NO FAULT LIABILITY UNDER MOTOR VEHICLES ACT, 1988

Sunanda Goyal

Himachal Pradesh National Law University, Shimla

Editor - Sakshi Soni

ABSTRACT

The Law of Torts takes centre stage in the battery of civil legal frameworks, in the manner it deals with injustices perpetrated by one person on another. It is founded on the main concept that an individual who caused misfortune to the other should pay damages to the victim. Tort is a Latin term, translated as: tortum meaning; twisted or wrong. Hence, a tort is a civil delinquency that creates a liability. [1]

The law of torts revolves around the notion of liability. Liability is a legal obligation of a person to acts or omissions which result in harming another. The law has over time identified different types of liability; one of which is the fiance-based liability, strict liability and the no-fault liability[2]. Even where in traditional tort law, fault or negligence had to be proven, in fact the modern legal system has come to adopt more and more no-fault means of providing immediate relief to victims, particularly when mass accidents and injuries in motor vehicles are involved. [3]

This change to no-fault liability in India was legally kept in the Motor Vehicles Act, 1988, which establishes compensation to road accident victims without fault consideration. The Act is a social welfare provision, which aims at not leaving the victim or the families without compensations as a consequence of the procedural or evidentiary obstacles in proving negligence. [4]

The aim of the project is to study the phenomenon of no-fault liability and tort law and its historical evolution, its introduction in Indian legislation, especially in the Motor Vehicles Act, 1988, and the understanding of that concept in Indian courts.

KEY WORDS: Liability, No Fault Liability, Compensation, victim, negligence, compensate

THE NO FAULT LIABILITY CONCEPT

  No-fault liability refers to a situation where the victim of a given accident should be compensated regardless of the party at fault. The claimant does not have to demonstrate negligence about the part of the defendant (owner, company or driver). [5]

A party is in a position to be liable even when it has exercised due care and caution and the injury or harm has not been caused by any wrong or negligence or default. [6]

The primary objective is to make sure that victims will get immediate compensations involving the injury, death, or damaged property without undergoing long and convoluted paths of proving negligence.[7]

NO FAULT LIABILITY UNDER MOTOR VEHICLES ACT,1988

 In No Fault Liability, the victim of a motor vehicle accident or his or her legal representatives can claim compensation without having to convince that any fault or negligence was committed by the owner or driver of the vehicle. This principle is especially important when it may be intricate to ascertain the fault or when the victim may be partially faulty.

Chapter X (Sections 140-144) of the Motor Vehicles Act, 1988, the successor of the 1939 Act, was in the form of Liability without fault in certain cases[8].

Ø  SECTION 140 OF MOTOR VEHICLES ACT READS AS:

(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 vehicle 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) shall be a fixed sum of— 

(a) fifty thousand rupees in case of death; and 

(b) twenty-five thousand rupees in case of permanent disablement. 

(3) In any claim for compensation under sub-section (1), the claimant shall not be required to plead or establish that the death or permanent disablement was due to any wrongful act, neglect, or default of the owner or any other person. 

(4) A claim for compensation under sub-section (1) shall not be defeated by reason of any wrongful act, neglect, or default of the person in respect of whose death or disablement the claim has been made. 

(5) The payment of compensation under this section shall be made in such manner as may be prescribed.[9]

Firstly, the compensation set in the Act is ₹ 50,000 for death and ₹ 25,000 for permanent disablement. These amounts were raised with new amendments and court suggestions. Recent changes, especially the Motor Vehicles (Amendment) Act, 2019, have increased compensation for different cases, such as hit-and-run accidents, to ₹ 5 lakh for death and ₹ 2.5 lakh for serious injury. Even though Section 140 does not specify fixed amounts, courts often see these figures as interim or minimum relief rather than full compensation. 

To successfully claim under Section 140, the claimant must show that:

- An accident occurred.

- The accident happened because of the use of the motor vehicle.

- It resulted in death or permanent disability.

- There is no need for additional proof of negligence, intention, or breach of duty.

Ø  Section 141: Provisions as to other right to claim compensation for death or permanent disablement.—

(1) The right to claim compensation under section 140 in respect of death or permanent disablement of any person shall be in addition to 1 [any other right, except the right to claim under the scheme referred to in section 163A (such other right hereafter] in this section referred to as the right on the principle of fault) to claim compensation in respect thereof under any other provision of this Act or of any other law for the time being in force. 

