Strict Liability and Absolute Liability
The journey of the evolution of a legal principle cannot be better understood through the study of any other principle than of absolute liability principle. It starts from a case of causing private nuisance/harm to a person, arising in the 19th century England, where the court establishes a principle of ‘strict liability’ and then the journey reaches a landmark point in the case of M.C. Mehta’s where the Indian Supreme Court, while India is a developing country, not economically very strong and affluential, still upholds the economic liability of the defendant causing a public nuisance, which further causes damage to the environment judiciary, and raises the standard and degree of the liability, making it an ‘absolute’ one.
This is a journey of a tortious, civil law principle transforming into an environmental and constitutional law principle, and also a principle traveling from recognition of civil rights to that of fundamental rights, which play the pivotal role in claiming the compensation from the defendant.
The Principle of ‘Strict Liability’
The principle was evolved in the famous case of Rylands v. Fletcher (1868 LR 3 HL 330), decided on July 6, 1868, The case was decided by Lord Chancellor Lord Cairns, and Lord Cranworth. John Rylands was the plaintiff and Thomas Fletcher, the defendant.
The facts were such that the plaintiff was the occupier of a mine and worked under a close of land. The defendants were the owners of a mill in Is neighborhood, and they proposed to make a reservoir for the purpose of keeping and storing water to be used about their mill upon another close of land, which is adjoining to the plaintiff’s land. Underneath the close of land of the defendants where they proposed to construct a reservoir, there were certain old and disused mining passages and works. The vertical shafts had been filled up with soil and rubbish, and it does not appear that any person was aware of the existence either of the vertical shafts or of the horizontal works communicating with them.
In the course of the working by the plaintiff on his mine, he came into contact with the old and disused works underneath the close of defendants. Defendants constructed the reservoir through the agency and inspection of an engineer and contractor, and they did not exercise reasonable care and caution. When reservoir got filled with water, the weight of the water-bearing upon the disused and imperfectly filled-up vertical shafts, broke through those shafts. The water passed down to horizontal workings, and then it passed into the workings under the close of the plaintiff, and flooded his mine, causing considerable damage to him.
While delivering the judgment of the court in favor of the plaintiff, Lord Cairns distinguished between natural use and non-natural use of the land. He reasoned that if the water had accumulated on or under the land of the defendants, during their ordinary course of enjoyment of land or natural use of land, then escape of water cannot be complained by the plaintiff, and plaintiff would have no remedy, while citing the case of Smith v. Kenrick (7 CB 515); while for the non-natural use of the land court stated, “for the purpose of introducing into the close that which in its natural condition was not in or upon it, for the purpose of introducing water either above or below ground in quantities and in a manner not the result of any work or operation on or under the land, – and if in consequence of their doing so, or in consequence of any imperfection in the mode of their doing so, the water came to escape and to pass off into the close of the plaintiff, then it appears to me that which the defendants were doing they were doing at their own peril; and if in the course of their doing it, the evil arose to which I have referred, the evil, namely, of the escape of the water and its passing away to the close of the plaintiff and injuring the plaintiff, then for the consequence of that, in my opinion, the defendants would be liable.” While citing the case law of Baird v. Williamson (15 CB NS 317) to uphold the second principle.
The principle which the court evolved was this:
“The person who, for his own purposes, brings on his land and collects and keeps there anything likely to do mischief if it escapes, must keep it in at his peril; and if he does not do so, is prima facie answerable for all the damage which is the natural consequence of its escape (Conditions for application of principle). He can excuse himself by showing that the escape was owing to the Plaintiff’s default; or, perhaps, that the escape was the consequence of vis major or the act of God. (Exceptions that defendant can claim)”
It must be noted that principle is not restricted only to hazardous things which a person keeps and it escapes and causing harm to the plaintiff; the principle covers every escape of a thing, which did not exist “naturally” on the property of the defendant.
