TORT 056 Exceptions to Rylands v Fletcher and Absolute Liability in M C Mehta — Law of Torts Notes for Judiciary

The Exceptions to Rylands v. Fletcher, and the Indian Rule of Absolute Liability in M.C. Mehta v. Union of India

The rule in Rylands v. Fletcher was hollowed out by exceptions almost as soon as it was stated: the plaintiff's own act, the act of a stranger, an act of God, consent and statutory authority between them accounted for a great deal of the litigation. When the Supreme Court of India came to consider the law after Bhopal and the oleum gas leak in Delhi, it declined to take the rule with its exceptions, and laid down a new principle of absolute liability in M.C. Mehta v. Union of India.

The six exceptions, the rule of absolute liability, and strict against absolute liability

1. The Exceptions

The exception	What it requires, and the illustration
The plaintiff's own default	Where the escape or the damage was due to the plaintiff's own act, or to his abnormally sensitive use of his property. Ponting v. Noakes: a horse that reached over the boundary and ate the leaves of a poisonous tree on the defendant's land
Act of God	An operation of natural forces so extraordinary that no human foresight could reasonably provide against it. Nichols v. Marsland: an extraordinary rainfall burst ornamental lakes and swept away four county bridges
Act of a stranger	Where the escape was caused by the deliberate and unforeseeable act of a third party over whom the defendant had no control. Rickards v. Lothian: a third party deliberately blocked a wash basin and turned on the tap, flooding the floor below
Consent of the plaintiff	Where the plaintiff expressly or impliedly consented to the accumulation. Volenti non fit injuria applies here as elsewhere
Common benefit	Consent is readily implied where the thing was accumulated for the common benefit of the plaintiff and the defendant: a water supply, a sprinkler system or a lift serving the whole building
Statutory authority	Where the accumulation is authorised by statute and the statute on its true construction excludes liability. Absolute authority protects even against inevitable consequences; conditional authority protects only if reasonable care was taken

Default of the plaintiff is sometimes listed as a separate head. Where the plaintiff was himself at fault in a manner amounting to contributory negligence the damages are apportioned, and that is better treated as part of the first exception than as an independent one.
The act of a stranger exception is limited by foreseeability. If the defendant knew or ought to have anticipated the stranger's interference and could have guarded against it, the exception does not protect him, because the true cause of the escape is then his own failure.
An act of God must be extraordinary, not merely unusual. Ordinary heavy rain of a kind that occurs from time to time in the locality is not an act of God, however inconvenient. The subject is examined in TORT 020.

2. The Indian Rule of Absolute Liability

📖 M.C. Mehta v. Union of India, (1987) 1 SCC 395

Facts Oleum gas escaped from one of the units of Shriram Foods and Fertiliser Industries in a densely populated part of Delhi in December 1985, a year after the Bhopal disaster. A number of persons were affected and an advocate practising in the Tis Hazari courts was said to have died. A second leak followed within days. Proceedings under Article 32 raised the question of the principle on which such an enterprise should be held liable.

Held Bhagwati CJ, for the Court, declined to follow the rule in Rylands v. Fletcher and laid down a new and stricter rule for Indian conditions.

Ratio An enterprise engaged in a hazardous or inherently dangerous activity owes an absolute and non delegable duty to the community to ensure that no harm results to anyone from that activity. If harm does result, the enterprise is absolutely liable to compensate those affected, and the liability is not subject to any of the exceptions which operate under the rule in Rylands v. Fletcher. The enterprise alone has the resources to discover and guard against the hazards, and the permission to carry on the activity is conditional on its absorbing the cost of any accident as an appropriate item of its overheads. The measure of compensation must be correlated to the magnitude and capacity of the enterprise, so that it has a deterrent effect: the larger and more prosperous the enterprise, the greater the amount of compensation payable by it.

The Court declined to be bound by a rule evolved in nineteenth century England, observing that the law must develop to meet the needs of a fast developing country and cannot remain static.
The rule was applied in Indian Council for Enviro Legal Action v. Union of India, (1996) 3 SCC 212, the Bichhri case, where chemical units had discharged highly toxic effluents that destroyed the soil and groundwater of a whole village, and the polluter was held absolutely liable for the cost of remediation.
The polluter pays principle follows from it, and has since been recognised as part of Indian environmental law.
And the principle now has a statutory counterpart, so that a claimant need not in every case rely on the common law at all.

Section 3, Public Liability Insurance Act, 1991

Where death or injury to any person, other than a workman, or damage to any property has resulted from an accident, the owner shall be liable to give such relief as is specified in the Schedule for such death, injury or damage.

