Insurer Not Necessary Party To Claim Compensation For Medical Negligence Under Consumer Protection Act: AP High Court

The Andhra Pradesh High Court has said that in an accident claim under the Motor Vehicles Act the insurance company is a necessary and property party, however in a compensation claim for medical negligence under the Consumer Protection Act the insurance company is not a necessary party. 

The petitioner had claimed that under MV Act, in claim petitions filed for compensation either due to death or injury, the insurance company is made a party. So applying the same principle, in the cases of compensation for the medical negligence also, the insurance company would be necessary party or at least a proper party to be impleaded. 

Rejecting the contention, a division bench of Justice Ravi Nath Tilhari and Justice Challa Gunaranjan noted that while the MV Act, mandates involvement of the insurance company, no such mandate can be found in the Consumer Protection Act, and there is no privity of contract between a consumer and the insurance company.

The court said that under Motor Vehicles Act against third party risks, there is necessity for insurance and the motor vehicle cannot be used in public place without a policy of insurance; the insurance company plays an active role to settle the claims relating to the accident. 

"So, far as the Motor Vehicles Act is concerned, the insurance company in such claim cases, becomes a necessary party to be impleaded. Any such comparison cannot be made for its impleadment in the cases for compensation before the District Forum due to medical negligence. Learned counsel for the petitioner has not been able to place before us any legal provision governing the field, like the statutory provisions under the Motor Vehicles Act". 

The complainant before the district consumer forum, claimed compensation/damages against the petitioner doctor and the respondents 4 and 5 who are doctors, alleging medical negligence. 

In this complaint, the petitioner (before high court) moved an application to implead Insurance Company as an opposite party before the district forum. The district forum dismissed the petitioner's application to implead the insurance company. The district forum had held that the complainant was not having any privity of contract with the insurance company and complainant was neither consumer nor beneficiary of the insurance company.

The petitioner moved the high court against the dismissal of impleadment application by District Consumer Forum and subsequently by the State Commission.

The petitioner contended that not adding the insurance company as a party would cause multiplicity of litigation and cited the example of claims under the MV act.

The court however said:

“The insurance company, in the present case of medical negligence, is not a necessary party, because the insurance company is not a person in whose absence, any effective order cannot be passed or compensation cannot be awarded against the hospital or the doctors. In our view, the insurance company is also not a proper party as the presence of the insurance company would not to be required to enable the Court to completely, effectively or adequately adjudicate upon the matters in dispute before the Consumer District Forum. Reason is that, the issue before the District Forum, inter alia would be the negligence or no negligence on the part of the doctors or the deficiency of service. For such adjudication of such question, the presence of the insurance company is not required.”

The Bench also noted that the plaintiff/complainant is the dominus litus and can choose his opponent.

“We are of the view that the insurance company is neither a necessary nor a proper party in the present case. The plaintiff/claimant is the dominus litis and against his wishes, the insurance company cannot be impleaded,” the high court said. 

The court dismissed the petition as being devoid of merit.

Case title: Dr. Mudunuri Ravi Kiran vs. The District Consumer Dispute Redressal Commission and others

Counsel for petitioner: K. Sarvabhouma Rao

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