Under Common Law there was no right to claim damages in case of death. Right to claim damages was however always recognized in case of personal injury. After the advent of the rail and road transport, the Fatal Accidents Act of 1846 was introduced in England and in case of death due to negligence the tort-feaser was made liable to pay compensation to certain relatives. Over a period of time, the law further developed and the Fatal Accidents Act was introduced in India in 1855.

The Motor Vehicles Act, 1939 was enacted to deal specifically with accidents arising out of the use of Motor Vehicles. The Motor Vehicles Act, 1988 was enacted to consolidate and amend the law relating to accidents arising from motor vehicles. When a law is enacted to consolidate and amend the law, the Legislature not only takes into consideration the law as it was existing but also the law which was prevailing prior thereto.

This Act further aims at regularizing the use of Motor Vehicles and to compensate victims who are injured or died in accident and family members and dependants of the deceased victims. This Act has been further amended in the year 1994. It is well settled that in case of motor accident claims, an endeavor is made to put the claimants in the pre-accidental position.

The damages to be awarded are to be adequate in terms of money so that the injured / claimants are put in the same position had they not suffered the loss on account of wrong of the respondent, though, no amount of compensation can restore the loss of limb or experience of pain or loss of life.

The Supreme Court, while enhancing compensation awarded to a young girl who became 100% disabled due to an accident, reiterated some principles for grant of compensation in motor accident claim cases.

The Bench comprising Justices L. Nageswara Rao & Deepak Gupta in Civil Appeal No. 735 of 2020 (Arising out of Special Leave Petition (C) No.15504 OF 2019) titled Kajal Vs Jagdish Chand & Ors., while enhancing the amount of compensation observed that Motor Vehicles Act, 1988 requires determination of payment of just compensation and it is the duty of the Court to ensure that she is paid compensation which is just.

Referring to various judgments, the Court said:
It is impossible to equate human suffering and personal deprivation with money.

However, this is what the Act enjoins upon the courts to do. The Court has to make a judicious attempt to award damages, so as to compensate the claimant for the loss suffered by the victim. On the one hand, the compensation should not be assessed very conservatively, but on the other hand, compensation should also not be assessed in so liberal a fashion so as to make it a bounty to the claimant.

The court while assessing the compensation should have regard to the degree of deprivation and the loss caused by such deprivation. Such compensation is what is termed as just compensation. The compensation or damages assessed for personal injuries should be substantial to compensate the injured for the deprivation suffered by the injured throughout his/her life. They should not be just token damages.

In this case, the Court noted that some of the medical bills have been excluded by the Courts below only on the ground that the name of the patient is not written on the bill. Limiting the amount only to the bills which have been paid in the name of the claimant only, would not be reasonable, the not written on the bill. Limiting the amount only to the bills which have been paid in the name of the claimant only, would not be reasonable, the Bench observed.

Reverting to the facts of the case, one young bright girl, leading a normal life like any other child, met with an accident on 18th October, 2007, while travelling on a tractor with her parents, when the tractor was hit by a truck which was driven rashly. In the said accident, Kajal suffered serious injuries resulting in damage to her brain. She was examined at the Post Graduate Institute of Medical Education and Research, Chandigarh (PGI, Chandigarh for short), for assessment of her disability. According to the said report, because of head injury Kajal is left with a very low I.Q. and severe weakness in all her four limbs, suffers from severe hysteria and severe urinary incontinence. Her disability was assessed as 100%.

Kajal through her father filed a Claim Petition, under the Motor Vehicles Act, 1988. The Motor Accident Claims Tribunal awarded Rs. 11, 08, 501/-­ and held that since there was violation of the terms and conditions of Policy, the Insurance Company would pay the amount but would be entitled to recover the same from the Owner. Not satisfied with the quantum of compensation, the claimant approached the High Court by way of appeal under Section of the Motor Vehicles Act, 1988 when the amount of compensation was enhanced to Rs. 25, 78, 501/-

Multiplier Method For Determining Attendant Charges
While awarding attendant charges, the Bench observed that the multiplier system should be followed not only for determining the compensation on account of loss of income but also for determining the attendant charges etc.

It said:
The attendant charges have been awarded by the High Court @ Rs.2,500/­ per month for 44 years, which works out to Rs.13,20,000/­. Unfortunately, this system is not a proper system. Multiplier system is used to balance out various factors. When compensation is awarded in lump sum, various factors are taken into consideration. When compensation is paid in lump sum, this Court has always followed the multiplier system.

