BISHWJIT GHOSHAL14/PMM-4831st SEMDOPM, NIPER, MOHALI

Flow of presentation Introduction Definition of consumer Types of consumer Consumer protection in different countries Consumer Protection Act Structure of consumer forums Legal avenues for consumers against medical

professionals Case Studies Conclusion

IntroductionThe industrial revolution and the development in the international trade and commerce has led to the vast expansion of business and trade, as a result of which a variety of consumer goods have appeared in the market to cater to the needs of the consumers and a host of services have been made available to the consumers like insurance, transport, electricity, housing, entertainment, finance and banking. For the welfare of the public, the glut of adulterated and sub-standard articles in the market has to be checked.

Introduction (Contd.)In spite of various provisions providing protection to the consumer and providing for stringent action against adulterated and sub-standard articles in the different enactments like Code of Civil Procedure, 1908, the Indian Contract Act, 1872, the Sale of Goods Act, 1930, the Indian Penal Code, 1860, the Standards of Weights and Measures Act, 1976 and the Motor Vehicles Act, 1988, very little could be achieved in the field of Consumer Protection. In order to provide for better protection of the interests of the consumer the Consumer Protection Bill, 1986 was introduced in the Lok Sabha on 5th December, 1986.

Definition of ConsumerFor the purpose of GOODS

(i) One who buys or agrees to buy any goods for a consideration which has been paid or promised or partly paid and partly promised or under any system of deferred payment.(ii) It includes any user of such goods other than the person who actually buys goods and such use is made with the approval of the purchaser.

For the purpose of SERVICES

(i) One who hires or avails of any service or services for a consideration which has been paid or promised or partly paid and partly promised or under any system of deferred payment.(ii) It includes any beneficiary of such service other than the one who actually hires or avails of the service for consideration and such services are availed with the approval of such person.

TYPES OF CONSUMERS

Personal Consumer

Organizational

Consumer

Personal ConsumerPersonal consumer is that consumer who purchases goods and services for his own personal consumption or uses. We can say that consumer is also called to be the ultimate or final person because when the marketer produces the goods then he hand over the goods to personal consumer for final consumption.

Organizational ConsumerOrganizational consumer consists of the government agencies, business organization, non governmental organization (NGO), firms and different types of manufacturing companies who purchases the goods and services in order to run the business of the firm or business concern or business organization.

Consumer ProtectionGroup of laws and organizations to ensure rights of consumersDesigned to prevent businesses engaging in fraud or unfair practices. Linked to the idea of:Consumer RightsFormation of consumer organizationsHelp with consumer complaints

Consumer protection in different countries AUSTRALIA

In Australia, the corresponding agency is the Australian Competition and Consumer Commission or the individual ‘State Consumer Affairs’ agencies. The Australian Securities and Investments Commission has responsibility for consumer protection regulation of financial services and products.

GERMANY

A minister of the federal cabinet is responsible for consumer rights and protection (Verbraucherschutzminister). In the current cabinet of Angela Merkel, this is Heiko Maas.

INDIA

In India, the Consumer Protection Act of 1986 is the law governing consumer protection. Under this law, Separate Consumer Dispute Redresal Forum have been set up throughout India.

UNITED KINGDOM

The United Kingdom, as member state of the European Union, is bound by the consumer protection directives of the European Union. Consumer Protection issues are dealt with when complaints are made to the Director-General of Fair Trade. The Office of Fair Trading will then investigate, impose an injunction or take the matter to litigation.

UNITED STATES OF AMERICA

In the United States a variety of laws at both the federal and state levels regulate consumer affairs. Among them are the federal Fair Debt Collection Practices Act, the Fair Credit Reporting Act, Truth in Lending Act ,Fair Credit Billing Act, and the Gramm-Leach-Bliley Act. Federal consumer protection laws are mainly enforced by the Federal Trade Commission, the Consumer Financial Protection Bureau, and the U.S. Department of Justice.

CONSUMER PROTECTION ACT Before the enactment of the Consumer Protection Act, 1986 a

person aggrieved by the defective goods or deficiency in service had to approach the ordinary civil court to get his grievances addressed.

The proceeding in the ordinary civil court is very complex, expensive and time consuming. In order to give more protection to the interest of consumers of goods and service the parliament enacted the Consumer Protection Act, 1986.

The law relating to consumer protection is contained in the Consumer Protection Act, 1986. The Consumer Protection Act-1986 and enforced from 10th June 1987 in India aimed at providing simple, quick and cheaper protection of consumers interest.

HISTORY

CPA-1986 & Medical related provisionsUnder the Act, following definitions have been laid down:

CONSUMERAny "person" who hires or ails of nay services for a consideration which has been paid or promised or partly paid and partly promised any include any beneficiary of such services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person.

