With the increase in transportation and infrastructure of roads, there has been a rise in road accidents as well. In order to cater to the needs of the modern society the Motor Vehicles Act, 1988 (hereinafter, the Act) has been introduced by amending and consolidating the earlier legislations. The Motor Accident Claims Tribunal is constituted under S.165 of the Act. It has been constituted for bringing about speedy and effective disposal of motor accident claims and cases. The Tribunal deals with claims relating to loss of life/property and injury cases resulting from motor accidents. This submission discusses about the procedure to be followed and specifically discusses about whether an advocate is needed in a motor accident claim.
Motor Accident Claims Tribunal:
Constitution, Composition and Qualification:
Every State Government is empowered to constitute Motor Accident Claims Tribunal (hereinafter MACT) for the purpose of adjudicating upon claims for compensation in respect of accidents involving the death of, or bodily injury to, persons arising out of the use of motor vehicles, or damages to any property of a third party so arising, or both.[i]
A Claims Tribunal shall consist of such number of members as the State Government may think fit to appoint and where it consists of two or more members, one of them shall be appointed as the Chairman thereof.
A person shall not be qualified for appointment as a member of a Claims Tribunal unless he-
(a) Is, or has been, a Judge of a High Court, or
(b) Is, or has been, a District Judge, or
(c) is qualified for appointment as a Judge of a High Court or as a District Judge.
Who can file an application in the MACT?
An application for compensation due to accident can be made
1. By the person who has sustained the injury.
2. By the owner of the property where death has resulted from the motor accident.
3. By all or any of the legal representatives of the deceased.
4. By any agent duly authorized by the person injured or all or any of the legal representatives of the deceased, as the case may be.[ii]
To which MACT should the application be made?
Every application shall be made, at the option of the claimant,
1. Either to the Claims Tribunal having jurisdiction over the area in which the accident occurred, or;
2. To the Claims Tribunal within the local limits of whose jurisdiction the claimant resides or carries on business, or;
3. Within the local limits of whose jurisdiction the defendant resides,
The application shall be in such form and contain such particulars as may be prescribed.[iii]
Procedure and Powers of the MACT:
After an application has been made, the MACT shall provide a notice, give an opportunity of being heard, conduct an inquiry and pass an award.[iv]
In holding any inquiry under section 168, the MACT may follow such summary procedure as it thinks fit. The intention of this clause is to avoid undue delay as it would be if the case was in a civil court.
The Claims Tribunal shall have all the powers of a Civil Court for the purpose of taking evidence on oath and of enforcing the attendance of witnesses and of compelling the discovery and production of documents and material objects and for such other purposes as may be prescribed; and the Claims Tribunal shall be deemed to be a Civil Court.[v]
In the case of death, the minimum sum to be paid is INR 50,000/- and in the case of disablement, a minimum sum to be paid is INR 25,000/-,[vi] and this minimum is subject to additional compensation which the tribunal might grant under s 163A.
The main flaws in the implementation of the law:
The law in essence provides efficacious remedies. However there are several implementation issues.
Ambulance Chasers and Innocent Victims:
There has been a shift from lawyers helping litigants get justice to the extent where lawyers are even called as ambulance chasers.[vii] Ambulance drivers, often the first ones to arrive at an accident spot, call these lawyers even before informing the police. If the police reach the spot, they too call these lawyers before calling an ambulance. The lawyer immediately enlists the traumatized victim as a client with the promise of on-the-spot compensation. Once the case is firmly in the grip of the lawyer, he makes all the necessary payouts to the police, ambulance drivers and doctors involved. It is at the time of the award of compensation that impersonators and bankers come in. Since the compensation cheques are given directly to the victim, somebody impersonates the victim or a kin and signs the receipt. The banker, who is also paid a share, discounts the cheque the very same day.[viii] This situation wherein the learned lawyers take undue advantage of the uninformed, ignorant and innocent litigants is appalling and inexcusable.
There are multiple cases where it the process of awarding compensation has taken years together. Recognizing such delay, the Delhi High Court in the case of Rajesh Tyagi and Others v. Jaibir Singh and Others,[ix] has drawn up on an Accident Claims Agreed Procedure. However, the Supreme Court in the case of M. R. Krishnamurthy v. The New India Assurance Co. Ltd.[x] observed that, “However, we find that there is no proper implementation thereof by the Claims Tribunals. We, thus, direct that there should be programmes from time to time, in all State Judicial Academies to sensitizing the presiding officers of the Claims Tribunals, Senior Police Officers of the State Police as well as Insurance Company for the implementation of the said Procedure.”
Is an Advocate needed in a Motor Accident Claim?
The general procedure in a MACT is that the claimant can appear by himself or through a lawyer. However in India not everyone is completely aware of the intricacies in law and hence a lawyer is hired.