“The neighbour who has brought something on his own property (which was not naturally there), harmless to others so long as it is confined to his own property, but which he knows will be mischievous if it gets on his neighbour’s, should be obliged to make good the damage which ensues if he does not succeed in confining it to his own property. But for his actions in bringing it there, no mischief could have accrued, and it seems but just that he should at his peril keep it there, so that no mischief may accrue, or answer for the natural and anticipated consequence. And upon authority this we think is established to be the law, whether the things so brought be beasts, or water, or filth, or stenches.”
Lord Cranworth deletes the earlier defense available to the defendant, i.e., he acted with due care and caution. Lord Cranworth opined that what is relevant to establish the case, is to see, whether the acts of the defendant occasioned the damage or not? If it is answered in affirmative, then whatever precautions he may have taken to prevent the damage, but damage occurs, then the defendant’s liability exists.
The principle of ‘Absolute Liability’.
Though the court in Rylands’ case declared its principle as ‘absolute liability’ rule, really, the Indian Supreme court transformed ‘Strict Liability’ rule of Ryland’s case into ‘Absolute Liability’ rule. Simply it can be understood as, widening the responsibility on the defendant for environmental nuisance caused by him, and reducing the chances of absolving him of his liability or rather nullifying the chances of his acquittal.
The Supreme Court got the opportunity to frame this principle, when a writ petition under article 32 of the constitution came to it in form of a Public Interest Litigation (PIL), i.e., when a famous case of M.C.Mehta v. Union of India (AIR 1987 SC 1086) got filed in the court. The background of the PIL was that on 4th and 6th December 1985, Oleum gas got leaked from one of the units of Shriram Foods and Fertilisers Industries in Delhi (hence, the case is popularly known as “Oleum Gas Leak Case”), belonging to Delhi Cloth Mill Ltd. In this Leakage one advocate practicing in The Hazari Court had died and several others were affected.
An environmental activist Mr. M.C. Mehta, approached the supreme court through this petition, so that court may take cognizance of the matter, and decide the liability of the people, responsible for the incident.
As during that period, the Supreme Court was going through its most activist stage, the court refused to follow the obliterated ruling of Ryland v. Fletcher. The Supreme Court, speaking through C.J. P.N. Bhagwati, opined that, “The rule evolved in the 19th century at a time when all these developments of science and technology had not taken place cannot afford any guidance in evolving any standard of liability consistent with the constitutional norm and the needs of the present day economy and social structure. …. Law has to grow in order to satisfy the needs of the fast-changing society and keep abreast with the economic developments, taking place in this country. …”
So, the court evolved the principle of ‘absolute liability’ in these words:
“We are of the view that an enterprise, which is engaged in hazardous or inherently dangerous industry which poses a potential threat to the health and safety of the persons working in the factory and residing in the surrounding areas owes an Absolute and non-delegable duty to the community to ensure that no harm results to anyone on account of hazardous or inherently dangerous activity which it has undertaken.
The enterprise must be held to be under an obligation to provide that the hazardous or inherently dangerous activity in which it is engaged must be conducted with the highest standards of safety and if any harm results on account of such activity the enterprise must be absolutely liable to compensate for such harm and it should be no answer to enterprise to say that it has taken all reasonable care and that it has taken all reasonable care and that the harm occurred without any negligence on its part.”
Now, when we distinguish both the principles, it can be noticed that strict liability principle applied to all things which existed in a place while being “non-natural thing in that place”, but for absolute liability principle to apply, the thing causing the damage must be inherently dangerous and hazardous. So, on this count, the court has narrowed the strict liability principle.
But, the more celebrated point is that now the liability of defendant exists, ‘absolutely’ and the word bears its literal meaning in the judgment i.e., if any harm is caused by the inherently dangerous matter which is kept by the defendant, no matter if it escapes or not? No matter what is the reason for the harm caused? No matter whether harm is caused by any negligence of the defendant or any other person or not? All these considerations are made irrelevant now. The liability of defendant is established as soon as it is shown by the plaintiff, that harm is caused by the inherently dangerous thing, which belonged the defendant. Mere proof of this establishes the liability of the defendant, and nothing more is needed to establish his liability now. No excuses of vis major, Act of God, can be claimed too.
