Compensation in death cases under the Law of Torts in India

The Author, Smita Singh is a 2nd Year Law student at National Law University, Delhi. She is currently interning with LatestLaws.com under LatestLaws.com Offline Internship Program,2022.

1. INTRODUCTION

In India, a common law country, compensation for death or specific legal injury emanating from an actionable wrong broadly depends on the nature of such wrong. There are few statutes such as the Motor Vehicles (Amendment) Act, 2019, the Railways Act,1989, the Public Liability Insurance Act,1991, the Employees Compensation Act,1923 etc. which provide for the detailed procedure of compensating the injured party under law of torts. These include rules relating to the creation of liability of the wrongdoer, the nature of liability (i.e., fault and no-fault), the amount of compensation to be paid, who has the obligation to pay the compensation, and the procedure and forum for seeking compensation.[1]

Majorly, the aim of the torts law is to restore the victim to his or her default position.[2] This position can be a bit different when it comes to the death of the injured party since it is hard to envisage the future prospects of the person had he/she been alive. In common law countries, death itself is not seen as an injury ‘per se’. Provision for damages for mere bereavement/ sentimental damages now finds place in the English law. On the other hand, as noticed by the Supreme Court of India, the Indian acts have remained static and need radical reformation.[3]

Death under torts can be a liability creator as well as liability exhauster. If personal injuries cause death of the injured party, the cause of death remains. On the contrary, the widely followed common law maxim actio personalis moritur cum persona says that a personal right of action dies with the person[4]. Few personal wrongs such as defamation, seduction and adultery are no more actionable after the death of the concerned party. Proprietary wrongs like unjust enrichment of tortfeasors, fraud, nuisance etc. can still be carried on. Although, it is believed that the right of action dies with the person, there are broadly two exceptions to the maxim of ‘actio personalis moritur cum persona’. They are as follows:

• Unfair enrichment of estate: A person, whose property was misappropriated by the deceased before his death, can still claim for damages because it is believed that only the property which actually and rightfully belonged to the person can be passed to his legal heirs[5].
• Exception of Contract: This maxim is not applicable to the cases under the law of contracts. The legal representatives of the deceased can still be made liable for the performance of the contract. Although, contracts involving personal services with the deceased cannot be performed for obvious reasons.[6]        

     2. STATUTORY MODIFICATION IN INDIA (A TIMELINE)

The methodology followed by the courts to compensate the dependents of the deceased has evolved through a series of interpretations of various cases and few legislations starting from 1855 (Coming of the Legal Representatives’ Suits Act). Initially, the damages were provided only for the pecuniary losses faced by the dependents of the dead person. Later, the Indian Succession Act of 1925 created some exceptions by mentioning that actions involving defamation and assault won’t be compensated after the death of the plaintiff as these actions die with the person. Previously, few high courts such as Calcutta and Rangoon were of the view that personal injuries should only consist of physical injuries. Madras high court took the opposite stance (personal injuries consist of every kind of injuries which do not even cause damage to the estate of the person wronged) which was later backed by the Supreme Court of India in the case of M Veerappa v Evelyn Sequiera[7].

It is interesting to note that as pointed out by the High court of Delhi, the cause action does not abate resulting out of the personal injuries. The cause of action for personal injuries is not time bound. Even if a death is caused years after an injury, the cause of action can still be initiated. The only pre condition for this is that the death should be a direct consequence of that particular injury[8].

Moreover, Section 1A of the Fatal Accidents Act of 1855 provides provisions for the compensation to the wife/husband/parent and children of the deceased person when the death is caused by the wrongful act or neglect of the defendant.[9] It’s on the discretion of the courts to decide the amount of compensation depending upon the proportion. It is pertinent to note that the Supreme Court itself found that the Fatal Accidents Act of 1855 needs drastic changes and needs to amended as it does not provide for adequate remedies for the large-scale disaster victims.[10]

Generally, courts in India allow the dependent to claim damages for two cause of actions which are separated from each other for obvious reasons. They are:

1. The financial loss suffered in direct consequence of the injury which the deceased would have had suffered, had he lived.
2. Loss with regards to the benefit of the estate.

