Product Liability Flashcards
The Gigantic Supermarket (GS) sells chocolate orange biscuits which are manufactured under the GS brand-name by Chocko Biscuits Company (CB), based in Manchester. The OS biscuit packaging has this marketing slogan: ‘Orange inside, chocolate on top: once you start, you just can’t stop!’ CB imports from Taste Extraordinaire Limited in China an orange food colourant additive, E666, for use in the biscuits. One research study in Singapore indicates that E666 is a carcinogen which, if consumed in very high quantities, may cause a very rare form of cancer, X. CB does not know about this research study. William, a novelist, becomes convinced that he is inspired only when he is eating GS chocolate orange biscuits, and consumes five boxes a day. After William has completed his massive novel, he is diagnosed with X cancer.
To provide his nine-year-old son Jimmy with a playmate, William buys a pedigree Persian cat, Fluffy, for £ I00. Jimmy enthusiastically enters Fluffy into pet competitions, and in 2007 wins £100. Unfortunately Fluffy’s favourite pet food, manufactured by Perfect Petfood, becomes contaminated during the manufacturing process, and on January 1, 2008, Fluffy dies of food poisoning after eating it. Jimmy suffers post-traumatic stress disorder from watching his pet die in agony. Discuss any claims in tort.
(FHS, 2008)
Barring any claims in contract under the Sale of Goods Act 1979, William has two claims in tort: one based on common law negligence and the other statutorily under the Consumer Protection Act 1987 (“the 1987 Act”).
Under the common law of negligence, William could argue that Taste Extraordinaire Limited (“TE”) and Chocko Biscuits Company (“CB”) both owed him duties of care to not use carcinogenic ingredients such as E666. Per Lord Atkin’s test in Donoghue v Stevenson, a duty of care will be owed if it is established that the manufacturer intended for the products to reach the ultimate consumer in the form in which the products left him, with no reasonable possibility of intermediate examination (STEEL: Whether this is true may depend upon whether a reasonable examination would reveal the danger in the product), and with the knowledge that the absence of reasonable care in the preparation or putting up of the products will result in an injury to the consumer’s life or property. TE is unlikely to satisfy these elements as it did not intend for the colouring to reach the ultimate consumer in that same form, and there was definitely a reasonable possibility of intermediate examination by subsequent manufacturers, such as CB. However, in the case of CB, all elements are likely to be factually made out.
Whether CB then breached this duty of care will turn on whether it acted negligently, i.e. whether its conduct fell below the standard of care of a reasonable person (Blyth v Birmingham Waterworks Co). The standard of care of a reasonable person has to be judged ‘in the light of knowledge which then was or ought reasonably to have been possessed’ (Roe v Ministry of Health); therefore, the fact that CB did not know about the research study is inconsequential. Presently, it is unclear whether the research study on the carcinogenic nature constitutes knowledge that CB was or ought reasonably to have been possessed. For example, should there only exist one such research study and an absence of other scientific literature condemning the E666, it would seem difficult to establish that any risk of injury that materialised from using the E666 was reasonably foreseeable. It should also be noted that the study only went so far as to conclude that E666 may cause cancer, and not that it will cause cancer. However, it could be argued that as a reasonable manufacturer, CB should have conducted examinations on the use of E66 and ought to have known of the inherent risks; conversely, if CB had conducted tests on E66 to a reasonable degree but these tests had not yielded any results, then the court would likely hold that CB was not negligent. These are highly fact-specific.
Even if it is established that CB acted negligently, William will further need to prove that, on the balance of probabilities, his consumption of E666 caused his cancer, or materially contributed to his cancer, or, per the Fairchild exception, materially increased the risk of his contracting cancer. It is unlikely to be able to prove that but-for the consumption of E666, William would not have contracted cancer. It is also difficult to prove, with an absence of scientific data, if the consumption of E666 even contributed to William’s contraction of cancer. As such, William may choose to rely on the Fairchild exception, which could be used when there is an uncertainty in scientific knowledge. However, barring any further facts to the contrary, other possible causes of William’s cancer will not be the same kind of noxious agent and the Fairchild principles might be disapplied, as was the case in Wilsher v Essex AHA (albeit concerning McGhee v National Coal Board, a precursor to Fairchild).
The above analyses taken together mean that William will have an uphill task pursuing a claim in negligence. It is submitted that a better alternative would be to rely on statute, i.e. the 1987 Act.
Pursuant to the 1987 Act, William can seek to impose liability on Gigantic Supermarket (“GS”) or CB, but not TE, given that TE is a foreign company based in China, out of the jurisdiction of the 1987 Act. On the other hand, GS falls under the ambit of a producer under section 2(2)(b) of the 1987 Act, given that it had put its name on the GS biscuits to hold itself out to be its producer. CB constitutes a producer of the GS biscuits under section 1(2) of the 1987 Act. Therefore, both GS and CB are governed by the 1987 Act (STEEL: TE is a ‘producer’ so could in principle be liable).