Apex Court on Settlement of Claims by Mediation:
In the above mentioned M.R.Krishnamurthy Case,[xi] the Supreme Court of India speaking through a Division Bench composed of Justice A. K. Sikri and Justice S. Abdul Nazeer went into the depth of the loopholes and accepted the proposal made by Senior Advocate Mr. Arun Mohan. A Motor Accident Mediation Authority (MAMA) was sought to be established.
The Court went on to state, “Insofar as disputes regarding claims are concerned, there is a need to resolve the same at the earliest inasmuch as compensation money may be badly needed by the claimants for so many reasons and delay may bring insurmountable sufferings of various kinds. Having regard to the fact that large numbers of accidents are giving rise to phenomenal quantum jump in such cases, methods need to be adopted for quick resolution. Here, mediation as a concept of dispute resolution, even before dispute becomes part of adversarial adjudicatory process, would be of great significance. Advantages of mediation are manifold. This stands recognized by the Legislature as well as policy makers and need no elaboration. Mediation is here to stay. It is here to evolve. It is because of the advantages of mediation as a method here to find new grounds. It is here to prosper, as its time has come.”
The Court recommended the Government to establish Mediation Authorities or Mediation Cells until which it directed the Legal Services Authority to come out with a working plan for the same.
Aftermath of the judgment:
Pursuant to the directions of the Apex Court, the Tamil Nadu State Legal Services Authority established MAMC (Motor Accident Mediation Cells) on 10th August 2019 in Madurai, Tamil Nadu. On the first day after establishing the Cell on Saturday, the MAMC chaired by Chief Judicial Magistrate (CJM) A. Subathra took up 42 cases, settled four cases, including a road accident case, in which four people, including three women were killed and awarded settlements for total amount of ₹18.72 lakh.[xii] However advocates had earlier expressed concerns about setting about mediation cells for the same. “While we are pleased with the noble intentions of the Supreme Court, the cause for concern is the mandatory process of mediation. When mediation is a voluntary process, compelling and relegating the party to mediation is contrary to the spirit of mediation.” they have contended.[xiii]
The Motor Vehicles Accident (Amendment) Act, 2019 vide S.57 introduced new Chapter XI. Post-amendment S.149 of the Motor Vehicles Act, 1988 reads as follows:
S.149 – Settlement by insurance companies and procedure thererof:
(1) The insurance company shall, upon receiving information of the accident, either from claimant or through accident information report or otherwise, designate an officer to settle the claims relating to such accident.
(2) An officer designated by the insurance company for processing the settlement of claim of compensation may make an offer to the claimant for settlement before the Claims Tribunal giving such details, within thirty days and after following such procedure as may be prescribed by the Central Government.
(3) If, the claimant to whom the offer is made under sub-section (2),—
(a) Accepts such offer,— (i) the Claims Tribunal shall make a record of such settlement, and such claim shall be deemed to be settled by consent; and (ii) the payment shall be made by the insurance company within a maximum period of thirty days from the date of receipt of such record of settlement;
(b) Rejects such offer, a date of hearing shall be fixed by the Claims Tribunal to adjudicate such claim on merits.
This section rightly balances the jurisprudence of mediation being voluntary as well as adheres to the direction of the Apex Court.
Is an Advocate really needed?
In the light of the above provision it is very clear that now the role of advocates in motor accident claims that get just compensation by way of mediation and settlement is drastically reduced.
However there are multiple drawbacks in this mediation process. Some companies may dominate over the claimants. They may adopt tactics like rotation of actual claim amount and monthly payment of amount to the claimant which will indirectly result in an increase in the company’s benefits. Factual circumstances may not be considered. The multiplier concept which is very integral in the determination of age may be ignored. There are also chances of misrepresentation of the claim amount by companies.
Hence, involvement of someone who can voice out the views of innocent claimants like an advocate who knows the rights, remedies and legal nuances is suggested.
The dynamics of law keep evolving as the society experiences new needs. Settlement by alternative dispute resolution is not completely new. There are ample statutes that recognize these methods. The plausibility of mediation as an option to settle motor accident claims should be time-tested in the days to come. It is high time that lawyers and advocates also adapt to new methods of settlement of disputes than gripping the age old method of litigation.
Edited by Pragash Boopal
Approved & Published – Sakshi Raje
[i] S.165, Motor Vehicles Act, 1988.
[ii] S.166, Motor Vehicles Act, 1988.
[iv] S.168, Motor Vehicles Act, 1988.
[v] S.169, Motor Vehicles Act, 1988.
[vi] S.140, Motor Vehicles Act, 1988.
[ix] FAO No.842 of 2003, decided by the Delhi High Court on 21st December 2009.
[x] Civil Appeal Nos. 2476-2477 of 2019, Arising out of SLP(C) Nos. 31521-31522 of 2017, decided by the Supreme Court on 05th March 2019.