Introduction
An important question on whether advocates are liable for alleged deficiency in services under the Indian Consumer Protection Act has been put to rest by the Hon’ble Supreme Court of India. In a significant ruling, the Hon’ble Supreme Court, vide its recent judgment in Bar of Indian Lawyers v D.K. Gandhi PS National Institute of Communicable Diseases and Anr.[1],has held that advocates would not be covered under the ambit of Consumer Protection Act, 1986 (“CPA 1986”), as re-enacted by the Consumer Protection Act 2019 (“CPA 2019”) (‘collectively referred as Acts/ consumer law framework’). Until the said decision, there was no definite pronouncement on the concerned issue.
The Apex Court, through this judgment, has shed light on this matter and has held that advocates cannot be made liable under the consumer protection laws framework for alleged deficiency in services. The Court delved into the objective behind enacting the laws, while highlighting the sui generis nature of the profession. Accordingly, the Hon’ble Supreme Court overruled the National Consumer Disputes Redressal Commission (“NCDRC”) decision in D.K. Gandhi PS v M. Mathias[2], wherein it was ruled that if there was any deficiency in the services rendered by the lawyers, a complaint under the Consumer Protection Act, 1986, would be maintainable.
Factual Overview
The appeal before the Apex Court emanated from an impugned 2007 NCDRC order. The respondent, before the Supreme Court, had availed the services of a lawyer in a cheque bouncing case, under the Negotiable Instruments Act, 1881. During the case, the accused agreed to pay the amount due, along with the expenses, which were paid to the respondent’s lawyer. However, the lawyer withheld a part of the sum received, allegedly because the respondent owed him fees. Consequently, the respondent ended up filing a consumer complaint against the lawyer for recovery of the pending payment, along with compensation for harassment and mental agony. Though, a preliminary objection regarding admissibility of a complaint against a lawyer, due to lack of jurisdiction, was raised before the District Consumer Forum, it was dismissed by the District Consumer Forum, and it ended up deciding the complaint in favour of the respondent. Aggrieved by the said decision of the District Consumer Forum, the lawyer filed an appeal before the State Commission, which overruled the District Consumer Forum’s decision by stating that Section 2(1)(o) of the Consumer Protection Act, 1986, did not cover lawyers. However, in the revision application, the NCDRC passed the impugned order, overturning the decision of the State Commission, which led to the present appeal before the Supreme Court.
Important findings of the Hon’ble Supreme Court
The Court delved into various sub-questions to resolve the matter.
Re: The intention of legislature behind enacting the Consumer Protection framework
The Court began by looking at the legislative intent of CPA 1986 as re-enacted in 2019. As per the Supreme Court, the consumer law framework was enacted to protect the interests of consumers against purported exploitation at the hands of manufacturers and traders. As per the court, the 2019 re-enactment happened because of large gaps emanating from rapid evolution of the market landscape. Such gaps left the consumer vulnerable, thereby necessitating the legislature to re-enact the Act. However, according to the Court, the Act did not intend to cover professionals, and furthermore they cannot be equated with business or trade, which involves a commercial aspect. A professional, on the other hand, requires high level of proficiency and training. Thus, the court opined that any interpretation marking the scheme of the Act or the preamble of the Act to include professionals within the fold of trade or business would be nothing but overstretching the scope and ambit of the Act. Furthermore, the Court also adopted a consequentialist reasoning in the judgement to fortify the above-mentioned claim. The Court opined that if professionals are brought under the ambit of the Act, its objective would be lost; and a barrage of vexatious and frustrated suits would be filed by disgruntled parties, thus defeating the aim of providing consumers with timely and effective dispute resolution.
