Liability for Supply of Defective Product - Assignment Example

? Case Study on Liability for Supply of Defective Product Question ISSUE Whether Paul Price is en d to claim damages for the defective product under the Sale of Goods Act 1979 as amended by the Sale and Supply of Goods Act 1994? Is the Exclusion clause limiting the liability will be of any help to Tefal? RULE In UK, the Sale of Goods (Amendment) Act 1994 states that the buyers have the privilege to anticipate that the products that they purchase are: Possessing an adequate quality Suitable for all planned purposes. Paul Price has the right to demand a full refund from the retailer from whom he bought the Tefal Actifrys provided an adequate notice is given to the retailer within a” reasonable time“ that products supplied are of defective in nature. Paul Price has the right to demand for the repairing of the Actifrys or ask for a replacement or demand for a credit note. If any customer has incurred any pecuniary losses due to usage of such faulty products, the retailer has the every responsibility to make good the loss sustained by Paul Price. Under Limitation Act 1980, a customer has up to six years to initiate legal proceedings against the retailer for the supply of defective product.(Bhatia, 2008:458). APPLICATION The Sale of Goods Act (Amended) will be applicable to all transactions where products are transferred for a consideration or price. Contracts of sale may be either implied or expressed with stipulations concerning any contract, or refer to mere consumer contracts. Nonetheless, once it has been decided that the Sale of Goods Act is applicable to a transaction, there are some stipulations implied in the sale by the Act. A seller cannot avoid these stipulations. For each sale of products, the Sale of Goods Act 1979 stipulates that wherever there is a sale of products by depiction, there exists an implied stipulation simultaneously that the products offered will have to be identical to their description. Thus, the seller must offer the consumer what has been advertised. S.13 of the Sale of Goods Act 1979 (amended) is applicable to all sales, whether by business or individuals. Anyone who offers a product to another will be covered. S.13 is applicable to all products with no concern over purchasing scenario. S.13 is a significant section as it offers the right to a consumer either to obtain a refund or to reject a product. The consumer has the right either to accept or reject a product and is not at the mercy of a seller. S.30 of the Act offers protection to a consumer where the products are not corresponding to the description, and also offers a relief to the buyer if the quantity or description of the products differs from what has been advertised or requested. S.14 of the Act stipulates that product sold should be of merchantable quality. If a consumer purchased the product after 2003, he has every right to request either to repair or replace the defective products within 6 months of receiving the products. (Bryan, 2009:16). Even if the shop where the purchase was made had included an exclusion clause limiting liability, still the shop cannot escape from the liability to Paul Price. Exclusion clause cannot offer any protection to the seller even when exclusion clause tries to shun accountability to consumers. The sellers usually will incorporate the exclusion clause into the contract by trying to have a blanket avoidance of any accountability to the buyers for any detriment, loss, injury or damage and even in case of death. In the majority of cases, courts have declined to implement such clauses if they are not brought to the attention of the buyer at the time of signing the contract or if the exclusion clause imposes unduly exorbitant or onerous penalties. Further, as the exclusion clauses are so damaging to the rights of the consumers, courts will always have narrow interpretation, and this is known as “contra proferentem“ rule under English Law. (Jones & Benson, 2011:298). In “Curtis v Chemical Cleaning Co [1951] 1 KB 805”, it was held that a signed contract with an exclusion clause could be made ineffective if there was a misrepresentation by the seller. In ”Evans Ltd v Andrea Merzario Ltd [1976] 1 WLR 1078,” it was held that a court can find an exemption clause as void if the same is found as repugnant or conflicting to the core aim of the contract. (Chandller & Brown, 2009:85). CONCLUSION Thus, for claiming damages sustained due to defective products, S.13 is applicable to all products with no concern over purchasing scenario. “S.13 is an important section as it provides a privilege to a buyer either to ask for a refund or to decline a product.” A consumer has every right to return the defective product or ask for a replacement or refund. Likewise, exclusion clause cannot offer any protection to the seller even when exclusion clause tries to shun accountability to consumers. The exclusion clauses are so damaging to the rights of the consumers that courts will always have narrow interpretation, and this is known as “contra proferentem “rule under English Law QUESTION 2 ISSUE Whether Tefal has any liability for negligence for burns and lung infection sustained by Dave and pecuniary losses suffered for failure to attend his work for a month and Sandra’s inability to continue her gardening even though they do not have any privity of contract? RULE Dave and Sandra (Paul’s parents) can be regarded as “ultimate consumers” and they can claim damages under tort as the receiver of the products and bystanders and as end-user customers. Dave and Sandra have to demonstrate that there subsist breach, duty of care and causation under tort by the defendants, namely Tefal. APPLICATION Dave and Sandra will have a cause of action against the manufacturer Tefal if they demonstrate that there exists a manufacturing defect by employing the concept of res ipsa loquitur which has been developed in the case law “Scott v London and St.Katherine Docks Co (1865) 3 H & C 596” where the burden of proof will be lying on the claimants. Thus, the claimants have to prove that have suffered injuries due to an accident which could have been averted had the defendant had taken all due care . In such scenario , the claimant can discharge the onus of proof by drawing the attention of the court to the balance of probabilities as the defendant did not show due care despite the fact the claimant may not be aware in