00:15It has now been eight months since the AI-171 crash in Ahmedabad that killed 260 people.
00:22While the investigation into what caused the crash continues, the compensation process has
00:27become a flashpoint. Two US-based law firms, Beasley Allen and the Chiyonuma Law Firm, say
00:33they together represent 105 families and they are advising their clients not to sign the
00:39final settlement forms being issued by Air India.
00:42In our group of families, none have signed it. We have advised all of our clients not
00:49to sign it and we have even gone as far as advising Air India not to contact our clients
00:55to make such offers to them.
00:58Now these are two copies of two settlement forms accessed by us. One mentions 10 lakh rupees
01:04as the final settlement amount, the other says 35 lakh rupees. So there is no one set compensation
01:10amount. It varies depending on the kind of injuries sustained, physical and mental and
01:16the loss of consortium and pecuniary loss to the family or dependents arising from the victim's
01:22death or disability. Now this amount is being determined by insurance companies. We also
01:27learn that not all families of the victims have been contacted by Air India as yet. Remember,
01:32families have already received 25 lakh rupees as interim compensation. The additional 1 crore
01:38rupee support to the family of every victim which was announced by the Tata Trust is still pending.
01:44And Air India says the process of ex gratia payment from the AI 171 Memorial and Welfare Trust is underway.
01:51So why are the law firms objecting? According to Chuck Chiyonuma, it's not just that they find the compensation
01:58amount inadequate. Law firms point out that the indemnity clause written into the forms forces families to
02:05relinquish any and all future claims, not just against Air India, but aircraft manufacturers, regulators,
02:13and other government and global entities.
02:15In addition to releasing Air India, the document requires the families to release
02:20everybody else in the world, including all the manufacturers, regulators, component manufacturers, and so on.
02:32In addition to releasing all of them from any future claims, known and unknown, the families are required to indemnify
02:41all of these people against any claims made by anybody else against them for the death of their family members.
02:52And indemnification has no limits. Typically, the airlines stay away from any claims that, you know,
03:00that pertain to other players like the manufacturers and so on. They don't insert themselves into those claims
03:10unless their actions combine to cause the incident. Again, in this case, we are seeing something that is aberrant, that
03:22is very unusual.
03:23The lawyers also say that there are indemnity clauses without limits in the form that transfer power and risk from
03:31the corporation to the family of the victims.
03:34Now, let's say the parents of a victim signed the form, but the wife of the victim files a claim
03:39down the road.
03:40The company can argue that the case has already been settled. It can also point to the indemnity clause and
03:46claim legal costs from the parents who signed and accepted the settlement.
03:51So instead of the company carrying the risk, the parents could end up carrying it.
03:55The plaintiff sues Erin there for an instance, and Erin there spends a million dollars defending it.
04:03This family who has just been offered £20,000 to £30,000 will be required to pay back Erin there
04:12for those million bucks, you know,
04:15to spend defending itself. So, the arithmetic to it is just unfair.
04:24Now, you may ask, if families reject the settlement, aren't they risking losing immediate compensation? Chiyonuma says that's not the
04:32case.
04:33To gamble away a few thousand dollars right now for the prospects of receiving even much more in the millions
04:44is not reasonable.
04:48Our experience with the Ethiopian airline case was very positive.
04:52It took a while to resolve, just like in this case, but our clients were very satisfied at the end
05:01of it.
05:02We are confident that if the data comes out indicating a fault on the part of manufacturers or other players
05:13in this incident,
05:16that we will be able to recover significant sums for our clients.
05:20Air India, however, maintains that the release in the settlement offer is above board, saying, and I quote,
05:26This particular aspect is important in order to ensure that the process is indeed final
05:31and to prevent Air India from receiving any direct or indirect claims in the future.
05:36We have been transparent in our communication to families, suggesting options, including seeking legal advice,
05:42before taking a final decision. End of quote.
05:45Now, like I said, the final investigation report into the crash is still awaited.
05:50So what families of the victims have to decide is whether they accept the settlement as drafted
05:55or preserve their right to pursue any wider legal claims that may arise once the findings of the crash report
06:02are made public.
06:16Thanks for tuning in to CNBC TV 18. And for more news and updates, follow us on all the social
06:21media platforms.
Comments