A settlement emerging from a Lok Adalat cannot bind disputing parties unless they themselves sign it, the Karnataka High Court has ruled while striking down an award that bore only a lawyer’s signature.
The decision came after a woman and her son challenged a Lok Adalat award that reduced the compensation they were entitled to in a fatal motor accident claim. They contended that the compromise reflected in the award was reached without their knowledge, alleging that their former counsel had entered into the settlement with the insurer without their consent.
The Court examined the record and found that the joint memo underlying the Lok Adalat award carried signatures of the advocates and the insurance company’s representative, but not those of the claimants. Relying on established precedents, the Court emphasised that a Lok Adalat settlement must be voluntary and that such voluntariness is ordinarily demonstrated through the parties’ own signatures.
Observing that the claimants had not endorsed the compromise, the Court concluded that the award could not be treated as binding. It therefore set aside the Lok Adalat order and restored the appeal for consideration on merits.
The dispute arose from the death of a daily-wage worker in a road accident. A Motor Accident Claims Tribunal had originally awarded compensation of ₹9,18,600 to the widow and her son. The insurer later challenged that decision. During the appellate stage, the matter was referred to a Lok Adalat, which reduced the compensation to around ₹7,82,000.
Since the reduced settlement was signed only by the advocate representing the claimants and not by the claimants themselves, the High Court held that the award lacked the essential element of consent. Consequently, the 2019 Lok Adalat award was quashed, and the earlier appeal was revived for fresh adjudication.