what scenario the failure had happened. (Lunney & Oliphant, 2008:208). Following the decision in “Aswan Engineering Establishment Co v Lupdine Ltd (1987),” Dave and Sandra can successfully claim non-integral damages caused due to defective fryers, and they can also raise a claim for loss of the amenity for the personal injuries sustained and loss of working days due to injury (Ribeiro, 1997:91). Apart from Tort, Dave and Sandra can claim additional liability from the manufacturer where damages are caused due to a product defect under “the Consumer Protection Act, 1987.” Like the action in negligence under tort, consequential damages in the guise of damages for personal injury or in the guise of damages to property can be claimed as liability under this Act. Thus, accountability under the CPA is defined without any reference to the defect or fault (Steele, 2007:846). Under Article 4 of the EU Product Liability Directive, a claimant has to demonstrate that there exists a defect in a product and hence, he suffered damage and that both product defect and damage are casually connected. In “Foster v Biosil [2000] 59 B.M.L.R.178,” the above article 4 has been construed as demanding a claimant to go further and establish the cause of the defect arising from the product, and this view had been disapproved now as held by Thomas L.J. in “Alan Peter Ide v ATB Sales Ltd.” (Twigg-Flesner, 2010:262). CONCLUSION Dave and Sandra have to demonstrate that there subsist a breach, duty of care, and causation under tort by the defendants, namely Tefal, for claiming damages for their injury and pecuniary losses under Tort. Apart from Tort, Dave and Sandra can claim additional liability from the manufacturer where damages are caused due to a product defect under “the Consumer Protection Act, 1987.” QUESTION 3 ISSUE Whether there was a legally binding contract between Paul and the shop which sold him the chip fryers? If so, when the contract will become binding and why? RULE There exists a privity of contract as regards Paul and the shop which sold Paul the chip fryers and Paul is entitled to get a relief under the contract between them. S.14 (2B) can help Paul to invoke such a remedy for the products which are of unsatisfactory quality. Thus, the above section offers Paul to reclaim the entire purchase amount paid on the ground that the products sold are not satisfactory in terms of durability and safety. APPLICATION In “Grant V Australian Knitting Mills Ltd [1936] AC 85”, a suit was filed against the retailer in contract and against the manufacturer in tort by a buyer, despite the fact that there was no privity of contract between him and the manufacturer. A buyer of defective products could initiate a claim for an infringement of either implied or express terms in the contract. SOGA has provided statutory safeguard by implying conditions in contracts for the sale of defective products against which various remedies are available. The main benefit of these contractual reliefs is that they are available without any necessity to demonstrate any fault in the product as S.14 (3) puts an implied condition that the products should be reasonably suitable for the objective for which they are sold. Under some scenarios, a third party can also enforce a claim unless specifically excluded by the terms of the contract. If damages are suffered by a third party due to defective products, it is entitled to recover damages for such losses. The parties in the product chain will include the manufacturer, sellers which include wholesalers or retailers, the buyer or consumer or end-user, a family member of the buyer of the product or his friend or his neighbours. Thus, there is no privity of contract needed to claim damages due to a defective product between the seller o manufacturer and the end-user. The product must include a defect making it dangerous to use. The fault may be due to defect in design, improper product maintenance or the seller or manufacturer’s failure to forewarn the buyer as regards inherent perils in using the product (Buckley & Okrent, 2004:315). The contract has come into effect no sooner than Paul Price bought four of fryers of Tefal, one for himself, one for his parents Dave and Sandra and two for other members of his family. Dave and Sandra can claim damages from Tefal even though there exists no privity of contract between them and the retailer or the manufacture on the principle laid down in “Donoghue v Stevenson (1932)“ which made the founding stone as third parties can also claim damages if they suffer injury due to a defective product and encouraged the development of negligence law, mainly via the duty of care notion. Thus, the narrow rule laid down in this case held that a manufacturer is obliged to excercise a duty of care to its ultimate consumers. Thus, this case law ushers a system of fault-footed accountability on the side of the manufacturer which will include their retailers also (Mitchell & Dadhania, 2003:250). CONCLUSION The contract has come into effect no sooner than Paul Price bought four of fryers of Tefal, one for himself, one for his parents Dave and Sandra and two for other members of his family. Dave and Sandra can claim damages from Tefal even though there exists no privity of contract between them and the retailer or the manufacture on the principle laid down in “Donoghue v Stevenson (1932)“ which made the founding stone as third parties can also claim damages if they suffer injury due to a defective product. References Bhatia, S.C. (2008) Retail Management. New Delhi: Atlantic Publishers and Distributors (p) Ltd Bryan, D. (2009) A Straightforward Guide to the Rights of the Consumer. New Delhi: Straightforward C Ltd. Buckley, W.R. & Okrent, C.J. (2004) Torts and Personality Injury Law. New York: Cengage Learning. Chandler, A. & Brown, I. (2009) Law of Contract: 2007 and 2008. Oxford: Oxford University Press. Jones, H. & Benson, C. (2011) Publishing Law. London: Taylor & Francis. Lunney, M. & Oliphant, K. (2008) Tort Law: Text and Materials. Oxford: Oxford University Press. Mitchell, A. & Dadhania, M. (2003) As Level Law. London: Routledge Taylor & Francis Group Ribeiro, R. (1997) Engineering Contracts. London: Butterworth- Heinemann Steele, J. (2007) Tort Law: Text, Cases, and Materials. Oxford: Oxford University Press Twigg-Flesner, C. (2010) The Cambridge Companion to European Union Private Law. Cambridge: Cambridge University Press Read More