EFFECTIVE HANDLING OF MOTOR THIRD PARTY CLAIMS

HANDLING OF SUMMONS AND W.S. 1.        Plea once not raised and proved before the tribunal can not be agitated in appeal so ensure all applicable defenses are incorporated in the WS 2.        Pleadings in counter depend on facts and circumstances of each & every case and they can not be standardised. 3.        Avoid routine denials in the WS. All the points, whether of law or of facts on the basis of which a claim is made must be raised by definite pleading. ( In Fushi lal vs Shiv Shankar MACT New Delhi took it as obstruction of the courts and amounting to contempt of court) 4.        Remember without pleading no quantum of evidence will be looked into by the courts. 5.        Allegations made in claim petition which are not expressly admitted must be specifically denied and put to strict proof of the same by the petitioners themselves. 6.        Immediate investigation: to collect criminal papers; BHT from hospital to ensure- involvement of vehicle – Negligence of driver/injured or deceased- maintainability of petition- validity of DL- status of deceased and claimant 9age, dependability, occupation, income) 7.        Late investigations do affect the qulity as the vital links associated with accident may go missing after the passage of time. 8.        An effort is generally made by claimants to get maximum amount bringing wrong facts on the record. Advocate can plead only when he is equipped with material in this regard. 9.        This respondent company is not liable to pay any compensation unless & until it is proved that the person at the wheel was having valid & effective DL to drive such vehicle and the vehicle was roadworthy to ply. 10.     Grat passenger,employees other than workmen under WC act- Vehicle was insured as the provisions of MV act and the risk of ___ carried upon in the vehicle at the material time of risk is neither covered in the policy issued by us nor was required so by the provisions of MV Act 11.     Where there is collision between 2 vehicles: Owner & Insurance co of other vehicle are also necessary parties to the proceedings. Petitioners purposely avoided to implead them as such pray court to direct the petitioners to implead the owner and insurer as required by law for proper adjudication of the claim. 12.      If vehicle is driven by unlicensed driver and insured do not step in witness box to prove his case an adverse inference has necessarily to be drawn against him for being driven by unlicensed driver (Supreme court in United Vs Gian chand) 13.     If breach has been committed by the driver with the knowledge of the owner of the vehicle take specific plea (aswithout knowledge not helpful to deny liability) 14.     Policy commences- if there is no time mentioned in the policy- from the previous midnight but when time is mentioned it starts from that time only. (S.Court in New India vs Sita Bai and Oriental Vs Sunita Rathi)- There is express mention in the covernote that the effective date and time of commencement of the insurance and that time and date alone is considered for contract. 15.     For rate of interest S court has mentioned in Kaushnama Begum Vs New India that with change in economy & policy of RBI lowered interest rates. In K Murgesh vs M Palappa court allowed 6% interest. 16.     Claimants- Workmen on C.V, specific plea should be taken that our liability is limited to the amounts provided under the WC Act 1923 (except when IMT-16 is there for wider legal liability). Even when workmen claim under MV Act the liability should be restricted to WC Act. (negligence should also be contested since the case is as per MV & not WC Act). Sec 167- option of claimant to seek compensation either under either of acts 17.     When policy particulars are not given- move application in court to remove our name from title of case; a letter to owner of the vehicle to find whether we are insurers and why the intimation of accident was not given to us; enquiry with police to ascertain the particulars of policy collected/ recorded by them. 18.     Identification process of covernotes / policies is time consuming process. Documents are illegible (that is bad copy of its original) many a times without address of the PIO- Move application for better particulars + letter to insured. Papers to RO for Appeal 1.        Scrutiny sheet signed by incharge of office/hub 2.        Certified copy of judgement 3.        Opinion of advocate 4.        Written order u/s 170 5.        Main petition 6.        Copy of policy and u/s docket 7.        Copy of written statement 8.        Investigation report 9.        Vehiclular documents 10.     Criminal set of papers; FIR; Panchnama, charge sheet 11.     Hospital records- BHT 12.     All important exhibits – statements of witnesses 13.     order sheets 14.     Deposit receipt of 25000 or 50% of award amount. OTHER AREAS: - Quicker settlements need active cooperation of other agencies like Police (S-158(6)-to pass on report of accident0, Authorities and Hospitals. - Coordination meets with Judges- insurers are custodian of public money. (Role of insurance is not to create wealth but to redistribute wealth) Sec 142: Permanent Disability: 1.        Permanent privation of the either eye-sight/ear-hearing/any member of joint 2.        Destruction/Perm imparing of the powers of any members or joint 3.        perm disfiguration of the head or face.

