Product liability is the area of law in which manufacturers, distributors, suppliers and retailers are held responsible for any injuries products cause. Regardless of any contractual limitations of liability, if a product or any of its component parts are defective its manufacturer may be liable for damage under the Consumer Protection Act (CPA) or the common law of negligence.
An action under the CPA or for negligence can be brought for death, personal injury and damage caused to private property as the result of a product defect. Neither type of action can be used to compensate for pure economic or consequential loss.
This guide considers claims for a defective product under the Consumer Protection Act. See also our Out-Law Guide to Product Liability for negligence.
Liability under Part I of the CPA
The CPA introduced statutory liability for defective products. Liability under the CPA exists alongside liability in negligence, and in some cases a common law claim may succeed where a claim would not be available under the CPA.
The CPA applies to both products used by consumers and products used in a place of work. The CPA imposes strict liability on manufacturers of defective products for harm caused by those products. This means that people who are injured by defective products can sue for compensation without having to prove that the manufacturer was negligent. It is merely necessary to prove that the product was defective, and that any injury or damage was most likely caused by the product.
The CPA applies to all consumer products and products used at a place of work. The inclusion of 'products used at a place of work' extends the scope of the law to include sales of products between businesses rather than just sales to consumers if such products are used in a place of work.
A claim may be brought under the CPA by any person who is injured by a 'defective product', regardless of whether that person purchased the product. A claim may be brought for death, personal injury or damage to private property in excess of £275. However, no claim may be brought for damage to business property or for 'pure' economic losses. In particular, the CPA provides that a claim cannot be made for the loss of or damage to the defective product itself. Other than these restrictions, the CPA imposes no financial limit on the producer's total liability.
Who is liable?
Under the CPA, the 'producer' of a product is liable for any defects. The producer is the manufacturer of the finished product or of a component of the finished product, or any person responsible for an industrial or other process to which any essential characteristic of the product is attributable. Liability may also be imposed on any party who holds itself out to be the producer through the use of a name or trade mark, and any person who imported the product into the European Community.
As such, there may be more than one party liable under the CPA in respect of the same damage. Liability is joint and several, so the injured party may sue any or all of these people. Liability cannot be excluded or limited.
What is a 'defective product'?
A 'product' can include goods, electricity and the component parts of any product. Where a component of or raw material incorporated into a finished product is defective both the manufacturer of the component and the manufacturer of the finished product are potentially liable.
A product is defective for the purposes of the CPA if its safety, including not only the risk of personal injury but also the risk of damage to property, is "not such as persons generally are entitled to expect". A product will not generally be considered defective just because a safer version is later put on the market.
In assessing the safety of the product the court will take into account all of the circumstances, specifically including:
- all aspects of the marketing of the product;
- the use of any mark in relation to the product;
- instructions and warnings;
- what might reasonably be expected to be done with the product at the time the product was supplied.
This last factor allows the court to take account of the 'state of the art' at the time of supply.
Defences to a claim under the CPA
Although liability under the CPA is strict (see above), the producer has a number of defences available if a claim is made. It is a defence to show:
- that the product is defective in order to comply with domestic or European law;
- the party the claim is being made against did not supply the product;
- that the product was not manufactured or supplied in the course of a business;
- that the defect did not exist at the time the product was put into circulation;
- if the party is being sued because it manufactured a component - that the defect is a defect within the finished product, and came about because of the way the finished product was designed or because of instructions given by the manufacturer of the finished product.
The CPA also includes a 'development risks' defence, which creates a defence if the "scientific and technical knowledge" at the time the product was manufactured was not such that the producer of a similar product might have been expected to discover the defect. This could be particularly important in relation to innovative and high-tech products. However it has been argued that the wording of the UK law is less strict than the wording of the law at European level, which deals with the state of scientific and technical knowledge generally rather than what a producer of similar products might be expected to discover.
How long are producers liable for?
The basic limitation period for claims under the CPA is three years from the date of damage or injury. However, since damage may not be immediately apparent, an alternative period of three years from the date when the producer knew - or could reasonably have known - of the claim, is provided. Since a product may remain in circulation for many years, a claim cannot be made more than ten years after the product was put into circulation.