CHAPTER 6

Strict Liability and Product Liability

 

 

So, here we go with a more detailed look at liability.  Yeah, the first part looks suspiciously like the end of the last chapter. 

 

We will concentrate on strict liability, where liability is imposed for reasons other than fault, and product liability, where liability is associated with manufacturers and sellers of defective products to consumers, users and even bystanders.  But first, let us recall the notion of:

 

 

 

NEGLIGENCE PER SE

 

Negligence Per Se: (in and of itself) An act or omission in violation of a statutory duty or obligation. Negligence per se often arises where the tortfeasor both violates a criminal statute or ordinance and causes injury to another party.

 

        Plaintiff must prove that:

 

(1)     the statute or ordinance clearly sets out what standard of conduct is expected, when it is expected, and of whom it is expected,

 

(2)     plaintiff is in the class of persons intended to be protected by the statute or ordinance, and

 

(3)     the statute or ordinance was intended to prevent the type of injury which plaintiff suffered as a result of defendant’s wrongful act.

 

Recall the good Samaritan laws.

 

 

 

STRICT LIABILITY

 

        Strict Liability: Liability regardless of fault. Strict liability is imposed on defendants whose activities are abnormally dangerous and/or involve dangerous animals and on defendants whose products are defective.  Compare:  Pet’s are given one free bite. 

 

          The concept began with the famous 1868 English case of Rylands v. Fletcher, the coal mining case where a reservoir broke through an abandoned mine and flooded an active mine. The active mine owners sued the abandoned mine owners, and won.  The court used a great phrase:  if a person for his own purpose brings on his land and collects and keeps there anything likely to do mischief if it escapes, must keep it at his peril, and if he does not do so, is prima facie answerable for all the damage which is natural consequence of its escape  What is so interesting about this ruling is it basically used the same analogy (remember this from the earlier chapters) of what happens to people who hold dangerous animals.

 

        Abnormally Dangerous Activities: Some activities are so inherently dangerous that they give rise to liability without regard to fault because the activity:

 

(1)     involves serious potential harm to persons or property;

 

(2)     involves a high degree of risk that cannot be completely guarded against by the exercise of reasonable care; or

 

(3)     is not commonly performed in the community or under the circumstances.

 

Consider:  Dynamite.  Nuclear plants.  Wild animals (contrasted against tame animals who generally get away with “one free bite.”)

 

 

 

PRODUCT LIABILITY: NEGLIGENCE

                                                                                 

        Product Liability: A manufacturer’s, seller’s, or lessor’s liability to consumers, users, and by-standers (privity of contract is NOT required, which means the parties did not have to have a business deal or relationship directly between themselves) for physical harm or property damage that is caused by the goods.

 

          Negligence: A manufacturer is liable for its failure to exercise due care to ANY person who sustained an injury proximately caused by the manufacturer’s negligence with regard to any of the following:

 

         design of the product,

 

         selection of materials (including any component products purchased from another seller that are incorporated into a finished product),

 

        use of appropriate production processes,

 

         assembly and testing of the product, and

 

         placement of adequate warnings on the product which inform the user of dangers of which an ordinary person might not be aware.

 

 

 

 

STRICT PRODUCT LIABILITY: RULES

 

        Strict Liability: A manufacturer, seller, or lessor of goods will be strictly liable, regardless of intent or the exercise of reasonable care, for any personal injury or property damage to consumers, users, and by-standers caused by the goods it manufactures, sells, or leases as long as:

 

(1)      the product is defective when the defendant sells it (either to an end-user or to another seller for ultimate resale);

 

(2)      the defendant is normally engaged in the business of selling or otherwise distributing the product in question;

 

(3)      the product is unreasonably dangerous to the user or consumer because of its defective condition;

 

(4)      the plaintiff suffers physical harm to self or property as a result of using or consuming the product,

 

(5)     which is proximately caused by the defective condition of the product; and

 

(6)      the product must not have been substantially changed between the time it was sold or otherwise distributed by the defendant and the time the injury occurred.

 

          Be sure to read the Pepsi- Cola case, Case 6.2.

 

 

 

 

PRODUCT LIABILITY: MISREPRESENTATION

 

        Misrepresentation: A manufacturer may also be liable for any misrepresentations made to a consumer or user of its product if the misrepresentation causes the consumer or user to suffer some injury.

 

        To be actionable, a misrepresentation must be made knowingly or with reckless disregard for the facts.

