Thalidomide Tragedy - Tort and Consumer Protection - Essay Example

SECTION A This section of the paper will analyse and evaluate the impact of public concerns for strict liability regimes in relation to product liability. In other words, the paper will focus on the circumstances and situation within which manufacturers of goods being held directly liable for defects and injuries they cause to consumers. To this end, the Thalidomide tragedy and its related law commission reports will be analysed. This will be followed by a critique of the relevant common law traditions and other rules that comes with it. The Thalidomide Tragedy Thalidomide was developed by Chemie Grunenthal GmbH in the 1950s and it was an anti-convulsive drug that made users sleepy and relaxed and was seen as a substitute for tranquilisers (Kelsey, 2012). During the testing, there were no issues identified, it was tested on animals and it became apparent that the drug could be used as a means of expanding the portfolio of the company that developed it (Jacoby and Youngson, 2004). The drug eventually became available to the members of the public and it became popular with pregnant women. This is because it had the ability to suppress morning sickness during pregnancy. So more and more pregnant women used it during pregnancy. In May 1961, a baby was born in a hospital in Australia and the baby died shortly (Jacoby and Youngson, 2004). In a space of three weeks, two other babies were born in the hospital and they all died. The obstetrician managed to identify the commonality in the deaths was Thalidomide (Jacoby and Youngson, 2004). However, Nobel Laureate, Sir Ernest Chain stated that “of course, it was a tragedy... it could not be foreseen... no one was to blame... even if you do all these things (drug tests)... there is still a risk factor... you cannot guarantee safety in any case – safety is an illusion” (Kalter, 2003, p172). In the United States, the Thalidomide case formed the basis for the authorities to place a strict liability rule framework for the design, bystander and workforce risk issues (Stapleton, 1994). In English law though, the Law Commission report showed a strong support for placing a strict liability on companies and producers and this called for claimants burden of proving fault to be eliminated (Giesen, 2009). After much debate in the United Kingdom, the European Commission Council Directive 85/324/EEC was released to member states and they were required to introduce strict liability on manufacturers (Giesen, 2009). Based on this, the UK implemented Part 1 of the Consumer Protection Act 1987 (Roach, 2012). Tort and Consumer Protection Prior to the Consumer Protection Act 1987, there was no strict liability provision for people who had issues with products purchased. In fact before the Sale of Goods Act 1979 and Unfair Contract Terms Act 1977, there was no kind of protection that was offered to consumers. The law of tort was what consumers could rely upon. In the landmark case of Donogue V Stevenson (1932), a widow went out to a bar with her friend. Her friend bought a ginger drink that was poured into a glass. D drank a bit of the ginger beer and later on, she found that there was a decomposing snail in the bottle. She had emotional stress and got sick due to the sight of the decomposing snail. She sued Stevenson, the ginger manufacturer for compensation. The matter was dragged up to the House of Lords and they held that there was a principle of neighbourhood which placed an obligation on people to be mindful and sensitive of the consequences of their actions on their neighbour. Thus, there was a discussion of who is a persons neighbour. This means that if a person gets injured because of the act of another, that individual is liable. In subsequent cases, Caparo V Dickman (1970), it was held that the injury must be caused by a damage that was foreseeable, proximate and it is reasonable to impose a duty of care. Thus, in the context of products, the traditional default position in English law was one in which a person had to prove these three things of the Caparo V Dickman ruling. However, the quest for a strict liability for products was meant to create a system through which a producer will be held liable by statute and there would be no need for a person who suffers an injury to prove anything. This is because in most cases there was a difficulty in establishing the burden of proof. Also, most corporate entities had very good lawyers who could work around the case and provide excuses and eliminate genuine demands and expectations. Secondly, most corporate entities could draft various types of standard-form contracts that could exploit consumers. This is because such standard-form contracts were designed by the best legal brains and these persons provided various clauses that could potentially cause problems and issues for consumers in future. Thus, there were many cases and issues that could not be resolved through tort of negligence cases that were brought against large corporate entities. Therefore in reaction to this, there were numerous statutes that were put in place to limit consumers risks and exposure to exploitation by producers. This include the Sale of Goods Act 1979 which held producers liable for defects in products that caused injuries. The Unfair Contract Terms Act of 1977 showed that firms and producers could not exclude themselves from injuries that were caused by the products that they produced. The Consumer Protection Act 1987 The Consumer Protection Act of 1987 states in section 2(1) states that where damages are partially or wholly caused by a defect in a product, the producer is liable. This was an attempt to provide a direct and a straightforward attribution of injuries to producers. Thus, there was no opportunity or possibility of getting a person to prove that there was an injury that was caused by the manufacturer or there was any tort issue or tort claim that came with the injury. Article 4 of the CPA 1987 states that there are only three things that provide a sufficient basis for a producer to be held liable. The first is that there was an injury. Secondly the product was defective. And thirdly, the injury was caused by the defective product. And the term “injury” included death, personal injury and/or the damage of property. Defective products include all unsafe and/or dangerous products. This is in contrast with “unsatisfactory” products as defined by Sale of Goods