The multiplier system should be followed not only for determining the compensation on account of loss of income but also for determining the attendant charges etc. This system was recognised by this Court in Gobald Motor Service Ltd. Vs R.M.K. Veluswami, AIR 1962 SC 1.

The multiplier system factors in the inflation rate, the rate of interest payable on the lump sum award, the longevity of the claimant, and also other issues such as the uncertainties of life. Out of all the various alternative methods, the multiplier method has been recognised as the most realistic and reasonable method. It ensures better justice between the parties and thus results in award of ‘just compensation’ within the meaning of the Act.

The Supreme Court of India has reaffirmed the multiplier method in various cases like Municipal Corporation of Delhi Vs. Subhagwati 1966 ACJ 57;  U. P. State Road Transport Corporation & Ors, Vs Trilok Chandra & Ors., (1996) 4 SCC 362; Sandeep Khanuja Vs Atul Dande & Ors., (2017) 3 SCC 351. The Supreme Court has also recognised that Schedule II of the Motor Vehicles Act, 1988 can be used as a guide for the multiplier to be applied in each case.

Liberal View While Assessing Compensation In Case Of 100% Disability
The Courts or the Tribunals, the Bench said, while assessing the compensation in a case of 100% disability, especially where there is mental disability also, should take a liberal view of the matter when awarding compensation. It added:
One factor which must be kept in mind while assessing the compensation in a case like the present one is that the claim can be awarded only once. The claimant cannot come back to court for enhancement of award at a later stage praying that something extra has been spent.

Therefore, the courts or the tribunals assessing the compensation in a case of 100% disability, especially where there is mental disability also, should take a liberal view of the matter when awarding compensation. While awarding this amount we are not only taking the physical disability but also the mental disability and various other factors. This child will remain bed­ridden for life. Her mental age will be that of a nine month old child. Effectively, while her body grows, she will remain a small baby.

We are dealing with a girl who will physically become a woman but will mentally remain a 9 month old child. This girl will miss out playing with her friends. She cannot communicate; she cannot enjoy the pleasures of life; she cannot even be amused by watching cartoons or films; she will miss out the fun of childhood, the excitement of youth; the pleasures of a marital life; she cannot have children who she can love let alone grandchildren. She will have no pleasure. Hers is a vegetable existence.

Guidelines To Ensure Victims Money Is Not Frittered Away
In this case, the High Court while enhancing the amount of compensation had directed that the enhanced amount be paid to the appellant within 45 days. The Court said that the following guidelines issued in General Manager, Kerala State Road Transport Corporation, Trivandrum v. Susamma Thomas, 1994 SCC (2) 176 should be followed by all the tribunals and High Courts to ensure that the money of the victims is not frittered away.

The guidelines in this case were as follows:

• 17....(i) The Claims Tribunal should, in the case of minors, invariably order the amount of compensation awarded to the minor be invested in long term fixed deposits at least till the date of the minor attaining majority. The expenses incurred by the guardian or next friend may, however, be allowed to be withdrawn;
   
• (ii) In the case of illiterate claimants also the Claims Tribunal should follow the procedure set out in (i) above, but if lump sum payment is required for effecting purchases of any movable or immovable property such as, agricultural implements, rickshaw, etc., to earn a living, the Tribunal may consider such a request after making sure that the amount is actually spent for the purpose and the demand is not a ruse to withdraw money;
   
• (iii) In the case of semi­literate persons the Tribunal should ordinarily resort to the procedure set out at (i) above unless it is satisfied, for reasons to be stated in writing, that the whole or part of the amount is required for expanding and existing business or for purchasing some property as mentioned in (ii) above for earning his livelihood, in which case the Tribunal will ensure that the amount is invested for the purpose for which it is demanded and paid;
   
• (iv) In the case of literate persons also the Tribunal may resort to the procedure indicated in (i) above, subject to the relaxation set out in (ii) and (iii) above, if having regard to the age, fiscal background and strata of society to which the claimant belongs and such other considerations, the Tribunal in the larger interest of the claimant and with a view to ensuring the safety of the compensation awarded to him thinks it necessary to do order;
   
• (v) In the case of widows the Claims Tribunal should invariably follow the procedure set out in (i) above;
   