 

         In addition to affirmative misrepresentations, a manufacturer may also be liable for knowingly or recklessly omitting to tell the consumer or user some relevant fact or concealing that fact from the consumer or user.

 

        To be actionable, a misrepresentation or omission must also be made with the intent that the consumer or user rely on it and the consumer or user must have, in fact, actually relied on the misrepresentation or omission.

 

          For example, a seller of chain saws may say that the chain saw can cut a 10” tree when they know it is not designed for such a cut, rather the chain saw is only designed for a 5” tree or brush.  The purchaser hurts themselves when the chain saw gets stuck and the tree falls on them trying to remove it; or perhaps the chain saw bucks when it exceeds its capacity.

 

          Another example:  a pharmaceutical company may say a drug is not habit forming, it turns out it is, and people have been harmed.

 

 

 

 

STRICT LIABILITY: PRODUCT DEFECTS

 

        Unreasonably Dangerous Product: A product so defective as to threaten a consumer’s health and safety either because (i) the product is dangerous beyond the expectation of the ordinary consumer or (ii) the manufacturer failed to produce an economically feasible, less dangerous alternative. Claims that a product is unreasonably dangerous generally fall into one of three categories:

 

(1)      Manufacturing Flaw: The manufacturer fails to exercise due care in the manufacture, assembly, and/or testing of the product [for example, an auto manufacturer doesn’t properly install an air bag system or brake system that otherwise is operational]; 

 

(2)      Design Defect: The product, even if manufactured perfectly, is unreasonably dangerous as designed -- often because an economically feasible, less dangerous alternative was available to the manufacturer [for example, an airplane could explode due to wires rubbing & sparking over a fuel tank due to a bad design]; and

 

(3)      Inadequate Warning: The product, even if designed and manufactured perfectly, lacks adequate warnings and/or instructions for the consumer or other end user [to protect users from unexpected results [[Case 6.3- the milling machine case]] or even perhaps expected results- see case 6.4- the famous meat grinder case ].

 

 

 

MARKET SHARE LIABILITY

 

        Generally, a plaintiff must prove that the defendant manufactured the defective product.

 

        However, in some cases, plaintiffs have been permitted to sue any or all manufacturers of an allegedly defective product, even if the plaintiff does not know which of those manufacturers made the product that caused the plaintiff’s injuries.

 

        In these cases, all of the product’s manufacturers (and, in some cases, distributors) are held liable in proportion to each firm’s respective share of the market. For example, if a plaintiff suffered damages of $1 million, a named defendant whose market share during the relevant period was 10% would be liable to the plaintiff for $100,000 -- even if manufacturers responsible for less than 100% of the market were named by the plaintiff.

 

        In some cases, courts have imposed market share liability on a defendant even though that defendant could affirmatively prove that it did not manufacture the product that caused the plaintiff’s injuries.

 

 

 

STRICT LIABILITY: DEFENSES

 

        Assumption of Risk: The defendant must show that (i) the plaintiff knew and appreciated the risk created by the alleged product defect, and (ii) the plaintiff voluntarily assumed the risk, even though it was unreasonable to do so.  For example, I use a beta computer software program which is clearly labeled and required to be “checked off” as such, and my data is forever destroyed due to a bug in the beta program. Shame on me! 

 

        Product Misuse: The defendant must show that (i) the plaintiff was using the product in some way for which it was not designed, and (ii) the plaintiff’s misuse was not reasonably foreseeable to the defendant, such that the defendant would be required to safeguard against it.  For example, I purposefully stand on a trash can to change a light bulb, it caves in, and I am hurt.

 

        Commonly-Known Danger: The defendant must show that the plaintiff’s injury resulted from a danger so commonly known by the general public that the defendant had no duty to warn plaintiff.  For example, using a knife.

 

        Knowledgeable User: If a particular danger is or should be commonly known by particular users of the product, the manufacturer need not warn those particular users.  For example, an electrician using commonly used electric connectors and related materials.

 

 

 

 

STRICT LIABILITY: DEFENSES Statutory

 

           Federal Preemption: A manufacturer who complies with federal safety regulations in manufacturing its product may be able to avoid liability under state products liability law. However, court decisions on this theory have not been consistent.

 

        Statute of Limitations: A typical statute of limitations requires that an action be brought within a specified period after the plaintiff’s cause of action accrued or within a specified period after the plaintiff discovered or should have discovered her injuries.

 

        Statute of Repose: Regardless of whether a plaintiff has discovered her injuries, many states also have statutes of repose which set absolute outer limits on the time within which an action must be brought.