Author Name:   shriyamisra

This essay examines whether issues arising out of commercial surrogacy can be adequately addressed by contract law, the different and distinct questions posed by commercial surrogacy agreements, the evolution by Courts of a best interest of the child test, and the case for regulation of commercial surrogacy...

Commercial Surrogacy - The Need for Regulation

Commercial Surrogacy has become so rampant in India that it has now been nicknamed the "rent-a-womb" capital and the surrogate mom capital of the world, where high-class women ‘hire’ a womb on ‘rent’ to carry their child to full term.

This essay examines whether issues arising out of commercial surrogacy can be adequately addressed by contract law, the different and distinct questions posed by commercial surrogacy agreements, the evolution by Courts of a "best interest of the child" test, and the case for regulation of commercial surrogacy.

Commercial surrogacy is when the surrogate mother carries the child in her womb to term and then relinquishes the child to the commissioning parents, for consideration. The basis of this is a surrogacy agreement, which demarcates the liabilities and intentions of the parties concerned.

The surrogacy agreement, which is based on free consent and a meeting of the minds of the parties concerned towards a particular outcome, has been held to be valid in India and is therefore interpreted in light of the provisions of The Indian Contract Act, 1872. There is no enactment on surrogacy on the subcontinent and The Indian Contract Act, 1872 exercises jurisdiction over all agreements and contracts.

In the Landmark case Baby Manji Yamada v. Union of India, a Japanese couple, Dr. Ikufumi Yamada and his wife, wished to have a baby and entered into a surrogacy contract with an Indian woman in Anand, a city in the state of Gujarat where this practice was pioneered. The couple went through matrimonial discord but the father still insisted on having custody of the child. Under Indian Lawa single father cannot adopt a girl child. He sent his mother in his stead and a petition was filed before the Supreme Court. The Government seemed to be helpless in this matter as there were no laws governing the effect of surrogacy. The Apex Court directed that the National Commission for Protection of Child Rights was the apt body to deal with this issue.
Justic Arijit Pasayat and Justice Mukundakan Sharma of the Supreme Court held that the father was the genetic father of the child and he was given custodial rights of the child. The Government was instructed to issue the passport to Manaji Yamada and she returned with her grand –mother. Most importantly, the Supreme Court held that the Surrogacy Agreement was valid in India.

What is most noticeable in the Baby Manji Yamada case is that the stance of the Court was not only pro-surrogacy it was also extremely pro-contract. The contract was held to be valid and therefore of most importance even though what the Court granted went against a particular legislation in the country.

More recently in the matter of Jan Balaz v. Anand Municipality, a German couple entered into a contract with a surrogate mother named Marthaben Immanuel Khrishti. Twin children were born. The German couple was working in the United Kingdom and the children required Indian passports to travel. Since their citizenship was being litigated in the courts the passport authorities withheld the passports. Germany, the parent state of the German couple did not recognize surrogacy. The Supreme Court denied the passports but granted an exit permit to the children and the German authorities decided to give the couple an opportunity to adopt the children and fight for their rights.

The Supreme Court of India also recommended the emergent legislation of a law on surrogacy. The Bench headed by Justice G.S. Singhvi and Justice C.K. Prasad said that no surrogate child should undergo the difficulties faced by Nicolas and Leonard who were already two years of age by the time this decision was made and had still not been granted citizenship in any country.

It is clear that in the case of Jan Balaz the contract proved to be insufficient in demarcating the rights of the parties and it also brought out residual issues such as citizenship and identity that are matters of vital importance to the children but do not find place in the surrogacy agreement.

In both the above case laws the courts take a very pro-contract stand possibly as a way of encouraging commercial surrogacy, which contributes millions of dollars to India’s economy.

