Claims and compensation

Dr Suganthi Iyer, Deputy Director-Hinduja Hospital,Mumbai, talks about the need for awareness on claims to be made, as well as basis of compensation in case of medical negligence

The amount of compensation granted over the years in courts for medical negligence has increased by leaps and bounds in the last few years. Ever since the Rs 11-crore award for damages in the Kunal Saha matter, the claims in complaints have shot up and also in addition the grant of compensation. Hence, there is a need to be aware on what basis the claims should be made, as well as the basis of compensation in case of medical negligence. In addition, the quantification of the claims in a complaint needs to be justified. If the claim is excessive, the complaint could be returned to the complainant for reduction of claim and directed the same to be filed in a lower court with amendment in the claim.

The amount of compensation in case of medical negligence is calculated on the basis of different types of damages that may have occurred:

• Loss of earnings (calculated on the basis of age of the victim, current earning and number of years of future earnings, any other financial loss)
• Pecuniary (cost that the victim is required to incur — future hospitalisations, employment of medical attendant, etc.)
• Non-pecuniary (compensation for mental trauma, loss of a limb, loss of amenities, wife’s company, prospect of marriage, etc., future pain and suffering and other factors — usually high amounts are claimed)
• General damages (physical defect and future suffering such as being confined to a wheel-chair, etc., depends upon extent of disability)
• Special damages (costs of special measures, need to buy equipment, employ nursing care, or modify the victim’s home)
• Punitive damages (where the judge intends only to punish the doctor for having been negligent)

III(2015)CPJ 15 SC—K Vs State of Tamil Nadu & Ors

The complainant’s wife delivered a premature child in the 29th week of pregnancy weighing 1250 gms. The infant was kept in an incubator in an ICU for 25 days and given blood transfusion and 90-100 per cent oxygen. After discharge, the child was taken for regular follow-up and the only advice given was to keep the child isolated and confined to the four walls of the sterile room so that she was protected from infection. No examination of the child for the onset of the Retinopathy of Prematurity (ROP) was done which is standard precaution in such a case. What was overlooked was that a premature baby administered supplemental oxygen and blood transfusion is prone to ROP which in usual course makes a child blind. ROP was discovered when the child was taken for immunisation at four and half months and later confirmed at Shankar Netralaya that the child had been rendered blind for life.

Held: The next question was the compensation and the child Sharanya had been rendered blind for life and it would affect education, career as well as marriage prospects. Besides, she would need help all her life and additional future expenses. The courts relied on the following while arriving at the amount of compensation.

• Restititio in integrum: This principle provides that the individual entitled to damages should as nearly as possible get that sum of money which would put him in the same position as he would have been if he had not sustained the wrong. It must necessarily result in compensating the aggrieved person for the financial loss suffered due to the event, the pain and suffering undergone and the liability that he would have to incur due to the disability caused by the event.

Rs 42,87,921 was considered as deemed fit for the financial hardship faced by the parents on behalf of treatment of Sharanya. Inflation over the time erodes the value of money. Hence, the courts were of the view that inflationary principle must be adopted at a conservative rate of one per cent per annum for the rest of her life. The formula to commute the future amount was FV=PV× (1+r)n. FV is future value, PV is present value, r is rate of return and n is time period. Accordingly, the amount arrived at an annual inflation rate of one per cent over 51 years was around Rs 1,38,00,000. The principle of apportioning for inflationary fluctuations in the final lumpsum award for damages has been upheld and applied in numerous cases of medical negligence.

A learned Judge has to be mindful of matters which are common knowledge, such as uncertainties as to future rates of interest and future levels of taxation. Taking a reasonable and realistic and common sense view of all aspects of the matte,r he must try to fix a figure which is neither unfair neither to the recipient nor to the one who has to pay. A judge cannot ignore the inflationary trends and it would be improper if he applied the entire sum awarded to him in the purchase of an annuity which over a period of years would give a fixed and predetermined sum without any provision.

The liability was Rs 1,30,00,000 (State of Tamil Nadu and Hospital) and Rs 8,00,000 by the doctors. Further, the amount of Rs  42,87,921 in lieu of past medical expenses was ordered to be paid to the complainant.

