Employer’s Duty in Ensuring Driver Competence: Legal Analysis

This legal case delves into the crucial question of the extent of care and diligence expected from employers regarding the competence and safety of employed drivers. The court’s analysis focuses on the standards of care and responsibility of the employer in verifying the validity of a driver’s license. Understanding the legal nuances of this case is essential in comprehending the obligations of employers in ensuring the competency of drivers they hire.


  • Complaint no. 227/2012 allowed by District Forum, directing Insurance Company to pay Rs. 2,00,000 for personal accident claim with interest and cost of litigation
  • Driver did not have valid driving license at the time of accident, claim repudiated by Insurance Company
  • National Commission absolved Insurance Company of liability due to lack of driver’s license record
  • Appellant/Complainant filed appeal seeking compensation for accident claim, mental agony, and litigation cost

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  • Extent of care/diligence expected of the employer/insured while employing a driver is the main issue for consideration in the case.
  • The court needs to determine the standard of care required and the level of diligence expected from the employer/insured.
  • Key question is how much responsibility the employer/insured holds in ensuring the competence and safety of the employed driver.

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  • The issue in the case revolves around whether the insurer is liable when the driver possessed a fake or invalid driving license.
  • It is argued by the Appellant/Complainant that the owner typically checks documents like driving license when employing a driver but does not usually verify their genuineness.
  • Breach of conditions under Section 149(2)(a) of the Motor Vehicles Act absolves the insurer of liability if the driver does not have a valid license.
  • It is noted that in this case, no record of the license was found with the licensing authority, absolving the insurer of liability.
  • The responsibility to verify the validity of the license should not unreasonably burden the owner, as mentioned in the case analysis.
  • If the insurer can prove that the owner was aware of the fake license and still allowed the driver to operate the vehicle, the insurer would not be liable.
  • The National Commission’s view that a previous case’s precedent does not apply, particularly in regards to third-party claims, is considered erroneous in this analysis.
  • The insurer has the right to argue that the driver was not properly licensed under Section 149(2)(a)(ii) when filing for compensation.
  • Insurance Company cannot avoid liability if the driver was not duly licensed, as long as the employer found the driver competent and licensed.
  • Insurer must prove negligence on part of the insured to avoid liability regarding the use of a duly licensed driver.
  • Employer is expected to verify driver’s license while hiring.
  • If driver produces a seemingly genuine license, employer is not required to further investigate unless there is reason to doubt.
  • Mere absence, fake, or invalid license of the driver is not a defense for the insurer.
  • The Appellant/Complainant had been driving competently and had no reason to doubt the veracity of the driver’s license.
  • The Respondent/Insurance Company does not contend that the Appellant/Complainant acted with willful negligence in employing the driver.

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  • The Insurance Company is held liable to indemnify the appellant.
  • The impugned judgment is not liable to be sustained and is set aside.
  • The appeals are allowed as a result.


Case Number: C.A. No.-001999-002000 / 2020

Click here to read/download original judgement

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