It seems from the above that the Contract Act in its current form is not able to quite comprehend the complex questions and requirements that surround surrogacy and surrogacy agreements. These are, firstly, that unlike most contracts that deal with the inanimate, which indirectly has an impact on the lives of human beings, the main entity being given for consideration here is a human child. Certain guidelines, precautions and conditions need to be included in these agreements which are not given anywhere in The Indian Contract Act. The mandatory clauses that are to be included in the agreement are not spelt out nor are there any specific formats that have been provided in the Act. In the absence of such a requirement, clauses favourable to the couple and not the surrogate mother can be incorporated. For example, what actually defines breach of a surrogacy agreement is not given anywhere in the Contract Act making it easier for certain parties to evade liability and accountability which will leave the innocent child unprotected and vulnerable.

Secondly, though free consent is one the pre-requisites of the surrogacy agreement there is an unequal balance of power between the two main parties, i.e , the commissioning parents and the surrogate due to the fact that the surrogate is usually more economically and social oppressed than the couple who are willing to pay $10,000 or more for a child. It is also well known that in many cases the husbands of the surrogates pressurize them to act as surrogate mothers in order to make more money for the family .The comparative illiteracy and powerlessness of the surrogate mother creates an inherently unequal bargaining power between the parties whereby the surrogate mother will forgo certain rights.

Thirdly, most surrogacy agreements in India are with foreign parents because compared to the developed countries such as the United States where the cost of surrogacy is $40,000 or more, the fee for commercial surrogacy is nominal. Indian clinics charge patients $10,000 - $28,000 for a complete package including fertilization, the surrogate fee and delivery of the baby. This is 1/10th less than the United States. In this context issues such as whether the parent country of the commissioning couple recognizes and accepts the citizenship of the surrogate child are of great importance since The Citizenship Act of India does not accord citizenship to a child born out of surrogacy and such matters can leave the child in a no-man’s land where citizenship is denied from both countries. For example both Japan and Germany do not recognize surrogacy and therefore do not grant citizenship and the surrogate children of couples from these countries will not be recognized as citizens. This was evidenced in the Baby Manji Yamada case and the Jan Balaz case mentioned above. This is an important issue for consideration since it directly harms the child who is not at fault and this factor should be a pre-requisite for surrogacy agreements. The Contract Act does not mention any such requirement, which is an important issue of international citizenship and identity of the surrogate child.

Fourthly, it is worth mentioning that though a requirement for the eligibility of a woman to become a surrogate is that she should have had a child before, in no way will the surrogate be able to comprehend prior to the agreement, the feeling of giving away a child that is carried in her womb. Aside from being kept in cramped conditions and having their eating, drinking and medication heavily controlled, these women suffer mental anguish since the doctor ensures that they do not bond with the babies by constantly reminding them that the fetuses they are carrying are not theirs. Therefore it cannot be said that the parties were actually ad idem since the surrogate will not have consented in an informed manner being alien to the feeling of relinquishing rights over a child delivered by her.

Lastly, the absence of a legislation to elaborate on certain issues that are peculiar to only the issue of surrogacy results in the courts of India handling these delicate and life-changing matters. As I had mentioned earlier one of the most distinguishing features of a surrogacy agreement from other agreements is that it directly deals with the exchange of a human child for consideration. In the event of a problem the matter is taken to the Courts, which will take a long time to give a decisive verdict, and this will hamper and traumatize the child during its formative years because of the uncertainty and insecurity in his life.

In this way it seems that the Indian Contract Act is not able to cover or be of any assistance regarding the myriad issues, questions and problems that the issue of surrogacy presents.

If we see how surrogacy has been tackled in other jurisdictions we will find that the English Legislature was the first to enact a law that tackled this medico-legal situation by passing the Surrogacy Arrangements Act, 1985. This Act was made in the aftermath of the notorious ‘Baby Cotton’ case in which, in order to adopt the baby the American couple created a false story and paid a lump-sum to the British surrogate to maintain the same story. Justice Booth stated that such arrangements amount to the sale of children and monetary payments to the surrogate should be prohibited.

Section 2 of the Act made commercial surrogacy a criminal offence.

Subsequently in Re E (Parental Order) and in Re C (A Child) it was held that payments can be made retrospectively for the physical, mental and financial burden undertaken by the surrogate during pregnancy. The Court has relaxed its position where it was felt that the payment was not extortionate.

