON OF THE RESPONDANT

SNBP LAW COLLEGE 3 rd INTERNAL MOOT COURT 2021

SNBP LAW COLLEGE

(AFFILITED TO SAVITRIBAI PHULE UNIVERSITY PUNE)

3 rd INTERNAL MOOT COURT 2021

SUBMITTED BY
ROHINI NAGNATH PATIL

MEMORANDUM ON BEHALF OF PETITIONER

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IN THE MATTER OF

L & T Insurance Company ..... PETITIONER

V/S

Mrs. Madhuri W/f Mr. Sudhir …….RESPONDENT

Mr. Rahul …….RESPONDENT

Mr. Ram …….RESPONDENT

Appeal in MFA No. 111/2020

________________________________________________________________________
PETITION UNDER THE MOTOR VEHICLE ACT 1988
Contains 217 Sections and 2 Schedules

________________________________________________________________________

MEMORANDUM ON BEHALF OF PETITIONER

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TABLE OF CONTENTS

1 INDEX OF AUTHORITIES

1.1 List of Statutes

1.2 List of cases

1.3 List of websites

1.4 List of Abbrivation

2 STATEMENT OF JURISDICTION

3 STATEMENT OF FACTS

4 STATEMENT OF ISSUES

5 SUMMERY OF ARGUMENTS

6 ARGUMENTS ADVANCED

7 THE PRAYER

INDEX OF AUTHORITIES

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 STATUTES
1. Motor Vehicle Act 1988

The Act contains 217 sections and 2 schedules.

The act provides compensation for the victims in a road accident, in case of
death and grievous injury.

It provides for the establishment of a Road Safety Board.

It provides the establishment of Motor Accidents Claims Tribunal for speedy

disposal of the claim cases in case of death or injury in a roadside accident.

It imposes fines and penalties in case of drink and drive.

It also provides for the recall of vehicles.

Relevant Case Laws :-

G. Govindan v New India Assurance Co. Ltd, it was held that Insurance Policy is
mandatory for every vehicle in India under the Motor Vehicle Act, 1988. 
National Insurance Company Limited v Pranay Sethi, the Supreme Court laid down
guidelines for assessing compensation

 WEBSITES REFERRED
1. www.livelaw.in
2. www.scconline.com
3. https://www.downtoearth.org.in
4. https://www.livemint.com
5. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6427124/
6. https://www.greengrowthknowledge.org/
7. www.indiankanoon.org
8. www.ifpri.org
9. http://www.aqi.in

LIST OF ABBREVIATION

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vs Versus

SC Supreme Court

u/s under section

u/a under article

etc etcetera

sec Section

Art Article

Ipc
Indian Penal Code 1860
SCR Supreme Court Report

ILI Indian Law Institute

Anr Another

Ors Others

ILR Indian Law Report

AIR All India Report

STATEMENT OF JURISDICTION

Motor Vehicle Act, 1988: 

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Motor Vehicles Act, 1988 is an inclusive act and was enacted on 1st July 1989. It has
replaced the Motor Vehicle Act, 1939. The very first act to govern road transport carriers was
the Motor Vehicles Act, 1914. With the change in socio-economic needs, the need to
introduce new law was felt and led to the enactment of the Motor Vehicles Act, 1988, and
was amended in the year 2019

Insurance Policy under the Motor Vehicle Act:

Section 145 to 164 deals with the insurance of motor vehicles against third party risk. This is
also called third party liability where the insurance company indemnifies the insured person
when the insured person is sued or is held liable for damages against the third person. In
Government national insurance Company Vs Fakir Chand, it was held that the third parties
include any person walking on the road, travelling in another vehicle, or is a passenger in the
vehicle that has been insured.

