SC explains principles of Spousal, parental and filial consortium for award of compensation under MV Act

Supreme Court explains principles of Spousal, parental and filial consortium for award of compensation under Motor Vehicles Act

ABCAUS Case Law Citation:
ABCAUS 2523 (2018) 09 SC

Important Case Laws Cited/relied upon by the parties:
National Insurance Co. Ltd.  v.  Pranay Sethi (2017) 16 SCC 680

The Insurance Company had filed a Special Leave Petition (SLP) to challenge the compensation  awarded by the  High Court  to be contrary to the Constitution Bench judgment of Hon’ble Supreme Court.

In the instant case, the motorcycle driven by the deceased was hot by a car.  The friend of the deceased was an eye witness to the accident.

The father, brother and sister of the deceased filed Claim Petition under the Motor Vehicles Act before the Motor Accidents Claim Tribunal (MACT) praying for compensation of Rs. 50,00,000 along with interest from the date of the accident till the  date  of realization.

The MACT came to the finding that the accident took place due to the rash and negligent driving of the car driver.

The deceased was 24 years old, The Claimants were unable to produce evidence of the income of the deceased. The MACT took the income of the deceased  to  be  that  of  an unskilled worker on the basis of the Notification issued by the Labour Commissioner. The MACT calculated loss of future income by making 1/3 deduction for personal expenses and applying a multiplier of 7 based in the age of the father of the deceased. Rs. 25000 and Rs. 15000 was added for Loss of love and affection and Funeral Expenses respectively. The MACT awarded compensation to the family of   the deceased accordingly.

The family of the deceased filed an Appeal against the order of the MACT before High Court for enhancement of compensation. The High Court found that the MACT had used the wrong principle  for application of the multiplier. The multiplier ought  to  have been taken on the basis of the age of  the  deceased,  and  not  of  his father.

The High Court re­assessed the compensation by adding loss of future prospects @ 50% of the monthly income taken at Rs. 6000/- p.m. The High Court took a multiplier of 18  as  per  age  of  the deceased.

Hence, the SLP was filed by the Insurance Company.

The Hon’ble Supreme Court observed that as per the decision of the Constitution Bench, Future Prospects are to be awarded on the basis of:

  1. the nature of the deceased’s employment; and
  2. the age of the deceased.

The Hon’ble Supreme Court opined that since the deceased was 24 years old at the time of the accident. Hence, future prospects ought to have been awarded at 40%  of  the  actual  income of the deceased, instead of 50% as awarded by the High Court.

The Insurance Company had contended that the deduction for personal expenses ought to be ½, and  not 1/3rd, since the deceased was a bachelor. The Hon’ble Supreme Court observed that it had previously took the view that where the family of the bachelor is large and dependent on the income of the deceased, his personal and living expenses may be restricted to one ­third, as contribution to  the family will be taken as two ­third. The Hon’ble Supreme Court opined that considering that the deceased was living in a village, where he was residing with his aged father who was about 65 years old, and an unmarried sister, the High Court correctly considered them to be  dependents of the deceased, and made a deduction of 1/3rd towards personal expenses of the deceased.

Hon’ble Supreme Court expressed its disagreement with the submission of the Insurance Company that the father and the sister of the deceased could not  be treated as dependents, and only a mother can be dependent  of  her  son. The Supreme Court opined that the deceased was a bachelor, whose mother had pre­deceased him. The deceased’s father was about 65 years old, and an  unmarried sister. The deceased was contributing a part of his meagre income to the family for their sustenance and survival. Hence, they would be entitled to compensation as his dependents.

The Hon’ble Supreme Court reduced the compensation towards funeral expenses to Rs. 15,000 but maintained the amount awarded by the High Court towards loss of love and affection.

The Hon’ble Supreme Court observed that noth the MACT as well as the High Court had not awarded any compensation with respect to Loss of Consortium and Loss of Estate, which are the other conventional heads  under  which compensation is awarded in the event of death, as recognized by  the Constitution Bench.

The Hon’ble Supreme Court opined that the Motor Vehicles Act is a beneficial and welfare legislation.  The  Court  is duty ­bound and entitled to award “just compensation”, irrespective of whether any plea in that  behalf  was raised by the Claimant. The Court, invoking its powers under Article 142, and in the interests of justice awarded an amount of Rs. 15,000 towards Loss of Estate to father and sister of the deceased.

Further, the Hon’ble Supreme Court observed that the Constitution Bench of the Court had dealt with the various heads under which compensation is to be awarded in a death case. One of these heads is Loss of Consortium.

The Court explained that in legal parlance, “consortium” is a compendious term which encompasses ‘spousal consortium’, ‘parental consortium’, and ‘filial consortium’. The right to consortium would  include the company, care, help, comfort, guidance, solace and affection of the deceased, which is a loss to his family. With respect to a spouse, it would include sexual relations with the deceased  spouse.

The Apex Court explained the three principles of consortium as under:

(i) Spousal consortium is generally defined as rights pertaining to the relationship of a husband wife which allows compensation to the surviving spouse for loss of “company, society, co­operation, affection, and aid of the other in every conjugal relation.”

(ii) Parental consortium is granted to the child upon the premature death of a parent, for loss of  “parental aid, protection, affection, society, discipline, guidance and training.”

(iii) Filial consortium is the right of the parents to compensation in the case of an accidental death  of a child. An accident leading to the death of a child causes great shock and agony to the parents family of the deceased. The greatest  agony for a parent is to lose their  child during their lifetime.  Children are valued for their love, affection, companionship and their role in the family unit.

The Hon’ble Supreme Court stated that Consortium is a special prism reflecting changing norms  about the status and worth of actual relationships. Modern jurisdictions world ­over have recognized  that the value of a child’s consortium far exceeds the economic value of the compensation awarded in the case of the death of a child. Most jurisdictions therefore permit parents to be awarded  compensation under loss of consortium on the death of a child. The amount awarded to the parents is a compensation for loss of the love, affection, care and companionship of the deceased child.

The Hon’ble Supreme Court opined that the Motor Vehicles Act is a beneficial legislation aimed at  providing relief to the victims or their families, in cases of genuine  claims.  In case where a parent  has lost their minor child, or unmarried  son or daughter, the parents are entitled to be awarded loss of consortium under the head of Filial Consortium. Parental Consortium is awarded to children who lose their parents in motor vehicle  accidents under the Act. A few High Courts have awarded  compensation on  this count. However, here was no clarity with respect  to the principles on which compensation could be awarded on  loss of Filial Consortium. The amount of compensation to be awarded as consortium will be governed by the principles of awarding compensation under ‘Loss of Consortium’ as laid down by the Constitution Bench.

The Hon’ble Supreme Court thereafter awarded the father and sister of the deceased, an amount  of  Rs.  40,000 each for loss of Filial Consortium raising the compensation to Rs. 14,25,600/-

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