2.1 Assessment of Damages Awarded in Death Cases

The pecuniary losses suffered prior to death, pre-trial and during the death (such as funeral expenses) are easy to determine depending upon the evidence provided by the plaintiffs or claimants. Losses related to future prospects and income are hard to determine. Though, we have few methods to evaluate that too. The compensation should not depend on the whims and fancies of the presiding judges. Rather, it should be uniform, reasonable and amenable. For evaluating the loss of dependency, judges usually take help of the Multiplier method. In this method, the predicted yearly earning/dependency (known as the multiplicand) is multiplied by a number (known as the multiplier) which is usually lower than the expected remaining years of the deceased. So, a deduction component is already built in the multiplier. It considers the element of all the uncertainties of life as well as the lumpsum payment element. Furthermore, it becomes completely unnecessary to make any further deductions after the product of these two counts has been calculated.

This multiplicand-multiplier method got well established in India after Supreme Court’s decision in the case of ‘General Manager, Kerala State Read Transport Corporation v. Susamma Thomas’[11]. In this case, the Supreme court of India applied a multiplier of 12 to evaluate the loss of dependency of the dependents of the 38-year-old deceased (mainly the children, widow and parents). This method was also suggested to reimburse the future earnings of the deceased person to the dependents. The multiplier method was also endorsed by the 3-judge bench of the Supreme Court in the Trilok Chandra (1996)[12] case where the multiplier scale was further clarified.

​​​​​​​2.1.1 Shortcomings of the Multiplier Method:

Few thinkers have pointed out that even the multiplier method has some shortcomings since it is not well settled if the judges use suitable multipliers in various cases. Even though the method has received the approval of the apex court in the country, it has a crucial shortcoming when it comes to the determination of the future earnings of the deceased since there is no evidence related to how judges apply the appropriate multiplier in a given case. The learned authors ‘Winfield and Jolowicz on Tort’[13] pointed out that judges did not "usually reveal the mathematical process (if such it be) by which they arrived at the appropriate multiplier". To avoid this, the Actuarial Multiplier Table[14] is suggested which is based on the demographic data of a particular country. Going in technical terms, there is a Present Discounted Value (PDV) formula which furthermore accelerates the payments. Such methods are used in various jurisdictions such as Canada and USA. Indian courts have not yet ventured into such technicalities.

​​​​​​​2.1.2 Other Methods of Assessment of Damages:

The Remaining Years (Without Deductions) and the Remaining Years (With Deduction) methods can also be used to award damages under wrongful deaths. Although, the multiplier method is considered superior than these two.

3. OBSOLETE NATURE OF THE FATAL ACCIDENTS ACT,1855

The Apex Court is of the view that the compensation for mere bereavement should also find its place in the Indian Acts (mainly The Fatal Accidents Act, 1855). The English Act has amended itself to an extent that it now includes the right to claim compensation for bereavement. Hence, somewhere, death ‘per se’ is now seen as an injury. That should be the ideal case. On the contrary, Indian laws and acts do not have such a provision. The world has changed drastically since the British rule and now the act needs to be amended.

It is a matter of profound concern that such crucial matters like the payment of compensation and damages for death resulting from a wrongful or negligent act are governed by a law which is more than one and a half centuries old. Few years ago, a constitution bench of supreme court in Charan Lal Sahu v. Union of India[15], a case arising from the Bhopal Gas Tragedy, had taken note of this antiquated law and in paragraph 168 made the following observations:

“The Fatal Accidents Act, on account of its limited and restrictive application, is hardly suited to meet such a challenge. We are, therefore, of the opinion that the old antiquated Act should be drastically amended or fresh legislation should be enacted which should, inter alia, contain appropriate provisions in regard to the following matters.”

While the Fatal Accidents Act 1855 creates rights to seek compensation, it does not provide for any rules or reasonable requirements either for the identification or calculation of the amount of compensation of the objects of damage to be paid. Questions left to be resolved by the judiciary are what damages need to be covered and how those losses have to be measured. Therefore, the laws established by the judges under the Fatal Accidents Act and the Motor Vehicles Act are directly applicable for the purpose of determining personal injury and death compensation resulting from tortious wrongs in India but these judge-made rules, unfortunately, have not yet been settled.

Moreover, in India, keeping in mind the economic and social conditions along with the prevalence of joint families, the beneficiaries should be sisters, brothers, and other dependent relatives too. Unfortunately, according to the Fatal Accident Act, 1855, they are not considered as dependents.  Currently, Section 1-A of the Fatal Accidents Act, 1855 contains actionable rights only in the benefit of wife, husband, children and parents. In the case of Budha v. Union of India[16], the court held that an action by the brother of the deceased is not maintainable as he is not identified as a legal representative or dependent under section 1-A of the Fatal Accidents Act, 1855[17].

