Ch. 8: Liability for Defective Products A. Introduction

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Ch. 8 Liability for Defective Products A.
Introduction
A person is injured by a product and sues the
manufacturer, or the retailer who sold the
product. What legal theories are available to
support recovery?
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Ch. 8 Liability for Defective Products A.
Introduction

• A person is injured by a product and sues the
  manufacturer, or the person who sold the product.
• What legal theories are available to support
  recover?
• negligence theories
• contract theories breach of warranty
• other tort theories fraud, or misrepresentation
• strict product liability

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Contract theories breach of warranty
Note 7, p. 545. Note 4. P. 550 2-314.
Implied Warranty Merchantability Usage of
Trade.   (1) Unless excluded or modified . . .
a warranty that the goods shall be merchantable
is implied in a contract for their sale if the
seller is a merchant . . . (2) Goods to be
merchantable must be at least such as. . .(c)
are fit for the ordinary purposes for which such
goods are used
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Ch. 8 Liability for Defective Products
Escola v. Coca Cola Bottling Co., Traynor, J.
concurring It should now be recognized that a
manufacturer incurs an absolute liability when an
article that he has placed on the market, knowing
that it is to be used without inspection, proves
to have a defect that causes injury to a human
being.
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Chapter VIII Liability for Defective
ProductsA. Introduction
The questions 1) What does it mean to say a
manufacturer is strictly liable? How does it
differ from fault based liability? 2) How do you
decide, doctrinally, that strict liability will
be imposed? When is a product defective? 3)
Why, as a matter of policy, are we imposing
strict liability on manufacturers?
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What are the arguments for strict liability in
such a case? Traynor, in Escola, p. 547 1)
placing liability where it will most effectively
reduce the hazards inherent in defective
products that reach the market. 2) shifting the
loss to the party who can best insure and spread
the loss among users of the product 3) providing
general and constant protection against a
general and constant risk 4) liability is in
effect strict anyway res ipsa gets the
plaintiff to the jury, and the jury will almost
always find for the plaintiff 5) under modern
marketing methods, the consumer no longer has the
means to investigate a products soundness, and
has been led to be confident in manufacturers
ability to produce a safe product.
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Ch. 8 Liability for Defective Products A.
Introduction
Greenman v. Yuba Power Products (note 5,
p.551) a manufacturer is strictly liable in tort
when an article he places on the market, knowing
that it is to be used without inspection for
defects, proves to have a defect that causes
injury to a human being. liability of course
should be defined in terms of the safety of the
product in normal and proper use (Escola, p.
550) and should not extend to injuries that
cannot be traced to the product (ditto)
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Ch. 8 Liability for Defective Products Manufact
uring defects
To establish strict liability, the plaintiff must
show 1) that the product was defective 2) and
that as a result of the defect, the product was
Restatement 402a was in a defective
condition unreasonably dangerous to the user or
consumer or to his property. California
failed to perform as safely as an ordinary
consumer would expect when used in an intended or
reasonably foreseeable manner.
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Ch. 8 Liability for Defective Products The
Third Restatement Products Liability
Section 1 One engaged in the business of selling
. . . products who sells . . . a defective
product is subject to liability for harm to
persons or property caused by the defect.
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Ch. 8 Liability for Defective Products The
Third Restatement
Section 2 there are three types of
defects Manufacturing defect A product
contains a manufacturing defect when the product
departs from its intended design even though all
possible care was exercised in the preparation
and marketing of the product. Design defect the
foreseeable risk of harm could have been reduced
by adopting a reasonable alternative
design. Warning defect the foreseeable risk of
harm posed by the product could have been reduced
or avoided by reasonable instructions or warnings.
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Ch. 8 Liability for Defective Products The
Third Restatement
Manufacturing defects A product contains a
manufacturing defect when the product departs
from its intended design even though all possible
care was exercised in the preparation and
marketing of the product. How is this different
from imposing liability on a negligence theory?
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• If the plaintiffs theory is that the tires that
  had tread separation were mismanufactured, what
  are the issues for a negligence cause of action
• Was there a flaw in the tires? Can you use res
  ipsa?
• Would a reasonable inspection would have revealed
  the flaw?
• Would a reasonable manufacturing process have
  avoided the flaw?
• Does Fords ability to inspect or test mean
  Firestone had no duty? Is it an intervening
  cause that absolves Firestone?
• Does the arguable misuse of the product by
  consumers give Firestone a complete defense?
  Does it constitute comparative fault?
• What is the relevance of arguments that the
  design of the vehicles contributed to the harm?

