Issues:

1. Can Vaibhav Motors be considered the owner of the offender vehicle, despite being a mere dealer of Hindustan Motors? Is Vaibhav Motors, along with Hindustan Motors, jointly responsible for compensating the victims of the accident?
2. Do Clauses 3(b) and 4 of the Dealership Agreement formulated by Hindustan Motors help them escape the payment of compensation to the victims?
3. Can Hindustan Motors question its liability under the decision granted by the Tribunal, despite preferring no appeal for the same?

Rule:

• The Motor Vehicles Act, 1988, is the primary legislation invoked in the aforementioned case. The highlight is on Section 2(30), which defines the term “owner” of a vehicle.

owner means a person in whose name a motor vehicle stands registered and where such person is a minor, the guardian of such minor, and in relation to a motor vehicle which is the subject of a hire-purchase, agreement, or an agreement of lease or an agreement of hypothecation, the person in possession of the vehicle under that agreement;

• Order 41 Rule 33 of The Code of Civil Procedure, 1908is also called upon by Hindustan Motors to invoke the power of the appellate court to pass an order that ought to have been passed, without one or more parties preferring an appeal for the same.
• The tort of Vicarious Liabilitywas adduced to determine if the employer, Hindustan Motors, was responsible for the actions of its employees driving the vehicle.

Analysis:

Issue 1:

A major point of contention in front of the Supreme Court was the establishment of “ownership,” in this case, as defined by Section 2(30) of the Motor Vehicles Act, 1988.

Through multiple judgements given by the Apex Court itself, the Supreme Court concluded that Section 2(30) is not exhaustive in its definition of ownership. In fact, it was opined that any person with command or control over the vehicle at the time can be accommodated in the definition of ownership. The aforementioned person can also attract liability for compensating the victims.

Now the question arose: Can Vaibhav Motors be tagged as the owner of the car during the time of the accident? Did they have command and control over the vehicle at the time of the accident?

The preceding ruling by the Tribunal had considered that Hindustan Motor possessed no evidence that the sale of the offender vehicle was made to Vaibhav Motors. Moreover, the driver of the car at the time of the accident and the deceased were employees of Hindustan Motors. No employee or representative from the dealership was present.

In this instance, Hindustan Motors was in “command” and “control” of the vehicle through its representatives when the accident occurred. The Court reasoned that Vaibhav Motors had no way to authorise or deny the representatives of the parent company about taking the vehicle on a test ride. Hence, the dealership does not fall under the purview of “owner” and holds no joint liability to compensate the victims.

Issue 2:

Clauses 3(b) and 4 of the Dealership Agreement emphasise that after the dispatchment of the motor vehicles, Hindustan Motors will merely have liability with the warranty provided for the vehicle. The company cannot be made liable for any further defects.

However, the Supreme Court ruled that since the vehicle was in control of Hindustan Motors at the time of the accident, the company cannot escape liability under the Motor Vehicles Act, 1986. Hence, the aforementioned clauses do not absolve Hindustan Motors from paying compensation to the victim.

(c) Issue 3:

Since Hindustan Motors had not engaged in any kind of appeal or cross-objection, the Court ruled that the company had allowed the decision to reach finality. The goal of Order 41 Rule 33 is to achieve justice for an aggrieved party, and the lack of appeal or objection by Hindustan Motors has supplemented their decision to allow finality in the matter. As such, Hindustan Motors cannot ask to reverse the order in their favour.

Conclusion:

In the case of Vaibhav Jain v. Hindustan Motors Ltd, it was established that the ambit of “ownership” as defined under Section 2(30) of the Motor Vehicles Act, 1986, is not exhaustive in its definition. In fact, the purview of ownership also accommodates the person or organisation having “command” and “control” of the vehicle at the time of the incident.

Since no representative from Vaibhav Motors was present in the vehicle at the time of the accident, the dealership does not attract tortious liability for compensating the victim. Hindustan Motors is solely responsible for providing such compensation to the victims.

by Yash More

Guided and mentored by Advocate Aameer Kale