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V.J. Acharya Vs. Ratilal Fulchand Shah and anr. - Court Judgment

LegalCrystal Citation
SubjectInsurance;Motor Vehicles
CourtMumbai High Court
Decided On
Judge
Reported in1(1985)ACC186
AppellantV.J. Acharya
RespondentRatilal Fulchand Shah and anr.
Excerpt:
.....as udeshi and that is how acharya is before this court in first appeal. such exceptional situations are rare and not relevant for the present purpose. further on, it is also well settled that the principle of vicarious liability is also extended to the tort committed by a person who cannot in ordinary usage be called a servant but could be called an agent. if an agent deceives another by his fraud his principal should make good the loss, it does not matter whether the servant or agent is acting for the benefit of his master or principal or not. 12. i am not oblivious of the fact that in the view that i am taking the victim will have no redress as udeshi, like other small time garage owners, probably has no means to satisfy the decree. injuries to third parties arising out of repairs..........preferred a claim before the addl. motor accidents claims tribunal, greater bombay, impleading salim acharya, udeshi and the insurance company as the opposite parties. the insurance company was dropped during the proceeding as salim never had any driving licence and salim's name was deleted on 13-12-1972 on account of his death. the learned member of the tribunal allowed the claim of the applicant to the extent of rs. 40,000 against dr. acharya as well as udeshi and that is how acharya is before this court in first appeal.4. it is trite law that a person who procures work to be done for him by an independent contractor is in general not liable for the negligence or other torts committed by the contractor or the servants of the contractor in the course of the execution of the work......
Judgment:

V.V. Vaze, J.

1. A car owner hands over a car for repairs to a garage. The mechanic of the garage who does not have and never had a driving licence drives the vehicle negligently and knocks down a man. Should the owner of the vehicle be held liable for damages arising out of the accident 7

2. Dr. Acharya was proceeding from Gamdevi to British Council Library on the morning of 18-1-1969 when his car MRC 7456 failed and got stalled just beyond the Life Insurance Corporation building near traffic control department. Acharya pushed the car near the curb, made unsuccessful attempts to start the same and finally after locking the car went to Kaypee garage near Bhatia Hospital where he used to usually give his car for repairs. Pravin Udeshi, the owner of the garage, received Acharya and after hearing the nature of the complaint, asked his mechanic Salim to accompany the customer. Acharya and Salim came to the spot where the car was parked. Salim fiddled with the engine for a considerable time but the motor would not respond. Exasperated, Acharya told Salim to take the car keys with him, go back to the garage, hand them over to Udeshi and to whatever was necessary including towing of the car. Salim and Acharya left the place by bus together. En route, Acharya got down at Dhobi Talao only to be told on phone in the evening by Udeshi that Salim had driven the car and injured some person near Lamington Road Police Station.

3. As Salim had hit Ratilal Fulchand Shah who was walking past Lamington Road in Poonam lane, Ratilal preferred a claim before the Addl. Motor Accidents Claims Tribunal, Greater Bombay, impleading Salim Acharya, Udeshi and the insurance company as the opposite parties. The insurance company was dropped during the proceeding as Salim never had any driving licence and Salim's name was deleted on 13-12-1972 on account of his death. The learned Member of the Tribunal allowed the claim of the applicant to the extent of Rs. 40,000 against Dr. Acharya as well as Udeshi and that is how Acharya is before this Court in first appeal.

4. It is trite law that a person who procures work to be done for him by an independent contractor is in general not liable for the negligence or other torts committed by the contractor or the servants of the contractor in the course of the execution of the work. There are no doubt certain exceptions to this general rule but they are predicated upon the finding that an employer himself was in the course of some duty which he transferred to the employee or the employer himself committed the tort by so hiring an incompetent contractor or employing an insufficient number of men or interfering with the manner of carrying out the work resulting in damage. Such exceptional situations are rare and not relevant for the present purpose. Further on, it is also well settled that the principle of vicarious liability is also extended to the tort committed by a person who cannot in ordinary usage be called a servant but could be called an agent. When the owner of a vehicle gets a friend to drive it for him, the friend cannot appropriately be called a servant but being an agent, the owner will be vicariously liable.

5. Mr. Abhyankar for the respondent in supporting the judgment under appeal extends the reasoning given by the Tribunal by saying that when the owner Acharya asked Salim to take the keys to his master Udeshi and do whatever was necessary for the car including towing it, an implied contract of agency was created between Acharya and Salim and Salim had an implied authority to drive the car or, at any rate, Salim drove the car during the course of the agency though in an unauthorised manner. On the other hand, Mr. Sawant on behalf of the appellant maintains that Udeshi was an independent contractor and if a servant of Udeshi has committed tort it will be Udeshi who will be responsible as employer of the tortfeasor and not Acharya who had engaged Udeshi as an independent contractor.

