NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI ORIGINAL PETITION NO. 130 OF 2001 Mrs. Anita Bhatia & Ors. Complainants Vs. Kenyan Airways Opposite Party BEFORE: HONBLE MR. JUSTICE D.P. WADHWA, PRESIDENT HONBLE MR. JUSTICE J.K. MEHRA, MEMBER. MRS. RAJYALAKSHMI RAO, MEMBER. MR. B.K. TAIMNI, MEMBER. Carriage by air Act, 1972 - IIA (IATA Intercarrier Agreement on Passenger Liability) AND MIA (Measures to Implement the IATA Intercarrier Agreement) - Kenyan Airways Agreement under IIA and MIA - principles applicable to award of damages - Fatal Accident Act - M.S. Grewal 7 Anr. vs. Deep Chand Sood & Ors. - JT 2001 (7) SC 159. For the complainant : Ms. Monika Arora, Advocate For the opposite Party : Mr. H.D. Nanavati and Mr. Subrot Birla, Adovcates O R D E R
DATED THE 2nd August, 2002
JUSTICE D.P. WADHWA, J.(PRESIDENT)
This complaint pertains
to the Carriage by Air Act, 1972 (for short the CA Act) which incorporates
Warsaw Convention in Schedule I and in Schedule II it is the Warsaw Convention
again as modified by the Hague
Protocol. We have to deal with the
liability of Kenyan Airways, an international air carrier, on account of the
death of Sanjeev Bhatia, a passenger,
in the air crash which occurred on
30.1.2000. Sanjeev Bhatia had taken the
flight No. KQ-431 of the Airways from
Bombay to Nairobi when it crashed into the sea of Ivory Coast near Abidjan resulting in the death of Sanjeev Bhatia and other passengers.
This complaint is by the
legal heirs of Sanjeev Bhatia being the
wife and two children, one minor, claiming Rs.2,22,91,066.80 as
compensation. In fact the total claim
made is Rs.2,53,87.024 out of which an amount of Rs.30,95,968/- had been received earlier by the complainants as compensation by way
of settlement. Complainants have
challenged the settlement which was arrived on
20.4.2000 in the sum of US $
70,800 and payments received, when this complaint was filed on 2.5.2001. Earlier a notice dated 19.9.2000 challenging
the settlement and seeking more compensation
was issued by the complainants
through their lawyers. This was
immediately replied to by the
Kenyan Airways through their
Solicitors by their letter dated
22.9.2000 denying the allegation of the complainants. This was again replied to by lawyers of the complainants by
letter dated 20.11.2000 and thereafter this complaint came to be
filed.
It
is the contention of the complainants that figure of compensation was wrongly
arrived at by the Kenyan Airways and the complainants were coerced to sign the settlement. Complainants say that they were threatened that in case they did not sign the
settlement they would not be paid even
a single penny as compensation and they would be left to litigate in Courts for
the next decade to get the
compensation. It is also mentioned
that Kenyan Airways took advantage of
the position of the complainants who
were in grief and sorrow in getting the agreement signed which they allege
was result of undue influence exercised by the Airways being in dominating position.
Then
the complainants contend they were
ignorant of the IATA Intercarrier Agreement on Passenger
Liability (IIA, for short) and subsequent
agreement to implement the same
called Measures to Implement the IATA Intercarrier Agreement (MIA, for
short). On the other hand complainants say that they were told that under the CA Act and the Warsaw
Convention the maximum compensation payable to them would be US $ 20,000 and unless they
agree to the amount offered by the Kenyan Airways they will have to face the
prospect of long drawn civil dispute. The situation created by Kenyan Airways was
that take it or leave it.
Complainants say they were left
with no choice. The agreement was signed without their free
consent and in violation of the provisions of Sections 14 and other Sections of the Contract Act. Complainants further say that discharge
voucher got signed from them would not estop them from claiming
higher amount under IIA and MIA as far as Kenyan Airways was concerned as
Article 22(1) of the Warsaw Convention
as modified by the Hague Protocol did
not apply. Since a great deal depends
upon these two documents we set out the same herein in extenso:
Explanatory
Note
The
Intercarrier agreement is an umbrella accord; the precise legal rights and
responsibilities of the signatory carriers with respect to passengers will be
spelled out in the applicable
Conditions of Carriage and tariff
fillings.