The Court also laid down that the measure of compensation payable within the capacity of the enterprise, so that the same can have a deterrent effect. The court held that “the measure of compensation in the kind of cases referred to must be correlated to the magnitude and capacity of the enterprise because such compensation must have a deterrent effect. The large and more prosperous the enterprise, greater must be the amount of the compensation payable by it for the harm caused on account of an accident in the carrying on the hazardous or inherently dangerous activity by the enterprise.”
The rule laid down in M.C.Mehta’s case was approved by the court in Charan Lal Sahu v. Union of India (AIR 1990 SC 1480). The court reiterated that this rule is ‘absolute and non-delegable’ and the enterprise cannot escape liability by showing that it has taken reasonable care and there was no negligence on its part. The Supreme Court justified the rule on economic basis by stating that, “If an enterprise is permitted to carry on a hazardous or inherently dangerous activity for its profit, the law must presume that such permission is conditional on the enterprise absorbing the cost of any accident (including indemnification of all those who suffer harm in the accident) arising on the account of such hazardous or inherently dangerous activity as an appropriate item of its overheads; and – The enterprise alone has the resource to discover and guard against hazards or dangers and to provide a warning against potential hazards.
The Supreme Court applied the principle in one of the most tragic environmental disaster case i.e., Bhopal Gas Leak Case. The round of litigation continued for more than 5 years after the disaster, and ultimately, a settlement between the parties reached out and vide orders of 14th February 1989, the Supreme Court awarded 470 million US Dollars compensation to the victims. The Supreme Court also held, while defending the settlement reached, as “settlement cannot be assailed as violative of Mehta principle which might have arisen consideration in a strict adjudication.” The Court denied to extend the “absolute liability” principle to the Union of India i.e. state, as recognizing its responsibility as a joint tortfeasor, rather supreme court chose to maintain liability of state under its role as ‘welfare state’.
In yet another case of Indian Council for Environment Legal Action v. Union of India (AIR 1996 SC 1446), The court held that, “Once the activity carried on is hazardous or inherently dangerous, the person carrying on such activity is liable to make good the loss caused to any other person by his activity irrespective of the fact whether he took reasonable care while carrying on his activity is by far the more appropriate and binding.”
The Public Liability Insurance Act, 1991.
The Public Liability Insurance Act has been incorporated on 22nd January 1991. This Act has been established to provide immediate insurance for the person who met with an accident while handling hazardous substance and other similar circumstances.
This Public liability-Insurance helps the weaker section of the people who handle such hazardous substances and chemicals from delayed relief or compensation. This Act provides immediate insurance relief to such person with the genuine injury occurring through an accident as prescribed in this Act.
All owners of such factory or industry handling hazardous substance are required to take several insurance policies in order to provide immediate relief to its own employee during such unforeseen accident or injury or even death while handling such chemicals or substances. No person shall claim for relief in case if such accident occurs due to his own wrong handling or negligent in handling, etc.
Every owner shall renew their insurance policies before the expiry date of such policies in order to meet such unforeseen circumstances throughout the period. Owners should not take insurance policies less than the paid-up-capital of undertaking hazardous chemicals and substances that is owned and controlled. The Owners shall pay not only premium to the insurer but also for a relief fund not more than such premium paid as specified in this Act. The Central Government shall by notifications exempt itself, State Government, any Corporations owned by Central and State Governments and any Local Authority from this Insurance operations.
Though a milestone is reached, when ‘absolute liability’ principle is declared as law by the Supreme Court, but the journey is incomplete, and will not reach its destination, unless a legislation is made, which address all these problems, so that the claim of the plaintiff is not grounded on a dynamic and frequently changing judicial pronouncement. A legislative provision gives weight to the rights of the victims and helps them in getting speedy justice.
– Harshdeep Singh Bedi
(National Law Institute University, Bhopal)
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