[Motor accident cases] Multiplier has to be determined based on completed age, not running age: Kerala High Court

The Kerala High Court recently held that the multiplier to be applied while calculating compensation in motor accident claim cases has to be decided on the basis of the age attained by the deceased/injured and not based on running age [PO Meera & Anr. v Ananda P Naik & Ors.]

Thus, the Court ruled that when a person aged 50 years and 7 months dies in a motor accident, the multiplier to be applied is the one applicable to the age bracket of 46-50 as laid down in Sarla Verma & Ors v Delhi Transport Corporation & Anr and not the one applicable to the age bracket of 51-55.

"The sine qua non to select the multiplier is the attainment of the specified age mentioned in the table and not the running of the age into the next group", the single-judge Justice CS Dias held.

Pertinently, the Court also ruled that in matters relating to negligence in a motor accidents claim, if there is credible evidence including oral testimony, which contradicts the First Information Report (FIR) in establishing such negligence, the Motor Accidents Claims Tribunal (MACT) may disregard the FIR.

The Court observed that while considering a claim petition under Section 166 of the Motor Vehicles Act, it is appropriate to decide negligence on the basis of preponderance of probability.

"A Fortiori, it is trite, a claim petition under Sec.166 of the Act has to be decided on the touchstone of preponderance of probability and not on the litmus test of beyond reasonable doubt," the Court said in its judgement.

The Court held the following:

- Multiplier has to be determined based on the completed age and not the running age;

- 10 percent enhancement has to be given every three years on the conventional heads every three years;

- Minors income has to be fixed at Rs.30000 per annum with multiplier of 15; and

- if there is evidence before MACT, information in FIR can be ignored.

The judgement was passed on appeals preferred against an award of the MACT for the death of one Madhavan and his minor daughter and the damages to the vehicle driven by Madhavan at the time of the accident.

The MACT allowed the claim petitions in part but found that Madhavan had also contributed to the accident. Hence, 50 percent of the compensation amount awarded in the three claim petitions was deducted.

This prompted the appellants to approach the High Court challenging the finding of contributory negligence and the quantum of compensation awarded.

The Court considered four main questions and found as follows:

(i) Is the finding of the contributory negligence attributed against Madhavan sustainable in law?

The tribunal after rejecting the oral testimonies of prosecution witnesses on the ground that they were interested witnesses, had accepted the First Information Report in the case and concluded that the accident occurred due to the negligence of the drivers of both the vehicles.

The Court referred to the decision of the Supreme Court in National Insurance Company Ltd v. Chamundeswari & Ors, in which it was held that if any evidence which is recorded before the Tribunal runs contrary to the contents in the FIR, there is no reason to give weightage to the contents in the FIR.

Thereafter, the Kerala High Court had in Sampath M.P and Ors. v Binu & Ors. held that if the tribunal feels that the charge-sheet does not satisfy its judicial conscience, then the tribunal can record its reasons and call upon the parties to let in oral evidence.

In the instant case, the Court found that even though the police stated that the drivers of both the vehicles were negligent in causing the accident, relevant supporting materials were not appended to the charge-sheet relied on by the MACT. However, oral testimonies given by eye-witnesses stated that the accident occurred due to the negligence of the other driver.

Therefore, the Court opined that the tribunal's finding of negligence on the part of Madhavan was erroneous and set aside the same.

(ii) Is the multiplier of 11 adopted by the Tribunal in the claim seeking compensation for Madhavan's death correct?

The Court referred to the decision of the Supreme Court in Sarla Verma & Ors v Delhi Transport Corporation & Anr, which was later approved by a Constitution Bench in National Insurance Company Limited v. Pranay Sethi & Ors, which laid down the multiplier to be adopted of the deceased/injured person(s) falling in age group of 16 to 66 and above.

The multiplier set by the top court for the age group 46-50 years was '13' and for 51-55 years was '11'.

On the date of the accident, Madhavan had completed 50 years and 7 days. The MACT chose to use the multiplier '11'.

However, the Court found from a reading of Sarla Verma that it is only when the deceased/injured completes the age of 51 years, that the multiplier would shift from ‘13’ to ‘11’ and not when the deceased/injured attains the age of 50 years and runs the said age till the previous night of his 51st birthday.

Hence, the Court set aside the finding of the tribunal in this regard, and adopted the multiplier of ‘13'.

(iii) Is the quantum of compensation fixed for the death of Madhavan reasonable and just?

Once again, going by the law laid down in Sarla Verma and Pranay Sethi, and considering the fact that Madhavan was aged 50 years at the time of his death, the Court found that the appellants are entitled to future prospects @ 10% and refixed the compensation for loss of dependency accordingly.

Further, the Court ordered compensation for the dependents under the conventional heads viz., ‘funeral expenses’, ‘loss of estate’ and ‘loss of consortium’ to be enhanced by 10% every three years.

(iv) Is the quantum of compensation fixed for the death of the minor daughter reasonable and just?

The tribunal had awarded compensation after fixing the monthly income of the 17 year old on a notional basis at ₹1,500 and adopting the multiplier of '15'.

The Court referred to the decision of the apex court in Kuruvan Ansari v Shyam Kishore Murmu & Anr which fixed the notional income of a ten year old child at ₹30,000 per annum and adopted the multiplier of '15'.

As the daughter was 17 years of age at the time of her death, the Court deemed it fit to fix her income notionally at ₹30,000 per annum and adopt the multiplier of 15 and accordingly re-calculated the compensation to be awarded.

The Court ordered the insurer to deposit the compensation amount, as fixed by the Court, before the tribunal within a period of sixty days.

[Read Judgment]