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Supreme Court Exempts Lawyers from Consumer Protection Act in Landmark Ruling.

In a landmark judgment delivered on May 14, 2024, the Supreme Court ruled that lawyers cannot be held liable under the Consumer Protection Act (CPA) of 1986, overturning a previous decision by the National Consumer Disputes Redressal Commission (NCDRC). The ruling redefines the scope of professional accountability for legal services in India. The Supreme Court bench, comprising Justices Bela Trivedi and Pankaj Mithal, stressed that legal representation, although paid, does not constitute a ‘service’ as defined under the CPA due to the unique professional characteristics of the legal profession.

The case originated from an appeal against the NCDRC’s 2007 ruling, which classified legal services as falling within the purview of the CPA. This interpretation allowed clients to file complaints against lawyers for alleged deficiencies in service. Petitioners, including advocate M. Mathias and various lawyer associations, argued that the legal profession should be treated differently from other trades or businesses. They emphasized the unique duties lawyers have toward the court and their opponents, which can often conflict with client interests. Additionally, they highlighted the unpredictability and complexity inherent in legal proceedings, which can influence case outcomes independently of a lawyer’s skill or diligence.

The Supreme Court established a clear distinction between professions and other forms of business under the CPA. Justice Trivedi argued that the term ‘profession’ implies a discipline involving specialized knowledge or learning, distinct from a mere ‘business’ or ‘trade’ driven by commercial interests. The court highlighted that the legal profession is inherently service-oriented and noble, not driven by commercial gains. Lawyers are expected to uphold citizens’ rights and contribute to maintaining judicial independence and the rule of law. The court also noted that the relationship between a lawyer and a client is best described as a ‘personal service contract’ – a category specifically exempted under the CPA.

The ruling suggested revisiting previous judgments that differed in view, such as the inclusion of medical services under the CPA as decided in Indian Medical Association v. V.P. Shantha (1995). This landmark case had concluded that medical services fall under the concept of ‘services’ described in the Consumer Protection Act when a fee is charged, holding medical practitioners accountable to consumer standards of care. However, the Supreme Court signalled a potential revaluation of this definition, hinting that the scope of ‘services’ within the Act might need reinterpretation, specifically concerning medical professionals.

Distinguishing Lawyers from Other Professions
During the hearings, senior advocate Narender Hooda, appearing for the appellants, submitted that lawyers have a duty toward their colleagues and must be fair, unlike doctors who primarily focus on treating patients. Hooda argued that a lawyer cannot be seen as a mere “mouthpiece” for their client, as they have obligations to the court and the opposing counsel.

Justice Trivedi posed a hypothetical question: “Can you say something adverse to the interest of your client, even if you believe that is not, right? In a way, you are a mouthpiece to your client.” Hooda fervently opposed this view, stating, “My duty is to assist the Court in performing the sovereign function. That is the first duty. In that duty, I will espouse the cause of my client within the permissible four corners of law.”

Hooda further elucidated that while a patient can ask a doctor not to prescribe any particular medicine, a client cannot ask a lawyer to not cite any specific judgment. He highlighted, “There the relationship is this, if the patient says that you are prescribing me this medicine, I will not take it. My client cannot say that do not cite this judgment and cite only this judgment. This is how, my lords, my profession is completely different, and this is how public policy element is involved in legal profession.”

The decision has significant implications for the medical profession as well. The Supreme Court directed that the 1996 decision concerning medical professionals be reviewed by a larger bench, potentially reconsidering whether medical services should fall under the CPA.

Legal and Ethical Context
The ruling intervenes in a long-standing debate on whether professional services, like those provided by lawyers and doctors, should be assimilated within the ambit of consumer protection laws. While the judgment distinguished lawyers from other service providers by noting their duties involve elements beyond mere contractual obligations, it is important to note that claims of negligence and malpractice can still be pursued in ordinary courts.

The decision reaffirms the unique nature of the legal profession and its role in upholding the rule of law and judicial independence. However, it also raises questions about the accountability of professionals and the appropriate mechanisms for addressing deficiencies in service. As the implications of this landmark judgment unfold, it is expected to spark further discussions and potential legal challenges on the extent to which various professions should be subject to consumer protection laws or governed by their respective regulatory bodies and ethical codes.

 

Written by Maria Therese Syriac.

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