The bench of the Madhya Pradesh High Court held that an owner’s negligent permission for a minor to drive a motor vehicle without a valid driving licence constitutes a fundamental breach of the insurance policy. In an appeal brought by an insurance company challenging a compensation award made by the Additional Motor Accident Claims Tribunal, the court reviewed the circumstances of a road accident that occurred when the claimant was seriously injured. The accident took place on 7 October 2024. The claimant had been travelling when the motorcycle driven by respondent no. 2 crashed due to rash and negligent driving, causing injury to the claimant’s right hand and leg and necessitating hospitalisation. Respondent no. 2 was the driver and respondent no. 3 the registered owner of the vehicle; the insurance company, as the insurer of the offending vehicle, had been ordered to indemnify the claimant under the tribunal’s award of Rs 76,000 in compensation.
In its appeal the insurer argued that respondent no. 2 did not hold a valid driving licence at the time of the accident and that the tribunal erred in not considering this fact. The insurer further contended that respondent no. 3, the owner, could not simply disclaim liability by saying that he did not give consent or was unaware of the minor brother driving the vehicle. The High Court noted that the accident arose from the rash and negligent driving of respondent no. 2, who was found to be a minor and unlicensed. Applying the provisions of the Motor Vehicles Act, 1988 — specifically Sections 3, 4 and 5 — the court emphasised that no person below the prescribed age can drive a motor vehicle and that the owner is under a statutory duty to ensure the vehicle is not driven by a person lacking a valid licence.
Rejecting the owner’s plea of lack of consent or knowledge, the court held that the true duty is on the vehicle owner to take adequate care to ensure that only drivers who are competent and licensed are permitted access to the vehicle. The bench underscored the moral and legal responsibility of guardians and elders in preventing minors from engaging in acts that demand maturity and lawful permission — such as driving. The court highlighted that thrill-seeking by youth must be regulated by responsible elders so as not to compromise the minor’s safety or the safety of others.
Because respondent no. 3 failed in his duty to keep the vehicle safe and inaccessible to an unlicensed person, he could not escape liability. The court found that by negligently allowing a minor to drive the vehicle without a valid licence, there was a fundamental breach of the policy condition. That breach was held to be directly contributory to the cause of the accident, thereby entitlement to indemnification by the insurer was denied. The court accordingly allowed the appeal of the insurance company, directed that the awarded amount be deposited by the insurer, with liberty for the insurer to recover such amount from respondents no. 2 and 3 in accordance with law.
The court thus placed liability squarely on the driver and the owner. It held that the insurer is exonerated from liability to indemnify the claimant because of the fundamental breach of the policy condition arising from the owner’s negligent permission. The matter before the court was styled “Branch Manager, United Insurance v. Maneesh Kumar Singrore [MA 376 of 2007]”.
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