The
carriers signatory to the Agreement undertake to waive such limitations
and liability as are set out in the
Warsaw Convention (1929), the Hague Protocol
(1955) the Montreal Agreement of
1966, and/or limits they may have
previously agreed to implement or were
required by Governments to implement.
Such waiver by a carrier may be made conditional
on the law of the domicile of the
passenger governing the calculation of the recoverable compensatory damages under the Intercarrier Agreement. But this is an option. Should a carrier wish to waive the limits of
liability but not insist on the law of the domicile of the passenger governing
the calculation of the recoverable compensatory damages, or not be so required
by governmental authority, it may rely on the law of the
court to which the case submitted.
The
Warsaw Convention system defences will remain available, in whole or in part to the carriers signatory to the
Agreement, unless a carrier decides to waive them or so required by a governmental authority.
INTERCARRIER AGREEMENT ON
PASSENGER LIABILITY
WHEREAS: The Warsaw Convention system is of great
benefit to international air transportation; and
NOTING
THAT: The Conventions limits of liability, which have not been amended since
1955, are now grossly inadequate in most countries and that international
Airways have previously acted together to increase them to the benefit of
passengers.
The
Undersigned carriers agree
1. To take action to waive the limitation
of liability on recoverable compensation, damages. In Article 22 paragraph 1 of the Warsaw Convention as to
claims of death, wounding or other
bodily injury of a passenger within the meaning of Article 17 of the
Convention, so that recoverable compensatory damages may be determined and awarded by
reference to the law of the domicile of the passenger.
2. To reserve all available defences
pursuant to the provisions of the Convention nevertheless, any carrier may
waive any defence, including the waiver of any
defence upto a specified monetary amounts of recoverable
compensatory damages, as circumstances may warrant.
3.
To reserve their rights of recourse against any other
person, including rights of contribution or indemnity, with respect to any sums paid by the carrier.
4.
To encourage other
Airways involved in the international carriage
of passengers to apply the terms of this Agreement to such carriage.
5.
To implement the
provisions of this Agreement no latter than 1 November
1996 or upon receipt of requisite
government approvals, whichever
is later.
6.
That nothing in this Agreement shall affect the rights of
the passenger or the claimant
otherwise available under the Convention.
7.
That this Agreement
may be signed in any number of counterparts, all of which shall
constitute one Agreement. Any carrier
may become a party to this Agreement by
signing a counterpart hereof
and depositing it with the Director
General of the International Air
Transport Association (IATA).
8.
That any carrier
party hereto may withdraw from this Agreement
by giving twelve (12) months written notice of withdrawal
to the Director General of IATA and to the other carriers
parties to the Agreement.
Signed
this 31s day of October 1995
AGREEMENT
ON MEASURES TO IMPLEMENT THE IATA INTERCARRIER AGREEMENT.
I. Pursuant to the IATA Intercarrier
Agreement of 31 October, 1995, the
undersigned carriers agree to implement
said Agreement by incorporating in
their conditions of carriage and tariffs, where necessary, the following:
1.
[CARRIER] shall not invoke the limitation of liability in
Article 22(1) of the Convention as to
any claim for recoverable compensatory
damages arising under Article 17 of the Convention.
2.
[CARRIER] shall not avail itself of any defence under Article
20(1) of the Convention with respect to that portion of such claim which does
not exceed 100,000 SDRs [unless option II(2)
is used].
3.
Except as otherwise provided in paragraphs 1 and 2 hereof,
[CARRIER] reserves all defences
available under the Convention to any such claim. With respect to third parties, the carrier also reserves all
rights of recourse against any other
person, including without limitation, rights of contribution and indemnity.
II. At the
option of the carrier, its conditions of carriage and tariffs also may
include the following provision:
1. [CARRIER] agrees that subject to applicable law,
recoverable compensatory damages for
such claims may be determined by
reference to the law of the domicile or permanent residence of the passenger.
