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Absolute Liability
In the landmark case of M.C. Mehta v. Union of India, the Supreme Court of India introduced the principle of absolute liability to address the hazards posed by inherently dangerous industries, deviating from the strict liability rule established in Rylands v. Fletcher.
The case stemmed from a gas leak incident in Delhi, caused by one of the units of Shriram Foods and Fertilisers Industries. Recognizing the inadequacy of the strict liability rule in handling such incidents, the Court sought to evolve a more suitable legal standard.
In rejecting the application of the Rylands v. Fletcher rule, the Supreme Court declared its authority to evolve a new principle suitable for India's social and economic conditions. Thus, it introduced the rule of absolute liability, holding hazardous industries accountable for any harm caused, regardless of negligence or exceptions.
Key Elements of Absolute Liability
Non-delegable Duty: Industries engaged in hazardous activities owe an absolute duty to ensure safety. This duty cannot be delegated, and enterprises must maintain the highest safety standards.
No Exceptions: Unlike the Rylands v. Fletcher rule, absolute liability does not recognize exceptions. Even if an accident occurs without negligence, the enterprise remains liable for compensation.
Reasons for Absolute Liability
The Court provided two justifications for the rule:
Social Obligation: Enterprises profiting from hazardous activities have a social obligation to compensate those affected.
Resource Capability: Enterprises possess the resources to identify and mitigate risks, making them responsible for preventing harm.
Compensation and Deterrence
The Court emphasised that compensation should be commensurate with the enterprise's capacity to serve as a deterrent. Larger enterprises should pay higher compensation to discourage negligence.
Environment Pollution
In the case of Indian Council For Enviro-Legal Action v. Union of India, the Supreme Court reiterated its stance on absolute liability, as established in its prior ruling, M.C. Mehta v. U.O.I.
The case centred on environmental pollution in Bichhri village and neighbouring areas, stemming from the production of 'H' acid and discharges from a sulphuric acid plant operated by the defendants.
A writ petition was filed under Article 32 of the Constitution, representing the affected villagers' right to life, enshrined in Article 21. This petition targeted the Central and State Governments and the State Pollution Control Board, urging them to fulfil their statutory duties.
The Supreme Court deemed the writ petition maintainable, asserting its authority and duty to safeguard citizens' right to life. Furthermore, it empowered itself to compel the Central Government to recover the costs of remedial actions from the private companies.
The Central Government was tasked with determining the required amount for remedial measures, including the removal of sludge from the respondent companies' premises.
In a bold move, the Court ordered the attachment of the respondent companies' assets to fund the restoration of the affected area's soil, water sources, and overall environment.
Citing the companies' persistent violations as "rogue industries," the Court ordered their closure, acknowledging the significant harm inflicted upon the unsuspecting villagers.
Additionally, the respondent industries were directed to pay Rs. 50,000/- as costs to the petitioner, who had diligently pursued the litigation for six years. This liability on the "rogue industries" was grounded in the "Polluter Pays" principle, along with the principle of absolute liability established in the Oleum Gas Leak case.
The principle of absolute liability found application in Klaus Mittelbachert v. East India Hotels Ltd. as well. In this case, a German co-pilot staying at the Oberoi Inter-continental hotel in New Delhi suffered severe injuries and eventual death due to a defective swimming pool design.
The Delhi High Court held the hotel liable under absolute liability, emphasising its duty of care owed to guests, especially considering the high price of its services. Consequently, the plaintiff was awarded Rs. 50 lakhs in damages for the tragic accident.
Bhopal Gas Tragedy
The Bhopal Gas Leak Disaster of December 2/3, 1984, stands as one of the most catastrophic events in recent memory, triggered by the release of Methyl Isocyanate (MIC) and other toxic gases from a plant operated by Union Carbide India Ltd. (UCIL) in Bhopal.
This tragedy claimed the lives of at least 3,000 individuals and inflicted severe injuries on over 600,000 others, leaving many with lasting health complications, including damage to unborn children.
Compensation claims presented a complex challenge due to the vast number of victims, many of whom were economically disadvantaged. Consequently, numerous cases were filed both in Bhopal and the United States against Union Carbide Corporation (UCC), UCIL's parent company.
Despite attempts at an out-of-court settlement between the Indian government and UCC failing, the Indian government enacted "The Bhopal Gas Leak Disaster (Processing of Claims) Act, 1985," granting exclusive representation rights to the Central Government for all claimants.
Under Section 3 of the Act, the Central Government assumed the responsibility to pursue claims on behalf of the victims. Pursuant to this, India filed a suit against UCC in the United States District Court of New York, consolidating previous suits filed by American lawyers.
Despite India's argument for the trial to proceed in the U.S., citing convenience and access to evidence, the court accepted UCC's plea of forum non conveniens, prompting India to file a suit in the District Court of Bhopal.
The Supreme Court's ruling in M.C. Mehta v. Union of India established the principle of 'Absolute Liability' over 'Strict Liability,' as laid down in Rylands v. Fletcher.
This meant UCC couldn't evade liability, even by claiming sabotage, as permitted under the strict liability rule. The Court's stance emphasised that enterprises engaged in hazardous activities bear absolute responsibility for any resulting harm.
The expectation following the Supreme Court's decision was that the victims of the Bhopal gas tragedy would receive timely relief.
This acknowledgment of 'Absolute Liability' and the grant of interim relief in the Bhopal case underscored the maturity and fairness of the Indian judiciary in delivering justice.
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