Not correct to say that Court thrust settlement upon parties: Supreme Court reserves verdict in Bhopal Gas Tragedy compensation case

The Supreme Court on Thursday reserved its judgment in the the curative petition filed by the Central government in the Bhopal Gas Tragedy compensation case. (Union of India v. Union Carbide Corporation).A Constitution Bench of Justices Sanjay Kishan Kaul, Sanjiv Khanna, Abhay S Oka, Vikram Nath and JK Maheshwari concluded hearing arguments and reserved its verdict.At today's hearing, Senior Advocate Sanjay Parikh argued that while passing the review judgment affirming the settlement, the top court at the time was arguably and rightly anxious that the claimants speedily receive the benefits due."It is not correct to say that the Court thrust the settlement on the parties," Justice Khanna said in response..The Bench was hearing a plea concerning compensation for deaths and injuries caused by the 1984 Bhopal Gas Tragedy.The curative petition filed by the Central government in 2010 challenged an earlier top court order concerning the settlement amount made by Dow Chemicals/Union Carbide Corporation to the families of the victims and survivors of the tragedy..Advocate Karuna Nundy, representing the NGOs seeking impleadment in the matter, began by submitting that the top court should take a slightly different view of the emerging medical reports (on injuries and illnesses of victims).Justice Kaul at the outset made it clear that the parties could not be directed to top up the settlement."Nothing stops them [Union of India] to do more for you. It may be that they have not done enough. But can we...Who stops them from helping?"Nundy then argued that private enterprises that use poisonous substances for profit have absolute and strict liability."Because they have exclusive knowledge of the impact of that hazardous material, as judgments have held. No other way to say this, we tried for gentler ways to put it, but a fraud has been played on this Court and the Union of India," she added..Justice Oka then asked if fraud is to be treated as a ground in a curative a petition."In some way, you are piggy-banking and supplementing what the AG has said. Fraud resulting in under-compensation would require trial. Can we order? We would need documents on their conduct, need evidence, that will be an unmanageable affair," Justice Kaul weighed in.Nundy then highlighted studies by the Indian Council for Medical Research and Carnegie Mellon University that showed that many of those affected by the gas leak were dying much earlier than usual. "Settlement was of civil and criminal [cases]...they [Union Carbide] were declared proclaimed offenders. Now they are proclaimed absconders. My lords have to consider whether the fugitive disentitlement doctrine allows them to say anything without submitting to jurisdiction of a magistrate or depositing some money for compensation were the case to go against them." She also relied on the in pari delicto (in equal fault) doctrine and sought a Mareva injunction (one which prevents a defendant from dealing with their assets). "This Court had said that the doctrine means when two parties to a contract are there, and one committed an illegality, one can keep the benefit if the other does not offer restitution."The Bench was dismissive of the same, with Justice Kaul opining,"What can they be called to do? What Mareva injunction? There was no ship that took away..."Justice Oka added, "Please keep in mind that you are not arguing the original suit, but in a curative filed by the Union government." .Nundy then argued that the word 'midnight settlement' used in proceedings showed that it was signed in quickness to provide succour to those affected."We are saying that by operation of law, the settlement can be set aside to unravel the fraud. This may be sent [back], under Article 142, strict liability."Justice Kaul said such arguments can only be made in a suit or appeal, and not during a curative petition.On the reliance placed on fresh medical reports, Justice Khanna said,"Basic fundamental of law is we cannot take any report at face value without examining it as evidence. Every study will have counter opinion".The Bench expressed its doubts as to whether an intervenors' prayers could be different from those of the Central government's, since the former sought setting aside of the settlement..Parikh, appearing for some other victims and their families, argued today that the top court's Article 32 jurisdiction can be evoked suo motu in cases of natural disasters. He pointed out the increase in number of cancer and renal failure cases of those affected by the tragedy. "It is a truth and a human problem that the injuries persist.".Senior Advocate Harish Salve, appearing for Union Carbide Corporation, refuted the claims of the settlement being a rushed one."I have to counter the contention that it was a midnight settlement. It is very easy to say such nonsense when people are called on to take difficult decisions...We all remember the huge fracas over the settlement, including the conspiracy theory that Mr Gandhi [former Prime Minister Rajiv] met Warren Anderson [then CEO of Union Carbide] in his hotel room. He had already retired...[The settlement] Process was started by a judicial order."Salve argued that a revision of final figures or a need to top-up could not be grounds to set aside or reopen a signed settlement. He further pointed out that the review petition was filed by families of the victims, and not the Central government. He concluded by underscoring that the settlement not having a reopening clause does not make it bad in law."No egregious breach of law exists for your Lordships to review this. Parliament had passed an Act, took full responsibility, no one else had the right to sue.".Attorney General (AG) R Venkataramani then made his rejoinder submissions, contending that the observations in the case by earlier benches in effect weaved in a reopening clause in the settlement. "I would like my lords to read the review judgment and the 1989 order together. For all practical purposes, they have introduced a reopener clause, given the wide forum of issues. Please see para 38 of the settlement justification. Having said this, I thought in all fairness to say that these three may be read as one judicial continuum.".Read our coverage of Day 1 and Day 2 of the hearing.

Not correct to say that Court thrust settlement upon parties: Supreme Court reserves verdict in Bhopal Gas Tragedy compensation case

Abhimanyu Hazarika

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