Law of tort seeks to compensate the victim in monetary terms for the wrong suffered by him. However, punitive damages may also be awarded in order to deter future wrongdoers.
There are three elements in torts like, breach of duty owned to the plaintiff by the defendant, harm suffered by the plaintiff and the breach being the immediate or proximate cause of the harm. The breach of duty must give rise to damages measurable in terms of money.
The law of tort also applies the principle of strict liability in order to make social conduct of people more responsible. The expression ‘strict liability’ stands for the principle that a person responsible for causing injury to another must compensate for the damage or inconvenience suffered even if the injury was not caused due to his fault.
For instance, if a person is injured by a motor vehicle, the owner must compensate the person despite the fact that he was not the person driving the vehicle.
The amount of damages paid must be in accordance with not only the damage suffered but also the paying capacity of the tort-faros so that the damages paid are not too small and may not thus be taken as a kind of payment to, for the wrong.
For instance, if a big corporate caused a damage of, say, Rs 10,000 to a person, it would be a very small amount for the corporate and the corporate concerned might not consider the wrong grave enough. Therefore, the compensation payable may be one lakh or so, so that the corporate takes due care that the wrong is not repeated.
Weaker sections of the society cannot afford to go through prolonged litigation to recover compensation so the Public Liability Insurance Act, 1991 was passed.
This Act provides for mandatory public liability, insurance for installation and handling hazardous substances to provide minimum relief to the victims. This legislation also provides for immediate relief.