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Supreme Court moves to raise upper limit of manufacturers’ compensation

Companies such as Oxy Reckitt Benckiser, Lotte may face up to W100b compensation costs

The South Korean Supreme Court will discuss ways to increase the upper ceiling of compensation to victims in cases of lethal damages from goods, sources said Monday.

Judges at the Supreme Court in charge of civil suits exchanged views last week about measures to order a company to pay up to 1 billion won ($880,000) to compensate victims in cases in which severe damage or injury was inflicted on a customer on purpose or by malicious will.

When the victim is a child or has severe aftereffect symptoms, the court can ask for up to 1.12 billion won in compensation for the victim, according to the plan.

The Supreme Court said it will make a final decision on the measures at a judicial meeting later this year.

If the measures are put in place, manufacturers of toxic humidifier disinfectants such as Oxy Reckitt Benckiser or Lotte, which together are responsible for around 100 deaths related to toxic humidifier sterilizers, can face a court order to pay up to 100 billion won in compensation. The amount could be enough of a burden to close down a business.
Lawmakers belonging to a special committee on investigating the toxic humidifier disinfectant case attend a meeting at the National Assembly on Monday (Yonhap)
Lawmakers belonging to a special committee on investigating the toxic humidifier disinfectant case attend a meeting at the National Assembly on Monday (Yonhap)
The minimum ceiling of compensation has been calculated from 100 million won, an amount a victim would get from a death caused by traffic accidents.

Due to a standardized cap on the amount of compensation, courts have been receiving criticism that such a compensation scheme does not fully address the situation of deaths or suffering endured by victims from using the faulty products.

According to the Korea Environmental Industry and Technology Institute data, a total of 3,698 victims filed damage reports from the use of toxic humidifier disinfectant to the government as of last month. The KEITI under the Environment Ministry has been receiving damage reports since January 2014, after it was handed down the task by the Korea Centers for Disease Control and Prevention in September, 2011.

Meanwhile, on Monday a civic group hosted a debate regarding the toxic humidifier disinfectant case and flawed legal system on toxic substances at the National Assembly.

The event was attended by medical professors, members of the people’s solidarity for health and medical treatment and lawmakers belonging to a special committee on the toxic humidifier disinfectant case. Experts at the debate underlined the legal loophole in controlling the use of toxic chemical substances in household products here.

“Ministries responsible for this incident also showed negligence and delayed response when the incident broke out, portraying a weak governmental management system,” said Professor Cheong Hae-kwan of Medicine School from Sungkyunkwan University.

“Authorities should consider establishing a main control center, in order to develop diagnosis and treatment facilities on this kind of incident,” added Professor Jung.

Kang Jung-hwa, a representative of The Voice for Consumers said that “it is necessary to establish an independent institution that manages the safety of consumers,” urging an active governmental system to investigate the cause and effect relationship of toxic humidifier disinfectant cases.

Earlier this month, the National Assembly endorsed a plan to conduct a parliamentary probe into the toxic humidifier disinfectant case through a special committee to carry out investigations for 90 days and to discuss compensation measures.

The committee, which comprises lawmakers from the rival parties, last week agreed to include the Justice Ministry on the probe list and decided to conduct an investigation into the Reckitt Benckiser headquarters in the U.K. in August.

By Kim Da-sol(ddd@heraldcorp.com)
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