Sec.20 Code of Civil Procedure[18] exists as on date to pursue claims under the Fatal Accidents Act, 1855. Therefore, the venue where the case happens or where the defendant lives might be the place to sue. The claimants/victims, though can face some difficulties regarding this.

In short, the legislature should come up with a new legislation to replace this archaic law which no longer meets the demands of the general public. With the high prevalence of negligent death cases in the modern world, few verbal changes are also required in the law like replacing the words ‘fatal accidents’ with ‘wrongful deaths’. This was suggested in the 111^th Law Commission Report. It is important to note that this report came in the year 1985, however, no changes have been made to the act till date.

The Fatal Accidents Act, 1855 was modelled on the lines of the UK’s Fatal Accidents Act, 1846 (also known as Lord Campbell’s Act). Since then, the UK’s parliament has made significant changes in the act while Indian counterpart has been rather stagnant and outdated.

4. COMPENSATION AND MERE BEREAVEMENT

The English Act priorly amended in the year 1982, now includes the provision allowing the claim for sentimental damages up to the extent of €7500 for the benefit of the wife/husband of the deceased and where the deceased was a minor, damages in benefit of the minor’s parents depending on the legitimacy of the child.[19]

On the contrary, Indian laws have no such provision. Even though, we have multiplicand-multiplier method for determining the reasonable amount to be compensated with respect to the future prospects, there should be a provision for sentimental damages. There should be no discrimination on the basis of income and future prospects. A fixed amount should be decided even for the dependents of a person who is not economically well off. The principle of ‘No fault liability’ comes into play here. Moreover, dependents should be allowed to claim for specific damages and fault basis damages. Currently, courts do provide damages for the recognizable psychiatric shocks and mental agony but in some cases, the mental agony might not be recognizable.

1. 1. Suggestions made in the Law Commission’s 111^th report:

“An intangible interest in the continuance of life consists in the natural ties of relationship or close association with a particular person and the moral comfort and companionship arising thereout. If compensation in money for the destruction of that interest, then it should include compensation for both the intangible and tangible interests. A solatium should also be included in that. Taking all these aspects into consideration, it is recommended that the third paragraph of Section 1A of the Fatal Accidents Act, 1855[20] must be widened in order to cover damages for such losses, as indicated above. Moreover, it may be mentioned here, that in England, by a recent amendment of the Fatal Accidents Act, 1976, a provision has been included in order to allow the parents and spouse of the deceased to claim compensation, precisely for ‘bereavement’, subject to a maximum.”

5. RECOMMENDATIONS AND CONCLUSION

As assessed in the research paper, there is a need for a few modifications in the existing laws. Subjectivity and ambiguity should be removed. It’s time to change the laws in a uniform way so that the judges don’t have the discretion of assessing the damages by their own reasoning.

The ‘No fault regime’ should be followed. There should be a minimum compensation provision in cases of death. There is a dire need to widen the scope of the Fatal Accidents Act. Provisions should be provided for the ‘No fault regime’ without taking away the right of the dependents to initiate the claim based on the actual fault alongside, subject to a cause of the ‘No Fault’ sum received. This will cover the damages for mere bereavement.

The scope of the fatal accidents act should also be widened in a way that it goes forward to include more dependents as beneficiaries of the compensation. As of now, under section 1-A of the Fatal Accidents Act,1855, only the wife, husband, children and parents can rightfully claim damages. The act should be amended to at least include brothers, sisters, uncles and aunts. According to the Law Commission’s 111^th report, even the widowed daughter-in-law living previously with the deceased should also be given the right to claim compensation. There is a period of limitation of two years to claim the damages as per Article 82 of the Limitation Act,1963[21]. This time limit also applies when someone files a case under the Fatal Accidents Act of 1855. The time period should be increased to at least 5 years.

The Multiplier Method should be used commonly but in order to avoid the inherent shortcomings of the method, the Actuarial Multiplier Method should be used which is said to be mathematically more accurate and efficient.

Sec.20 Code of Civil Procedure[22] exists as on date to pursue claims under the Fatal Accidents Act, 1855. Therefore, the venue where the case happens or where the defendant lives might be the place to sue. The claimants/victims, though can face some difficulties regarding this. This provision should be amended and the claimants should be allowed to sue from their place of residence too. Also, there is a need for a special tribunal for the speedy disposal of fatal accident cases.

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