III(2011)CPJ 239 NC —S N Vs P Nursing Home & Ors

The complainant filed a complaint seeking compensation of Rs 1,50,00,000 with an interest of 18 per cent p.a. till the date of actual payment of compensation alleging medical negligence that during the course of her treatment for fractures of her hip and pelvis, blood was transfused to her and she became HIV positive. The court enquired as to the basis of quantification of the claim of Rs 1.50 crores for the complainant. In the case of Tara Devi Vs Sri Thakur Radha Krishna Maharaj (1987) 4 SCC 69, the Supreme Court held that: The principles that regulate the pecuniary jurisdiction of civil courts are well settled. The valuation of a suit depends upon the reliefs claimed therein and the plaintiff’s valuation in his plaint determines the court in which it can be presented. It is also true that the plaintiff cannot invoke the jurisdiction of a court by either grossly overvaluing or grossly undervaluing a suit. The court always has the jurisdiction to prevent the abuse of process of law. If a complainant grossly overvalues or undervalues his complaint by bringing it within the jurisdiction of a particular forum, the complaint can be directed to be presented in the proper forum. In the current case, the question is whether the complainant can legitimately claim compensation as high as Rs 1.50 crores.

Held: The complainant has claimed a sum of Rs 50,00,000 towards mental agony and Rs 45,00,000 towards future expenditure on HIV medication and a further sum of Rs 35,00,000 towards future medical expenses relating to progressive failure of immune system. The complainant has not described the basis of arrival at the said figures. What has been submitted is that the complainant has suffered irreparable loss and to mitigate her present and future expenses, the amount claimed is not excessive. However, the Consumer Courts can grant compensation commensurate with the loss or injury and cannot be arbitrary, imaginary or for a remote cause. The complainant should have made a just and reasonable claim for compensation where compensation upto Rs one crore is claimed. Hence the complaint was ordered to be returned to the complainant for presentation before appropriate consumer court after making amendment in the complaint in accordance with the law.

VI (2000) SLT 267—SUPREME COURT OF INDIA —C S Vs HT Hospital & Ors

In this case, the complainant alleged medical negligence during surgery and had made a claim of Rs 34 lakhs. The same was dismissed on the ground that the claim was excessive with liberty to the complainant to approach district forum or state commission. The Supreme Court observed: “The National Consumer Forum disposed off the complaint by styling the claim as ‘exagerrated’ or ‘excessive.’ The National Commission held that the complainant was drawing a salary of Rs 3000 plus allowances. This is not admitted by Opposite Party. Even if this contention was correct, and he suffered permanent disability, the claim of Rs 34 lakhs is excessive. This exaggerated claim has been made only for the purpose of invoking the jurisdiction of the National Commission. While quantifying damages, consumer courts are required to make an attempt to serve ends of justice so that compensation is awarded in an established case, which will not only serve the purpose of recompensing the individual but bring about a qualitative change in the attitude of the service provider. Calculation of damages depends upon facts and circumstances of every case. All relevant factors to assess compensation on the basis of accepted legal principles is taken into account. It is not merely the injury or harm or agony or physical discomfort, loss of salary suffered by the complainant which is an issue but also the quality of conduct committed by the respondents which decide the compensation.

II(2012)CPJ 676 NC—R K Vs G Eye Institute & Ors

In this case, a claim of Rs 3 crores with 12 per cent p.a. from March 2010 till date of payment was filed for alleged negligence in cataract surgery. In this case, the complainant had incurred expenditure of ` 86,050 towards medical treatment and the complainant has failed to give a break up of  rest of the high claim of Rs 2.99 crores. The compensation in a case of medical negligence has to be commensurate with the injury and is granted by well established norms. No compensation exceeding Rs 1 crore has been granted so far in a case of medical negligence resulting in loss of one eye. The complainant continued to serve with the government despite loss of vision in one eye and had several years to go for retirement.

Held: Complainant has overvalued his claim and has misused the jurisdiction of the National Commission. The legitimate value of the claim cannot exceed Rs 1 crore by any stretch under any circumstances. Hence, it is directed to return the complaint to the complainant with liberty to file the same before appropriate consumer court after making amendment in the complaint in accordance with the law.

Take-home messages

• Compensation is based on different types of damages
• Inflationary principle is adopted while granting compensation
• In a complaint, basis of quantification of claims has to be justified.
• Courts can dismiss a complaint if claim is ‘excessive’ and the complaint can be returned to the complainant to be filed in the lower court. Hence, in a case of medical negligence, if the claim is ‘excessive’ and ‘unjustified’, the same  could pointed out to the courts so that the claim can be reduced by the order of the court.