Author: Chirumamilla Suswani, 2nd Year B. A. Llb, DSNLU, Visakhapatnam
The year 2020, had begun with a life-threatening disease, first emerged in December 2019 (and hence the name COVID-19) at China’s Wuhan City. Public health officials from China informed the World Health Organization (WHO) at the end of December that they had an unknown health problem, a new virus in the city of Wuhan was causing pneumonia-like illness. They soon decided that it was a coronavirus and that it was spreading rapidly across and beyond Wuhan City. The WHO assessed the situation in China and other countries where the COVID-19-caused outbreak had begun.
This Article critically examines and discusses the significant changes that have occurred in the normal chain of human living and repercussions to the lives considering as a socio-legal issue. At first, the article discusses the issue of contracts that are in motion and now cannot be put in action due to the circumstances vying around us. The term ‘Force majeure’ is discussed to its depth taking into consideration the contemporary issue of coronavirus. Further, the article highlights the economic-legal consideration of Digital Healthcare and telemedicine laws and later, the violation of rights of people (migrant workers) and how in these times the courts render the justice and measures taken by the government to curb these challenges. This brief aims to list the shortcomings of the legal system of the country for a health outbreak caused by an epidemic or a pandemic.
Dr. Tedros Adhanom Ghebreyesus, the director-general of WHO, proclaimed it a pandemic at a media conference on COVID-19 on 11 March 2020. He also noted that it was the first time a coronavirus-induced epidemic has been described as a pandemic. Since this was a new form of the virus with no cure and antidote known, it was called The Novel Coronavirus.
COVID-19 and its subsequent lockdowns have put a toll on trade worldwide. It has caused unparalleled disruption to global business and trade operations. There is considerable uncertainty about the effect on industry and trade of such an exceptional occurrence. The pandemic has undermined companies’ ability to sustain a stable activity and fulfill contractual obligations worldwide. Given the disruption caused by the COVID -19 outbreaks, the performance of several contracts is likely to be at a standstill, postponed, or even canceled. This outbreak not only affected the companies but also had a great impact on the lives of the migrant workers, daily wage employees, and the poor.
As a global impediment, COVID-19 has shown a great downturn in the global market. The government has locked down the whole nation to reduce the spread of the COVID-19 outbreak and has taken several steps. Many people are unable to fulfill their contractual obligations because of lockdown and government actions. As it has become impossible for some contractors to fulfill their contractual obligations, studying the applicability of force majeure doctrine is imperative at this juncture of time. On 11 March 2020, Covid-19 has declared a pandemic which led to national lockdowns in all sectors. The effect on businesses is severe, and force majeure clauses will play an important role if businesses could not fulfill their contractual obligations amid the crisis. Providers tend to postpone or circumvent contractual obligations. The manufacturer or company does not want to be held responsible for failure to comply with contractually. A frequent question is whether a force majeure clause provides for excuses for parties to fulfill or do so on time.
For business contracts, the force majeure clause is crucial as it relieves parties from fulfilling the contractual obligation and removes liabilities during which the force majeure event continues, provided that conditions are met to satisfy the clause. Clauses such as price control clauses, restriction or exclusion clauses, material adverse change clauses, etc. can also be used by the parties to restrict liability resulting from non-performance of contractual obligations.
Force Majeure is defined as:
- Superior or irresistible force
- an event or effect that cannot reasonably be anticipated or controlled
The word ‘Force Majeure’ comes from the French language and means a ‘superior force’ literally. An extraordinary event or circumstance beyond human control, such as Act of God, government restrictions, or extraordinary circumstances that prevent contractual terms, is called an event of force majeure. This clause exempts both parties to the contract from performing the contractual obligation when performance is impeded by an event beyond the control of the parties. Force Majeure was examined in the wider sense in the case of Dhanrajmal Gobindram vs. Shamji Kalidas & Co., where the Supreme Court opined that Force majeure is a concept of broad importation and that precedents have developed that “strikes, breakdown of machinery usually not included in ‘vis major’ are included in force majeure.” The reasoning behind including such a provision was to protect the parties’ interests from the effects of something the parties had no influence over. The court states that the major purpose of this clause was to prevent the parties from the situation beyond their control.
