Product liability law
Product liability law concerns the rules governing the responsibility incurred by a manufacturer or seller of defective goods for the damages resulted. The set of rules is used to protect consumers who have purchased defective products and who may decide to file civil lawsuits. In liability cases, it is fundamental to establish the causal link between the damage and the defective product, and the burden of proof may fall on the buyer or may be presumed by the law.
In most jurisdictions, a plaintiff would base its case on one or more of these three different theories:
- Breach of warranty
- Strict liability
Breach of Warranty
The breach of warranty presumes a contract already exists between the seller and consumer, and the former did not fulfill his obligations. There is usually a time limit set for verifying the product meets the stipulations laid down in the agreement. The legal basis is the pre-existing contract and product liability law applies only the parts not covered by the agreement.
Negligence represents the obligation to exercise due diligence and care. In this manner, a business is held responsible under product liability rules for inaction if it failed to implement something they should have applied, but also for action, if they did something they were not supposed to. The responsibility lies with the business and anyone within that can be associated to the damage. The usual standard of care is the ‘reasonable’ one, in which the appreciation is given comparing to an average person.
The range of people affected is also large, comprising all those who were or risk being injured by the product. This is an important difference between breach of warranty, in which the scope is limited by the contract, and negligence, which overs everyone affected.
When the business accepts strict liability, it is bound by the highest level of commitment and the plaintiff does not need to prove the standard of care in order to be covered. Thus, regardless of fault and without needing to show any causal link, the business is responsible for any defective product it manufactures or sells.
In the EU, product liability is covered by the Directive 85/374/EEC which aims to harmonize the rules in the EU Member States and define the main terminology in the same manner. The benchmark is high and tends to protect consumers by establishing the principle of liability without fault applicable to European producers. Whenever a defective product causes damage to a consumer, the producer may be liable even without negligence or fault on their part. EU countries may set a limit for the total liability of a producer in the case of death or personal injury caused by identical items with the same defect.