Tag Archives: compensation

Term Compensation – Under Motor Vehicles Act

The term “compensation” has not been defined in the Motor Vehicles Act, 1988. By interpretive process, it has been understood to mean to recompense the claimants for the possible loss suffered or likely to be suffered due to sudden and untimely death of their family member as a result of motor accident. Two cardinal principles run through the provisions of the Motor Vehicles Act of 1988 in the matter of determination of compensation. Firstly, the measure of compensation must be just and adequate; and secondly, no double benefit should be passed on to the claimants in the matter of award of compensation. Section 168 of the Motor Vehicles Act, 1988 makes the first principle explicit. Sub-section (1) of that provision makes it clear that the amount of compensation must be just. The word “just” means — fair, adequate and reasonable. It has been derived from the latin word “Justus”, connoting right and fair. In State of Haryana v. Jasbir Kaur, (2003) 7 SCC 484, it has been held that the expression “just” denotes that the amount must be equitable, fair, reasonable and not arbitrary. In Sarla Verma v. DTC, (2009) 6 SCC 121, it was held that the compensation “is not intended to be a bonanza, largesse or source of profit”. That, however, may depend upon the facts and circumstances of each case, as to what amount would be a just compensation. Reliance General Insurance Company Ltd. v. Shashi Sharma, (2016) 9 SCC 627.

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Filed under compensation, Motor Vehicles Act

Existence of A Concluded Contract – Is a Sine Qua Non in a claim for compensation

Section 7 of the Contract Act, 1872 provides that in order to convert a proposal into a contract, the acceptance must be absolute and unqualified. The existence of a concluded contract is a sine qua non in a claim for compensation for loss and damages under Section 73 of the Contract Act arising out of a breach of contract. If instead of acceptance of a proposal, a counter – proposal is made, no concluded contract comes into existence.
In U.P. Rajkiya Nirman Nigam Ltd. v. Indure (P) Ltd., also related to a proposal and counter-proposal. Holding that no concluded contract had come into existence, the Hon’ble Apex Court held as under:
“As seen, the material alterations in the contract make a world of difference to draw an inference of concluded contract.” Vedanata Ltd. v. Emirates Trading Agency LLC, (2017) 13 SCC 243.

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Widow Remains Legal Representative Even After Remarriage

Widow even after remarriage continues to be the legal representative of her husband as there is no provision under the Hindu Succession Act or any other law laying down that after remarriage she does not continue to be the legal representative. The right of succession accrues immediately on death of her husband and in the absence of any provision, she cannot be divested from the property vested on her due to remarriage.
Hon’ble Apex Court in the case of Manjuri Bera v. Oriental Insurance Co. Ltd., AIR 2007 SC 1474, while considering the question as to whether a married daughter could maintain a claim petition in terms of Section 166 of the Motor Vehicles Act and whether she would be entitled to any compensation as she was dependent upon the deceased, considered the provisions of Sections 166 and 168 of the Motor Vehicles Act and Section 2(11) of the Code of Civil Procedure and relying upon the earlier observations of the Court in Custodian of Branches of BANCO National Ultramarion v. Nalini Bai Naique, (1989) 2 SCR 810, observed that the definition contained in Section 2(11) of the Code of Civil Procedure in inclusive in character and its scope is wide, it is not confined to legal heirs only. Instead it stipulates that a person who may or may not be legal heir competent to inherit the property of the deceased can represent the estate of the deceased person. It includes heirs as well as persons who represent the estate even without title either as executors or administrators in possession of the estate of the deceased. All such persons would be covered by the expression ‘legal representative’. As observed in Gujarat State Road Transport Corporation v. Ramanbhai Prabhatbhai, (1987) 3 SCR 404, a legal representative is one who suffers on account of death of a person due to motor accident and need not necessarily be a wife, husband parent and child.
Delhi High Court in Ram Kishan v. Meena Kumari, 2011 ACJ 1211, has held that remarriage will not deprive a person from claiming compensation for the death of her/his spouse. United India Insurance Co. Ltd. v. Smt. Baby, 2017 (2) AWC 1181.

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Filed under Civil Law, Legal Representative

Interest and Compensation

The essence of interest in the opinion of Lord Wright, in Riches v. Westminitser Bank Ltd., 1947 AC 390 : (1947) 1 All ER 469 is that:
“….it is a payment which becomes due because the creditor has not had his money at the due date. It may be regarded either as representing the profit he might have made if he had had the use of the money, or, conversely, the loss he suffered because he had not that use. The general idea is that he is entitled to compensation for the deprivation;
The money due to the creditor was not paid, or, in other words,
‘was withheld from him by the debtor after the time when payment should have been made, in breach of his legal rights, and interest was a compensation, whether the compensation was liquidated under an agreement or statute’.
A Division Bench of the High Court of Punjab in CIT v. Sham Lal Narula, AIR 1963 P&H 411 held as under :
“The words “interest” and “compensation” are sometimes used interchangeably and on other occasions they have distinct connotation. “Interest” in general terms is the return or compensation for the use or retention by one person of a sum of money belonging to or owed to another. In its narrow sense, “interest” is understood to mean the amount which one has contracted to pay for use of borrowed money………..
In whatever category “interest” in a particular case may be put, it is a consideration paid either for the use of money or for forbearance in demanding it, after it has fallen due, and thus, it is a charge for the use or forbearance of money. In this sense, it is a compensation allowed by law or fixed by parties, or permitted by custom or usage, for use of money, belonging to another, or for the delay in paying money after it has become payable.’ Tamil Nadu Generation and Distribution Corporation Ltd. V. PPN Power Generating Company Private Ltd. (2014) 11 SCC 53

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Composite Negligence and Contributory Negligence – Difference Between

‘Composite Negligence’ refers to the negligence on the part of two or more persons. Where a person is injured as a result of negligence on the part of two or more wrong doers, it is said that the person was injured on account of the composite negligence of those wrongdoers. In such a case, each wrongdoer is jointly and severally liable to the injured for payment of the entire damages and the injured person has the choice of proceeding against all or any of them. In such a case, the injured need not establish the extent of responsibility of each wrongdoer separately, nor is it necessary for the court to determine the extent of liability of each wrongdoer separately. On the other hand where a person suffers injury, partly due to the negligence on the part of another person or persons and partly as a result of his own negligence, then the negligence on the part of the injured which contributed to the accident is referred to as his ‘contributory negligence’. Where the injured is guilty of some negligence, his claim for damages is not defeated merely by reason of the negligence on his part but the damages recoverable by him in respect of the injuries stand reduced in proportion to his contributory negligence. Pawan Kumar v. Harkishan Dass Mohan Lal and others, (2014) 3 SCC 590.

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Filed under Composite Negligence, Negligence