Summary
The Supreme Court upheld the insurer’s right to recover compensation from an owner-driver after first paying the claimant. The licence initially produced was proved fake. The alternative licence had expired before the accident and was renewed more than two years later, and the owner-driver did not testify. Applying Swaran Singh, the Court found that the insured had failed to take reasonable care concerning a valid licence. The decision rested on that proved failure, rather than treating every licensing defect as sufficient to avoid insurer liability.
Issues
- Whether the insurer’s pay-and-recover direction was justified by the owner-driver’s proved failure to hold and ensure an effective licence.
Held
- Swaran Singh requires the insurer to establish breach by the insured; mere absence, falsity or invalidity of a licence does not automatically suffice. Whether reasonable care was exercised depends on the facts of the case. The Court applied those principles to the insured’s own conduct. (¶¶ 7, 8)
- The owner-driver produced a licence proved not to have been issued by the purported licensing authority. His alternative licence had expired before the accident and was renewed well outside the period considered in the judgment. He avoided the witness box and could not have been unaware of facts within his own knowledge. These circumstances established failure to take reasonable care. (¶¶ 6, 8)
- The insurer therefore remained directed to satisfy the award first, with a right of recovery from the owner-driver. The appeal concerned that allocation of liability; the claimant’s separate challenge had already been dismissed and the compensation quantum was not redetermined. (¶¶ 2, 4, 5, 9)
Result
Owner-driver’s appeal dismissed without costs. Insurer’s obligation to pay the claimant and right to recover from the owner-driver upheld.