• (vi) In personal injury cases if further treatment is necessary the Claims Tribunal on being satisfied about the same, which shall be recorded in writing, permit withdrawal of such amount as is necessary for incurring the expenses for such treatment;
   
• (vii) In all cases in which investment in long term fixed deposits is made it should be on condition that the Bank will not permit any loan or advance on the fixed deposit and interest on the amount invested is paid monthly directly to the claimant or his guardian, as the case may be;
   
• (viii) In all cases Tribunal should grant to the claimants liberty to apply for withdrawal in case of an emergency. To meet with such a contingency, if the amount awarded is substantial, the Claims Tribunal may invest it in more than one Fixed Deposit so that if need be one such F.D.R. can be liquidated....”

Normally interest should be granted from the date of filing of the petition

On awarding interest, the bench said:
Normally interest should be granted from the date of filing of the petition and if in appeal enhancement is made the interest should again be from the date of filing of the petition. It is only if the appeal is filed after an inordinate delay by the claimants, or the decision of the case has been delayed on account of negligence of the claimant, in such exceptional cases the interest may be awarded from a later date. However, while doing so, the tribunals/High Courts must give reasons why interest is not being paid from the date of filing of the petition.

The principles with regard to determination of just compensation contemplated under the Act are well settled. Injuries cause deprivation to the body which entitles the claimant to claim damages. The damages may vary according to the gravity of the injuries sustained by the claimant in an accident.

On account of the injuries, the claimant may suffer consequential losses such as:

1. loss of earning;
2. expenses on treatment which may include medical expenses, transportation, special diet, attendant charges etc.,
3. loss or diminution to the pleasures of life by loss of a particular part of the body, and
4. loss of future earning capacity.Damages can be pecuniary as well as non-pecuniary, but all have to be assessed in Rupees and Paise.

It is impossible to equate human suffering and personal deprivation with money.

However, this is what the Act enjoins upon the courts to do. The Court has to make a judicious attempt to award damages, so as to compensate the claimant for the loss suffered by the victim. On the one hand, the compensation should not be assessed very conservatively, but on the other hand, compensation should also not be assessed in so liberal a fashion so as to make it a bounty to the claimant.

The Court while assessing the compensation should have regard to the degree of deprivation and the loss caused by such deprivation. Such compensation is what is termed as just compensation. The compensation or damages assessed for personal injuries should be substantial to compensate the injured for the deprivation suffered by the injured throughout his/her life. They should not be just token damages.

There are numerous cases where the principles for grant of compensation have been enunciated. In Phillips Vs. Western Railway Co. (1874) 4 QBD 406 Field, J., while emphasizing that damages must be full and adequate, held thus:
You cannot put the plaintiff back again into his original position, but you must bring your reasonable common sense to bear, and you must always recollect that this is the only occasion on which compensation can be given. The plaintiff can never sue again for it. You have, therefore, now to give him compensation once and for all.

He has done no wrong, he has suffered a wrong at the hands of the defendants and you must take care to give him full fair compensation for that which he has suffered. Besides, the Tribunals should always remember that the measures of damages in all these cases should be such as to enable even a tort-feasor to say that he had amply atoned for his misadventure.

In the case of Mediana, [1900] AC 113, Lord Halsbury held:
Of course the whole region of inquiry into damages is one of extreme difficulty. You very often cannot even lay down any principle upon which you can give damages; nevertheless, it is remitted to the jury, or those who stand in place of the jury, to consider what compensation in money shall be given for what is a wrongful act.

Take the most familiar and ordinary case: how is anybody to measure pain and suffering in moneys counted?
Nobody can suggest that you can by any arithmetical calculation establish what is the exact amount of money which would represent such a thing as the pain and suffering which a person has undergone by reason of an accident.

In truth, I think it would be very arguable to say that a person would be entitled to no damages for such thing. What manly mind cares about pain and suffering that is past? But, nevertheless, the law recognizes that as a topic upon which damages may be given.

The following observations of Lord Morris in his speech in H. West & Son Ltd. Vs. Shephard, 1963 2 WLR 1359 , are very pertinent:
Money may be awarded so that something tangible may be procured to replace something else of the like nature which has been destroyed or lost. But money cannot renew a physical frame that has been battered and shattered. All that Judges and courts can do is to award sums which must be regarded as giving reasonable compensation.

