Product Liability

Question 1

What’s the statutory basis for claiming re. damage caused by defective products? Does this replace claim in negligence?

Answer 1

Consumer Protection Act 1987.

Does NOT replace: works alongside.

Question 2

Why was CPA 1987 introduced?

Answer 2

To introduce strict liability.

Question 3

What are the four key elements of the basis for a product liability claim under s 2(1)?

Answer 3

1. Product
2. Defect
3. Damage
4. Every person to whom subsection (2) below applies.

Question 4

What’s a ‘product’?

Answer 4

s 1(2): any goods - something which is included as a component or raw material in something else still a product.

Question 5

What’s a ‘defect’?

Answer 5

s 3(1): whether or not something is defective depends on what people are 'generally entitled to expect'.
s 3(2) expands: what people are generally entitled to expect depends on: manner/purposes marketed for; what might reasonably be expected to be done with it; time wen product was supplied by producer to another. 
Examples: 
Y Abouzaid v Mothercare: elastic strap of fleece lined sleeping bag hit C in eye - held to be defective.
N Richardon v LRC Products Ltd: condom NOT held to be defective.

Question 6

What’s the difference between s 3(1) and the standard of care in negligence?

Answer 6

The Act was meant to demand considerably more of manufacturers than traditional negligence requires.
N i.e. A v National Blood Authority [2001]: C sued the under the Act as a result of personal injuries arising from their being transfused with blood infected by hepatitis.
- Court noted that a patient undergoing a transfusion is legitimately entitled to expect that they will not be given infected blood

Question 7

What’s ‘damage’?

Answer 7

s 5(1): most types of loss count as damage within the meaning of the Consumer Protection Act 1987, but not (it would appear) pure economic loss.
NOT RECOVERABLE –>
- However, no claim can be brought for the loss of the product itself, or any product supplied with the defective product as part of it.
Two further limits:
1. No claim re. to damage to property unless sum exceeds £275, excluding interest (s 5(4)).
2. No claim for damage to property can be brought unless the property is ordinarily intended for private use / occupation / consumption and intended by the person suffering the loss or damage mainly for his own private use / occupation / consumption (s 5(3)).
- (2) means losses suffered by businesses unlikely to be recoverable.

Question 8

Who are ‘persons liable for damage’?

Answer 8

s 2(2):

a) producer
b) held himself out to be producer
c) any person who has imported into member State from outside member States - i.e. EU provision

Question 9

What does ‘producer’ mean?

Answer 9

s 1(2):
1. products that are manufactured – the manufacturer
2. products that are ‘won or abstracted’ – the person who won / abstracted it
3. products to which neither of the above applies, but where the essential characteristics are attributable to a process carried out – the person who carried out that process.
This is bolstered by s 2(3): includes suppliers: i.e. retailer who sells products which they did not produce – if supplier wants to avoid liability have to be able to say who produced/imported goods.

Question 10

Who can bring a claim? Is this in the Act?

Answer 10

Nowhere in the Act is there a description of who can bring a claim: BUT as business losses not recoverable; protection afforded is limited to CONSUMERS.

Question 11

What’s the effect of who can bring a claim not being noted in the Act?

Answer 11

Anyone suffering damage as a result of the defect can sue (this is the natural interpretation of s 2(1)), and the Act does not state anything different anywhere else.

Question 12

What are the most important defences?

Answer 12

1. ‘the defect did not exist in the product at the relevant time’ (s 4(1)(d)); or
2. ‘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).
   - – 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.

Question 13

Are exemption clauses allowed?

Answer 13

S 7 prohibits any exclusion or limitation of liability under the provisions of the Act set out in this element.

Question 14

What are the limitations to these claims?

Answer 14

Within three years from the later of:
1. the date the injury and/or damage occurred; OR
2. when the claimant became aware or should reasonably have become aware of the damage (s 11A(4) Limitation Act 1980).
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.

Question 15

What’s important to note about the Act? What does this add to other areas of law?

Answer 15

Breadth of the Act.

1. protection is not limited to people who purchased the product
2. in negligence, foreseeability of harm is a necessary part of establishing a duty of care and therefore of establishing liability.
3. ‘causation’ requirement under the Act is that the damage was caused ‘wholly or partly’ by the defect (s 2(1)).

Question 16

Starting point for negligence claim for product liability?

Answer 16

Duty: is there a precedent making clear whether or not a duty is owed?
- Donoghue: manufacturer owes a duty not only to the final purchaser at the end of the supply chain, but also to other users of the product.
Stennett v Hancock [1939]: manufacturer owes a duty to a party that neither bought nor used the product, but who comes into contact with it.
Most likely TARGET manufacturer - but Donoghue extends to other parties involved with product.

Question 17

Is pure economic loss recoverable?

Answer 17

Not generally. No.

Question 18

How to establish breach?

Answer 18

Same way: standard of care, and then if manufacturer has fallen below that standard (likelihood/magnitude of harm, practicality of precautions etc.)
Whilst breach must be proved, in many cases the presence of a defect in a product will be sufficient evidence to establish breach, unless the manufacturer can show another reason for the defect - but for claimant to prove the breach.

Question 19

How to establish causation?

Answer 19

Usual principles.
A manufacturer might argue that where goods were going to be examined at some point between the manufacture and use by the consumer, then any harm caused to the consumer is not the manufacturers responsibility - ‘immediate inspection’
Clarified in Haseldine v Daw [1941]: ‘reasonable probability’ rather than a ‘reasonable possibility’
if there is a warning to test the product or to use it in a particular way, and the claimant fails to carry this out, this may be sufficient to constitute a break in the chain of causation.