Chapter 6 Product and Strict Liability 25 1

Chapter 6 Product and Strict Liability 25 -1

Introduction to Product and Strict Liability § Product Liability: Liability of manufacturers, sellers, lessors, and others for injuries caused by defective products § Strict Liability: A plaintiff may recover punitive damages if the defendant’s conduct has been reckless or intentional Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -2

Product Liability: Negligence § Requires the defendant to be at fault for causing the plaintiff’s injuries § The plaintiff must prove that: § The defendant breached a duty of due care to the plaintiff § This breach caused the plaintiff’s injuries § Only a party who was actually negligent is liable to the plaintiff Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -3

Product Liability: Negligence § Failure to exercise duty of care includes: § Failing to assemble a product carefully § Negligent product design § Negligent inspection or testing of a product § Negligent packaging § Failure to warn of the dangerous propensities of a product Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -4

Product Liability: Misrepresentation § Occurs when a seller or lesser either: § Fraudulently misrepresents the quality of a product § Conceals a defect in it § Recovery is limited to persons who relied on the misrepresentation Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -5

Product Liability: Strict Liability § Doctrine of strict liability in tort § Strict liability is liability without fault § Makes manufacturers, distributors, wholesalers, retailers, and others in the chain of distribution of a defective product liable for the damages caused by the defect, irrespective of fault Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -6

Product Liability: Strict Liability § Liability without fault § Does not require the injured person to prove that the defendant breached a duty of care § Casual sales and transactions by nonmerchants are not covered § Applies only to products, not services Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -7

Product Liability: Strict Liability § Chain of distribution § Comprises of: § Manufacturers § Distributors § Wholesalers and retailers § Lessors § Subcomponent manufacturers § All parties in the chain of distribution of a defective product are strictly liable for the injuries it causes Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -8

Product Liability: Strict Liability § Parties who can recover for strict liability § Any injured party § Privity of contract not required § Recovery possible even if the injured party had no contractual relations with the defendant § Bystanders and non-users are entitled to the same protection as users Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -9

Product Liability: Strict Liability § Damages recoverable for strict liability § Damages recoverable vary by jurisdiction § Property damage recoverable in most jurisdictions § Economic loss in few jurisdictions § Some jurisdictions limit the dollar amount of the award § Punitive damages generally allowed if defendant recklessly or intentionally injured the plaintiff Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -10

Product Defects § To recover for strict liability, the injured party must first show that the product that caused the injury was somehow defective § The injured party does not have to prove who caused the product to become defective § Plaintiff can allege multiple product defects in one lawsuit Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -11

Product Defects § § § Defect in manufacturing Defect in design Defective packaging Failure to warn Inadequate instructions 6 -12

Case 6. 1: Defect in Manufacture § Case § Shoshone Coca-Cola Bottling Company v. Dolinski § 82 Nev. 439, 420 P. 2 d 855, Web 1966 Nev. Lexis 260 § Supreme Court of Nevada Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -13

Case 6. 1: Defect in Manufacture § Issue § Should the state of Nevada judicially adopt the doctrine of strict liability? If so, was there a defect in the manufacture of the Squirt bottle that caused the plaintiff’s injuries? Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -14

Defect in Design § Defect that occurs when a product is improperly designed § Evaluation of adequacy of a product’s design: § Risk-utility analysis § Consumer expectation test Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -15

Case 6. 2: Design Defect § Case § Domingue v. Cameco Industries, Inc. § 936 So. 2 d 282, Web 2006 La. App. Lexis 1593 (2006) § Court of Appeal of Louisiana § Issue § Is the forward blind spot on Cameco’s 405 -B dump truck a design defect? Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -16

Defect in Design § Crashworthiness doctrine: § Automobile manufacturers have duty to design automobiles taking into account the possibility of a second collision § They should take into account the possibility of harm from a person’s body striking something inside the automobile in the case of a car accident Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -17

Failure to Warn § Defect that occurs when a manufacturer does not place a warning on the packaging of products that could cause injury if the danger is unknown § Proper and conspicuous warning insulates all in chain of distribution § Failure to warn is a defect that will support a strict liability action Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -18

Defect in Packaging § Manufacturers owe a duty to design and provide safe packages for their products § Containers should be: § Tamperproof § Clearly indicate tampering § Defective packaging subjects the chain of distribution to strict liability Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -19

Other Product Defects § § Failure to provide adequate instructions Inadequate testing of products Inadequate selection of component parts or materials Improper certification of the safety of a product Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -20

Defenses to Product Liability § Generally known dangers § Certain products are inherently dangerous § These products are known to the general population to be inherently dangerous § Sellers are not strictly liable for failing to warn of generally known dangers Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -21

Defenses to Product Liability § Government contractor defense § Contractors that manufacture products to government specifications are not usually liable if such a product causes injury § Abnormal misuse of the product § Relieves the seller of product liability if the user abnormally misused the product Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -22

Defenses to Product Liability § Supervening event § The manufacturer or seller is not liable if: § A product is materially altered or modified after it leaves the seller’s possession § The alteration or modification causes an injury Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -23

Defenses to Product Liability § Assumption of risk § Defendant must prove that the plaintiff: § Knew and appreciated the risk § Voluntarily assumed the risk Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -24

Defenses to Product Liability § Statute of limitations § Plaintiff must bring action within a certain number of years from the time that he or she was injured by the defective product § Limitation period set by each state § Defendant is relieved of liability if action is not brought within limitation period Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -25

Defenses to Product Liability § Statute of repose § Limits the seller’s liability to a certain number of years from the date when the product was first sold § Varies from state to state Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -26

Defenses to Product Liability § Plaintiff partially at fault § Types § Contributory negligence

Defenses to Product Liability § Contributory negligence § Plaintiff who contributed to own injuries cannot recover from the defendant in negligence § Contributing plaintiff cannot recover damages even if the product was defective Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -28

Defenses to Product Liability § Comparative negligence § Applies when a plaintiff is partially responsible for causing his own injuries § Liability is assessed proportionately to the degree of fault of each party § Damages are apportioned proportionally between the plaintiff and the defendant Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 6 -29