Products Liability: Definition and Meaning

When a manufacturer or seller is held accountable for putting a faulty product in the hands of a customer, this is referred to as "product responsibility." All sellers of the goods who are involved in the distribution chain are accountable for any product flaw that results in harm. In general, the law demands that a product live up to typical consumer expectations. A product cannot be said to meet the typical expectations of the consumer if it has an unforeseen flaw or risk.

Meaning of Product Liability

The term "products liability" refers to the responsibility of any or all parties involved in the production of a product for any harm the product may have caused. This covers the distributor, retailer, maker of the assembled product (at the top of the supply chain), and manufacturer (at the bottom of the chain). Products liability lawsuits would be brought against manufacturers of goods that have inherent flaws that damage consumers (or anyone else to whom the product was lent, gifted, etc.). Although most people consider items to be tangible personal property, products liability has expanded the definition of tangible personal property to encompass intangibles (such as gas), naturals (such as dogs), real estate (such as houses), and writings (i.e., navigational charts). The main source of product liability is tort law.

A federal product liability law does not exist. Product liability lawsuits are typically brought under the doctrines of negligence, strict liability, or warranty breach and are based on state law. Additionally, each state will have a set of commercial statutes that are based on the Uniform Commercial Code and contain warranty guidelines that affect product liability.

Types of Product Defects

A plaintiff in a product liability case must demonstrate, under any theory of liability, that the damaged product was both faulty and excessively harmful as a result of the defect. Three different sorts of flaws can lead to harm and make a manufacturer or supplier liable:

A plaintiff in a product liability case must demonstrate, under any theory of liability, that the damaged product was both faulty and excessively harmful as a result of the defect. Three different sorts of flaws can lead to harm and make a manufacturer or supplier liable:

• Design Defects: Something that is inherently hazardous about a product is present from the very beginning, even before it is made.

• Manufacturing Defects: those that happen during the creation or assembly of a product.

• Marketing Defects: flaws in a product's marketing strategy, including incorrect labelling, inadequate instructions, or inadequate safety warnings.

Product Flaws: Parties in Charge

At some point, the product must have been sold in the market for product liability to occur. In the past, a "privilege of contract" relationship between the victim of a product injury and the manufacturer or supplier of the product was necessary for the victim to get compensation. In most states today, the injured party does not necessarily have to be the product's buyer, as that criterion has been removed. As long as the product was sold to someone, any person who could have been damaged by it can be compensated for their damages.

Any person in the product's supply chain could be held accountable for a flaw, including −

• The maker of the item;

• A company that produces component parts;

• A contractor who builds or instals the product;

• The distributor; and

• The retail establishment where the consumer purchased the merchandise.

A product must be sold in the normal course of the supplier's business for strict responsibility to apply. Therefore, it is unlikely that a person selling a product at a garage sale would be held accountable in a product liability case.

Who Is in Charge?

The "res ipsa loquitur" theory transfers the burden of proof to the defendant in some product liability proceedings. This Latin phrase, which translates as "the thing speaks for itself," denotes that the flaw in question would not exist without negligence. If the theory is used effectively, the defendant must demonstrate its lack of negligence rather than the plaintiff having to show the defendant was negligent.

Strict responsibility is the second criterion that supports plaintiffs in matters involving product liability. If strict responsibility is applicable, the plaintiff just needs to demonstrate that the product was flawed—not that the producer was careless. The idea of no-fault, or "strict," liability enables plaintiffs to recover when they may otherwise be unable to do so by removing the question of manufacturer blame.

Frequently Used Rebuttals to Product Liability Claims

The claim that the plaintiff has not sufficiently identified the manufacturer of the product that is supposedly to blame for the harm is a defence frequently used in product liability claims. A plaintiff must be able to link the product to the person or people who made or provided it. The "market share responsibility" exemption, which is an exception to this rule that pertains to situations involving faulty pharmaceuticals, exists. Each manufacturer will be held accountable based on its share of sales in the region where the accident happened if a plaintiff is unable to determine which pharmaceutical company supplied the drug they took.

The plaintiff significantly altered the product after it left the manufacturer's control, and this alteration resulted in the plaintiff's injury, which is another defence a manufacturer can assert. A related defence is that the plaintiff used the product improperly and that this improper usage resulted in the asserted harm.

Legal Theories for Product Liability

Following are major theories for product liability −

Breach of Warranty

Contract law governs a warranty breach since there was a contract between you and the product's vendor. A guarantee is similar to a warranty. Both express and implied warranties apply. A seller's claim that "this cream will cure your baldness in thirty days" is an express warranty. The seller is required by law to provide an implied warranty. The two primary implied warranties are fitness for a particular purpose and merchantability.

In essence, merchantability refers to a product's capacity to satisfy consumer demand. We all assume, for instance, that an automobile will have a steering wheel. A warranty that a product is suited for a particular purpose effectively guarantees that it will carry out its intended function.

Warranty breaches are rarely invoked in product liability lawsuits. Breach of warranty has a number of restrictions that limit its applicability. First of all, a breach of warranty must be based on a contract, which requires privity between the victim and the supplier. In its simplest form, exclusivity refers to face-to-face communication.

Therefore, for a breach of warranty, the affected party usually only has the option of suing the product's seller rather than the maker or another party that caused the problem. Another issue with breach of warranty is that sellers frequently include exclusions from warranties in the written contract's fine print, which might limit the claims that the harmed party may be able to make.

Negligence

Negligence is the absence of routine care. A person or business may be responsible for damages if their carelessness results in a defective product. The negligent party can be the creator, distributor, part supplier, manufacturer, or anybody else who is accountable for the product's flaws.

This legal theory is widely applied. It is not covered by the warranty breach limitations. Any party, not simply the seller, whose carelessness resulted in the product being the cause of the injury may be held accountable for negligence. On a negligence claim, attempts to limit warranties are irrelevant.

Finding the person or entity who was really in charge of the product's flaw is a difficulty with the negligence premise. or identifying the specific negligent act. Sometimes, this is not obvious and necessitates careful research.

Strict Liability

Similar to negligence, strict responsibility entitles the victim of an injury to reimbursement from the entity that caused the product's flaw. In contrast to negligence, the aggrieved party is not required to determine who specifically failed to perform their obligation. Strict responsibility just requires that the product be unreasonably harmful and faulty.

Strict liability allows for liability to arise from any link in the supply chain of commerce, including the manufacturer, distributor, seller, and supplier of component parts. This gives the injured party a less expensive and more convenient path to compensation, particularly if the producer is based overseas. Without the need for the injured party to bring the foreign manufacturer into the case, the distributor or seller in the US can be sued.

Conclusion

The law of product liability is intricate. Success depends on having competent, qualified counsel who is familiar with both the theory and practise of product liability law. This is especially true if your exposure could be global.

FAQs

Q1. What’s a product liability case?

Ans. Plaintiffs have a legal right to pursue a claim under the doctrine of product liability if they come across a defective consumer good and successfully proved it.

Q2. How product liability affects a company?

Ans. Yes, business operations and decisions are impacted by product liability because they must be coordinated with specific measures to prevent releasing faulty goods and services onto the market.

Q3. What is the liability for products and services?

Ans. Product or services liability refers to the legal obligation placed on a company or service providers for the creation or sale of faulty goods or providing faulty and painful service.