Chapter 9 Strict Liability and Product Liability

Strict Liability Does not require fault, intent or breach of duty. Usually involves ‘abnormally dangerous’ activities and risk cannot be prevented. Dangerous Animals. Product Liability—manufacturers and sellers of harmful or defective products.

Warranty Law Under the Uniform Commercial Code, certain warranties can arise in a contract for sale of goods. Consumers and others can recover from any seller for losses resulting from a breach of express or implied warranty.

Express Warranties Those made by oral or written representations concerning the goods. Quality, condition, description or performance potential of goods. Buyer relies on the representation. Can be made in advertising or salesperson.

Implied Warranties Warranty of Merchantability: A merchant warrants goods are “reasonably fit for the ordinary purposes for which such goods are used.” Applies only to merchants! Warranty of Fitness for a Particular Purpose: Arises when any seller knows of the particular purpose for which a buyer will use the goods and knows the buyer is relying on the seller to select suitable goods.

Liability for Breach of Warranty The legal liability of manufacturers, sellers, and lessors of goods to consumers, users, and bystanders for injuries or damages that are caused by the goods. Product liability claims are most often based on: Warranty Law. Negligence. Misrepresentation. Strict Liability.

Product Liability Based on Negligence In order to prevent claims of negligence, due care must be used by the manufacturer in: Designing the product. Selecting materials. Using the appropriate production process. Assembling and testing the product. Placing adequate warnings on the label or product.

Privity of Contract Privity of contract is not required. A manufacturer is liable for failure to exercise due care to any person who sustains an injury proximately caused by a negligently made (defective) product.

Product Liability Based on Misrepresentation Fraudulent misrepresentation of a product may result in product liability based on the tort of fraud. Examples include: Intentional mislabeling of packaged cosmetics Intentional concealment of a product’s defects

Product Liability Based on Strict Liability Under the doctrine of strict liability, people may be liable for the results of their acts regardless of their intentions or their exercise of reasonable care. If a child is injured by a toy, should the manufacturer be held liable regardless of the circumstances? Case 9.1 Greenman v. Yuba Power Products, Inc. (1962).

Product Defects: Section 402A of the Restatement (Second) of Torts Requirements for Strict Liability Product Defects: Section 402A of the Restatement (Second) of Torts 1. One who sells any product in a defective condition unreasonably dangerous to the user or consumer or to his property is subject to liability for physical harm thereby caused to the ultimate user or consumer or to his property, if a. the seller is engaged in the business of selling such a product, and b. it is expected to and does reach the user or consumer without substantial change in the condition in which it is sold.

Product Defects: Section 402A of the Restatement (Second) of Torts Requirements for Strict Liability Product Defects: Section 402A of the Restatement (Second) of Torts 2. The rule stated in Subsection (1) applies although: a. the seller has exercised all possible care in the preparation and sale of his product, and b. the user or consumer has not bought the product from or entered into any contractual relation with the seller.

Requirements for Strict Liability The defendant must sell the product in a defective condition. The defendant must normally be engaged in the business of selling that product. The product must be unreasonably dangerous to the user or consumer because of its defective condition (in most states). A court may consider a product so defective as to be unreasonably dangerous if either (a) the product was dangerous beyond the expectation of the ordinary consumer or (b) a less dangerous alternative was economically feasible for the manufacturer, but the manufacturer failed to produce it. The plaintiff must incur physical harm to self or property by use or consumption of the product. The defective condition must be the proximate cause of the injury or damage. The goods must not have been substantially changed from the time the product was sold to the time the injury was sustained.

“Unreasonably Dangerous” Products Claims that a product is so defective as to be unreasonably dangerous generally allege that the product is unreasonably dangerous for one of the following reasons: Because of a flaw in the manufacturing process. Because of a design defect. Case 9.2 Rogers v. Ingersoll-Rand, Co. (1998). Because the manufacturer failed to warn adequately of harms associated with the product’s use. Obvious Risks.

Market-Share Liability In cases in which plaintiffs cannot prove which of many distributors of a harmful product supplied the particular product that caused the plaintiffs’ injuries, some courts have applied market-share liability. All firms that manufactured and distributed the harmful product during the period in question are then held liable for the plaintiffs’ injuries in proportion to the firms’ respective shares of the market, as directed by the court.

Other Applications of Strict Liability Suppliers of Components: Suppliers of component parts are strictly liable for defective parts which, when incorporated into a product, cause injuries to users. Bystanders: Manufacturers and other sellers are liable for harms suffered by injured bystanders due to defective products.

Defenses to Product Liability There are several defenses that manufacturers, sellers, or lessors can raise to avoid liability for harms caused by their products. Assumption of Risk Product Misuse Comparative Negligence Commonly Known Dangers Other Defenses

Defenses to Product Liability Assumption of Risk The user or consumer knew of the risk of harm and voluntarily assumed it. Product Misuse The user or consumer misused the product in a way unforeseeable by the manufacturer. Case 9.3 Pelman v. McDonald’s Corp. (2003).

Defenses to Product Liability Comparative Negligence Liability may be distributed between plaintiff and defendant under the doctrine of comparative negligence. Commonly Known Dangers If a defendant succeeds in convincing the court that a plaintiff’s injury resulted from a commonly known danger, such as the danger associated with using a sharp knife, the defendant will not be liable.

Other Defenses Lack of Required Elements A defendant can also defend against a products liability claim by showing that there is no basis for the plaintiff’s claim (that the plaintiff has not met the requirements for an action in negligence or strict liability).