In any claim for relief under this section, the claimant shall not be required to plead and establish that the death, injury or damage in respect of which the claim has been made was due to any wrongful act, neglect or default of any person.

Section 4 requires every owner, before he starts handling any hazardous substance, to take out one or more insurance policies providing for contracts of insurance against liability under section 3, and to renew them so that cover is continuous.

3. Strict Liability and Absolute Liability Compared

	Strict liability: Rylands v. Fletcher	Absolute liability: M.C. Mehta
Source	English common law, 1868	Supreme Court of India, 1986
Who is liable	A person who accumulates a dangerous thing on his land	An enterprise engaged in a hazardous or inherently dangerous activity
Is escape required	Yes. Read v. J. Lyons: no escape, no liability	No. A person injured inside the premises, including a worker, is covered
Non natural use	Must be established, and it is the chief control on the rule	Not required. That the activity is hazardous is enough
Do the exceptions apply	Yes: plaintiff's default, act of God, act of a stranger, consent, common benefit, statutory authority	No. The liability is subject to no exceptions at all
Is it delegable	The duty may in some circumstances be discharged through others	Expressly non delegable
The measure of damages	Compensatory, on the ordinary principles	Correlated to the magnitude and capacity of the enterprise, so as to deter
Foreseeability of damage	Required since Cambridge Water	Not made a condition

4. Strict Liability and Negligence

	Strict liability	Negligence
Is fault required	No. The defendant answers though he took every precaution	Yes. Breach of a duty of care is the foundation
What the plaintiff must prove	Accumulation, non natural use, escape and damage	Duty, breach, causation and damage
The burden on the plaintiff	Lighter. He need not explain how the escape happened	Heavier, though res ipsa loquitur may assist
The defences	The six recognised exceptions	Absence of duty or breach, and the general defences
Where it applies	To a defined class of situations involving abnormal risk	Generally, wherever a duty of care exists

5. The Rule in India

Rylands v. Fletcher survives in India for the ordinary case of an escape from land, and is regularly applied by the Indian courts with its exceptions intact.
M.C. Mehta governs the hazardous enterprise, and is the rule that matters for industrial and environmental disasters.
The two coexist. M.C. Mehta did not overrule Rylands; it declined to apply it to a category of case for which the Court considered it inadequate.
The Public Liability Insurance Act, 1991 gives a statutory no fault relief, of limited amounts and on a summary procedure, without prejudice to any other right to compensation.
The National Green Tribunal Act, 2010 carries the principle further, and the Tribunal applies the principles of sustainable development, the precautionary principle and the polluter pays principle in deciding claims for compensation for environmental damage.

⚠ Why India framed a new rule instead of adapting the old one

The Supreme Court could have reached much the same result by holding that operating a chemical plant in a crowded city is a non natural use of land and that the recognised exceptions did not apply on the facts. It chose not to, and the reason it gave is worth understanding. A rule with exceptions invites litigation about the exceptions, and the party best placed to run those arguments is the enterprise, which has the records, the experts and the resources. A victim of a gas leak, often poor, often injured and often without access to any information about what happened inside the plant, is in no position to meet a defence of sabotage by a stranger or of an unprecedented natural event. By making the liability absolute the Court removed the entire field of argument, and by scaling the compensation to the size of the enterprise it turned the liability from a cost that could be absorbed into an incentive that could not be ignored. Whether courts should make a change of that magnitude without legislation is a fair question; that the change addressed a real defect in the older rule is not seriously disputed.

6. The Position Stated Shortly

1. The rule in Rylands v. Fletcher is subject to six recognised exceptions, which between them account for much of the litigation under it.

2. They are the plaintiff's own default, act of God, act of a stranger, consent, common benefit, and statutory authority.

3. The act of a stranger exception fails where the defendant could have foreseen and guarded against the interference.

4. M.C. Mehta v. Union of India laid down a new rule for enterprises engaged in hazardous or inherently dangerous activity.

5. Such an enterprise owes an absolute and non delegable duty to the community to ensure that no harm results from the activity.

6. If harm results the enterprise is absolutely liable, and the liability is not subject to any of the exceptions to Rylands v. Fletcher.

7. Compensation must be correlated to the magnitude and capacity of the enterprise, so that it has a deterrent effect.

8. Escape is required under Rylands and not under M.C. Mehta, so a worker injured inside the plant is covered by the Indian rule.

9. The rule was applied in Indian Council for Enviro Legal Action v. Union of India, the Bichhri case, and underlies the polluter pays principle.

10. Section 3 of the Public Liability Insurance Act, 1991 gives statutory no fault relief without proof of wrongful act, neglect or default.