FRAMING OF ISSUES for adjudication & PROCESS OF CLAIM: 1.        Whether the personal injury has arose due to use of motor vehicle (mentioned in application) at public place being driven negligently & rashly by Respondent 1 (driver) owned by R-2(insurer) and insured by R-3 (onus to prove on applicants) 2.        Whether the respondents are not liable in view of the preliminary or specific objections taken by them in their WS (Sec 149(2) defences) (onus to prove on insurers) 3.        Whether the driver on the wheels was in control & in employment of the owner of the vehicle 4.        Whether the petitioners are entitled for compensation (dependents)? If so towhat amount and from whom? 5.        Relief. 6.        It is observed from the awards pronounced that in general no material evidence is led in rebuttal of even important issues by our advocates. 7.        Cases where good defence is available should be marked separately and step by step strategy should be prepared & close watch is required on progress of such cases. 8.        Where technical defense is not available efforts should be put to limit the liability by getting correct age, dependency, income, % of disability etc by immediate and effective investigation. (not by reducing facts from FIR/Hospital records) 9.        Our advocates should not admit xerox produced by the plaintiff/advocates (sometimes these are produced after the close of evidence & at argument stages leaving no time for insurers to verify the same). Advocates to raise objections. Photocopies are not admissible in evidence but if such copies are allowed to be exhibited without any objection that objection can not possibily be taken later. 10.     While examing policy before Tribunal co’s officer should be examined as a witness explaining agreed terms along with proposal and motor tariff if necessary. Gratutious passenger (Oriental- Devi Reddy Konda Reddy; New India- Asha Rani) 11.     To get an order in writing to get all wider defenses u/s 170 available to owner. After the relief insurers got in Bhushan Sachdeva vs United India (any person aggreived by award can appeal u/s 173) set aside by the Supreme court in Nicolleta Rohitagi Vs National now it is well settled law that where condition precedent embodied in S-170 is satisfied and award is adverse to the interest of the insurer than only the insurer has right to file an appeal. 12.     Sec-170 (a) collision between claimant and insured (b) person against whom claim has been made failed to contest. For reasons recorded in writing..reasoned written order.- contesting claim on all grounds 13.      If need be the RTO official (take his name while he certifies record) should be summoned through court for evidence. (Sec 169 –Tribunal has powers of civil court to ensure attendance of witness) Even author of investigation reports should be produced before Tribunal for evidence. Do not take certificates in case of fake license as it is not admissible in itself. Take certified copy of the document itself which is a public document 14.     If a case is fit for compromise… explore possibilites for compromise. If worth contesting more attention Tough testing time- nevertheless the crisis for portfolio is not a cause for dispair but an opportunity to transform this portfolio. One thing is sure there is no convenient exit mechanism from this huge portfolio and only way left is to pull all the levers to improve in all areas related to it- In final analysis the sure formula for success..Needs a strong leadership and an equally stong culture and dedicated taskforce- Mgt discipline, strategic architechure and learning capabilities will require perfect alignment for better results. Change in mindset can do wonders. Putting new discipline and time-based targets. No set blueprint to address. There are certain compulsions of legal frame work beyond our control but the interanl inefficiencies – can we not improve upon them. Practicing on contingency fees where we practice No fault law. Weak internal management. Right man at right place. Inadequate control and procedures. - chargesheet against other vehicle we provide 100% liability. - Orphan claims age > 1 year ??? - NFL paid but liability remain unreduced?? - Documents not obtained even after expiry of 6 months….in some cases even upto announcing of award ??? - No check and supervision to ensure advocates appear well prepared on listed date to contest the good cases in most effective manner. - Advocates are not appointed on consideration of point of law. Sr advocates contesting cases where there is no dispute of liability…jr advocates dealing cases with complex legal issues?? - Evaluate the cost of one-day delay. - A good investigation and good conduct of case in tribunal only protects the interest of the company - Officers should follow up the good cases even during the conduct of the trials. - The achievement of advocate lies with his art of cross-examining the witness. No suggestions can be effective on this point. In case a witness is not cross-examined on any particular point that point goes unchallenged and we may not be able to argue much thereafter. - Rights of TP protected even on dishonour of cheques (New India vs Rula II – Oriental vs Indrajeet Kaur) (National vs Seema Malhotra-though insurers liable to TP but not for OD case if cheque dishonoured) - Time limit for filing the application has been deleted MV amed 1994 Earlier 166(3) time limit was 6 months. - Sec 166 Application- (a) within whose jurisdiction accident occurred- (b) claimant resides or carries busienss-(c) defendant resides. - Sec 149(2) Breach of specified condition (a)- Vehicle used in breach of its permit to use. (organised racing/sppedtesting) (b) used by unlicensed driver (c) condition excl liab for War civil war riot or civil commotion (d) policy obtained by non-disclosure or misrepresentation of material fact.

Handling Awards: 1.        Immediate entry in award register. Read in full and examine on merits. If award is to be satisfied satisfy without delay to avoid penal inerest, interest or bank attachment or execution. Each day’s delay translates into cost for co 2.        Advocates opinion for appeal- whether such grounds were taken up before the MACT and if not recommendation for appeal is only a cover up operation. Why such advocates are on panel? 3.        Whether written order u/s 170 is available. Where substantial point of law is involved or specific defenses available us/ 149(2). Rs 25000 or 50% of award (less) is deposited.

Handling awards…. 4.        Also check later on disposal of appeal whether this amount has been reduced. 5.        Examine order sheet- how many adjourment taken by our advocate (whether with our consent to arrange evidence/docs) and how many by opponent – whether written objection taken by our advocate and application moved in court that co should not be burdened with interest liability accumulated due to the fault of claimant’s counsel. Ensure certified copy of award is along with- copy of order sheets- all important exhibits by us as well as applicants. As per Sec 168(3) award has to be deposited within 30 days of its announcement. Contradictorily the prescribed period for filing appeal is 90 days.