William then has to prove that there was a defect in the product under section 3 of the 1987 Act. Adopting the legitimate expectations test, it is clear that, if sufficiently proved on the facts that E666 is indeed carcinogenic, the safety of the GS biscuits was not such as persons generally are entitled to expect, especially since the GS biscuits were meant for consumption. It could scarcely be argued that persons generally should have expected (STEEL: Though the question is always what people are entitled to expect; their actual expectations are not directly relevant to this. In determining what people generally are entitled to expect, a risk-utility analysis is applied: Wilkes.
) that consumption of the GS biscuits could lead to cancer, a situation similar to that in A v National Blood Authority. This is buttressed by section 3(2)(a) of the 1987 Act, which provides that the manner in which the product was marketed should be taken into account. In the present case, the slogan of ‘Orange inside, chocolate on top: once you start, you just can’t stop!’ was devoid of any warnings of the potential risks of overconsumption. Once a defect has been established, it would be easy for William to prove that damage had been inflicted on him under section 5 of the 1987 Act, as cancer fully constitutes a non-trivial impairment of a person’s physical condition.
GS and CB may then plead a defence under section 4(1)(e) of the 1987 Act, which provides that a defence will arise if it is shown 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’. Such a defence may apply in the present case (A v National Blood Authority). Two points may be noted about this possible defence. Firstly, it seems untrue to claim that the state of scientific knowledge was such that, during the production of the GS biscuits, either GS or CB could not have been expected to discover the defect. The presence of the Singaporean scientific study prima facie establishes that the scientific knowledge was, or had become, sufficient for GS or CB to discover the defect. Secondly, the defence cannot be applied if the producer was aware of a risk that the product might not conform to its intended design in the way it did (A v National Blood Authority). There seems to be an inherent risk known to any manufacturer of foodstuffs that their ingredients are not safe for consumption, especially with the many health permits required. As such, it is unlikely that this defence will succeed.
Accordingly, William should be able to rely on the 1987 Act to hold GS and CB jointly liable for his contracting cancer, and should be entitled to damages to be quantified.
William may also commence a court action against Perfect Petfood on behalf of Jimmy, given that Jimmy is a minor. Once again, William has a tortious claim in negligence and a tortious claim under the 1987 Act.
Under the common law tort of negligence, William might be able to claim liability for Jimmy’s loss of property (by way of Fluffy’s death) and his resultant psychiatric injury. In relation to the loss of property, the Donoghue v Stevenson test once again applies and is likely to be satisfied by Perfect Petfood. In addition, Fluffy wholly constitutes Jimmy’s property given that Jimmy had a sufficient interest in Fluffy at the time it was harmed, and it was reasonably foreseeable that Perfect Petfood’s act would result in property like Fluffy (i.e. pets) being harmed. Perfect Petfood, in manufacturing contaminated pet food, most likely acted negligently and therefore breached its duty to Jimmy. But-for causation is also established on the facts. As a result, Jimmy may claim for the loss of Fluffy (being £100) and any subsequent loss of earning (being future prize-winning monies). It is to be noted that any claim for the loss of profits to Jimmy is not pure economic loss but consequential economic loss given that it occurs directly because of Fluffy’s death.
In relation to Jimmy’s psychiatric injury, a duty of care would be harder to establish. While post-traumatic stress disorder is a recognised psychiatric illness, it must also be shown that a person of ‘normal fortitude’ would have suffered psychiatric damage. It is unclear if Jimmy could be said to have been in a ‘close and loving relationship’ with Fluffy given that case law typically applies this to relationships between humans. If so, Jimmy will have to prove that the psychiatric injury was triggered by the shock of witnessing the event in which Fluffy was killed, or seeing Fluffy in the immediate aftermath of the event (Alcock v Chief Constable of South Yorkshire). Barring any facts to the contrary, this seems to be fairly made out. However, if an owner-pet relationship is not deemed by the law to amount to a ‘close and loving relationship’, Jimmy could possibly also establish that he felt responsible for what happened to Fluffy and that he was present when Fluffy died. In any case, it is likely that given the circumstances, the court will hold that Perfect Petfoods owed Jimmy a duty of care in relation to his psychiatric injury.
It is most likely that Perfect Petfoods breached their duty of care by acting negligently, although this has to be made out on the facts. Causation will also be easy to prove once a duty of care and a breach are established. Therefore, Jimmy is likely to be able to attain damages.
Under the 1987 Act, Perfect Petfoods will be liable as the producer under section 2. Adopting the legitimate expectations test, it can scarcely be said that persons generally are entitled to expect that pet food would be contaminated, and therefore, the product most definitely constitutes a defect. Damage under section 5 of the 1987 Act includes any loss of or damage to any property, which in this case is Jimmy’s pet cat Fluffy. It could be counter argued by Perfect Petfoods that the consequent loss from Fluffy’s death is but a trivial damage under section 5(4) of the 1987 Act as it is quantified to be less than £100; however, it is instead submitted that coupled with an estimated loss of future earnings from the prize winnings, this amount is likely to exceed £275 and be claimable under the 1987 Act. It is likely that Jimmy may also claim for his psychiatric injury as that falls under the ambit of section 5(1) of the 1987 Act and its mention of ‘mental condition’ (S. 45)
Given that there seem to be no valid defences, Jimmy’s claim against Perfect Petfood under the 1987 Act is likely to be actionable in tort.