(2) A claim for compensation under section 140 in respect of death or permanent disablement of any person shall be disposed of as expeditiously as possible and where compensation is claimed in respect of such death or permanent disablement under section 140 and also in pursuance of any right on the principle of fault, the claim for compensation under section 140 shall be disposed of as aforesaid in the first place. 

(3) Notwithstanding anything contained in sub-section (1), where in respect of the death or permanent disablement of any person, the person liable to pay compensation under section 140 is also liable to pay compensation in accordance with the right on the principle of fault, the person so liable shall pay the first-mentioned compensation and— (a) if the amount of the first-mentioned compensation is less than the amount of the second-mentioned compensation, he shall be liable to pay (in addition to the first-mentioned compensation) only so much of the second-mentioned compensation as is equal to the amount by which it exceeds the first-mentioned compensation; (b) if the amount of the first-mentioned compensation is equal to or more than the amount of the second-mentioned compensation, he shall not be liable to pay the second-mentioned compensation.[10]

Section 141 allows a claimant to receive quick, fixed compensation under the no-fault rule while still seeking higher compensation under the fault-based rule. This approach provides immediate relief and aims for complete justice. It also ensures that when someone claims compensation under no-fault liability (Section 140), they still have the right to seek additional compensation under the fault-based provisions (Section 166) of the Act. Courts have repeatedly stressed that Section 141 safeguards the claimant’s right to pursue both types of compensation. It makes clear that the no-fault amount is temporary, not final, and promotes prompt justice for accident victims.

Ø  Section 142: Permanent disablement.—

For the purposes of this Chapter, permanent disablement of a person

shall be deemed to have resulted from an accident of the nature referred to in sub-section (1) of

section 140 if such person has suffered by reason of the accident, any injury or injuries involving—

(a) permanent privation of the sight of either eye or the hearing of either ear, or privation of any

member or joint; or

(b) destruction or permanent impairing of the powers of any member or joint; or

(c) permanent disfiguration of the head or face.[11]

According to this part, one is declared to be permanently disabled when he/she is hurt due to an accident involving the use of a motor vehicle that causes injury rendering him/her unable to perform some activity. 

·       Sight or Hearing loss- irreversible loss of one eye or ear;

·       Failure or injury to a limb or a joint, failure or removal of which the arm, leg, or any other joint, is incapacitated;

·       Disfigurement permanent- head; or face; or.

·       Any damages that are irreversible in the normal functioning of an organ of the body or earning capacity of the individual. 

The principal Objective is to give the term permanent disablement a distinct legal definition and enable the victims of a serious and enduring injury to have an immediate and just compensation (Section 140) in the scheme of no-fault liability. Section 142 in Simple Terms is a reassurance that everyone who has suffered a severe and irreversible physical loss or injury due to a motor accident is permanently disabled and might be compensated without any requirement to demonstrate fault or negligence.

Ø  Section 143: Applicability of Chapter to certain claims under Act 8 of 1923.—

The provisions of this Chapter shall also apply in relation to any claim for compensation in respect of death or permanent disablement of any person under the Workmen’s Compensation Act, 1923 resulting from an accident of the nature referred to in sub-section (1) of section 140 and for this purpose, the said provisions shall, with necessary modifications, be deemed to form part of that Act.[12]

2. Section 143 states that Chapter X in under the Motor Vehicles Act (contemplating the topic of Liability without Fault in Certain Cases) shall also be applied to the cases of hit-and-run cases of motor accidents as specified in Section 161 of the Act. 

They Simple apply the same principle of no fault to the normal road accidents is also to be applied to the hit and run accidents, where the vehicle or the driver who committed the crime cannot be identified or tracked down. 

This part will include the victims of the hit and run accidents or their family that will not be compensated simply because the vehicle in question has eloped or has been misplaced. 

Section 161 also permits the compensation to be paid out of special Solatium Fund which was formed by the government on behalf of the victims of hit and run.

This compensation scheme is linked to the Chapter X in section 143 that states that there is no need of an evidence of fault.