2. [CARRIER]
shall not avail itself of any defence
under Article 20(1) of the Convention with respect to that portion of such
claims which does not exceed 100,000
SDRs, except that such waiver is limited to the amounts shown below for the
routes indicated, as may be authorised by governments concerned with the
transportation involved.
[Amounts and routes to
be inserted]
3. Neither the waiver of limits nor the
waiver of defences shall
be applicable in respect of claims made by public social
insurance or similar bodies however
asserted. Such claims
shall be subject to the limit in Article 22(1) and to the
defences under Article 20(1) of the Convention. The
carrier will compensate the passenger or
his dependents
for
recoverable compensatory damages in excess of
payments received from any public social
insurance or
similar body.
Furthermore,
at the option of a carrier, additional provisions may be included in its conditions of carriage and
tariffs, provided they are not
inconsistent with this Agreement and are in accordance with applicable
law.
I. Should any provision of this Agreement or a
provision incorporated in a condition of carriage or tariff pursuant to this
Agreement be determined to be invalid, illegal or unenforceable by a court of
competent jurisdiction, all other provisions shall nevertheless remain valid,
binding and effective.
V 1. This Agreement may
be signed in
any number of
counterparts,
all of which shall constitute one
Agreement. Any carrier may become
Party to this Agreement by signing a counterpart hereof and depositing it with the Director General of
the International Air Transport Association. (IATA).
2. Any
carrier Party hereto
may withdraw from
this
Agreement by
giving twelve (12) months written notice of withdrawal to the Director General of IATA and to the other carriers Parties to the Agreement.
3. The
Director General of
IATA shall declare
this
Agreement
effective on November 1st, 1996 or such
later date as all
requisite Government approvals
have
been
obtained for this
Agreement and the
IATA
Intercarrier Agreement of 31st
october, 1996
Singned
on this __________ day of _______
1996.
IATA
is a non-Government body of
international Airways. It
makes schedules of the scheduled
Airways and also decides about air tariffs.
To provide for uniformity of
action by international Airways in case of loss of goods, death or causing
injury to the passengers outside the
Warsaw Convention as modified by Hague Protocol..
The
issue arises for consideration as to
how far the IATA Intercarrier Agreement on Passenger
Liability (IIA) and Measures to Implement the IATA Intercarrier Agreement (MIA)
would be applicable vis a vis the provisions of the CA Act. First
we go to the relevant provisions of the Air Act. Admittedly it is schedule-II of the CA Act which is applicable and it
incorporates Warsaw Convention as modified by the Hague Protocol. Article 17, Chapter III, which
contains liability of the air carrier, provides that carrier is liable
for damage sustained in the event of the death
or wounding of a passenger or any
other bodily injury suffered by a passenger if the accident which caused
the damaged so sustained took place on board the aircraft or in the course of any of the operations of embarking or
disembarking. Article 20 provides the exceptions which says
that carrier is not liable if he proves that it had taken all necessary measures to avoid the damage or that it was impossible to such measures. Sub-Article (1) of Article 22 limits the liability of the
carrier for each passenger and limit is US $ 20000. To this there is exception contained in
Article 25 which says the limit of
liability would not apply if the damage
is resulted from an act or omission of the carrier, his servants, or
agents, done with interest to cause damage
or recklessly . We quote these provision extensively:
17. The carrier is liable for damage sustained
in the event of the death or wounding of a passenger or any other bodily injury
suffered by a passenger if the accident which caused the damage so sustained
took place on board the aircraft or in the course of any of the
operations of embarking or disembarking.
20. The carrier is not liable if he proves that
he and his servants or agents have taken all necessary measures to avoid the
damage or that it was impossible for him or them to take such measures.
22(1) In the ca+rriage of persons the liability
of the carrier for each passenger is limited to the sum of 2,50,000
francs. Where in accordance with the
law of the Court seized of the case, damages may be awarded in the form of
periodical payments the equivalent capital value of the said payments shall not
exceed 2,50,000 francs. Nevertheless
by special contract , the carrier and the passenger may agree to a higher limit
of liability.
25. The limits of liability specified in
Article 22 shall not apply if it is proved that the damage resulted from an act
or omission of the carrier, his servants or agents, done with interest to cause
damage or recklessly and with knowledge that damage would probably result,
provided that in the case of such act or omission of a servant or agent it is
also proved that he was acting within the scope of his employment.
