Product Liability

Question 1

To establish a duty of care between a manufacturer and a consumer, what must C show under the ‘narrow rule’?

Answer 1

• the defendant is a ‘manufacturer’;
• the item causing damage is a ‘product’;
• the claimant is a ‘consumer’; and
• the product reached the consumer in the form in which it left the manufacturer with no reasonable possibility of intermediate examination.

Question 2

Who is a manufacturer?

Answer 2

Wide definition - any person who works in some way on a product before it reaches the consumer.

Includes suppliers if the circumstances are such that they ought reasonably to inspect or test the products which they supply, or if they actually know of a defect/danger.

Question 3

What is a product?

Answer 3

Almost any item which is capable of causing damage, including its packaging.

Question 4

Who is a consumer?

Answer 4

Not only the ultimate user of the product, but also anyone whom D should reasonably have in mind as likely to be injured by the defendant’s negligence

Question 5

What is intermediate examination?

Answer 5

Where someone examines the contents of a product before it is consumed by the ultimate user.

If the manufacturer reasonably believes that there is a likelihood of intermediate examination then the manufacturer will not owe a duty of care (although a DoC may be owed by the party which examined the product).

Manufacturer would not be exonerated if

Note that if an examination by a third party (eg a supplier), or by the consumer himself, would not have revealed the defect (eg because it is a hidden defect), the manufacturer will not be exonerated.

Question 6

Where does product liability not apply in relation to a defective product?

Answer 6

Where the only loss is the defective quality of the product itself, the reduction in value of the product, or the cost of repairing the defect or of replacing the product.

Question 7

How does breach of duty apply in cases of defective products?

Answer 7

The same as usual - standard of care of a reasonable person is required.

Note: a manufacturer may be able to comply with its DoC by adequately warning the consumer of any danger connected with the product.

Question 8

Why is proving the breach harder for C in relation to product liability?

Answer 8

C is unlikely to have evidence of what went wrong in the manufacturing process and res ipsa loquitur cannot be relied on in cases of product liability.

But if C can prove enough for the court to infer a breach of duty by D, this is sufficient. Once the inference arises, the court will infer breach unless D can rebut the inference.

Question 9

What common method can D use to try to rebut the inference of breach in relation to product liability?

Answer 9

Can claim the defect was not due to D’s lack of care but to some later problem e.g., C’s misuse of the product.

Question 10

How is causation proved in relation to product liability?

Answer 10

C must prove D’s breach caused their loss in the normal way. If factual causation is established, the court will then consider any intervening acts and also the issue of remoteness, ie whether the claimant’s loss is of a reasonably foreseeable type.

Question 11

What defences can D rely on in relation to product liability?

Answer 11

Consent - if C is aware of the defect and uses the product anyway, this will = consent. Knowledge of a risk =/= sufficient.

Exclusion of liability - Liability in negligence for death or personal injury cannot be excluded at all where liability arises in the course of a business or trade. However, liability to non-consumers in negligence for other loss or damage can be excluded if the reasonableness test is satisfied (UCTA) or the fairness test if the claimant is a consumer (CRA 2015)

CN - e.g., D notice a hammer head is loose but uses it anyway, it snaps and hurts him. Probably hard to argue consent, but could argue CN.

Question 12

How can one sue under the CPA 1987?

Answer 12

C must establish:

• that they have suffered damage
• caused by
• a defect
• in a product.

This is wide - not just confined to the buyer, or even a direct user, of the defective product (unlike in negligence, C need not be a foreseeable victim).

Question 13

How is damage defined under the CPA?

Answer 13

Damage:

• Claims for death and personal injury are without limit. Personal injury is defined as including ‘any disease and any other impairment of a person’s physical or mental condition’.
• Damage to private property must exceed £275 before a claim for it can be brought. Provided the loss of or damage to private property exceeds £275, the full amount of the loss or damage is recoverable.

Not damage:

• Damage caused by a defective product to business property is outside the scope of the CPA 1987.
• The cost of repairing or replacing the defective product itself is not recoverable. This is regarded as being pure economic loss.

Question 14

How does causation differ under the CPA to negligence?
‘

Answer 14

But for’ test applies still.

But under the CPA, C must show that the defect caused the damage. In negligence, C must show that D’s breach caused the damage.

Remoteness not discussed in the CPA, so if C can establish damage caused by a defect, D will be liable for that damage without limit.

Question 15

What is a ‘defect’ under the CPA?

Answer 15

Defect’ = unsafe. So a product that is merely broken and is not unsafe will not fall under CPA product liability.

To determine the level of safety ppl are entitled to, the following circumstances must be taken into account:
* the whole get-up and presentation of the product (including packaging, instructions, warnings);
* what the expected use of the product is;
* the age of the product in question.

Question 16

What is a ‘product’ under the CPA?

Answer 16

‘any goods or electricity and… includes a product which is comprised in another product whether … a component … or raw material’. This would, therefore, include component parts like an engine in a car. It also includes blood.

Question 17

Under the CPA, who can be liable?

Answer 17

The manufacturer - includes e.g., a manufacturer of a replacement part of the product.

An ‘own-brander’ - person who holds themselves out as being the producer e.g., through a name or trademark on the product.

An importer - person who imported product into the UK to supply it to D.

A forgetful supplier - supplier only liable under the CPA where they are unable to meet C’s request to identify those upstream the supply chain e.g., the manufacturer.

Question 18

Explain the nature of CPA product liability

Answer 18

Merely requires C to show that they have suffered damage caused by a defect in a product. It does not require C to prove that the defect resulted from any fault or carelessness on D’s behalf

Question 19

What defences are applicable to the CPA?