Sections 32 and 56 of the Indian Contract Act deal with the basic sense of force majeure clause. Where it is expressly or implicitly included in a contract, agreements shall be governed by Section 32. Force Major events occurring outside the scope of the agreements shall be covered by Section 56(Frustration of Contract). However, the applicability of Section 56 to different contracts entered into during such a lockdown period will depend on each case.
In the case of Ganga Saran v. Ram Charan, “It seems necessary for us to emphasize that, as far as the courts in this country are concerned, they must look primarily at the law as set out in Sections 32 and 56 of the Indian Contract Act, 1872.” The essence of the Doctrine of Frustration in Section 56 travels through Section 32 and should, therefore, be interpreted in conjunction.
Section 32- Enforcement of Contracts contingent on an event happening – Contingent contracts to do or not to do anything if an uncertain future event happens, cannot be enforced by law unless and until that event has happened. If the event becomes impossible, such contracts become void.
As per section 32, a party to a contract which contains a Force Majeure clause must prove the following:
- that the event which caused non-performance included in the force majeure clause;
- the non-performance was caused due to the said event;
- the non-performance was beyond the party’s control and
- that there existed no alternative mode of performance.
Section 56- Agreement to do impossible act – An agreement to do an act impossible in itself is void. For invoking Section 56,
- there needs to be a valid contract
- the performance of the contract has not been completed or must have been partially completed,
- the said performance becomes impossible by way of facts or law
- the subsequent event is beyond the control of the party who intends to claim frustration and no reasonable steps could mitigate subsequent events.
- subsequent impossibility of performance after the contract is entered into.
The doctrine of frustration under Section 56 of the Indian Contract Act, 1872 rests upon the idea envisaging the impossibility of the performance of the contract. ‘Impossibility and ‘Frustration’ are often used as interchangeable terms. The Indian Contract Act 1872 governs “force majeure.” The Supreme Court held that: “In so far as a force majeure event occurs dehors the contract, it is dealt with by a positive rule of law according to Section 56 of the Contract. The performance of an act may not be impossible but it may be impracticable and useless from the object and purpose of the parties.”
Implications of Force Majeure clause by Government:
On February 19, 2020, the Expenditure Department, Procurement Policy Division, Ministry of Finance released an Office Memorandum to the “Manual for the Procurement of Goods, 2017” which serves as a dictum for the Government of India’s procurement.
This memorandum notes that the Covid-19 will be effectively protected by force majeure clause, as it is a ‘natural calamity’ and all the departments that can invoke it by the ‘due process.’
Amidst this COVID-19 outbreak, the parties need to know what they should consider while making claims for the force majeure. Following are the certain points which the parties should keep in their mind:
- In the case of COVID-19 outbreak, the affected party should keep an account of the steps it is taking to mitigate with the consequences of coronavirus outbreak so that it could perform its contractual obligations.
- The party making claim to force majeure should deeply analyze the way the force majeure clause was drafted, and the impacts that could have arisen from that event.
- For instance, the party could claim that the COVID-19 outbreak falls under the ambit of the force majeure event, or the party has another option to make claims based on governmental restrictions that disrupted the supply chain.
- A party should always analyze deeply and then only claim the force majeure event because a wrong claim can lead a party into various difficulties. It could amount to the breach of contract. In such circumstances, the other party can claim the damages for breach of contract.
Alternative to Force Majeure Clause:
In the absence of the force majeure clause, by claiming the frustration and impossibility of the contract, the parties could excuse the performance of the contract. To ensure an unattainable performance, the event has to be unforeseen. The doctrine of dissatisfaction based on the Covid-19 outbreak would rely on the facts and circumstances of the contractual relation. In contrast, to force majeure clauses, a group attempting to rely on the reasonable defense of impossibility must show its reasonable effort to resolve the barriers to performance.
DIGITAL HEALTHCARE DURING PANDEMIC: LEGAL FRAMEWORK
In the time of unprecedented medical crisis, where it has become impossible to reach out to all people in need of healthcare facilities, the government’s strenuous efforts are focused on digital healthcare facilities to mitigate this pandemic ‘s effect. Amid this uncertainty, one of the government’s worries is about the suspicious cases that can be broadly separated into two categories. Firstly, those people who have the prodromes concerned but blood test reports are on hold. Secondly, those who come into contact with the positive patients but have not yet been positively checked and are recommended to isolate strictly.