COMPLAINANTAny allegation, in writing made by a complaint that the service hired or availed of or agreed to be hired or availed of by him suffer from deficiency in any respect.

DEFICIENCYAny fault, imperfection, short coming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to nay service.

CONTD. SERVICEService of any description which is made available to potential users and includes the provision of facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing, construction, entertainment, amusement or the purveying of news or other information but does not include the rendering of nay service free of charge or under a contrast of personal services.

Who can file a complaint? A consumer Any voluntary consumer organization registered under the Societies Registration Act,

1860 or under the Companies Act, 1956 or under any other law for the time being in force.

The Central Government The State Government or Union Territory Administrations. One or more consumers on behalf of numerous consumers who are having the same

interest.

CONTD. What constitutes a complaint?

Under the Act, a complaint means any allegation in writing, made by a complainant in regard to one or more of the following:-

Any unfair trade practice, as defined in the Act or restrictive trade practices like tie-up sales adopted by any trader.

One or more defects in goods: when goods are hazardous to life and safety, when used, are being offered for sale to public in contravention of provisions of any law for the time being in force.

Deficiencies in services. A trader charging excess of price:

Fixed by or under any law for the time being in force; or Displayed on goods; or Displayed on any packet containing such good;

CONSUMER RIGHTS UNDER CPA-1986 Right to Safety

A consumer has the right to safety against such goods and services as are the hazardous to his health, life and property. Right to be Informed/ Right to Representation

A consumer has the right that he should be provided with all information on the basis of which he decides to buy goods or services. Right to choose

A consumer has the absolute right to buy any goods or services of his choice from among the different goods or services available in the market. Right to be Heard

A consumer has the right that his complaint be heard.

CONTD. Right to Consumer Education

Consumers must be aware of the rights to enjoy against the loss they suffer on account of goods and services purchased by them. Right to Basic Needs

All the consumers have the right to fulfil basic needs of food, clothing, shelter, energy, etc. Right to Healthy Environment

The right provides the consumers, protection against environmental pollution so that quality of life is enhanced. Right to seek Redressal

Compensation to the consumers against unfair trade practice of the seller.

STRUCTURE OF

CONSUMER FORUMS

SUPREME COURT NATIONAL COMMISSION STATE COMMISSIONDISTRICT FORUM

(Final Appeal)

Original Jurisdiction over Rs 20 lacsOriginal Jurisdiction from Rs 5 lacs to 20 lacsOriginal Jurisdiction up to Rs 5 Lacs

CONSTITUTION OF COURTS DISTRICT FORUMS

This shall consists of: a person who is, or has been or is qualified to be a District Judge, who shall be

its President two other members who shall be persons of ability, integrity and standing and

have adequate knowledge or experience of or shown capacity in dealing with problems relating to economics, law, commerce, accountancy, industry, public affairs or administration, one of whom shall be a woman.

STATE COMMISSION

It shall consist of: A person who is or who has been judge of a High Court, appointed by its state

govt. who shall be its president. Two other members with qualifications and experience (as for District Forum)

within the state;

CONTD. NATIONAL COMMISSION

This shall consists of : a person who is or has been a judge of the Supreme Court to be

appointed by the Central Government who shall be its President. (No appointment under this clause shall be made except after consultation with the Chief Justice of India).

4 other members (qualification: As for District Forum/State Commission), one of whom shall be a woman.

SUPREME COURT

This shall consist of: A chief justice of India and, until Parliament by law prescribes a

larger number, of not more than 7-8 judges.

Legal avenues for consumers against medical professionalsMedical Council of India and Dental Council of India

Civil CourtsMRTP (Monopolies and Restrictive Trade Practices Commission)

Public Interest LitigationSections of Indian Penal Code, 1860

INDIAN MEDICAL COUNCIL & INDIAN DENTAL COUNCILAn aggrieved patient can complain to the State Councils about a registered medical practitioner about an alleged wrong committed by him.The Council initiates proper hearing where the concerned doctor is given adequate opportunities to represent his side. If it arrives at the conclusion that the doctor has indeed committed an act, which involves an abuse of professional position that might reasonably by regarded as disgraceful or dis honorable by professional men of good repute and competence, the doctor is either given a warning notice or temporarily or permanently debars him for practicing medicine. The Council does not have any statutory powers to award any compensation to the aggrieved patient or legal heirs.

