Compensation Awarded Prior to Claimant’s Death Devolves upon Legal Heirs as an Intangible Asset of the Estate

In brief

The question

1. Whether the legal heir of a deceased claimant is entitled to the full compensation amount awarded by the Tribunal if the claimant dies after the judgment was pronounced.

The court held

As the award was passed while the claimant was alive, it became an asset of his estate that must be disbursed in full to his legal heir.

It also directed

The Gauhati High Court found no merit in the appeal and dismissed it. The Insurance Company was directed to pay the original compensation amount of Rs. 26,32,000/- with interest to the respondent.

Records were ordered to be returned to the Tribunal for disbursement.

01Facts

On April 14, 2011, Angshuman Borah sustained grievous injuries resulting in permanent disability (80% loss of earning capacity) after the motorcycle he was riding as a pillion was driven negligently by respondent No. 2 and hit an electric post.

pp. 2-3

The injured filed a claim under Section 166 of the Motor Vehicles Act, 1988, through his brother, Anjan Borah.

p. 3

The Motor Accident Claims Tribunal (MACT), Golaghat, awarded Rs. 26,32,000/- on October 30, 2014.

p. 4

Following the award, the claimant died on December 13, 2014.

p. 4

The Insurance Company appealed, contending that as the claimant had died, his legal representative (respondent No. 1) was only entitled to "No Fault Liability" (Rs. 25,000) and not the full award, as the sibling was not a dependent.

pp. 5-6

02Issues

i.1. Whether the legal heir of a deceased claimant is entitled to the full compensation amount awarded by the Tribunal if the claimant dies after the judgment was pronounced.

p. 9

ii.2. Whether the assessment of 80% loss of earning capacity by the Tribunal was justified based on the medical evidence.

pp. 9-10

03Law Applied

Section 173 of the Motor Vehicles Act, 1988, regarding appeals.

p. 2

Once a compensation award is passed, it crystallizes into a debt/asset and becomes part of the claimant's estate, devolving upon legal heirs regardless of dependency.

p. 9

Manjuri Bera v. Oriental Insurance Co. Ltd. (2007) regarding the entitlement of legal heirs to "estate".

p. 5

Gujarat State Road Transport Corp. v. Ramanbhai Prabhatbhai (1987), and National Insurance Co. Ltd. v. Birender (2020) concerning the rights of legal representatives.

p. 7

Provisions in the judgment · 2 · Linked ones open on LawLens

Motor Vehicles Act, 1988 Section 173 Section 166

04Reasoning

The Court rejected the appellant’s argument that compensation should be limited to the "estate" or "No Fault Liability" because the claimant died during the pendency of the appeal. The Court reasoned that since the MACT judgment was delivered prior to the death of Angshuman Borah, the compensation amount had already survived as a liquidated asset.

¶ 21

The amount was no longer a personal injury claim that might abate, but a crystallized asset of the deceased's estate that devolved to his legal heir, Anjan Borah.

¶ 22

Regarding the quantum, the Court analyzed the testimony of the Medical Officer (CW-2), who confirmed hemiplegia and an 80% loss of earning capacity; the Court found this assessment reasonable given the claimant's profession as a Hardware Computer Engineer requiring the use of both hands.

¶ 23-24

05Holding

As the award was passed while the claimant was alive, it became an asset of his estate that must be disbursed in full to his legal heir.

¶ 22

The Gauhati High Court found no merit in the appeal and dismissed it. The Insurance Company was directed to pay the original compensation amount of Rs. 26,32,000/- with interest to the respondent.

¶ 26 · p. 10

Records were ordered to be returned to the Tribunal for disbursement.

¶ 27

LawLens.Gauhati High Court

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