6. Lord Denning was consistently taking the view that the principle behind vicarious liability is to put the responsibility on the person 'who ought in justice to bear it' and in most cases involving vehicles, that person is the owner or hirer because it is he who puts the vehicle on the road, causes or permits it to be used and who is or ought to be insured in respect of it. Thus, Launchbury v. Morgans (1971)2 Q.B. 245 Lord Denning observed at page 253 :

What is the basis of this doctrine of vicarious liability To answer it, I would first ask : what does 'vicarious' mean I turn to the Shorter Oxford English Dictionary, 3rd Edn. (1944) Vol. II. It means one 'that takes or supplies the place of another.' So vicarious liability means that one person takes the place of another so far as liability is concerned. Familiar instances are where the master shoulders are liability of his servant : or the principal shoulders the liability of his agent: and so forth. Whenever the law imposes vicarious liability, it does so for reasons of social policy, reasons which commend themselves to the people at large. If a servant injures another by his negligence, his master should answer for it. If an agent deceives another by his fraud his principal should make good the loss, It does not matter whether the servant or agent is acting for the benefit of his master or principal or not. Suffice it that the master or principal has put him in a position where he may do injury to another: and should be liable for the way in which he conducts himself therein. It is true that the master or principal is not personally at fault. But it is only right that he should be made vicariously liable. Otherwise it would mean that the injured person would get no redress : for more often than not, the servant or agent has not the means to pay : whereas his master or principal has the means : or, at any rate, ought to insure against the liability so as to get the means to pay. In this way the innocent victim is not left to bear the whole loss himself. It is distributed amongst the community in a way that is fair to all.

7. On this basis the Court of Appeal held the wife in whose name the car was registered as liable when her husband had permitted a friend to drive the car which ultimately met with an accident.

8. Probably Lord Denning was prompted to make these observations and expand the doctrine of vicarious liability because at that time insurance for passengers was not compulsory in England. Thereafter it has been made compulsory and in consequence a victim who cannot find an insured defendant may be able to recover his damages from the motor insurers bureau subject to assignment of the judgment to that body.

9. This decision of the Court of Appeal was unanimously reversed in Morgans v. Launchbury (1973) A.C.J. 21 and it was held that *if the owner of a vehicle is to be liable for the negligence of a bailer of it, it is necessary that he has some interest in the purposes for which the vehicle is used.' As regards the social policy propounded by Lord Denning, the House of Lords felt that the change of law, if need be, should be brought about by legislation.

10. A case akin to the one under appeal is found in Chowdhary v. Gillot (1947)2 All E.R. 541 in which the plaintiff had taken his car to the manufacturers for repairs and after handing it to over to the company's representative with instructions in regard to his requirement, he asked if he could have a 'lift' to the nearest railway station. An employee of the company wag instructed to drive him to the station in the plaintiff's own car. On the way to the station due to the negligence of the employee of the company, the car collided and the plaintiff was injured. When the plaintiff claimed damages the company took the defence that the services of their employee were at the material time transferred to the plaintiff. The contention was negatived and it was held that having received the car for repairs, the company were, at the lime of the accident, in possession of it as bailees and, so long as the bailment continued, the owner had no right to control the bailees' servants : the company had lent the plaintiff the service of their servant and had not transferred the servant himself to the plaintiff; and, accordingly, the driver did not at common law become the particular servant of the plaintiff.

11. From the evidence in this case, it is clear that when the car got stalled near Life Insurance Corporation building, Acharya as usual went to the garage run by Udeshi and the moment Udeshi gave instructions to his mechanic Salim to accompany Acharya to the spot, the contract of engaging Udeshi as an independent contractor to repair the car was complete. Nothing turns on the fact that Acharya was waiting by the side of the car when Salim was trying to repair it. He was only hoping that the car would get repaired and he would be able to drive it away. The bailment of the car was completed when Acharya asked Salim to go to Udeshi for instructions. As argued in Chowdhary's case above, Salim could not be called a transferred servant nor was an agent of Acharya. He continued to remain a servant of Udeshi who in turn was an independent contractor, over whose manner of working Acharya had no control. In this view of the matter there appears to be no case made out that Salim was acting as an agent of Acharya. As the link of master and servant or principal and agent has not been established in the case of Acharya and Salim, Acharya cannot be held to be vicariously liable for the tort committed by Salim. Hence, in this case, not without reluctance but without doubt, I find that the Tribunal fell in error in allowing the claim.

12. I am not oblivious of the fact that in the view that I am taking the victim will have no redress as Udeshi, like other small time garage owners, probably has no means to satisfy the decree. But any overbroad expansion of the doctrine of vicarious liability without sufficient legal basis either of principle or of authority would be, in the words of Professor Freund, 'a short step from social statics of Herbert Spencer to the social ecstasies of the judges'.

13. How wide can the net be cast A short step may end up in a long stride. If in the facts of this case, the car owner be held liable vicariously on a rubricated principle of agency, he would likewise be liable if a thief steals the car and in the get-away knocks down a pedestrian. It belongs to the State to regulate the functioning of the mushrooming garages who permit grease-smeared unskilled mates to roll down Chariots of Juggernaut on unsuspecting pedestrian. The common law process is pathetically incapable of containing, controlling or correcting such situations while a compulsory insurance legislation will. Neither the car owner nor the garage proprietor will grudge a few rupees more of premium. Injuries to third parties arising out of repairs carried out negligently--such as scalding of face upon opening an overheated radiator ; uncontemplated propulsion of the car upon switching on the ignition while the gear is engaged--could as well be provided for. Such a legislation may well serve as a paradigm for future work in the field of compensation to the victim of crime. To a victim or his dependents it hardly matters whether the injury was caused by the glistening chromium of a car bumper or the shining steel of street mugger.

14. As regards the quantum of damage that the appellant had made an issue of, and challenged as being excessive. 1 find that the assessment, if any, worked out on the lower side considering the fact that the appellant who was earning about Rs. 1,300 per month at the time of the accident had a life expectancy of ten years or so.

15. The appeal of Dr. Acharya is allowed and the order of the Tribunal is modified to the extent that instead of both the opposite parties, only opposite party No. 5 Pravinbhai Udeshi shall pay to the applicant Ratilal Fulchand Shah the sum of Rs. 40,000 as computation together with interest at the rate of six per cent per annum from the date of award till payment. No order as to costs throughout.


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