Insurance company of tractor liable for accident of attached trailer without separate coverage: Supreme Court

New Delhi: The Supreme Court has said if an insured vehicle hits another vehicle which in turn hits a third vehicle, then for the entire chain of accidents, the liability would pass on to the vehicle which was the root cause of the accident because it is the result of the action in the same chain of events which cannot be segregated or compartmentalised.

Holding that this court is duty-bound to be mindful of the ground realities of the nation and cannot let practicality be overshadowed by technicality, a bench of Justices Sudhanshu Dhulia and Ahsanuddin Amanullah held that the liability of the tractor and its insurer would be extended to the accident caused by the vehicle resulting in the death of the deceased, through the trailer, attached to it. 

Dealing with an appeal by the insurance company, the court did not find any infirmity in the judgment, either with regard to the quantum of compensation awarded or fixation of liability on the insurer-appellant for the accident. It ordered the amount to be paid within two months. 

Royal Sundaram Alliance Insurance Company Limited challenged the Karnataka High Court's order of November 25, 2022. The High Court partly allowed appeal by the family members of the deceased coolie and enhanced the compensation awarded from Rs 9,50,000 to Rs 13,28,940, with 6% per annum interest and fastened the liability on the appellant to pay such compensation.

On February 29, 2012, the deceased-Nagarajappa was travelling in a tractor and trailer as a coolie in order to unload the soil. Due to the rash and negligent driving, the tractor and trailer toppled causing injuries to the deceased-Nagarajappa, ultimately leading to his death.

The appellant-insurer contended the policy did not extend any coverage, either to the trailer or employees of the owner or any passenger travelling on the trailer.  

In its judgment on May 5, 2025, the court explained that the principle that the trailer has to be separately registered with the insurance company to make it liable, would not be applicable here. 

Justice Amanullah, who authored the 17-page judgment, noted the admitted fact is that the incident occurred while a tractor which was insured with the appellant was attached to a trailer and a person who was present on the trailer fell off, due to an unfortunate accident and the trailer was being pulled by/driven by/attached to the tractor, resulting in the death of such person.

"The undisputed position is that the trailer was being pulled by/attached to the tractor and then the trailer on which the deceased was present, turned turtle/upturned, resulting in his death. It is clear that the tractor which was insured was the reason for the accident. It is not the case that only because of some fault on the part of the trailer stand-alone, the accident happened," the bench said.

Giving an example, the bench said had the trailer been stationary at a place and due to some reason, it overturned or a mishap happened, then without the trailer being specifically insured, the appellant would not be liable to pay, but here the main cause of the accident was the tractor which was pulling/driving/moving the trailer and in such sequence of events, the trailer upturned. Thus, the accident was caused by the tractor, as during the course of being driven/pulled by the tractor, the accident occurred, the court said.

It said that ultimately the root cause of the accident being the tractor, which was insured, this crucial fact cannot be lost sight of.