Such individuals are expected to visit the doctor regularly before the final report on the diagnosis is out. This makes even the doctors more vulnerable to the virus because on average, 22 percent of healthcare staff get infected with the virus. In many such situations, this problem has been deciphered with the implementation of virtual healthcare services that are declared for offenders whose condition is not critical at all. An example of such virtual programs is the one developed in Mumbai by Day-to-day Health, an acute care management firm. This program involved an app that provides a virtual care team.
In the current COVID-19 scenario, the Government of India has emphasized and actively promoted the use of digital health care since, on 14 April, the Prime Minister urged the countrymen to download the Aarogya Setu app. This initiative by the Ministry of Electronics and Information Technology to develop this application together with a team of 20 experts was appreciated by the WHO and World Bank. The app came into being to link the common man with the essential health services and make them aware of the risks and advisories relating to the COVID-19 restrictions.
Based on an individual’s health status, this App ‘Aarogya Setu’ executes a form of digital contract tracing. Although this app has been criticized on the grounds of security by French ethical hacker Robert Baptiste, claiming that the security of 90 million Indians is at stake. The former Supreme Court judge, Justice B.N. Srikrishna, also stated that the government cannot make it compulsory for people to download the app as it had no legal backing. However, this app has become the most downloaded healthcare app as it reached fifty million users in just thirteen days.
The outbreak poses humongous challenges to the healthcare sector of the country. But the digital healthcare and the technology is successful in warring against COVID-19 by developing a novel diagnostic, a strong surveillance system, telehealth and mobile chatbots for spreading the information about the virus. Digital healthcare is no longer an alternative, but a compulsory requirement. Amidst this pandemic, one can say that health is wealth and technology being its greatest investment.
INFORMATION TECHNOLOGY ACT 2000:
At present, in India, the legal framework related to the digital health is regulated by the IT Act, 2000 r/w the Information Technology (Reasonable security practices and procedures and sensitive personal data or information) Rules 2011. The act ensures the protection of the data collected, disclosure, and collection of the information within the ambit of medical records.
In 2018, the Indian government proposed a Digital Information Security in Healthcare Act (DISHA) bill to establish the country’s National eHealth Authority (NeHA) and State eHealth Authorities (SeHA). DISHA also aimed to initiate an exchange of health information and to ensure data security, confidentiality, collection, and transmission of digital health data. The act defines the rights of owners of health data and lists the duties of the data collector. The infringement of any clause of the act shall be liable for strict actions.
The country’s coronavirus positives figures are constantly flaring. As a result, the Ministry of Health and Family Welfare issued and approved telemedicine practice guidelines on 25 March 2020 to allow Registered Medical Practitioners (RMPs) to provide telemedicine-based healthcare. These guidelines were adopted as an amendment to the “Indian Medical Council Regulations (Professional Conduct, Etiquette and Ethics Regulations)2002”, in the form of a regulation under the Indian Medical Council Act, 1956. The RMPs need to follow these guidelines while providing e-medicine or any consultation to a patient where distance is a critical factor through technology. There was no specific legislation before that which dealt with the telemedicine practice in the country. This is the first Telemedicine law. There are several acts and statutory guidelines but they focus primarily on medical practice and the digital health data privacy issue.
According to the guidelines, RMPs are required to provide healthcare for the benefit of individuals and their communities through the use of communication technologies and the exchange of the information required to facilitate the diagnosis, treatment, and prevention process. These guidelines have been issued taking into account several complications that are likely to arise when opting for digital healthcare in place of the traditional ones. RMPs are required to comply with the Privacy and Protection Act, Informative Technology Act, 2000, Indian Medical Council Regulations, 2002, and other data privacy and patient confidentiality legislation.
EMPLOYEE TERMINATION, WAGE CUTS, RIGHTS OF MIGRANT WORKERS: MAJOR LEGALITIES PUSHED BY PANDEMIC 2020
TERMINATION OF EMPLOYEE:
The Coronavirus outbreak has led to numerous problems in the country. The country has shifted to digitalization due to the sudden outbreak of a pandemic. This is obvious to create a huge impact on the business and the job of the employees. Various pleas are initiated before the honorable courts in India.