In the process there must be the endeavour to secure some uniformity in the general method of approach. By common assent awards must be reasonable and must be assessed with moderation. Furthermore, it is eminently desirable that so far as possible comparable injuries should be compensated by comparable awards.

In the same case Lord Devlin observed that the proper approach to the problem was to adopt a test as to what contemporary society would deem to be a fair sum, such as would allow the wrongdoer to hold up his head among his neighbours and say with their approval that he has done the fair thing, which should be kept in mind by the court in determining compensation in personal injury cases.

Lord Denning while speaking for the Court of Appeal in the case of Ward Vs. James, (1965) 1 All ER 563 laid down the following three basic principles to be followed in such like cases:

1. Firstly, accessibility: In cases of grave injury, where the body is wrecked or brain destroyed, it is very difficult to assess a fair compensation in money, so difficult that the award must basically be a conventional figure, derived from experience or from awards in comparable cases.
    
2. Secondly, uniformity: There should be some measure of uniformity in awards so that similar decisions may be given in similar cases; otherwise there will be great dissatisfaction in the community and much criticism of the administration of justice.
    
3. Thirdly, predictability: Parties should be able to predict with some measure of accuracy the sum which is likely to be awarded in a particular case, for by this means cases can be settled peaceably and not brought to court, a thing very much to the public good.

The assessment of damages in personal injury cases raises great difficulties. It is not easy to convert the physical and mental loss into monetary terms. There has to be a measure of calculated guess work and conjecture. An assessment, as best as can, in the circumstances, should be made.

In McGregor’s Treatise on Damages, 14th Edn., Para 1157, referring to heads of damages in personal injury actions states:
The person physically injured may recover both for his pecuniary losses and his non­pecuniary losses. Of these the pecuniary losses themselves comprise two separate items, viz., the loss of earnings and other gains which the plaintiff would have made had he not been injured and the medical and other expenses to which he is put as a result of the injury, and the courts have sub­divided the non­pecuniary losses into three categories, viz., pain and suffering, loss of amenities of life and loss of expectation of life.

In M/S Concord of India Insurance Co. Ltd. Vs. Nirmala Devi & Ors, 1980 ACJ 55 (SC), the Honble Supreme Court of India held:
2....The determination of the quantum must be liberal, not niggardly since the law values life and limb in a free country in generous scales.

In R.. D. Hattangadi Vs. Pest Control (India) Pvt. Ltd., (1995) 1 SCC 551, dealing with the different heads of compensation in injury cases the Supreme Court held thus:
9. Broadly speaking, while fixing the amount of compensation payable to a victim of an accident, the damages have to be assessed separately as pecuniary damages and special damages. Pecuniary damages are those which the victim has actually incurred and which are capable of being calculated in terms of money; whereas non ­ pecuniary damages are those which are incapable of being assessed by arithmetical calculations.

In order to appreciate two concepts pecuniary damages may include expenses incurred by the claimant

1. medical attendance
2. loss of earning of profit up to the date of trial;
3. other material loss. So far as non-pecuniary damages are concerned, they may include:

(i) damages for mental and physical shock, pain and suffering already suffered or likely to be suffered in the future;
(ii) damages to compensate for the loss of amenities of life which may include a variety of matters, i.e., on account of injury the claimant may not be able to walk, run or sit;
(iii) damages for loss of expectation of life, i.e. on account of injury the normal longevity of the person concerned is shortened;
(iv) inconvenience, hardship, discomfort, disappointment, frustration and mental stress in life.

In Raj Kumar Vs. Ajay Kumar and Others, (2011) 1 SCC 343, the Supreme Court laid down the heads under which compensation is to be awarded for personal injuries.

6. The heads under which compensation is awarded in personal injury cases are the following:
Pecuniary damages (Special damages)

1. Expenses relating to treatment, hospitalization, medicines, transportation, nourishing food, and miscellaneous expenditure.
2. Loss of earnings (and other gains) which the injured would have made had he not been injured, comprising: (a) Loss of earning during the period of treatment; (b) Loss of future earnings on account of permanent disability.
3. Future medical expenses.
   Non ­ pecuniary damages (General damages)
4. Damages for pain, suffering and trauma as a consequence of the injuries.
5. Loss of amenities (and/or loss of prospects of marriage).
6. Loss of expectation of life (shortening of normal longevity)

In routine personal injury cases, compensation will be awarded only under heads (i), (ii) (a) and (iv). It is only in serious cases of injury, where there is specific medical evidence corroborating the evidence of the claimant, that compensation will be granted under any of the heads (ii)(b), (iii), (v) and (vi) relating to loss of future earnings on account of permanent disability, future medical expenses, loss of amenities (and/or loss of prospects of marriage) and loss of expectation of life.”