A
conjoint reading to IIA, MIA and Articles 17, 20 and 22
of Warsaw Convention would show that Airways were conscious of the fact
that Warsaw Conventions limit of liability has not been amended since 1955
after the Hague Protocol and the liability is grossly inadequate in most
countries and that international Airways
have previously acted together to increase them to the benefit of
passengers. IIA and MIA apply in the
case of claim for death, wounding, bodily injury of a passenger within the
meaning of Article 17 and there would be no limitation of liability and
compensation would be determined and awarded
with reference to law of domicile of the passenger. Carrier shall not avail of any defense
under Article 20(1) with respect to such compensation which does not exceed
US $ 1,35,000.
At the time of his
death, Sajeev Bhatia was about 44 years
of age. He was in business and partner
of Laborate Pharmaceeuticals
(India). Kenyan Airways was approached by the Complainants
through Ajay Bhatia, brother of the deceased, to know the modalities for
making a claim on account of unfortunate death
of Sanjeev Bhatia. Kenyan
Airways informed Ajay
Bhatia that it had
engaged services of Mr. Hoshang Nanavati, Solicitor of Mulla & Mulla
Craigie Blunt and Caroe, Mumbai to deal
with all the claims arising in India and that he should be contacted. On 15.2.2000 complainants through Aditya Bhatia (son of the deceased) as
partner of Laborate
Pharmaceuticals (India) wrote a letter
to Mr. Nanavati requesting him to send the modalities to make the claims for
the death of Sanjeev Bhatia. On
26.2.2000 Anita Bhatia(wife of the deceased)
sent the claim form for the loss
of life of her husband, duly signed and
completed in all respects. She
requested for immediate settlement of the claim. A reminder by Fax was sent on
10.4.2000 where she wrote that
she had not received any reply after she had submitted her claim.
Mr. Nanavati immediately responded by Fax on the same day wherein he expressed his surprise over the
contents of the Fax of Anita Bhatia.
Mr. Nanavati said that
immediately on receipt of letter dated
26.2.2000 he had telephoned Ajay Bhatia, brother of the deceased, and explained to him legal position, that
the compensation was to be
assessed basically by reference to the
pecuniary loss sustained by the family
as a result of the death. Mr. Ajay
Bhatia was requested to send a copy of the return filed by the deceased or other appropriate evidence of his
income having regard to the fact that
a very substantial income figure has
been mentioned in the Claim Form
without giving any details as to how that
figure had been arrived at or giving
any other evidence in regard thereto.
This had not so far been done.
Thereafter, it would appear,
documents were forwarded by Ajay Bhatia showing the income of the
deceased Sanjeev Bhatia. On
20.4.2000 an agreement was arrived at
and was duly signed by all the
complainants and witnessed
by S.K. Bhatia (brother in law of the deceased ) and Mr.
Nanavati, Solicitor and Advocate.
This agreement is on non-judicial stamp paper of Rs.120/-.
Under this agreement US $ 70,800 was agreed to be payable as total
compensation as a result of death of Sanjeev Bhatia in the air crash. Same day a discharge voucher duly signed by same very persons signing the
agreement for having received the amount was given. On 4.5.2000 a letter was
written by M/s. Mulla & Mulla & Craigie Blunt & Caroe to Anita Bhatia stating that an amount of US $ 70,400 had been remitted
to them as compensation payable on account of death of her husband and that
she had also requested that she be reimbursed the air fare of herself and her
son from Panipt to Bombay and back which amounted to Rs.20,400/- (US $ 470),
and thus a cheque for Rs.30,95,968.90
equivalent to US $ 71,270/- was being sent to her. It was acknowledged
by letter dated 9.5.2000 of Anita Bhatia.
As far as Kenayan Airways is
concerned matter rested at that till, as noted above, notice was issued by
the lawyers of the complainants. It
would be seen it were rather the
complainants who wanted settlement with
all the promptitude.
Now a claim was made that Kenyan Airways was liable to pay Rs.2,22,91,055.80 as
under:
a) Compensation payable to the petitioners Rs.
