Vehicle Compensation in Grievous Injury Cases

In simple injury cases

In simple personal injury cases, the compensation will be awarded only for expenses relating to treatment etc, loss of earnings, and damages for pain and suffering.

In grievous injury cases, multiplier method to be used

Kerala High Court, in Oriental Insurance Co. Ltd. v Abdul Khader [ 2023 (6) KLT 591 ], says that in grievous injury cases coming under Section 163  of the Motor Vehicle Act, the Multiplier Method laid down in Sarla Verma judgement (2010 (2) KLT 802 (SC)), approved in Reshma Kumari case (2013 (2) KLT 304 (SC)) and reiterated by the Constitution Bench in Pranay Sethi judgement (2017 (4) KLT 662 (SC)), would be followed.

Other items in injury cases

In grievous injury cases and permanent disability, other items such as loss of future earning, future medical expenses, loss of amenities and loss of expectation in life can be added in arriving at just compensation when medical evidence corroborates with claimant’s evidence.

The principle of compensation in injury cases is that the award must be just. It means that compensation should, to the extent possible, fully, and adequately restore the claimant to the position prior to the accident. The object of awarding damages is to make good the loss suffered as a result of wrong done as far as money can do so, in a fair, reasonable and equitable manner.

The court or tribunal shall have to assess the damages objectively based on the nature of disability and its consequences. A person must be compensated for his inability to lead a full life, his inability to enjoy those normal amenities which he would have enjoyed but for the injuries, and his inability to earn as much as he used to earn or could have earned.

The SC, in Rajkumar case, reminds the tribunals that they should be mindful that a serious injury not only permanently imposes physical limitations and disabilities but too often inflicts deep mental and emotional scars upon the victim. The attendant trauma of the victim is having to live in a world entirely different from the one she or he is born into, as an invalid, and with degrees of dependence on others, robbed of complete personal choice or autonomy, should forever be in the judge’s mind, whenever tasked to adjudge compensation claims.

Principles in assessing future earnings in injury cases

The principles to be followed in assessing future earnings in injury cases are detailed in para 13 of the SC judgement in Rajkumar v Ajay Kumar [(2011)1 SCC 343] and they are as follows:

• All injuries (or permanent disabilities arising from injuries), do not result in loss of earning capacity.
• The percentage of permanent disability with reference to the whole body of a person, cannot be assumed to be the percentage of loss of earning capacity. To put it differently, the percentage of loss of earning capacity is not the same as the percentage of permanent disability (except in a few cases, where the Tribunal on the basis of evidence, concludes that percentage of loss of earning capacity is the same as percentage of permanent disability).
• The doctor who treated an injured-claimant or who examined him subsequently to assess the extent of his permanent disability can give evidence only in regard the extent of permanent disability. The loss of earning capacity is something that will have to be assessed by the Tribunal with reference to the evidence in entirety.
• The same permanent disability may result in different percentages of loss of earning capacity in different persons, depending upon the nature of profession, occupation or job, age, education and other factors.

A case study of a permanent disability case

An injured aged 30 years, earning Rs 3000/ per month with permanent disability of the limb of 60 per cent and consequential permanent disability to the person amounting to 30 per cent, assessed to have 15 per cent loss of earning as per evidence.

• Annual income before accident: Rs 36000/
• Loss of future earing per annum 15 per cent of prior income: Rs 5400/
• Multiplier as per Pranay Sethi case applicable with reference to age: 17
• Loss of future earning Rs 5400 X 17 = Rs 91, 800/-

The defence the insurance firms can raise

Insurance companies can defend the case on the following grounds:

• the vehicle is not under permit to ply on the date
• using the vehicle for a purpose not permitted
• Driving of vehicle by a person not licensed
• Policy itself is obtained by fraud or by providing false data
• The passenger is a gratuitous one, including a second pillion rider

Contributory negligence will result in reduction of amount

Negligence is failure of a person to take reasonable care. Negligence is of two types: composite negligence or contributory negligence.

Composite negligence is the negligence in which a third person gets injured without his own negligence but due to the negligence of the other persons and the inter se liability will be fixed proportionate to their contribution.

Negligence of the injured which contributed to the accident along with negligence of the other is contributory negligence. In contributory negligence one person gets injured due to his negligence and the negligence of another person and the compensation will be granted based on the per centage of their contribution of negligence. If the applicant’s contributory negligence is assessed as 50 per cent, then the amount of compensation for which he is entitled will be reduced to one-half of what is fairly assessed.

When a person is employed by a master, the master is responsible for paying compensation under vicarious liability.

Reference

1. Sarla Verma v Delhi Transport Corporation & Anr (2009) 6 SCC 121,
2. Reshma Kumari & Ors v Madan Mohan & Anr
3. National Insurance Co. Ltd. v Pranay Sethi & Ors (2017) 16 SCC 680
4. Bajaj Allianz General Insurance Company Pvt Ltd. v Union of India
5. Gohar Mohammed v UP State Road Transport Corporation [CA No 9322 of 2022 delivered on 15^th December 2022]
6. Rajkumar v Ajay Kumar [(2011)1 SCC 343]
7. General Manager, KSRTC, Trivandrum v Susamma Thomas (AIR 1994 SC 1631)
8. Motor Vehicle Act, 1988
9. Motor Vehicle (Amendment) Act, 2019

• The Central Motor Vehicles (Fifth Amendment) Rules, 2022: enforced since 1/4/2022
• New Forms prescribed by Motor Vehicle (Fifth Amendment) Rules 2022
• Solatium Fund Scheme, 1989, of the Government of India