Supreme Court on Drunk Driving and Insurance Claims

 

INTRODUCTION

 

On today’s show, we will discuss the case of IFFCO TOKIO General Insurance Company Ltd. v. Pearl Beverages Ltd., 2021 SCC OnLine SC 309, wherein the Hon’ble Supreme Court discussed the influence of liquor on driving and its legal implications.

 

FACTS

 

The brief facts of the case are that a Car (Porsche) that was insured with the Appellant, suffered an accident and the MLC (Medico-Legal Case) Report indicated smell of alcohol coming from the Driver of the Car and the co-passenger. The Insurance Company denied the claim with respect to the Car’s accident on the ground that the driver was under the influence of intoxicating liquor breaching Clause 2 (c) of the Insurance Contract that stated that:

 

“The Company shall not be liable to make any payment in respect of any accidental loss or damage suffered whilst the insured or any person driving the vehicle with the knowledge and consent of the insured is under the influence of intoxicating liquor or drugs.”

 

Interpretation of this clause was conducted by the Supreme Court by taking into consideration the fact that the Driver of the Car had consumer liquor before or during the accident. However, there was no clarity as to the quantity of alcohol consumed and the only evidence regarding alcohol was its smell that was detected at the time of MLC Report.

 

Let us understand the observations of the Court in this regard.

 

OBSERVATIONS OF THE COURT

 

Firstly, in order to interpret Clause 2 (c), the Court observed that the Insurance Claim “must be considered on the basis of the nature of the accident, evidence as to drinking before or during the travel, the impact on the driver and the very case set up by the parties.”

 

Secondly, the Court explained the meaning of driving under the influence of alcohol as “driving when, on account of consumption of alcohol, either before commencement of driving or during the driving and before the accident, when consumption of alcohol by the driver would affect (influence) his faculties and his driving skills.” Basically, the alcohol consumed earlier should have been the cause or should have contributed to the occurrence of the accident.

 

Thirdly, the Court discussed the impact of alcohols on individuals by quoting Modi's Medical Jurisprudence and Toxicology. It stated that “alcohol acts differently on different individuals and also on the same individual at different times. The action depends mostly on the environment and temperature of the individuals and upon the degree of dilution of the alcohol consumed. The habitual drinker usually shows fewer effects from the same dose of alcohol.”

 

Fourthly, the Court discussed the concept of BAC (Blood Alcohol Concentration) which is the concentration of alcohol in a person's blood. In India, the permissible BAC level is pegged at 30 mg of alcohol in 100 ml. of blood. It was observed that “BAC is correlated to a number of variables. It is affected by gender and body weight. The male has more water content than a female. On same quantity drunk, the latter builds up greater BAC than the former. BAC is also affected clearly on whether the person drank on an empty stomach or not. The liver metabolises ordinarily a standard drink at the rate of a drink in an hour. The frequency, at which the drinks are taken, impacts the BAC level. Even the genes play their part.” The neurological effects of alcohol were also discussed that lead a person to become lethargic and euphoric.

 

 

Fifthly, the Court observed that the since the Car was being driven by the Driver after having consumer alcohol, the amount of alcohol consumed by the Driver would be known only to him and it would be “disproportionately difficult” for the Insurer to prove “as to whether the driver has consumed liquor on an empty stomach or he had food and then consumed alcohol or what was the quantity and quality of the drink (alcohol content) which would have been circumstances relevant to consider as to whether he drove the vehicle under the influence of alcohol.”

 

Sixthly, the Court discussed the principle of Res Ipsa Loquitur. It means that mere happening of an event, or an accident is not an evidence of negligence, but the peculiar circumstances constituting such event or accident “may themselves proclaim in concordant, clear and unambiguous voices the negligence of somebody as the cause of the event or accident.” In such cases, this doctrine or rule is applicable. According to the Court, “the manner in which the accident occurred may along with other circumstances point to the driver being under the influence of alcohol.”

 

HELD BY THE COURT

 

Those were the observations of the Court and in such light the Court finally held that there seems to be no apparent cause or explanation for the occurrence of the accident and dashing of the car on the footpath with a massive force in a setting where the roads are wide (near India Gate, New Delhi), traffic is thin, along with the fact that the alcohol was consumed, does point to a conclusion that alcohol did influence the driver. Hence, the driver and the car owner were denied insurance claim in accordance with Clause 2 (c) of the Insurance Contract.

 

So, what are my concluding remarks?

 

CONCLUSION

 

Drunk driving is a big cause of accidents in India. The insurance companies deny claims of insurance where drunk driving is involved because it would be next to impossible for the insurance company to prove the exact amount of alcohol consumer by a driver. The only thing to required to be proved in such cases is that alcohol was consumed before or during the time of the accident. Further, the wordings of the Insurance Contract are paramount. Hypothetically speaking, if there is an Insurance Contract Clause that permits payment of insurance claim even if there is a case of drunk driving, then such Contract Clause shall prevail over any other reasoning and such case would be adjudged on its own merits.