MOOT COURT PROPOSITION

Case concerning Product Liability and Endorsers Liability

Bio-Med Care Co. & Others v. Mrs. Lisa & Another
1. The Union of Vengadam, a South Asian country, is a union of 28 states. It has a written
Constitution and a federal democratic pattern of government. The total population of Vengadam is
more than 1.4 billion as per the recent statistics, and hence, it is the world’s most populous country. It
is the seventh largest country in the world by area and is home to about 17.5 % of the world’s total
population. The country has a glorious tradition of public health, and there exists a Ministry of
Health Care at the Centre from 1947 onwards.
2. As per the Constitution of Vengadam, health is a ‘State’subject, and hence, the different state
governments have taken several measures to ensure basic healthcare facilities in their states.
Moreover, since ancient times, there has been an active involvement of private players in the
healthcare sector. Together with the initiatives of the Central Government, State Governments and
private players, the health sector in Vengadam has made enormous strides over the past decades. As
a result, the life expectancy of individuals in the country has crossed 70 years, there has been a steep
decrease in infant mortality, many communicable diseases have disappeared, etc. With the help of a
well-established healthcare system during the COVID-19 Pandemic, the Vengadam successfully
reduced hardships and death rates of COVID-19 patients.
3. Over the years, Medical Tourism has flourished in the Union of Vengadam and is rapidly
developing as a ‘Healing Center of the world’. This is due to the fact that Vengadam offers health
services in compliance with international quality standards with the latest technologies and medical
expertise at a low cost. Most of the doctors are trained in European countries and other developed
countries, as well as there are plenty of trained nurses to take care of patients. It is estimated that
every year, approximately 3 million patients visit Vengadam from about 100 countries in the world.
As a result, Vengadam stands at number 5 in the Global Medical Tourism Index.
4. The Union of Vengadam actively participates in almost all international discussions and
conferences relating to the protection of human rights, including the rights of consumers. It was one
of the first countries in the world to enact a specific legislation for the protection of consumers, i.e.,
the Consumer Protection Act, 1986, immediately after the adoption of Guidelines for the Protection
of Consumers by the United Nations in 1985. The Consumer Protection Act, 1986 has undergone
several amendments, and finally, it was replaced with the Consumer Protection Act, 2019 in order to
create a comprehensive framework for the protection of consumers in the country. Though the
provisions of the Act do not specifically include health services under the purview of consumer
service, the Hon’ble judiciary, through interpretations, settled that a patient is a consumer and health
services are consumer services for the purpose of consumer protection laws.
5. In May 2022, Mr. Steve and Mrs. Lisa, an Irish couple, visited Union of Vengadam to spend their
summer vacation. As they were more interested in beach activities and trekking, they made their visit
to the State of Dhrupadam, the southern State of the Union of Vengadam. While travelling in the
State, they have seen several big hoardings of hospitals on the roadside as well as in popular tourist
destinations. Mr. Steve and Mrs. Lisa were attracted to the hoardings of Pillai’s Wellness Hospital as
they displayed the details of Liposuction surgery.
6. The hoardings of Pillai’s Wellness Hospital contain the photo of a famous Tamil Film Actor, Mr.
Tilak Varma. He is one of the pan-Indian actors and recipient of several awards, including national
film awards and film critics’ awards. The hoardings of Mr. Tilak Varma portray that Pillai’s
Wellness Hospital is the best hospital in the country to carry out Liposuction surgery. Mrs. Lisa was
facing the problem of over fat in her hands and was suffering pain and discomfort due to the same for
the last two years.
7. Mr. Steve and Mrs. Lisa consulted Dr. Shivaraj, a cosmetic surgeon at Pillai’s Wellness Hospital,
to overcome the problem of over fat in Lisa’s arms. Dr. Shivaraj suggested Liposuction surgery for
the removal of over fat, and accordingly, Mrs. Lisa was admitted to the hospital. On June 4th, 2022,
the said surgery was completed. On 6th June, 2022, she started to have pain in her right hand, and a
color change was also noticed. On 8th June, 2022, it was identified that the cause of pain in the right
hand was ‘Necrosis’. It is an infection that usually occurs due to non-sterilised conditions during the
surgical procedure.
