National Insurance Co.Ltd. Singrauli vs Kallu @ Devi Prasad And Others

Deepak Khot, J

Counsel for the petitioner submitted that by the impugned order dated 30.11.2013 (Annexure P-1), the claim application filed by the respondent no.1 has been settled in the Lok Adalat on the basis of compromise. However, from the perusal of the Annexure P-2 no compromise has been accorded by the petitioner/Insurance Company.

It is submitted that the counsel was not authorized to enter into the compromise with the claimants and no sanction was granted by the petitioner/Insurance company. For the said, the letter dated 17.01.2014 (Annexure P-3) issued by the petitioner/Insurance Company and reply dated 23.01.2014 given by the counsel, who appeared on behalf of the petitioner/Insurance company has been filed as Annexure P-4.

Heard learned counsel for the petitioner and perused the record.

On perusal of the award, it is found that award has been passed in Lok Adalat recording compromise between the parties. Annexure P-2 is the application recording compromise. However, the said application does not contains signature of any of the authorized representative of the Insurance Company. From the perusal of the letter dated 23.01.2014 (Annexure P-4), written by the counsel, it is found that the counsel appeared for petitioner was not authorized to enter into compromise; therefore, from the record it is clear that the compromise has been entered into by the counsel of the petitioner without any authority, which is not binding on the petitioner/ Insurance company.

That the Hon'ble Apex Court in case of Himalayan Co-operative Group Housing Society Vs. Balwan Singh; reported in (2015) 7 SCC 373 has held that any concession given by the counsel without authorization that too in respect of compromise is not enforceable against the parties. It is further held as under:-

"32. Generally, admissions of fact made by a counsel is binding upon their principals as long as they are unequivocal; where, however, doubt exists as to a purported admission, the Court should be wary to accept such admissions until and unless the counsel or the advocate is authorised by his principal to make such admissions. Furthermore, a client is not bound by a statement or admission which he or his lawyer was not authorised to make. Lawyer generally has no implied or apparent authority to make an admission or statement which would directly surrender or conclude the substantial legal rights of the client unless such an admission or statement is clearly a proper step in accomplishing the purpose for which the lawyer was employed. We hasten to add neither the client nor the Court is bound by the lawyer's statements or admissions as to matters of law or legal conclusions. Thus, according to generally accepted notions of professional responsibility, lawyers should follow the client's instructions rather than substitute their judgment for that of the client. We may add that in some cases, lawyers can make decisions without consulting client. While in others, the decision is reserved for the client. It is often said that the lawyer can make decisions as to tactics without consulting the client, while the client has a right to make decisions that can affect his rights. "

Considering the fact that there is no signature by the petitioner/Insurance company to accord compromise, the impugned award dated 30.11.2013 (Annexure P-1) in absence of any consent of the petitioner/Insurance company is nullity is hereby quashed. The Additional Motor Accident Claim Tribunal, Singrauli is directed to restore the MVC No.62/13 and hear the case on its merits by issuing notices to the interested parties.

With the aforesaid, this writ petition is disposed of.