The principal Intention was to bring about homogeneity and social equity to the compensation of every victims of road-accidents.

Ø  Section 144: Overriding effect.—

The provisions of this Chapter shall have effect notwithstanding anything contained in any other provision of this Act or of any other law for the time being in force.

In short, section 144 can be treated as a protective barrier to the victims of the accidents providing the liability principle of no-fault role with the absolute legal authority.

It guarantees the superiority of Chapter X to any other rule, contract or policy and the statutory compensation is binding and enforceable.

CASE ANALYSIS: 

• Gujarat State Road Transport Corporation v. Ramanbhai Prabhatbhai, A.I.R. 1987 S.C. 1690 

The court held that “Section 92-A creates a new liability not founded on fault. It provides that the owner of the vehicle shall be liable to pay compensation in certain cases of death or permanent disablement, whether or not there has been any wrongful act, neglect, or default.”

 The term “legal representative” in Section 110-A of the Motor Vehicles Act, 1939 must receive a broad and liberal interpretation, not a narrow one. 

Accordingly, even persons who are not legal heirs or dependants in the strict sense (such as brothers or sisters) may be treated as legal representatives for the purpose of claiming compensation under the Act. [13]

This judgment broadened the scope of beneficiaries under the no-fault liability regime to include pedestrians and third parties. It reaffirmed that the Motor Vehicles Act is a social welfare legislation and must be interpreted liberally. It laid the conceptual foundation for Chapter X of the Motor Vehicles Act, 1988, which includes Sections 140–144. 

• Kaushnuma Begum v. New India Assurance Co. Ltd., (2001) 2 S.C.C.  

The court laid down that “The principle of no-fault liability under Section 140 of the Motor Vehicles Act, 1988, is based on the doctrine of strict liability. It is independent of fault and intended to provide immediate relief to victims of road accidents.”[14] 

The Supreme Court took a progressive and humanitarian approach, holding that: 

“Even if there is no negligence, the owner and insurer of a motor vehicle are liable to pay compensation when its use causes death or injury.” [15]

This decision harmonized common-law strict liability with statutory no-fault provisions, ensuring that justice and relief reach victims quickly and fairly, thereby advancing the social welfare purpose of the Motor Vehicles Act, 1988. 

CONCLUSION: 

The chapter X of the Motor Vehicles Act, 1988 is a landmark in the development of the Indian accident-compensation law as it will change the system that was founded on negligence, shifting to a social-welfare-based provision. 

Nevertheless, the philosophy of justice, and the principles of humanity behind it are praiseworthy, the actual process of its execution is unsatisfactory because it involves small payments and bureaucratic barriers. 

India needs to empower, update, and broaden the application of Chapter X to actually be able to realise its constitutional promise of social justice to all people, and on the ground that no-fault liability is not just a legal theory, but a working tool of compassion and justice. 

References

[1] W.V.H. Rogers, Winfield & Jolowicz on Tort 1–3 (19th ed. 2014).

[2] Ratanlal & Dhirajlal, The Law of Torts 23–26 (28th ed. 2016).

[3] P.S. Atiyah, Accidents, Compensation and the Law 12–15 (7th ed. 2006).

[4] Motor Vehicles Act, No. 59 of 1988, pmbl., India Code (1988).

[5] Black’s Law Dictionary 1148 (11th ed. 2019).

[6] Rylands v. Fletcher, (1868) L.R. 3 H.L. 330 (H.L.).

[7] Atiyah, supra note 3, at 45.

[8] Gujarat State Road Transp. Corp. v. Ramanbhai Prabhatbhai, A.I.R. 1987 S.C. 1690.

[9] Motor Vehicles Act § 140 (1988).

[10] Motor Vehicles Act § 141 (1988).

[11] Motor Vehicles Act § 142 (1988).

[12] Motor Vehicles Act § 143(1988).

[13] Gujarat State Road Transp. Corp. v. Ramanbhai Prabhatbhai, A.I.R. 1987 S.C. 1690.

[14] Kaushnuma Begum v. New India Assurance Co. Ltd., (2001) 2 S.C.C. 9.

[15] Kaushnuma Begum v. New India Assurance Co. Ltd., (2001) 2 S.C.C. 9.