Thursday, November 13, 2014

In India, Toyota directors escape criminal trial for confirmed airbag defect; complaint alleges fraud and criminal conspiracy

SC quashes criminal trial of Toyota Motor directors

The apex court ruling comes on the plea challenging the Allahabad HC order
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The today quashed the order allowing the criminal trial of directors of on a complaint of a buyer that the of the was defective which caused his driver’s death and injury to him.

Toyota offered to pay Rs 15 lakh to the family of the driver who died and Rs 10 lakh to the owner of the vehicle. Disposing of the appeal, the bench headed by Chief Justice H L Dattu stated that this order would not be a precedent to be cited in other cases.

Gautam Sharma, the vehicle owner, filed a complaint against all the directors of the company, without the company being named, for cheating, forgery and criminal conspiracy.

The non-deployment of the airbags had allegedly led to the death of his driver and injuries to him in the accident in 2012. Since there was no direct collision, the airbags did not inflate, it is said.

The four directors moved the high court for quashing the complaint as they were not directly responsible for the accident, but it refused to do so as the trial court had already taken cognizance of the complaint.

Therefore the directors, C Kirloskar, Vikram S Kirloskar, Shekar Vishwanathan and Sandeep Singh, moved the Supreme Court.

When the appeal was mentioned before the Chief Justice yesterday, the bench had asked the company to arrive at a settlement with the affected parties. Senior counsel F S Nariman had agreed to do so. The offer to pay the compensation was made following this assurance.

The court had also observed on Wednesday that the directors could not be vicariously made liable in a criminal complaint unless their specific role is evident. The principle of vicarious liability is found only in the law of torts.