A few reasons to terminate:
- Lack of projects and work available
- No access to financial supports due to lack of investors
- Work from home of remote work is not possible
- Consistency of work has been lowered relatively
- Inefficiency, Frustration of Contract grounds wherein the employer would be unable to determine with any certainty how they may be able to resume operations
- Breach of employment contract
- Violation of confidential provisions
Employees who fall under the category of a workman’, their conditions of service are governed by the Industrial Dispute Act 1947. Section 2A of the act provides that dismissal of an individual workman will be deemed to be an industrial dispute.
- The employee has the right to file a case against the employer for unfair dismissal in the labor court
- The dismissal dispute can be settled by conciliation or by adjudication
- When an employee is terminated who is a non-workman, his terms and conditions of service are governed by an employment contract or letter of appointment. A non-workman has a right to approach the civil court and also the court designated under the shops and establishments legislation seeking relief.
- The government on March 21, 2020, issued a circular which provides that even if a work unit is non-functional due to the virus, the employers are entitled to consider the employees as working. The various state governments have issued notices that such employees should be paid.
- The Maharashtra government also mentioned that no employer can deduct salaries or terminate the employee based on this pandemic. It especially implies on the contract or casual workers.
- Ministry of Home Affairs issued a circular on March 29, 2020, which informed the state governments and ministries to ensure that the employers of all the industries, companies, etc. pay full wages to the employees without any deductions, during the lockdown.
- Employers cannot reduce the working hours, to get a reason to reduce the salaries of the employees to control the loss of the business. Moreover, the employers are not entitled to reduce the workforce to safeguard the business from the impact of Covid-19. Both acts are prohibited by the notification issued by the Ministry of Home Affairs on 29th March 2020.
- Employers should make sure that the working hours of the employees are not exceeded, then their actual working hours. Since there is no statute to govern the concept of work from home therefore general employment laws will be applicable.
- Principles of Natural Justice apply to employee, which shall allow him to be heard and be given due representation during the termination process.
RIGHTS OF MIGRANT WORKERS:
The worldwide spread of COVID 19 from China was unpredictable, just like India’s migrant workers’ crisis. The fourth lockdown has begun after the first 21 days of lock-down that was put on 24 March 2020. The shutdown affects all but migrant workers suffered the most. In India, lakhs of workers move to various states to earn money, where they do low-wage semiskilled or unskilled jobs. Those people have lost their source of income and livelihood because of the complete lockdown. When the government suddenly suspended all transportation services, these migrant workers were forced to walk kilometers to return to their homes.
Article 21 of the Constitution states that “no person shall be deprived of his life or personal liberty except according to the procedure established by law”. Here the right to life does not mean mere animal existence,’ as the court held in the case of Kharak Singh v State of Uttar Pradesh. In various cases, the Supreme Court further explained the meaning of life and personal liberty. The Supreme Court in Maneka Gandhi v. Union of India held that the right to life includes the right to live with human dignity. Besides, the Supreme Court in Olga Tellis v Bombay Municipal Corporation is popularly known as the case of pavement dwellers,’ a five-judge bench of the court implied that right to livelihood’ is born out of the right to life as no person can live without the means of living i.e. livelihood.
Role of Courts:
On 31 March 2020, the Supreme Court heard a petition filed by lawyer A. A. Shrivastava seeking directions for providing food and shelter to migrant workers, in which Solicitor General Tushar Mehta claims that food is given to over 22 Lakh people. These are people in poverty, migrant workers, and day-to-day wage workers. They were kept in a shelter.’ He also argued that no-one is on the road now. The Supreme Court acknowledged the contention as well. However, the court asked the central government to ensure that basic facilities such as food, water, and medicines are supplied to migrant workers who are now being held in shelter homes. However, lakhs of workers can still be seen walking on highways barefooted.
On 16 May, the Supreme Court dismissed a PIL to order the district magistrates to recognize and provide the migrant workers with free relief and transportation stating that it was the responsibility of the state governments.
The Madras High Court orders recognized the severity of the situation and expressed concern for their plight. On May 12, the Karnataka High Court ordered the government to decide to pay the costs of the workers returning to the villages and towns. Gujarat High Court also took up the Suo Motu case of the workers and was seeking the government’s response. At the hearing, the Uttarakhand High Court said that if the migrant workers are not provided with food and livelihood now, their fundamental rights may be violated. On one side, where the Supreme Court has rejected its responsibility in this matter, the High Court’s display continued empathy for migrant workers.