CIVIL COURTSThe aggrieved patients can file a case against the doctor for monetary compensation for which the patient to pay court fees that depends upon the compensation sought. The legal remedies are based on the law of Torts, Section 1-A of the Fatal Accidents Act, 185536 and the Section 357 of Cr. P.C., 197337. But to avail it, an aggrieved patient have to wait for years and spend considerable amount of money on litigations. The civil court cases take care the route of Sub-Court, District Court, High Court and Supreme Court.

MONOPOLIES AND RESTRICTIVE TRADE PRACTICES ACTThis Act is the precursor of CPA, 1986. Before the advent of CPA, this Act was the only resource to consumers against the unfair trade practices. The commission that looks into the disputes brought under MRTP Act based in New Delhi.

LANDMARK CASES

Spring Meadows Hospital vs. Harjo AhluwaliaIn Spring Meadows Hospital vs. Harjo Ahluwalia

the Supreme Court was concerned with the rights of a parent when a child dies due to medical negligence.

It was argued by the hospital that the parents were not consumers under the Act so could not get any relief. The Court rejected this argument and observed that even parents were covered under the Act and there was nothing in the law which prevented the parents as well as the child from recovering damages.

CONTD. In this case, a child patient was treated for seven days in

the Spring Meadows Hospital (Noida) for typhoid. The consultant physician prescribed “Chloramphenicol injection”, but the unqualified nurse misread it as “chloroquine” and indented, for the purchase of injection, “Lariago” (i.e. chloroquine). She injected chloroquine 5 mg IV, which was at least 3-1/2 times of the normal paediatric dose. The patient suffered irreversible brain damage. Treatment for 21 days in AIIMS New Delhi, did not help. The patient was compelled to live in a vegetative state.

The National Consumer Commission, whose judgment was confirmed by the Supreme Court, came to the conclusion, that the attending doctor was negligent, as he allowed an unqualified nurse to administer the injection, even though the consultant doctor had advised administration by the attending doctor himself.

CONTD.The Court made the following important observations:  Very often in a claim for compensation arising out of medical

negligence a plea is taken that it is a case of bona fide mistake which under certain circumstances may be excusable, but a mistake which may tantamount to negligence cannot be pardoned.

Gross medical mistake will always result in a finding of negligence.Use of wrong drug or wrong gas during the course of anesthesia

will frequently lead to the imposition of liability. Even delegation of responsibility to another may amount to negligence in certain circumstances.

A consultant could be negligent where he delegates the responsibility to his junior with the knowledge that the junior was incapable of performing his duties properly.

CONTD.The Court ordered the following compensation in  the

case:

 (a) Rs. 12.5 lakhs to the child (Rs. 10 lakhs compensation, plus Rs. 2.5 lakhs for equipment).

 (b) Rs. 5 lakhs to the parents, for mental agony.

 The Supreme Court further held that when a young child

is taken to a hospital and treated by the hospital, then

 (a) the child’s parents would come within the definition of “consumer”; and

 (b) the child also becomes a “consumer”, being a beneficiary of such services.

EXAMPLES OF PRESCRIPTION DRUG CASES Yasmin (2012): Bayer paid $110 million to settle more

than 500 lawsuits. Consumers who took the prescription drug for birth control experienced blood clots.

Prempro (2011): Pfizer agreed to pay $330 million to settle more than 2200 lawsuits. The company was accused of hiding the menopause drug’s cancer risks.

Avandia (2010): GlaxoSmithKline agreed to pay $460 million to settle 10000 lawsuits. Claimants said the company hid heart attack risks associated with the diabetes drug.

Vioxx (2008): Merck paid $4.85 billion to settle a reported 50000 claims. People who took the painkiller suffered heart attacks and strokes.

Recent AdvancesSome new changes are being brought into the consumer

protection act that would give more teeth to the act.The government plans to amend a law to allow customers to

file case against sellers from their place of residence. As per current norms, the case has to be filed at the place of transaction.

The requirement of engaging lawyers in the consumer forums is likely to be done away with, if the goods or services availed is of less than Rs 2 lakh value.

The amended Act is likely to have provisions to cover e commerce companies and some other service providers like Railways and courier firms.

CONCLUSIONA well organized sector of manufacturers and traders with better

knowledge of markets has come into existence, thereby affecting the relationship between the traders and the consumers making the principle of consumer sovereignty almost inapplicable.

The Consumer Protection Act, 1986 is a milestone in the history of socio-economic legislation in the country. It is one of the most progressive and comprehensive piece of legislations, enacted for the protection of consumers.

Unlike existing laws, which are punitive or preventive in nature, the provisions of this Act are compensatory in nature. The act is intended to provide simple, speedy and inexpensive redressal to the consumers' grievances, and reliefs of a specific nature and award of compensation, wherever appropriate, to the consumer.