STATEMENT OF FACTS

Facts of the Case

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The Government of India declared on 24th March 2020, a complete Lock down
throughout Indiana due to spreading of Corona Virus. On 28th March 2020 Mr. Rahul
S/o of Mr. Suresh, the owner of the Mini Bus bearing No. MH ST1000, was going in
his bus to his native place at Maharajya .The Bus was driven by his driver Mr. Ram.
Though such movement during Lockdown period was restricted Mr. Rahul wanted to
visit his sick mother so, he was traveling. On the way, the police, on duty prevented
his bus, but Mr.Rahul along with his driver escaped. On the same day, in a nearby
village a person Mr. Sudhir tested Corona positive, as it was lockdown period there
was no transport facility in the village, the local Doctors and police were unable to
arrange vehicle to shift the patient to the nearby Government Hospital, at that time,
when they were looking for any vehicle, they found the vehicle of Mr. Rahul, who
was travelling in his mini bus, was going on the same route. In this emergency
situation the said mini bus was intercepted forcibly and the vehicle was used for
shifting Corona infected patient. Mr. Rahul was also forced to travel with the
infected patient. While carrying the patient, the vehicle met with an accident due to
rash and negligent driving of Mr.Ram and the corona patient died on the spot on
28th March 2020..

The MVC No 22/20 was filed seeking compensation by Mrs. Madhuri wife of Mr.
Sudhir against Mr. Rahul, Mr. Ram & I&T insurance Company, before the
Maharajya MACT. After registering the cases, summons was issued, after
appearance, I&T insurance company filed written statement denying liability,
while admitting the fact that the driver had effective driving license and the policy
was in force, but denied liability on the ground that the vehicle was illegally
moving on the road which was not permitted to move during the Lock Down
period that amounts to violation of terms and conditions of the insurance
contract. Mr. Rahul and Mr. Ram in their written statement admitted the accident
and contended that the policy was in force and there was a valid driving license.
Further the Government used the Vehicle for shifting of Mr. Sudhir, a corona
patient. Hence, I&T insurance company is liable to pay compensation. After
conclusion of hearing, the MACT, Maharajya, awarded compensation of Rs.

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5,00,000/- but fixed liability on the I&T insurance company by Judgment and
award dated 01st June 2020. Being aggrieved by the same, the I&T insurance
company preferred the appeal in MFA No : 111/2020 before the Hon’able High
Court, Maharajya ,against Mrs. Madhuri w/f of Mr. Sudhir, Mr. Rahul and Mr.
Ram as respondent No :1, 2 and 3 respectively in MFA No : 111/2020. Therefore
the High Court is considering the question, “Whether the I&T insurance company
shall be absolved from liability to pay compensation as Mr. Rahul and Mr, Ram
took the Mini bus to the road during Lockdown period without permission even
though the Government used the mini Bus to shift Mr. Sudhir ,a corona patient,
to the hospital.

STATEMENT OF ISSUES

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1) Above Accident Case Create a Vicarious Liability and also Government Servant
Liable For Late Sudhir Accident Death ?

2) Mrs. Madhuri w/o Mr. Sudhir Rs. 500000/- Very much Reasonable
Compensation From L & T Insurance Company.

3) u/s 140. Liability to pay compensation in certain cases on the principle of no

Fault

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SUMMARY OF ARGUEMENTS
1) Above Accident Case Create a Vicarious Liability and also Government Servant
Liable For Late Sudhir Accident Death ?

It is humbly submitted before the Hon’ble court that In an ordinary motor vehicle accident
case, the plaintiff is generally the driver who believes that he or she was injured by
the defendant, another driver. However, when the defendant driver is a professional
driver or even just a person who was driving at that moment as part of his or her job
duties, the case is likely to take on more complexity, because it is possible to bring
the employer into the lawsuit along with the driver as defendants.

The legal doctrine that sometimes would allow an employer to be brought into the
lawsuit is called Respondeat Superior, or vicarious liability. The idea behind the
doctrine is that the employer may be held responsible for the wrongful acts of its
agent. Now, this doctrine does not apply in every situation, just as intuition would
lead one to believe that in some instances that would not be fair to the employer.
Generally, the threshold question for whether it is allowable to bring the employer
into the lawsuit is whether or not the driver was acting in the course of performing his
or her job.

1) Mr. Rahul S/o of Mr. Suresh, the owner of the Mini Bus bearing No. MH ST1000,
was going in his bus to his native place at Maharajya .The Bus was driven by his
driver Mr. Ram. Though such movement during Lockdown period was restricted On
the way, the police, on duty prevented his bus, But Mr.Rahul along with his Driver
escaped. And there Breach of Lock down Rules Above Accident Case Create a
Vicarious Liability .

