Chapter 8 - Product Safety & Consumer Protection

Question 1

What 3 theories determine when a product is defective and what is owed to victims of accidents?

Answer 1

1. Due Care theory
2. Contractual theory
3. Strict Liability theory

Question 2

What is due care theory?

Answer 2

Manufactures have obligation to exercise due care: take reasonable precautions so products are free of causing harm.

Question 3

When are manufactures liable under due care theory?

Answer 3

Only liable if they fail to carry out obligation.

Principle of corrective justice: Something is owed by person who inflicts wrongful harm

Question 4

What is failure to exercise due care an act of?

Answer 4

Negligence: conduct that falls below standard established by law for portection of others against unreasonable harm.

Question 5

What is the first standard of due care?

Answer 5

1. Design
   - Products should be designed in accordance with all government & industry standards to be safe under all conditions including misuse.

Question 6

What is the second standard of due care?

Answer 6

2. Materials

- Materials should meet standards and be durable enough for reasonable use

Question 7

What is the third standard of due care?

Answer 7

3. Production

- Due care should be taken when fabricating parts and assembling so parts are not left out

Question 8

What is the fourth standard of due care?

Answer 8

4. Quality Control

- Should have program to inspect products to ensure quality is sufficient

Question 9

What is the fifth standard of due care?

Answer 9

5. Packaging, Labelling, Warnings
   - Package should avoid damage in transit and if perishable should not create hazards
   - Labels inserts should include instructions and warnings in language easily understood

Question 10

What is the sixth standard of due care?

Answer 10

6. Notification

- Should have a system to notify consumers of hazards that become apparent later

Question 11

What are the 3 negligence rules?

Answer 11

1. Probability of harm
2. Severity of harm
3. Burden of protecting against harm

Question 12

What are problems with due care theory?

Answer 12

• Difficult to apply
• Focuses on conduct of manufacturer rather than condition of product
• Product may be defective but that doesn’t mean manufacturer failed due care
• Can be used to defend manufacturers under: contributory negligence and assumption of risk

Question 13

What is contractual theory?

Answer 13

Responsibility of manufacturers for harm resulting from defective products specified in sales contract.

Question 14

What does contractual theory say about defects?

Answer 14

Even if manufacturer is unaware of defect, cost and any accident caused by defect should be place on manufacturer b/c it was sold wit hunderstanding there would be no hazard except those revealed

Question 15

What are problems with contractual theory?

Answer 15

• Understanding in sales agreements are not very precise. Doesn’t leave consumers with much protection.
• Sales agreement may consist of written contract that limits the right of injured consumer to be compensated.

Question 16

What is Strict Liability thoery?

Answer 16

Manufactureres are responsible for all harm resulting from a dangerous defective product even when due care has been exercised. (May not be negligent)

Question 17

What is the main problem with SLT?

Answer 17

Ignores element of fault, which is fundamental condition for owing compensation for compensatory justice

Unjust to hold manufactureres liable when there was no negligence or contractual obligation to compensate.

Also unfair to make consumers pay indirectly through higher prices

Question 18

What do advocates of SLT say?

Answer 18

Not unjust to amke those not at fault pay if everyone benefits

Question 19

Why are pricers higher under SLT?

Answer 19

In order to pay for compensation

Question 20

What are the problems with SLT?

Answer 20

• Companies can’t always distribute burden of strict liability easily
• insurance and high compensation drive many out of business
• stifles innovation
• It is best choice amongst the 3 though