[quote=Beta]
What happens if a student accidentally kills another student. 
I'm not saying everyone will kill everyone... but logically, fatalities WILL happen.
[/quote]

They will be suspended from further fights until an investigation is held to see if it was fowl play. If it's determined an accident then they may be allowed again after attending a special safety class.

Due to the vital spirit plot device it will make fatalities less likely unless you really start beating on them. Therefore, normally fatal blows will still win you the fight but not as likely kill them.