Re: Whether legal profession is sui generis or is it different from other professions
The bench further posed a question to itself by stating that even if it is assumed that consumer protection laws applied to professionals, whether the nature of law as a profession was sui generis from the others, to make it fall outside the ambit of the consumer protection framework. The Court took on the said question because the NCDRC had based its impugned order on the decision in Indian Medical Association v VP Shantha, which was related to medical professionals,for bringing advocates within the purview of the consumer protection framework. The Court while relying on precedent cases in State of UP and Ors v UP State Law Officer Association and Ors[3] and having regard to the element of nobility in the profession observed that the legal profession stood on a much different footing than other professions. Furthermore, the Court did not take a myopic view and delineated that an advocate’s role is not just limited to providing services to a client, instead they don multiple duty caps. The duty of an advocate is not just limited to the client or their opponent, but they also have a paramount duty to assist the court. The nobility and uniqueness of the profession can be gauged by the fact that lawyers are considered as intellectuals among the elites and social activists among the downtrodden. Furthermore, the distinct character of advocacy as a profession is marked by the stellar and incomparable role played by it in strengthening one of the three pillars of Democracy.
Re: Whether a service hired or availed from an advocate could be said to be a service under a “contract of personal service”
The statutory wording of the definition of “service” as mentioned in the CPA 196 and CPA 2019 is divided into three parts: i.e. explanatory, inclusionary and exclusionary. It is to be noted that both Acts exclude any service rendered under a ‘contract of personal service’. Therefore, the Court considered the issue of whether services rendered by Advocates practising the legal profession could be said to be service under ‘a contract of personal service’ to exclude it from the definition of ‘service’ contemplated under the Act. The court relied on its pronouncement made in Dharangdhara Chemical Works Ltd v State of Saurashtra and Ors.[4], wherein it was held that:
“the correct method of approach, therefore, would be to consider whether having regard to the nature of the work there was due control and supervision by the employer”
As per the Court, going by the above principle, the client exercises direct control over the advocate, who is rendering his legal professional services. The court, inter alia, also relied on Order III of the CPC, pertaining to agents and pleaders. By conjointly reading relevant sections, it held that there remains no iota of doubt that an advocate whose name has been entered on the state roll of a bar council is entitled to practise in all courts. However, it is only by virtue of a ‘vakalatnama’ that an advocate can appear on behalf of a client. Thus, there is considerable amount of control exerted by a client over the actions of an advocate. Taking all of this into account, the court concluded that the nature of contract between the advocate and their client is ‘of service’ rather than ‘for service’. Thus, the contract between a client and an advocate is excluded from the definition of ‘service’ contemplated under the Act.
Conclusion
In India, it is the Advocates Act, 1961, which regulates and governs the working of the legal profession. As provided under the Advocates Act, the Bar Council of India vide Section 49(1)(c) has laid down exhaustive standards of professional conduct and etiquette. Thus, a client can always reach out to the State Bar Council where the concerned advocate is enrolled to complain about misconduct. The Bar Councils are not only vigilant, they are also sensitive to acknowledge cases involving the legal profession. It is evident that the Advocates Act already deals with issues pertaining to the conduct of lawyers. Thus, the Advocates Act being a special law would prevail over the framework of the Consumer Protection Act, as far as conduct of Advocates is concerned. In fact, the Court also pointed out that a client can sue an advocate for any criminal or civil liability arising out of professional misconduct or negligence.
Furthermore, the Court distinguishing between the legal and the medical profession in this particular case was apt, given that no universal standard of care or objective test exists or can be prescribed as the threshold in the case of the legal profession to adjudicate upon the question of abdication of duty to care. This lack of objective standard becomes clear when peculiar kinds of unpredictability involved in a legal case are taken into account. The strategies and outcome in a legal case are highly contingent on the steps taken by the opposite party, interpretation of law, thereby making it unpredictable.
The decision of the Hon’ble Supreme Court finally brings closure to an issue that was pending for over a decade. There is always a risk that a case might not be determined perfectly, which very well could be because of factors not attributable to the advocate involved. As quoted in the judgment, the system of law aims to provide the best and safest system of determination that is compatible with human fallibility. Advocates need to be able to perform their duties without any fear of such repercussions. Immunity granted to advocates is a necessary consequence of the aforementioned need, which the Supreme Court vide this judgement has provided.
For further information, please contact:
Sumit Attri, Partner, Cyril Amarchand Mangaldas
sumit.attri@cyrilshroff.com
[1] Civil Appeal No. 2646 of 2009 along with Civil Appeal No. 2647 of 2009, 2648 of 2009 and 2649 of 2009.
[2] 2007 (3) CPR 84.
[3] (1994) 2 SCC 204.
[4] AIR 1957 SC 264.