WAGE CUTS: MEASURES BY GOVERNMENT:
According to the Ministry of Labour advisory dated 20 March 2020, all public and private companies were advised during this period to continue paying their employees ‘ salaries and not to decrease their salaries. The Ministry also demanded that employers to not terminate or lay off their employees and that all employees on leave during this time be regarded as employees on duty, without any reduction in salaries.
On March 29, 2020, the Home Ministry issued an order according to Section 10(2)(1) of the Disaster Management Act directing the state governments to take the required steps to ensure that each employee was paid their wages on the due date without any deduction. What must be remembered is that any order passed by the State shall bypass or prevail over any other law at the time under Section 72 of the DM Act. Now, because the letter issued on March 20 was an advisory and not an order, it is not binding. While the advisory of 20 March stated that employers should avoid relying on wage cuts as a measure to reduce losses, sectors such as the Indian automotive and aviation industries have been seriously affected by the outbreak of Covid-19 and are thus forced to rely on wage cuts.
COURTS DURING COVID-19:
The crisis that will flood as the world grapples with the coronavirus is unimaginable. Also, in such troubled times, the Supreme Court paved the way for unrestricted access to justice by video-conferencing court proceedings. During the COVID-19 lockdown, the Hon’ble supreme court answered the issue of providing justice in the form of an order. In Re: Guidelines for Court Functioning Through Video Conferencing During COVID-19 Pandemic, a bench composed of CJI Bobde and Justices DY Chandrachud and L Nageswara Rao issued a direction regarding measures to be taken by courts to reduce the physical presence of all litigants in court premises by adapting the social distance guidelines. Such guidelines were provided by invoking Article 142 of the Constitution of India as an extraordinary jurisdiction.
A two-judge Bench in Krishna Veni Nagam v. Harish Nagam while dealing with transfer petition seeking transfer of a case instituted under Section 13 of the Hindu Marriage Act, 1955, when both parties were not located within the jurisdiction of the same court, referred the parties to participate in the matrimonial dispute cases through video conferencing. While allowing the abovementioned transfer petition, the difficulties faced by the litigants living beyond the local jurisdiction was acknowledged by the Hon’ble Apex Court that “it is appropriate to use videoconferencing technology where both the parties have equal difficulty due to lack of place convenient to both the parties.”
Later on, the Veni Nagam’s case was overruled by the Supreme Court of India in Santhini v. Vijaya Venkatesh by a 2:1 majority. Chief Justice of India, Dipak Mishra, and Justice AK Khanwilkar held that “in transfer petition, video conferencing cannot be directed”. However, Justice DY Chandrachud wrote the judgment in favor of the use of modern technology and video conferencing.” Justice Chandrachud in the dissenting opinion highlighted the pros of video conferencing which are laid down below:
“The Family Courts Act, 1984 was enacted at a point in time when modern technology which enabled persons separated by spatial distances to communicate with each other face to face was not fully developed. There is no reason for the court which sets precedent for the nation to exclude the application of technology to facilitate the judicial process.”
“Imposing an unwavering requirement of personal and physical presence (and exclusion of facilitative technological tools such as video conferencing) will result in a denial of justice.”
In M/S Meters and Instruments vs Kanchan Mehta, it was pointed by the Hon’ble Apex court that “Use of modern technology needs to be considered not only for paperless courts but also to reduce overcrowding of courts. There is a need to categorize cases which can be concluded “online” without the physical presence of the parties where seriously disputed questions are not required to be adjudicated like traffic challans and cases of Section 138 of NI Act”.
This analysis of the challenges and consequences due to the pandemic, it is clear that India is short of a legal architecture to effectively fight a global pandemic like COVID-19. Without an updated and comprehensive law on health emergencies, the state governments are resorting to the use of Section 144 of the Indian Penal Code and other draconian laws. Once the COVID-19 crisis abates, the country’s lawmakers should use this opportunity to repeal the colonial law and pave the way for a new one that can better address health emergencies that India might face in the future. The migrant laborers make a huge contribution to the Indian Economy but their share in the National Income is minimal. These workers require economic protection not only during the lockdown but also post lockdown. Thus, the urgent need of the hour requires States and Union Territories to explore a solution to alleviate the situation of unorganized sector employees. The people must adhere to the directives issued by the government to mitigate the challenges and impacts.
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