In K. Suresh Vs. New India Assurance Company Ltd. & Ors., (2012) 12 SCC 274, the Supreme Court held as follows:
“2...There cannot be actual compensation for anguish of the heart or for mental tribulations. The quint essentiality lies in the pragmatic computation of the loss sustained which has to be in the realm of realistic approximation. Therefore, Section 168 of the Motor Vehicles Act, 1988 (for brevity ‘the Act’) stipulates that there should be grant of just compensation. Thus, it becomes a challenge for a court of law to determine “just compensation” which is neither a bonanza nor a windfall, and simultaneously, should not be a pittance.

The Tribunal has power to award the compensation above the amount claimed, so as to award compensation which was just. In this regard the following observations of the Supreme Court in State of Haryana Vs. Jasbir Kaur, (2003) 7 S.C.C. 484 are worth noting:
7. It has to be kept in view that the Tribunal constituted under the Act as provided in Section 168 is required to make an award determining the amount of compensation which is to be in the real sense damages which in turn appears to it to be just and reasonable. It has to be borne in mind that compensation for loss of limbs or life can hardly be weighed in golden scales. But at the same time it has to be borne in mind that the compensation is not expected to be a windfall for the victim. Statutory provisions clearly indicate that the compensation must be just and it cannot be a bonanza; not a source of profit; but the same should not be a pittance.

The courts and tribunals have a duty to weigh the various factors and quantify the amount of compensation, which should be just. What would be just compensation is a vexed question. There can be no golden rule applicable to all cases for measuring the value of human life or a limb. Measure of damages cannot be arrived at by precise mathematical calculations. It would depend upon the particular facts and circumstances, and attending peculiar or special features, if any. Every method or mode adopted for assessing compensation has to be considered in the background of just compensation which is the pivotal consideration.

Though by use of the expression which appears to it to be just a wide discretion is vested in the Tribunal, the determination has to be rational, to be done by a judicious approach and not the outcome of whims, wild guesses and arbitrariness. The expression just denotes equitability, fairness and reasonableness, and non-arbitrary. if it is not so it cannot be just. (See Helen C. Rebello v. Maharashtra SRTC (1999(1) SCC 90)”

The Motor Accidents Claims Tribunal should not be a silent spectator when medical evidence is tendered in regard to the injuries and their effect, in particular the extent of permanent disability. Sections 168 and 169 of the Motor Vehicles Act, 1988 make it evident that the Tribunal does not function as a neutral umpire as in a civil suit, but as an active explorer and seeker of truth who is required to `hold an enquiry into the claim for determining the `just compensation. The Tribunal should therefore take an active role to ascertain the true and correct position so that it can assess the `just compensation.

While dealing with personal injury cases, the Tribunal should preferably equip itself with a Medical Dictionary and a Handbook for evaluation of permanent physical impairment (for example the Manual for Evaluation of Permanent Physical Impairment for Orthopedic Surgeons, prepared by American Academy of Orthopedic Surgeons or its Indian equivalent or other authorized texts) for understanding the medical evidence and assessing the physical and functional disability.

The Tribunal may also keep in view the First Schedule to the Workmens Compensation, 1923 which gives some indication about the extent of permanent disability in different types of injuries, in the case of workmen. If a Doctor giving evidence uses technical medical terms, the Tribunal should instruct him to state in addition, in simple non-medical terms, the nature and the effect of the injury.

If a doctor gives evidence about the percentage of permanent disability, the Tribunal has to seek clarification as to whether such percentage of disability is the functional disability with reference to the whole body or whether it is only with reference to a limb.

If the percentage of permanent disability is stated with reference to a limb, the Tribunal will have to seek the doctors opinion as to whether it is possible to deduce the corresponding functional permanent disability with reference to the whole body and if so the percentage. Purpose of social welfare legislation is to find out ways and means to help the sufferer in all possible fields.

The Bench accordingly enhanced the amount of compensation to Rs. 62, 27, 000/- in favour of the claimant/appellant.

Written By: Dinesh Singh Chauhan, Advocate, High Court of Judicature, J&K, Jammu.
Email: [email protected], [email protected]