8. The Management of Pillai’s Wellness Hospital, constituted a medical team to investigate about the
unfortunate incident of Mrs. Lisa. The Medical team identified that, the Dr. Shivaraj and his team
performed the surgical procedure with utmost care and caution and the surgical instruments used for
the procedure were of high quality. In Pillai’s Wellness Hospital, the sterilization of surgical
instruments was done with the help of various equipment supplied by Bio-Med Care Co. The
technicians found that the equipment used for the sterilization of instruments used for Liposuction
surgery contained a manufacturing defect. Though the equipment works well, due to this
manufacturing defect the sterilization process does not happen positively. The Medical team
concluded that, the infection occurred due to poor sterilization of surgical instruments used for the
procedure. On receiving the legal advice that, the Pillai’s Wellness Hospital will not come under the
purview of ‘Consumer’ as defined under the Consumer Protection Act, 2019, the Hospital decided to
initiate legal proceedings against the Bio-Med Care Co. under other appropriate laws.
9. The pain in Mrs. Lisa’s hand was increasing day by day and they requested free treatment from
Pillai’s Wellness Hospital. However, the Hospital denied the request for free treatment. Mr. Steve
shifted Mrs. Lisa to another well-known hospital in the same city. About a period of 6 months of
treatment and suffering, Mrs. Lisa’s condition was improved and she got discharged from the
Hospital. Aggrieved by the mis-happenings and sufferings due to the surgery, Mrs. Lisa filed three
different consumer complaints: two complaints before the District Consumer Commission and one
complaint before the Central Consumer Protection Authority.
10. The first complaint was against the Bio-Med Care Co., claiming remedies as per the relevant
provisions of the Consumer Protection Act, 2019. The Bio-Med Care Co. filed their reply stating that
this complaint is not maintainable since Mrs. Lisa is not a consumer as per the provisions of the Act
and also because she is a foreign Citizen. However, rejecting the contentions of Bio-Med Care Co.,
the District Commission awarded Rs.15 lakhs as compensation. In appeals, both the State
Commission and National Commission reaffirmed the order of the District Commission. Hence, Bio-
Med Care Co. filed an appeal before the Hon’ble Supreme Court.
11. The second complaint was against the Pillai’s Wellness Hospital, claiming remedies for the
sufferings. The Hospital, in their reply, contented that, there was no negligence on the part of the
Doctor and his team while providing the surgery and related treatments. Moreover, in the complaint,
Doctor who actually provided the service is not arrayed as a party. During the pendency of this
complaint, both the parties agreed to submit their dispute for mediation, and accordingly, the District
Commission referred this complaint for settlement through mediation.
12. The mediation was successful, and the parties settled their dispute accordingly the District
Commission passed an order. However, after one week of passing the order, Mrs. Lisa filed an
appeal before the State Commission. While disposing of the appeal, the State Commission held that
the Hospital is liable for deficiency in service and ordered to pay Rs.5 lakhs as compensation to the
appellant. On an appeal filed by the Hospital, the National Commission reaffirmed the order of the
State Commission. Aggrieved by the order, Pillai’s Wellness Hospital filed an appeal before the
Hon’ble Supreme Court.
13. The third complaint was filed before the Central Consumer Protection Authority against the
claims made in the hoardings of Pillai’s Wellness Hospital placed in different parts of the State of
Dhrupadam. The Central Authority, after an appropriate investigation and other proceedings,
imposed a penalty of Rs.50000 on Mr. Tilak Varma for endorsing the advertisement. In an appeal,
the National Commission reaffirmed the order of the Central Authority. Being aggrieved by the said
order, Mr. Tilak Varma filed an appeal to the Hon’ble Supreme Court challenging the constitutional
validity of the relevant provision, which empowers the Central Authority to impose penalties on
endorsers.
14. The Hon’ble Supreme Court of Vengadam, for the sake of convenience, decided to hear all the
cases on the same day with the following issues:
A. Whether Mrs. Lisa can be considered as a Consumer as per the provisions of the Consumer
Protection Act, 2019, and hence eligible to claim remedy from Bio-Med Care Co.?
B. Whether there is any deficiency in service on the part of Pillai’s Wellness Hospital so as to be
liable to compensate Mrs. Lisa?
C. Whether the provisions conferring the right to appeal against an order issued by the Commission
based on the settlement in Mediation is Constitutionally valid?
D. Whether the provisions that empower the Central Consumer Protection Authority to impose
penalties on endorsers is Constitutionally valid?