Friday, February 27, 2009

Consumer Protection Bill


Liability for product defect

In terms of Section 61 of the soon to be enacted Consumer Protection Bill a producer, importer, distributor or retailer of any goods (the supplier) is liable for any harm including
  • death injury or illness
  • the loss of or physical damage to property
  • economic loss
caused wholly or partially by the supply of any unsafe goods, product defect or failure and inadequate instructions or warnings.

In terms of section 61(2)(c) liability arises irrespective of the absence of negligence on the part of the supplier.

In addition a supplier of services who supplies any goods in conjunction with the supply of services also is liable as if he were a supplier of those goods.

If more than one supplier is involved then their liability is joint and several.

Liability does not arise if
  • The product is defective or unsafe as a result of compliance with public regulation.
  • The product defect, failure or hazard did not exist at the time of supply by a “middle man” unless the harm arose as a result of such “middle man's” instructions.
  • It is unreasonable for the distributor or retailer to have discovered the defect having regard to that persons role in marketing the products and the general state of scientific and technical knowledge at the relevant time.
  • Claims for damages are brought more than 3 years after
  • death or injury
  • the claimant had knowledge of an illness caused by a product
  • the first time a claimant knew about the loss caused to his property
  • the latest date upon which a person suffered economic loss
Section 60 of the Bill contains provisions for the authorities to compel the recall of defective products

Comment

This bill will have far reaching consequences for importers, suppliers and distributors of goods. The bill imposes strict product liability. This means that claimants need only to prove that the products were defective and that harm resulted thereby in order to found a claim against anybody in the chain of supply regardless as to whether or not they were negligent.

Furthermore the Bill extends strict liability to persons who supply goods during the course of the supply of services. Where for example a plumber installs defective water pipe he can be held liable for damages resulting from a defect in the pipes he installed.

The Bill contains provisions to compel the provision of adequate instructions on the packaging of hazardous goods for the safe use and handing of such goods.

The Bill also empowers the authorities to monitor the safety of products and order recalls should there be reasonable grounds to believe that the products are unsafe.

In the Building Industry where a myriad of products are used it will now become easier for consumers to sue for damages arising from the supply of defective products regardless as to whether or not the builder was negligent.

Furthermore as the liability of all persons involved is joint and several the successful litigant is entitled to look to any one of the persons in the chain of supply for full compensation notwithstanding such person's degree of involvement.

Members are advised to contact their insurers to ensure that they have adequate cover in place to cater for product liability.

Bruce Lyle
Membership Services Manager

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