Product Liability – Defective goods
If your business supplies products to consumers, you need to make sure the products are safe. The heaviest responsibility falls on producers, eg the manufacturer of a product. But distributors - such as shops and wholesalers - also have legal responsibilities.
Failing to meet your responsibilities can have serious consequences. You could face legal action with possible fines or even imprisonment. You could also be sued by anyone who has been injured or has suffered damage to personal property as a result of using your product.
If someone sues you under product liability laws, your first step is to consider who is liable. If you are a distributor, such as a shop, you may not be liable if you can identify the original producer.
If you’re the producer and you believe the problem was caused by a fault in your production process, you may want to admit liability and settle the claim. Alternatively, you will need to prove one of six defences:
- You did not supply the product. For example, you are not liable if a product is stolen or is a fake copy of one of your products.
- You could not reasonably be expected to discover the safety fault. For example, if scientific evidence first comes to light after you have manufactured or sold your product.
- The safety fault was an inevitable result of obeying other laws.
- Someone else caused the fault after you supplied the product.
- You didn’t supply the product in the course of business. For example, the law does not apply to private gifts.
- If you make components, you are not liable if you can show that the manufacturer who assembled the product caused the fault. For example, the manufacturer might have made a poorly designed product or ordered the wrong components from you.
You can’t defend yourself simply on the basis that a user was careless. But if you can show that they contributed to a problem, the amount of damages may be reduced.
Claims for defective goods can be minor and worth only a few hundred pounds, to very significant running to millions. Examples of the latter are defective surgical implants where thousands of people suffered as a result of dangerous or inadequate products being distributed in the market place. Breast implants are one of the most common products which have caused problems.
You should be aware that court cases are usually expensive and complicated. Take professional legal advice before taking any action or where action is being taken against you for a defective product. Anyone who is harmed by an unsafe product can sue. They can begin their court case up to three years from the date of the injury. In some cases, they can even sue up to ten years after the product was sold.
If you’re involved in producing or supplying consumer products, you should take practical steps to prevent problems and also take out product liability insurance which should protect you.
An extreme example of where product liability can potentially destroy the reputation of an international brand is the emissions scandal surrounding Volkswagen. In this case VW had to admit that they had installed software in their cars to “cheat” the test for emissions from the vehicles. We are already hearing that several class actions for damages have been issued in relation to this matter.
Please Note: This document is for general information only. It is not legal advice and should not be acted or relied on as being so. It does not create a solicitor-client relationship between Temple Legal Solutions Ltd and any other person. Legal advice should be taken before applying any information in this document to any facts and circumstance.
If you contact Temple Legal Solutions or call 01483 514814 to make an initial enquiry, you will then referred to an appropriate, experienced law firm.