Surrogacy is more common in the United States than it is in the United Kingdom but the certain landmark judgments show that above all else, even the surrogacy agreement, the test of “best interest of the child” has been adopted. In the highly debated case Re Baby M the surrogate mother refused to relinquish the baby for $10,000 as agreed. The Supreme Court of New Jersey stated that the surrogacy contract was against public policy and hence invalid. Custody was awarded to the commissioning parents of the child keeping in mind the ‘best interest’ of the child.

In Johnson v.Calvert the Supreme Court of California stated that a surrogacy contract was enforceable and commissioning parents had all parental rights over the child and not the surrogate. Any conflict regarding parentage was to be resolved on the basis of the intention of the parties at the time of agreement.. Payments made in surrogacy agreements are for services rendered and not compensation or consideration for transfer of parental rights.
This decision has been highly criticized.

In the case of Re Marriage Moschetta the court awarded parental rights to the surrogate because the commissioning parents got separated.

In Australia, the view of the courts on best interest of the child is highly in favour of the surrogate mother. In Re Evelyn, the court decided that the child should be with the surrogate mother because bonding with the biological and natural mother will be in the ‘best interest of the child’ in the long term.

We see here that in both America and in Australia, the test used to decide issues of parental right is that of “best interests of the child” which draws a cloak over all complex matters since it seems to be the most decisive factor regardless of whether the agreement is valid or not. In Re Baby M, though the agreement was held to be invalid the child was still given to the intended parents by applying this test. Its clear that the United States does not consider it a contract issue because otherwise in the case of Re Marriage Moschetta , even though the parents got separated the contract should have still been binding and enforceable. It is unfair because it goes against the contract. Furthermore, if parents do not forfeit a biological child on divorce then why should they be allowed to abandon a fetus?
The verdict in Re Marriage Moschetta is exactly the opposite of that in Baby Manji Yamada where the contract gained precedence over everything else and the baby was given to its intended parent even after the couple got separated.

In light of the above mentioned arguments it becomes clear that more than an issue of contract, commercial surrogacy is an issue of rights, mainly, the rights of the intending parents, the rights of the donors, the rights of the surrogate mother and last but definitely not the least, the rights of the child. It is also an issue of Human Rights because of the cramped and heavily controlled living conditions of the surrogate mothers.

The Indian Contract Act is used for economic regulation. At the same time there are areas where the market by itself will not work such as telecommunications, and will require a certain amount of monopolization in order to succeed by virtue of a separate legislation. Surrogacy is similar in this manner because there are too many collateral costs that are not covered by the Indian Contract Act.

Keeping in mind the Government’s desire to encourage medical tourism and the fact that commercial surrogacy is recognized in India, what would be best would be to have a separate, comprehensive legislation on surrogacy.

In 2008, The Indian Council of Medical Research (ICMR) came out with a draft Assisted Reproductive Technologies Bill ,2008. The Law Commission of India in its 228th report made further suggestions on the issue of surrogacy in India. This Bill has yet to be placed before Parliament and there are already 350 surrogacy clinics in the country.
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# “It is selfish to have a surrogate baby” by Julie Bindel for the The Guardian on 31 December 2011
# Baby Manji Yamada v. Union of India, AIR 2009 SC 84; (2008) 13 SCC 518
# AIR 2009 SC 84; (2008) 13 SCC 518
# Guardian and Wards Act, 1890
# Special Civil Application no. 3020 of 2009 ; SC 31639/2009
# “Is Surrogate Motherhood Moral?” by Irvi H.Thakkar.
# [1985] FLR 846
# [1996] 1 FLR 369
# [2002] 1 FLR 1008
# 525 A 2d 1128 (NJ, 1987)
# 851 p 2d 776 (Cal, 1993)
# 30 Cal Rptr 2d 893(1994)
# (1998) FLC 92

The  author can be reached at:shriyamisra@legalservicesindia.com

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