of the injury, loss or damage." Direct damage as the result of collision or malfunctioning resulting in space object debris falling back to earth is compensable under the terms of the agreement. During the negotiations the issue was raised as to indirect or consequential damage. As opposed to direct damage, namely, an "injury, loss or damage flowing directly or immediately from, and as the probable and natural result, of the launching State's space object," a consequential damage would be that which did not result directly or immediately from the act, but only from some of the consequences or results of the act. Illustrative of this form of damage might be the loss of consortium resulting from injury to a spouse or to the need for a replacement employee in the event of harm to an injured employee. The United States urged that the agreement did not include consequential damage. In its view the agreement "holds a launching State liable for damage traceable directly to the launching, flight and re-entry of a space object or associated launch vehicle but does not cover what some delegations earlier called remote or indirect damage and for which there is only hypothetical causal connection with a particular space activity." The basis for such consequential damage depends on an earlier physical harm to a person other than the person asserting consequential damage. The line between a physical and nonphysical damage is often blurred. In the United States, for example, nonphysical harm may be produced via psychic injury where there has been no physical contact between the harmed person and the Staff Report, p. 23. staff Report, p. 23. Ibid. Ibid., p. 24.
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