On the same day, in a nearby village a person Mr. Sudhir tested Corona positive, as it was
lockdown period there was no transport facility in the village, the Local Doctors and Police
were unable to arrange vehicle to shift the patient to the nearby Government Hospital, at
that time, when they were looking for any vehicle, they found the vehicle of Mr. Rahul, who
was travelling in his mini bus, was going on the same route. In this emergency situation the
said mini bus was intercepted forcibly and the vehicle was used for shifting Corona infected
patient. Mr. Rahul was also forced to travel with the infected patient. While carrying the
patient, the vehicle met with an accident due to rash and negligent driving of Mr. Ram and
the Corona Patient died on the spot on 28th March 2020.

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1) Mrs. Madhuri w/o Mr. Sudhir Rs. 500000/- Very much Reasonable
Compensation From L & T Insurance Company.

The Commission has, therefore, suggested that a new provision shouldbe inserted in Chapter
VIII of the Motor Vehicles Act, 1988 providing that in"claim cases", the claimant third party
shall not be required to plead and establish that the injury or damage suffered by him was the
result of wrongful actor neglect or default in the use of the vehicle, and further the claim for
compensation shall not be defeated or reduced by reason merely of any wrongful act,neglect
or default of the party suffering injury or damage. The Commission hastaken advantage of
this opportunity for suggesting other amendments for securing speedy disposal of claim
cases, for early payment of the amount of compensation awarded, for restricting the right of
appeal against an award only to those caseswhere the amount in dispute in appeal exceeds Rs.
5,000, for award of interest on the compensation amount and placing a monetary limit on the
liability of the insurer. Some other amendments have also been suggested. They are of a
minor nature. All these amendments have been fully explained in the Report.

 u/s.140. Liability to pay compensation in certain cases on the principle of no fault

(1) Where death or permanent disablement of any person has resulted from an accident
arising out of the use of a motor vehicle or motor vehicles, the owner of the vehicles
shall, or, as the case may be, the owners of the vehicles shall, jointly and severally, be
liable to pay compensation in respect of such death or disablement in accordance with the
provisions of this section.
(2) The amount of compensation which shall be payable under sub-section (1) in respect
of the death of any person shall be a fixed sum of fifty thousand rupees and the amount of
compensation payable under that sub-section in respect of the permanent disablement of
any person shall be a fixed sum of twenty - five thousand rupees.
(3) In any claim for compensation under sub-section (1), the claimant shall not be
required to plead and establish that the death or permanent disablement in respect of
which the claim has been made was due to any wrongful act, neglect or default of the
owner or owners of the vehicle or vehicles concerned or of any other person.
(4) A claim for compensation under subsection (1) shall not be defeated by reason of any
wrongful act, neglect or default of the person in respect of whose death or permanent
disablement the claim has been made nor shall the quantum of compensation recoverable
in respect of such death or permanent disablement be reduced on the basis of the share of
such person in the responsibility for such death or permanent disablement.

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* 163 - A. Special provisions as to payment of compensation on structured formula basis

-

Notwithstanding anything contained in this Act or in any other law for the time being in
force or instrument having the force of law, the owner of the motor vehicle of the
authorised insurer shall be liable to pay in the case of death or permanent disablement due
to accident arising out of the use of motor vehicle compensation, as indicated in the
Second Schedule, to the legal heirs or the victim, as the case may be.

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ARGUMENTS ADVANCE

A. Introduction to Third Party Insurance terms

Insurance is a contract whereby one party agrees to compensate the

loss or discharge the liability of another person. And in case of motor insurance in
India, this also includes the loss suffered by third person. Motor insurance and all
third-party rights and liabilities with respect to it are covered by Motor Vehicle Act
1988, in India. Part XI of the Acti.e. Insurance of motor vehicle against third party
risks (from section 145 to 164), solely deals with provisions related to third party.
Apart from the said Act, the Insurance Act, 1938 via its section 32-D creates
obligation of insurer in respect of insurance business in third party risks of motor
vehicles.