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Negligence based theories

• Applying MacPherson to our problem, what are the
  legal issues?
• As to duty
• Would there be a duty on the tire manufacturer,
  as opposed to Ford?
• Is the danger not merely possible, but
  probable?
• Was there knowledge that the product would be
  used by persons other than the purchaser?
• Was there knowledge that the product would be
  used without new tests?

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Negligence based theories
Applying MacPherson to our problem, what are the
legal issues? As to breach?
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Negligence based theories

• Applying MacPherson to our problem, what are the
  legal issues?
• As to breach? What are the untaken
  precautions?
• Mismanufactured?
• Failure to inspect and discover flaw?
• Poor design?
• Failure to warn?

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Ch. 8 Liability for Defective Products The
Third Restatement
Section 2 there are three types of
defects Manufacturing defect A product
contains a manufacturing defect when the product
departs from its intended design even though all
possible care was exercised in the preparation
and marketing of the product. Design defect the
foreseeable risk of harm could have been reduced
by adopting a reasonable alternative
design. Warning defect the foreseeable risk of
harm posed by the product could have been reduced
or avoided by reasonable instructions or warnings.
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Ch. 8 Liability for Defective Products The
Barker v. Lull test
A product may be found defective in design a) if
the plaintiff demonstrates that the product
failed to perform as safely as an ordinary
consumer would expect when used in an intended or
reasonably foreseeable manner OR b) if through
hindsight, the jury determines that the products
design embodies excessive preventable danger,
or in other words, if the jury finds that the
risk of danger inherent in the challenged design
outweighs the benefits of such design.
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Ch. 8 Liability for Defective Products
Under the Barker test, the risk utility test in
strict liability differs from the negligence
test because 1) consumer expectation is a
floor. 2) the risk - utility calculus is applied
in hindsight. 3) the burden of showing that the
benefits of the design used outweigh its dangers
is on the defendant. 4) the focus is on the
product, not on the manufacturers conduct.
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Ch. 8 Liability for Defective Products The
Barker Test
A two step approach 1) Under Soule, the product
must be one as to which ordinary consumers have
an expectation of safety 2) If it is such a
product, then the question is whether the
article is dangerous to an extent beyond which
would be contemplated by the ordinary consumer
who purchases it with the ordinary knowledge
common to the community as to its characteristics
(574, Restatement 402A comment i) 3) If it is not
such a product, the plaintiff must show that the
design embodies excessive preventable danger
the risks of the design are not outweighed by its
benefits.
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Ch. 8 Liability for Defective Products The
Camacho test
In determining whether the design is defective,
look to 1) usefulness of product 2) safety
aspects of the product 3) availability of a
substitute product 4) ability to eliminate the
unsafe character without harming its utility 5)
users ability to avoid danger by exercise of due
care 6) users anticipated awareness of the
dangers inherent in the product 7) feasibility of
spreading the loss by setting the price or
carrying insurance
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Ch. 8 Liability for Defective Products
Restatement of Product Liability, 2 A
product b) is defective in design when the
foreseeable risks of harm posed by the product
could have been reduced or avoided by the
adoption of a reasonable alternative design by
the seller or other distributor, or a predecessor
in the commercial chain of distribution, and the
omission of the alternative design renders the
product not reasonably safe
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Ch. 8 Liability for Defective Products
Restatement of Product Liability, 2 comment f
(p. 567-568, note 8) Factors to be considered in
evaluating a RAD 1) magnitude and probability of
risk 2) instructions and warnings accompanying
the product 3) nature and strength of consumer
expectations, including expectations based on
marketing 4) relative advantages and
disadvantages of the product and its
alternatives, including product longevity,
repair, range or consumer choice among products,
etc.
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Ch. 8 Liability for Defective
Products Failure to Warn
Restatement of Product Liability, 2 A
product c) is defective because of inadequate
instructions or warnings when the foreseeable
risks of harm posed by the product could have
been reduced or avoided by the provision of
reasonable instructions or warnings by the seller
or other distributor, or a predecessor in the
commercial chain of distribution, and the
omission of the instructions or warning renders
the product not reasonably safe.