2,01,70,420/-
on account of death of
Shri Sanjeev Bhatia.
I.
Interest at the rate of 24% per annum from the Rs
49,66,604.80
date of
death till 1.4.2001
c) Mental harassment and injury caused to
the Rs. 2,00,000/-
petitioners
due to the threat given by the
respondent.
d) Legal fees Rs.
50,000/-
——————
TOTAL: Rs.2,53,87,024.80
Less
amount received Rs. 30,95,968.80
——————
Amount
payable Rs.2,22,91,055.80
———————
This
amount is claimed as per
the two agreements IIA & MIA.
It is stated that under these agreements even the minimum amount payable as compensation would be US $
1,35,000 while settlment arrived at was for US $ 70,800/-.. It was stated in the notice of the lawyer that these two documents (IIA & MIA) were not disclosed by Kenyan Airways with the intent to deprive
the complainants of their lawful
amount of compensation and to induce them to enter into the
agreement dated 10.4.2000. This
apart there has been allegations of undue influence etc. It was also mentioned in the notice that principles of Motor Vehicles Act, 1988
would apply in arriving at the correct
amount of compensation
Though the provisions under CA Act limit the liability, in the present case
to US $ 20,000 but then under sub Article (1) of Article 22 this limit would
not apply when there is a
special contract under which the carrier and the passenger may agree to a
higher limit of liability. The special contract in the present case by which Kenyan Airways and Sanjeev Bhatia
agreed to a higher limit of liability
would be MIA terms of which were accepted by the former being
members of IATA. An argument was sought to be raised, more
perhaps in desperation than anything else, that it is the air ticket
which contains the terms of the contract between the air carrier and the
passengers we do not find any such special contract. Relevant clauses of the air ticket have been brought on
record. But then how come that in spite of the fact that law
limits the liability the US $ 20,000 in the present case, Kenyan Airways agreed to
pay US $ 70,800/-. Certainly
this was on account of the two agreements namely IATA Intercarrier Agreement on Passenger Liability (IIA) and Measures
to Implement the IATA Intercarrier Agreement (MIA). Kenyan Airways cannot be
permitted to take a stand contrary to the terms of IIA & MIA and particularly having agreed not to invoke the limit of liability of US $ 20,000
The
fact that Kenyan Airways agreed to pay above US $ 20,000 as provided under Article 22(1)
of the Second Schedule to the Air Act, would that show that it agreed not to
avail of any defence under Article
20(1) of the Conventions with respect
of that portion of such claims
which did not exceed US $ 1,35,000 is a
question which can be answered after we examine the MIA completed by the Kenyan Airways and filed with IATA. This has not been produced. Subject to that it
would not mean that Kenyan Airways agreed that it would pay a minimum of
US $ 1,35,000 on account of death of the passenger. These provisions do not
provide requiring an air carrier to pay any minimum figure of
compensation the figure of SDR 100,000
equivalent of approximately US $ 1,35,000.
It would not be minimum liability figure, but a sum to which an air carrier is precluded from raising
any defence under Article 20(1) of the Conventions. The defence that an carrier would take under Article 20 is that
carrier is not liable if it proves that
he, his servants or agents have
taken all necessary precaution to avoid damage
or that it was impossible for
him or them to take such measures. Only
this defence an air carrier would not take if the claim made is below US $ 1,35,000. If the claim is over and above US $ 1,35,000 then there is no bar
on the air carrier to take any defence under Article 20 of the Air Act for
the amount in excess of US $ 1,35,000. According to Kenyan Airways therefore, there
is no provision under the aforesaid MIA
agreement which could allow award of compensation
of US $ 1,35,000 on account of death of passenger without anything more.
Under the MIA
in pursuance to the IIA entered
into on 31.10.1995 the international air carriers agreed to implement that
agreement by incorporation that:
(i) a
carrier shall not invoke the
limitation of liability under
Article 20(1) of the
Convention and
(ii) to avail itself
any defence under Article 20(1) of the
Convention in respect of that portion of that claim which does not exceed SDR 100,000 approximately US $ 1,35,000 except that such waive is limited to the
amounts as may be prescribed..
