Motor Accidents Claims: Supreme Court Accepts Dependent Mother-In-Law As Legal Representative Entitled To Claim Compensation

A Bench of the Supreme Court comprising Justice S. Abdul Nazeer and Justice Krishna Murari has held that a Motor Accident Claim Petition filed by a dependent mother-in-law is maintainable and she can claim the compensation. The Court has held that every legal representative who suffers on account of the death of a person in a motor vehicle accident should have a remedy for realization of compensation.

The Bench ruled thus while observing that the mother-in-law can file the petition as she was dependent, as materials on record clearly established that she was residing with the deceased and his family members. The Court held that she may not be the legal heir of the deceased, but has certainly suffered on account of his death.

"It is not uncommon in Indian Society for the mother in law to live with her daughter and son in law during her old age and be dependent upon her son in law for her maintenance. Appellant no.4 herein may not be a legal heir of the deceased, but she certainly suffered on account of his death. Therefore, we have no hesitation to hold that she is a "legal representative" under Section 166 of the MV Act and is entitled to maintain a claim petition."

In this case, a mathematics professor died in an accident in 2011 and his wife, two daughters and his mother-in-law (appellant-4) had filed a claim petition before the Motor Accident Claims Tribunal. By considering the mother-in-law as legal representative, the MACT awarded a total sum of Rs.74,50,971 towards compensation.

The insurance company filed an appeal in the High Court to reduce the compensation. The High Court held that the mother-in-law is not a legal representative of the deceased. It reduced the compensation to Rs 48,39,728 by deducting 1/3 from the actual income towards personal and living expenses, treating the number of dependents as 3 instead of 4.

After hearing the parties, the Bench while referring to Section 166 of the Motor Vehicles Act, 1988 (filing of an application for compensation), held that the MV Act does not define the term 'legal representative'. Generally, 'legal representative' means a person who in law represents the estate of the deceased person and includes any person or persons in whom legal right to receive compensatory benefit vests.

"A 'legal representative' may also include any person who intermeddles with the estate of the deceased. Such a person does not necessarily have to be a legal heir. Legal heirs are the persons who are entitled to inherit the surviving estate of the deceased. The MV Act calls for liberal and wider interpretation."

The Bench further observed that the term legal representative should be given wider interpretation for the purpose of Chapter XII of MV Act and it should not be confined only to mean the spouse, parents and children of the deceased. A legal representative should have a remedy for realization of compensation.

"MV Act is a benevolent legislation enacted for the object of providing monetary relief to the victims or their families. Therefore, the MV Act calls for a liberal and wider interpretation to serve the real purpose underlying the enactment and fulfil its legislative intent. We are also of the view that in order to maintain a claim petition, it is sufficient for the claimant to establish his loss of dependency. Section 166 of the MV Act makes it clear that every legal representative who suffers on account of the death of a person in a motor vehicle accident should have a remedy for realization of compensation."

The Bench held that the provisions of the MV Act give paramount importance to the concept of 'just and fair' compensation. It is a beneficial legislation which has been framed with the object of providing relief to the victims or their families.

"Section 168 of the MV Act deals with the concept of 'just compensation' which ought to be determined on the foundation of fairness, reasonableness and equitability. Although such determination can never be arithmetically exact or perfect, an endeavor should be made by the Court to award just and fair compensation irrespective of the amount claimed by the applicant/s."

Regarding deduction in income, the Bench observed that it can't be governed by the rigid rule of the formula of universal application. It does not depend upon the relationship of the claimant with the deceased. It depends upon the facts and circumstances of each case.

"It is settled that the percentage of deduction for personal expenses cannot be governed by a rigid rule or formula of universal application. It also does not depend upon the basis of the relationship of the claimant with the deceased. In some cases, the father may have his own income and thus will not be considered as dependent. Sometimes, brothers and sisters will not be considered as dependents because they may either be independent or earning or married or be dependent on the father. The percentage of deduction for personal expenditure, thus, depends upon the facts and circumstances of each case."

Citing precedents, the Bench observed that at the time of calculation of the income, the Court has to take actual income as well as future income. The Bench considered the fact that the deceased was an Assistant professor in mathematics with a meritorious academic background. He would have earned income even post his retirement

"Evidence on record also shows that there is an acute shortage of lecturers in Mathematics for appointment in colleges and retired Mathematics Professors are appointed in so many colleges. It is common knowledge that the teachers, especially Mathematics teachers, are employed even after their retirement in coaching centers. They may also hold private tuition classes. This would increase their income manifold after retirement."

Citing a judgment in the matter of Sarla Verma and Ors. vs. Delhi Transport Corporation and Anr., the Bench further observed, "it is clear that at the time of calculation of the income, the Court has to consider the actual income of the deceased and addition should be made to take into account future prospects. Further, while the evidence in a given case may indicate a different percentage of increase, standardization of the addition for future prospects should be made to avoid different yardsticks being applied or different methods of calculation being adopted."

The Bench enhanced the compensation to Rs. 85,81,815 and allowed the appeal.

Parties: N. Jayasree & Ors Vs Cholamandaam MS General Insurance Company Ltd.