Sunday, November 12, 2017

The Four Equal Shareholders


The village was adjoining the big forest near the boundary of the state. Many villagers depended on the forest for their livelihood. Collecting and selling firewood, honey, and other forest produce gave them income to supplement earning from raising crops in their lands. One of the tigers in the forest started venturing into the village and lifting animals. In time, it started lifting children and became a menace to the population. Villagers decided to approach the King for sending a hunting party to the forest to kill the tiger to enable them to live in peace.

The delegation of villagers reached the capital under the leadership of the village headman. When they reached the capital the King was away on official duties. They were now constrained to wait in the capital till the King returned. They were standing in front of the palace and discussing the future course of action.

The Queen was observing the surroundings from the terrace of the palace. She saw the group of villagers standing near the palace. A servant was sent to find out the purpose of their arrival in the capital and waiting there. The servant made enquiries and reported the matter to her. The Queen knew that the King would be back only after three days. She instructed the palace officials to provide accommodation to the villagers in the royal guest rooms till the King returned. She instructed the Royal kitchen head to ensure that food was supplied to them three times a day. Her orders were duly carried out and the villagers waited for the King to return.

Food was being carried from the palace kitchen to the royal guest rooms on the morning of third day. An eagle had caught a poisonous snake and flying in the air above the palace area. The snake was struggling in the eagle's hold and drops of poison came out of its mouth. One of the vessels carrying the food was not covered and the poison fell in the food in it. Unaware of this happening, the servants distributed the food to the villagers. The villagers fell ill and two of them died in the evening.

The King returned and the matter was reported to him. The issue of tiger had now taken back seat and death of villagers came to the forefront. The King held a detailed enquiry to find the reasons for the event and punished the guilty. The queen was also sentenced to prison along with the cook and the servants.

The Queen protested and submitted that she had only helped the villagers by providing them lodging and boarding facilities in the King's absence. The King held that while her actions were indeed laudable, she cannot escape the consequences of wrong implementation of her orders. When giving the orders she also had the responsibility for their proper implementation. Mere good intention is not enough. Giving orders is not the end. The responsibility for proper compliance of the order also rests with the authority giving the orders. Otherwise, there is no accountability at all and all superiors are scot-free. The King stuck to his judgement and it was implemented strictly.
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The above story offers a good example of the principle of "Vicarious Liability". Vicarious liability is the strict and often secondary liability arising out of the responsibility of the superior authority or the master. It is different from contributory infringement. In contributory infringement, the superior or the master has some knowledge of the actions of the servant or the subordinate. Vicarious liability is different from contributory infringement as knowledge is not an element of vicarious liability. The master or the superior authority is held responsible even if he did not have knowledge of the action or wrongful implementation of the order by the subordinate.
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Who are the responsible parties for any action? What are their characteristics? Who is responsible for the results of the actions, whether good or bad? What is the role of a person who does the act and others who are directly or indirectly connected with it? What is the ratio or proportion in which they share the consequences? These are interesting questions and jurisprudence deals with them in various dimensions.

Ancient Indian jurisprudence identifies four persons as responsible for any act. The first is the person who actually does something or indulges in an action. He is the Karta (कर्ता) or the Doer. The second is the one who gets it done, advises or counsels in the action. He is the Kaarayita (कारयिता) or the Advisor. The third is the Proposer who motivates or inspires the action. He is the Preraka (प्रेरक) or the Proposer. Then there is the fourth one who supports the proposer. He is the Anumodaka (अनुमोदक) or Seconder/supporter.

What is the share of responsibility of these four people in the actions? The considered view is that the four are equal shareholders in all actions. There is no distinguishing between the one who does and others who take indirect part in it like the motivator and supporter. Is it only for the bad things that they have their shares? What about good deeds and actions that benefit the mankind? Ancient Indian jurisprudence does not differentiate between the good deeds or bad deeds. It stipulates that these four shall be equal shareholders in good as well as bad deeds. This holds good even if the action is done by one who is incapable of judgement like a child or idiot. 

All this is beautifully summed up in the following verse:


कर्ता कारयिता चैव प्रेरकस्चनुमोदकः |
सुकृते दुष्क्रुतेचैव चत्वारः समभागिनः ||


Karta karayitaashchaiva prerakascha anumodakah |
sukrute dushkrutechaiva chatvarah samabhaginah ||

The Doer, The Advisor, The Proposer (Motivator) and the Seconder, these four are equal shareholders in all good as well as bad deeds.

Indian Penal Code also follows the same line of thinking while prescribing punishment for those abetting or instigating by either action or inaction. Section 107 of the IPC defines abetment of a crime. Section 120-B of the IPC prescribes the same punishment for criminal conspirators as the ones prescribed for those committing the crime.
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What is the lesson to be drawn from this discussion? One simple action point for raising our share value is to motivate, propose or second all good actions. Thus the share value goes up even if one does not actually or physically participate in the actual work of implementation. Similarly, refraining from motivating or seconding any action that is harmful to the community prevents from the share value going down!

Can we build a good portfolio of shares using these two golden rules?

8 comments:

  1. Wow! Jurisprudence too! This is another revelation of vastness of domains of your knowledge, Sir.

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  2. Wonderful Nyaya Samhite. The world always indulge in passing the buck on bad actions and taking full credit for good results. This article is a must to read by all, especially our political system. Thanks for yet again exceptional article.

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  3. Sir,
    The concept of vicarious liability is explained beautifully with the help of a simple story. Somebody has said that Jurisprudence in India is evolved from such fables only. Codified Law is nothing but the distilled acts and experiences coupled with the principles of natural justice and equity.
    Thanks for the enlightenment and narrating the law through an interesting and simple story.
    subramanya

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  4. Good management lesson for modern managers. Well narrated.

    Gone are the days when Shastriji resigned as Railway Minister owning responsibility for an accident in distant Tamilnadu. Now our rulers/management have become thick skinned or they don't care at all.

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  5. Excellent narration of management and accountability..Thanks to you sir once again..Waiting for next edition..

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  6. It is good explanation of accuntability

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  7. Im learning something daily.. good narration.. waiting for the next

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  8. People who motivate are equally responsible in the deeds. But a person who is indirectly involved in the deed like "a person who sees something wrong is happening but closes his eyes", I believe he also has the responsibility to do what is right.

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