Motor accident compensation: interest follows prevailing rates, and loss of dependency may include reasonable future prospects.

In motor accident compensation claims, the rate of interest on compensation should be fixed on the facts of the case with reference to the prevailing bank rate, and the award was maintained at 9% per annum. For assessing loss of dependency, the structured formula in the Second Schedule should ordinarily be followed, but a just and fair assessment under the Motor Vehicles Act may account for future prospects where the deceased was young and in stable employment. The multiplier of 15 was accepted, while the yearly income was reassessed upward after deduction of one-third for personal expenses, resulting in enhanced compensation.

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Issues: (i) whether the rate of interest on the compensation should be 9% per annum; (ii) whether the multiplicand for assessing loss of dependency should be enhanced by taking a higher estimate of the deceased's future income.

Issue (i): whether the rate of interest on the compensation should be 9% per annum.

Analysis: The rate of interest in motor accident compensation matters depends on the facts and circumstances of each case and is ordinarily guided by the prevailing bank rate. Earlier awards granting different rates were noted, but the appropriate rate had to be fixed on the basis of the present case.

Conclusion: The compensation carried interest at 9% per annum.

Issue (ii): whether the multiplicand for assessing loss of dependency should be enhanced by taking a higher estimate of the deceased's future income.

Analysis: Compensation under the structured formula in the Second Schedule should ordinarily be followed, subject to just and fair assessment under Section 168 of the Motor Vehicles Act. As the deceased was a young man with a stable job, future prospects and career advancement had to be reasonably considered. The multiplier of 15 was accepted, but the yearly income was reassessed at a higher figure, one-third being deducted towards personal expenses.

Conclusion: The loss of dependency was enhanced to Rs. 30,000 per annum and the compensation was recalculated accordingly.

Final Conclusion: The claimant obtained enhanced compensation and a higher rate of interest, but the award was otherwise maintained on the basis of the multiplier of 15.

Ratio Decidendi: In motor accident compensation claims, interest must be fixed with reference to the facts and prevailing rate, and assessment of dependency may include a reasonable estimate of future prospects while adhering to the structured formula unless exceptional reasons justify deviation.

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