It is a mandate, provided by legislature under section 146, to not to use any vehicle
in public place without any valid third-party insurance. As the following law suggests,
that, drivers must carry at least a minimum of bodily injury liability and property
damages liability coverage, causing third party insurance as a mandate for all motor
vehicle. In Govindan v. New India Assurance Co. Lt 1, it was stated that third party
insurance is compulsory under the law should not be overridden by any clause in the
policy. Having said that, there are two types of policies in motor insurance sector.
One is first party and other is known as third party. India has a mandate regarding
the later one. And these third-party policies are beneficial to both insured person and
third parties.

Duty to Compensate – In the event when claims are made, losses should be
minimised. These includes segregation of damaged property from rest of the
property, obtaining competitive quotes for the repairs/ replacements that may be
required etc. If third party is found guilty of losses/ damages, then should be held
responsible so that rights of recovery are protected.

2. Definitions.—In this Act, unless the context otherwise requires,

“Driver” includes, in relation to a motor vehicle which is drawn by another motor vehicle,
the person who acts as a steersman of the drawn vehicle;

“Driving licence” means the licence issued by a competent authority under Chapter II
authorising the person specified therein to drive, otherwise than as a learner, a motor
vehicle or a motor vehicle of any specified class or description.

“Owner” means a person in whose name a motor vehicle stands registered, and where such
person is a minor, the guardian of such minor, and in relation to a motor vehicle which is the
subject of a hire-purchase, agreement, or an agreement of lease or an agreement of
hypothecation, the person in possession of the vehicle under that agreement;

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Transfer of right of insured, against insurer, to third party 13

>
Generally, the liability raised against insurer by third party in relation to an event
which is secured by way of insurance policy by insurer will be fulfilled by insurer.
However, in case of insolvency of insured person, his rights against insurer under
the policy shall be transferred to and vest in the third party to whom liability was so
incurred. Any condition in insurance policy which directly or indirectly alters the right
to transfer shall be of no effect. Upon transfer of rights, insurer will be in same
position to fulfil the liability incurred to third party as he would have been to insured
person. In case where the liability raised is more than the liability of insured person
to third party, insured party has to pay the balance to third party.

Liability of Insurer towards Third Party– As per section 147(2) of Motor Vehicle
Act, policies shall cover any liability in respect of any accident up to the limit of
amount of liability incurred and a limit of rupees six thousand, in case of damage to
any property of third party. In Bhoopathy v. Vijayalakshmi14the Madras High Court
is of opinion that no bar is to be imposed as to when the liability of insurer ceases to
exist i.e. it is void. It was the case of fracture of wrist, caused due to motor accident
in which plaintiff was dashed against and injuries were sustained. Event took place
on 4th December 1958, where car originally belonged to second defendant, which
was sold to first defendant on 11 August 1958. The insurance policy of second
defendant covered him till 12 September 1958. Thereupon the first defendant applies
to another policy and starts paying premiums. The Court held that when the vehicle
was transferred, insurance policy collapsed. And insurance company of second
defendant was not liable for paying the damages. In National Insurance Co. Ltd. v.
Swaran Singh15,  The Apex Court observed:

"The liability of insurer is statutory one. The liability of insurer to satisfy the decree
passed in favour of third party is also statutory. The insurance company cannot
shake off its liability to pay compensation only by saying that at the relevant
point of time the vehicle was driven by a person having no licence."

151. Duty to give information as to insurance.—

(1) No person against whom a claim is made in respect of any liability referred to in clause
(b) of sub-section (1) of section 147 shall on demand by or on behalf of the person making
the claim refuse to state whether or not he was insured in respect of that liability by any
policy issued under the provisions of this Chapter, or would have been so insured if the
insurer had not avoided or cancelled the policy, nor shall he refuse, if he was or would have
been so insured, to give such particulars with respect to that policy as were specified in the
certificate of insurance issued in respect thereof.

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PRAYER

Wherefore, in light of the issues raised, arguments advanced and authorities cited, may
this Hon‘ble Court be pleased to adjudge and declare that:

1. u/s.140. Liability to pay compensation in certain cases on the principle

of no fault Compantions Benefits of a insured are always paid by his
own insurance company.

2. Order Actually Pass may deem fit, in the interest of Justice, Equity and
Good Conscience.

All of which is most humbly and respectfully submitted.

Date:14/03/2021 Counsel For Respondent

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