1991 (3) TMI 393 - HC - Indian Laws

Summary

Issues Involved:
1. Liability of the insurer to pay compensation.
2. Validity of the transfer of vehicle ownership.
3. Validity of the driver's license.
4. Burden of proof regarding breach of insurance terms.
5. Competence of cross objections by claimants.

Issue-wise Detailed Analysis:

1. Liability of the Insurer to Pay Compensation:
The insurer, United India Insurance Co. Ltd., appealed against the Motor Accidents Claims Tribunal's award of Rs. 55,000 to the claimants (heirs of the deceased). The insurer argued that they were not liable to pay compensation because the vehicle's ownership had allegedly transferred to respondent No. 8, who was not covered by the insurance policy. The Tribunal found that the driver caused the death by rash and negligent driving, and the vehicle was driven by respondent No. 10, not respondent No. 8. It also held that the insurance policy covered respondent No. 9, who was still the owner of the vehicle at the time of the accident, making the insurer liable to indemnify the claim.

2. Validity of the Transfer of Vehicle Ownership:
The document Ext. R4 was examined to determine if it effected a transfer of ownership from respondent No. 9 to respondent No. 8. The court concluded that Ext. R4 was an agreement to sell rather than an immediate transfer of ownership. The agreement stipulated that the ownership would transfer only after the full payment of the vehicle's price and execution of requisite documents. Since these conditions were not fulfilled, the ownership did not pass to respondent No. 8, and respondent No. 9 remained the owner on the date of the accident.

3. Validity of the Driver's License:
The insurer contended that the vehicle was driven by an unlicensed driver, constituting a breach of the insurance policy. However, there was a controversy about whether respondent No. 8 or respondent No. 10 was driving the vehicle. The court found no evidence proving that the driver did not hold a valid license. Consequently, it could not be held that the vehicle was driven by an unlicensed driver.

4. Burden of Proof Regarding Breach of Insurance Terms:
The court emphasized that the burden of proving a fact that excludes the insurer's liability lies on the insurer. The insurer must prove the existence of facts upon which their legal right to be exonerated depends. In this case, the insurer failed to provide evidence that the vehicle was driven by an unlicensed driver. Therefore, the insurer did not meet the burden of proof required to exclude their liability.

5. Competence of Cross Objections by Claimants:
The claimants filed cross-objections to the appeal. The court held that the claimants, who are indemnified by the insurer, are not entitled to maintain cross-objections in an appeal by a party who is a mere indemnifier. Thus, the cross-objections by the claimants were deemed incompetent.

Conclusion:
The appeal by the insurer was dismissed with costs, and the cross-objections by the claimants were also dismissed, but without any order as to costs.