Answer 19

The defect was attributable to compliance with legal requirements

The defendant did not supply the product to another - e.g., C steals the product, C’s child is injured due to defect.

The defendant supplied the product otherwise than in the course of business - e.g., product is sold by one friend to another.

The defect did not exist when the defendant supplied the product - e.g., the defect is caused by wear and tear.

A manufacturer of component parts is not liable for a defect in the finished product which is wholly attributable to the design of the finished product or to compliance with the instructions given by the manufacturer of the finished product

‘Development risks’ - Dt must prove that the state of knowledge, at the time the product was supplied, amongst producers of the product in question, was not such as to allow a producer of the product to discover the defect.

Question 20

What defence does not apply to CPA product liability?

Answer 20

Exclusion of liability

Question 21

What is the aim of damages?

Answer 21

To put C in the same position they would have been in if the tort had not been committed.

Re personal injuries, payment will not restore C to his previous position, so damages are compensatory.

C should also be no better off than he was previously - C cannot profit. C must mitigate damage by taking all reasonable steps to keep his losses to a minimum e.g., if C loses his job due to D’s negligence, he should seek alternate employment; same with medical care etc.

Question 22

What is the one action rule?

Answer 22

Once an award of damages has been made, a claimant cannot go back to court with a second claim simply because the injury worsens rather than improves. When a court assesses the claimant’s damages, it must award a single lump sum to cover both losses already suffered up to the time of trial and losses which the claimant is expected to suffer in the future.

Question 23

The Consumer Protection Act 1987 (the ‘Act’)

Answer 23

provides a statutory basis for claiming in relation to damage caused by defective products. It does not replace any claim in negligence or breach of contract, so whenever faced with a problem involving a defective product, a practitioner should consider negligence, breach of contract and the Act.

Question 24

Persons liable for damage - CPA 1987

Answer 24

Section 2(2)

(2) This subsection applies to—

(a) the producer of the product;

(b) any person who, by putting his name on the product or using a trade mark or other distinguishing mark in relation to the product, has held himself out to be the producer of the product,

(c) any person who has imported the product into the United Kingdom from a place

outside the United Kingdom in order, in the course of any business of his, to supply it to another.

Question 25

S 1(2) CPA 1987 tells us that 'producer' means:

Answer 25

For products that are manufactured (eg a car) – the manufacturer For products that are 'won or abstracted' (eg coal, which is abstracted from the ground, but not manufactured) – the person who won / abstracted it For products to which neither of the above applies, but where the essential characteristics are attributable to a process carried out (for example, agricultural produce – which is neither manufactured nor abstracted, but which is the clear result of a process) – the person who carried out that process. The provision mentioned above is bolstered by s 2(3). This provides that someone who supplied a defective product to any person will be liable for the damage caused by the defect if the person suffering damage asks for details of the producer / importer within a reasonable time and when they cannot identify the producer / importer themselves, and the supplier fails to identity that person. The result of all these provisions is that more than one person could be liable for the same damage under the Act. If so, they will be jointly and severally liable (s 2(5)).

Question 26

Who can bring a claim? CPA 1987

Answer 26

You might notice that neither in s 2(1) nor anywhere else in the Act is there a description of who can bring a claim, and despite the name of the Act referring to 'consumer', there is no reference / definition to consumer in the relevant provisions. However, if you recall / revisit the explanation of the types of recoverable 'damage' above, you will see that, broadly, business losses cannot be recovered under the Act. In this sense, the protection afforded by the Act is limited to 'consumers'. Note however that the effect of this approach is that the protection is not limited to people who purchased the product as would usually be the case in a contractual claim, nor even limited to people who used the product. Anyone suffering damage as a result of the defect can sue (this is the natural interpretation of s2(1)), and the Act does not state anything different anywhere else.

Question 27

Defences UNDER CPA 1987

Answer 27

‘the defect did not exist in the product at the relevant time’ (s4(1)(d)); or that the state of scientific and technical knowledge at the relevant time was not such that a producer of products of the same description as the product in question might be expected to have discovered the defect if it had existed in his products while they were under his control' (s 4(1)(e)). There is some argument as to whether s 4(1)(e) introduces a fault aspect 'via the back door'. Note, however, that if a manufacturer is aware of a defect but the state of scientific / technical knowledge is such that the defect cannot be fixed, this will not be a defence to a claim. S 4(1)(e) talks only about inability to discover, not about inability to fix. Under s 6(4) contributory negligence is available as a defence.

Question 28

Limitation period under CPA 1987 to bring claim

Answer 28

he claim must be brought within three years from the later of: the date the injury and/or damage occurred; OR when the claimant became aware or should reasonably have become aware of the damage (s11A(4) Limitation Act 1980) There is a long stop of ten years after the product was put into circulation by the defendant (s 11A(3) Limitation Act 1980). This represents an absolute defence to such actions after this time. This means that sometimes the only option a claimant will have is a claim in negligence whose limitation rules are more generous.

Question 29

How does CPA 1987 relate to other areas of law?

Answer 29

1) the protection is not limited to people who purchased the product (as would usually be the case in a contractual claim), nor even limited to people who used the product. Anyone suffering damage as a result of the defect can sue. 2), in negligence, foreseeability of harm is a necessary part of establishing a duty of care and therefore of establishing liability. This is not the case in relation to the Act. 3) the 'causation' requirement under the Act is that the damage was caused 'wholly or partly' by the defect (s 2(1)). This is somewhat simpler than the causation aspect of a negligence claim.