Kenyan Airways has rejected
the stand now taken by the complainants and has referred the circumstances under which the agreement came to
be concluded and the discharge vouchers signed. They say after having accepted the amount with their free consent
complainants could not go back and
claim higher amounts. They say that
the claim was settled on proof-of-loss basis without reference
to any limit as contained in the
Warsaw Convention.
Complainants
came to know of the existence of IIA and MIA subsequent to their signing
the agreement and the discharge voucher.
The agreement and the voucher do not at all refer to these two documents.
It is difficult to accept the
proposition as advanced by Kenyan Airways that complainants supposedly should have
known the existence of these two
documents as these two documents could easily be discovered. If that was so there was then no need for
Kenyan Airways to send these two documents to the complainants with their
reply. Existence of these documents
could not have been known to a common man.
Principle of ignorance of law
does not apply as these documents
do not constitute any law.
Kenyan airways do not say if the
contents of IIA and MIA were ever brought to the notice of the
complainants. Knowledge of these two documents was vital to a fair agreement.
As to how the amount of
US $ 70,800 has been arrived at we were
not told by Kenyan Airways . It is
stated by Kenyan Airways that the amount was
arrived at on the basis of
proof-of-loss basis without reference to any limit. Kenyan Airways do not
tell us as to what formula was applied to arrive at this figure. We are inclined to believe the version of
the complainants that they did not sign the agreement and gave discharge
voucher with their informed consent.
They were certainly acting under the mistaken belief and unless they
agreed to accept the figure of US $ 70,800
they would have to face the prospect of tortuous civil litigation in a Civil Court even to
get US $ 20,000. Existence of these two documents were not disclosed
which in our opinion it was the duty of the Kenyan Airways to do so who were in full knowledge of the
same and were bound by the same.
As noted above, the
compensation had to be arrived at as per law of the country. For this we have
the provisions of Fatal Accidents Act, 1855,
Motor Vehicles Act, 1985 various decisions of the Courts and
the recent decision of the Supreme Court in the case of M.S.
Grewal & Anr. Vs. Deep Chand
Sood & Ors. (2001) 7 JT 159.
To restate
it is the stand of the Kenyan Airways
that claim had been settled wholly in accordance with Warsaw Convention read with the said IIA and MIA, both of which have been signed by Kenyan
airways. It was stated that Kenyan
Airways had given instructions to its
Solicitor/Advocate to settle all claims
arising out of air accident in question on proof -of -loss basis without reference to such limit of liability
of US $ 20,000 under the Warsaw Convention as incorporated in the Act. It was then stated in the claim form submitted by the complainants, Sanjeev Bhatia, the deceased, was shown having
annual income of Rs.16,81,035/-. With
the reply to the notice of the complainants, Mulla & Mulla & Craige
Blunt & Caroe, Advocates and Solicitors
also sent copies of IIA and MIA.
No doubt a settlement has been arrived at. But if it is in accordance with law of land, is the question before us. Has the amount of compensation arrived at
keeping in view the relevant factors
and have those factors been applied in
the given situation? If the figure so arrived at is less than
the amount of compensation stated to
have been settled, the other question is if it was with the free consent of the complainants pales into insignificance as the complainants would
never have consented to a lower figure. It will therefore be for the Kenyan Airways to spell out the details as to how the amount of US $
70,000 as compensation was computed.
Before concluding we would say that after going through the
records of the case as to how
settlement has been arrived at, we agree with the Kenyan Airways that allegations made against
their Advocate/ Solicitor was not proper and made in bad taste. We are, however, of the view that making
allegation against Solicitor and
Advocate, complainants were ill advised.
We would, therefore,
direct Kenyan Airways to file an affidavit
the details as to how the figure of US $ 70,000 was arrived at keeping
in view the age, income and other relevant parameters for fixing the
compensation in the case of death by accident of a person. Let this
affidavit be filed within four weeks of the receipt of this order.
To
be listed on 26th September,
2002 for directions and further proceedings.
J
(JUSTICE
D.P. WADHWA)
PRESIDENT
J
(J.K.
MEHRA)
MEMBER
(RAJYALAKSHMI
RAO)
MEMBER
(B.K.
TAIMNI)
MEMBER