Manufacturer Liability: Harm to ‘Ultimate Consumer’

In this case study, which concerns the liability of a manufacturer of a product for harm which is suffered by the “ultimate consumer” of that product, it will be important to consider the remedies that would be available in contract and under the doctrine of tortuous liability for defective goods.

There exists privity of contract in the relationship between Pamela and Cooks Stores and, therefore, in contract a remedy would be available to Pamela only. To invoke such a remedy under contract, Pamela should be able to rely on the terms implied into the contract by the Sale of Goods Act 1979, such as provided under s. 14 (2B) by which goods are not of satisfactory quality if they are unsatisfactory in terms of safety and durability, according to the standards of a reasonable person. The SGA provides recourse to a seller^[1] and, therefore, this act should enable Pamela to reclaim the £175 purchase price of the food processor from Cooks Stores.

The “narrow rule” in Donoghue v Stevenson^[2] dictates that a manufacturer owes a duty to the customer to take reasonable care when he sells goods in the form in which he intends them to reach the ultimate consumer with no reasonable possibility of intermediate examination. This rule is a variety of negligence and creates a regime of fault-based liability on the part of manufacturers, which will include retailers, such as Cooks Stores, alongside Price (UK) Ltd.

Pamela and Rose are potential claimants since here they are both “ultimate consumers” and the rule covers those who receive goods as presents and bystanders.^[3] To bring an action in tort Rose, as the claimant, would have to show the existence of a duty of care, breach and causation.

There might be a cause of action for Rose against Price (UK) Ltd as manufacturer, if she can show that there has been a failure in the production process, for instance^[4]. The doctrine of res ipsa loquitur may be useful here, as developed in Scott v London and St Katherine Docks Co.^[5], which, it has been argued, creates a rebuttable presumption of negligence on the part of the defendant. Applying the argument of Erle CJ^[6] Rose would have to show that the accident was of the kind that does not normally occur in the absence of a want of care, that the defendant had exclusive control over the thing which caused harm and that the defendant cannot offer any plausible alternative explanation of what caused the accident. These would be evidential questions, but they might help Rose to determine whether or not Price (UK) Ltd has breached its duty of care, which is important since experts can’t say what caused the accident.

It must be considered whether intermediate examination was possible and whether Rose was using the food processor properly. Although the case study states that Rose followed the operating instructions carefully, it should be noted that Pamela has used it previously – if not frequently – without difficulty. This leaves open the possibility that consumer misuse is to blame. Further, the manufacturer might be exonerated if another person can reasonably be expected to inspect their product.

From the given facts it is unclear whether the food processor could reasonably be subject to an intermediate investigation, following the unsuccessful argument of the defendant in Grant v Australian Knitting Mills^[7]. If this reasonable expectation arises the tester could be regarded as the cause of the harm^[8], and therefore, Cooks Stores might be found to have contributed to the negligence of Price (UK) Ltd. It is, however, unclear whether a retailer can reasonably be expected to test every appliance that it sells. This defence would be unlikely to allow Price (UK) Ltd. to deflect all the blame on to Cooks Stores.

The burden of proving the causal link between any breach of duty by Price (UK) Ltd and/or Cooks Stores and the harm suffered rests with Rose herself, as confirmed in Foster v Biosil^[9]. If she should fail to satisfy the burden of proof in this respect, her action will fail^[10]. If Rose succeeds, following Aswan Engineering^[11] she would be able to recover “non-integral” damage caused by the defect in the food processor, such as the vase. She would also have a claim for loss of amenity in respect of the personal injury to her hands and face, with a quantum to be evaluated.

Part I of the Consumer Protection Act (CPA) 1987 introduced a regime of strict liability which purports to create a system of strict liability in respect of defective products that cause physical harm to a person or property^[12]. This might provide Rose with an alternative cause of action. The CPA 1987 makes a producer, i.e. Price (UK) Ltd., responsible for the defectiveness of their product, however, according to CPA 1987 s. 3(1) regard may be had to any warnings which had been provided. The status of any such warning remains unclear. The CPA 1987 s. 3(2) allows a court to consider how a product might reasonably be used. It remains to be seen whether Rose was using the food processor for the correct purpose, even if she was attempting to follow the instructions. It is clear from CPA 1987 s. 6(4) that the defence of contributory negligence will apply to a defective product and any damages awarded to Rose may be reduced dependent on her blameworthiness.

The CPA can be invoked against anyone involved within the chain of manufacture and distribution and liability is joint and several, so Rose would be best advised to sue whoever has the greatest financial resources. Cooks Stores, as a supplier, is however only liable to name their supplier and, accordingly, Price (UK) Ltd. will be Rose’s target for any damages. The CPA covers personal injury, but no damage to property under £275 and, therefore, under the guise of this act, Rose would be unable to claim for the damage to her vase and would be advised to rely on tort.

Bibliography

Murphy, J., Street on Torts, 11^th ed., Lexis Nexis, London, 2003

Oughton, D. et. al., Law of Torts, 3^rd ed., Oxford University Press, Oxford, 2005

McKendrick, E., Contract Law, 1^st ed., Oxford University Press, Oxford, 2003

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Footnotes

^[1] SGA 1979 s. 14 (2)

^[2] [1932] AC 562

^[3] Stennet v Hancock and Peters [1939] 2 All ER 578

^[4] Grant v Australian Knitting Mills [1936] AC 85

^[5] (1865) 33 H & C 596

^[6] cf (1865) 33 H & C 596

^[7] [1936] AC 85

^[8] Perrett v Collins [1998] 2 Lloyd’s Rep 255

^[9] (2001) 59 BMLR 178

^[10] Evans v Triplex Safety Glass Ltd [1936] 1 All ER 283

^[11] Aswan Engineering Establishment Co. v Lupdine Ltd [1987] 1 All ER 135, CA

^[12] cf. CPA 1987 s. 2(1)