Madras High Court Denies Compensation Claim in Motor Accident Case
Borrower of Vehicle Deemed as Owner, Ineligible for Insurance Compensation
In a significant judgment, the Madras High Court's Madurai Bench has quashed the compensation awarded to the family of a deceased man involved in a motor accident, ruling that a borrower of a vehicle cannot claim insurance as a third party. The decision came in the case of New India Assurance Company Limited versus Annalakshmi and others, where the court held that the deceased, who borrowed the vehicle from his brother, stepped into the shoes of the owner and was not entitled to claim compensation under Section 163-A of the Motor Vehicles Act, 1988.
The case revolved around an accident on February 23, 2009, involving a Toyota Qualis driven by the deceased, Rajasekar. The vehicle capsized on the Sankarankoil-Kovilpatti Main Road, resulting in fatal injuries to Rajasekar. His family filed a claim petition for compensation, asserting that the deceased was the sole breadwinner. However, the insurance company contested the claim, arguing that the deceased's negligent driving caused the accident and that he was not a third party.
The tribunal initially awarded a compensation of Rs. 3,93,500, but the insurance company appealed the decision. The High Court, referencing the Supreme Court's ruling in Ramkhiladi v. United India Insurance Company, emphasized that a borrower or permissive user of a vehicle is not considered a third party and is ineligible for compensation from the insurer of the borrowed vehicle.
Justice R. Poornima, presiding over the case, stated that the deceased, by borrowing the vehicle, assumed the role of the owner and was responsible for the negligent driving. The court further noted that the deceased was not a paid driver or third party under Section 147 of the Motor Vehicles Act, thus exempting the insurance company from liability.
This ruling underscores the legal interpretation that individuals borrowing vehicles cannot claim compensation under third-party insurance policies, reinforcing the precedent that only third parties, not owners or borrowers, are eligible for such claims.
Bottom Line:
Under Section 163-A of the Motor Vehicles Act, a borrower or permissive user of a vehicle cannot claim compensation from the insurer of the borrowed vehicle as they step into the shoes of the owner and cannot be considered a third party.
Statutory provision(s): Motor Vehicles Act, 1988 Sections 163-A, 147