Act. The implication of this is that the Consumer Protection Act 1987 is meant to protect producers from injuries and damages rather than to seek the satisfactory nature or status of the products sold. The Consumer Protection Act 1987 protected consumers and thereby placed an obligation on the producer and got him to inspect and ensure that the product is safe. This also removes the need to prove that there was negligence. Rather, the strict liability was meant to get producers to be careful and inspect and re-inspect their products to ensure that they were safe for use by members of the society. In spite of this, there are a few exceptions to the rule. In some cases where the producer was adhering to the rules of the UK or EC, that producer will be free from the impacts and the consequences of the injury. This is because adherence to rules and regulations exempts the strict liability clause and principle that comes with the CPA. Secondly, where the consumer that was injured or affected by the product acquired it through an illegal or unacceptable means, that producer has no obligation towards the consumer. This is because such an unauthorized or unapproved acquisition and usage of the product does not in any way qualify under the act. Also, where the product was not supplied for a profit to the producer, the CPA does not apply. Finally, in cases where a defect did not exist at the time of supply or sale, the producer is exempt from the damages that comes with the CPA 1987. Conclusion The Thalidomide tragedy created a situation in which there was the quest for the law on producer defects and problems to be attributable to producers without the need to prove any form of negligence. This created a system and a network through which the traditional law of tort rules and regulations could not be applied to products successfully. This led to the institution of the Consumer Protection Act 1987 as a means of protecting consumers. The obvious issue with consumers having to prove negligence and injury was complicated. Due to this, most ordinary consumers could not sue large corporate entities for damages. Therefore, there was a general trend through which businesses could go about their situations and come up with solutions to their problems. The Consumer Protection Act 1987 came in to eliminate the need to prove negligence on the part of an injured consumer. Thus, the consumer only needed to show that he was injured, the product was defective and the injury was as a result of using the defective product. This made the producer liable. The notable exception to the CPA 1987 include cases where producer adhered to all necessary rules, the product was illegally or inappropriately acquired, the product was not supplied for a profit or where the defect did not exist at the time the product was acquired by the consumer. SECTION B This section will examine a practical case by evaluating the issues, analyse it and apply the relevant rules to the case. The section will discuss the legal implication of the facts and come up with an advice to the individual in question. Issues David has been involved in two transactions that have come with various complications that can be examined and evaluated under the law of contract. In the first case, he bought a computer from Righttablet Ltd online and this involved a representation that the computers they sell are “no more than 2 years old”. He therefore purchased a model represented as a 2013 model and compatible with all Android aps. Instead, he noticed that the laptop was manufactured in 2011 (at best) and could not cope with many Android aps that he tried to download to the computer. Upon an attempt to return the computer, the seller stated that he had held the computer for too long. Case 1 There are three main issues at hand. The first issue is whether the representation that the computers are no more than 2 years old or not was a misrepresentation that is of significance to the contract or not. The second issue is whether or not the submission that the laptop sold to him was made in 2013 and was compatible with all Android aps is a breach of conditions and hence renders the contract void or not. Finally, there is an issue of whether Righttablet Ltd has the right to refuse to accept the returned computer after four weeks is something they can insist upon or not. Case 2 The second case involves the renovation of Davids kitchen area which involved the fitting of a new back door and a new kitchen. David got quotes from three companies and the cheapest by Fititright Ltd showed a cost of £8,000. David signed the contract but the contract did not cover the cost of work and duration of completion. Eventually, the contract ended many months late and the cupboards were badly fitted and the work surfaces were uneven whilst the back door leaked rain water. The bill was £12,000 which was 50% higher than the bill shown in the estimate. This case presents three issues. In the first case, there is a question of whether or not the bill of over £4000 above the invoice price was recoverable by Fititright or not. The second issue is whether the delay in completion of the project was enforceable by David or not. Thirdly, there is an issue of whether Fititright is liable to the defective works or not. Rules Case 1 In the first case, the relevant rules relate to representations that are made during the formation of contracts. In Patridge V Crittenden (1968), it was identified that some kind of submissions and statements are merely invitations to treat. Thus, statements made to induce discussions are merely invitation to treat. However, in situations where a false statement is made and the other party relies upon it, then that party can sue for misrepresentation (Attwood V Small 1838). An operative misrepresentation is one that is involved in the operation of the firm and it renders the contract voidable (Hunt, 2009). However, in cases where the misrepresentation was fraudulent, the injured party can claim damages (Hunt, 2009). Also, in commercial contracts, exclusion clauses must be expressly stated and the other party must sign it and accept it for it to be enforceable (LEstrange V Graucob). And exclusion clauses like clauses that forbid return of goods can be invoked if and only if they are reasonable. The Unfair Contract Acts (1977) states that exemption clauses that are unreasonable are void (section 1). Also, exclusion clauses cannot be used for the exemption of liability for negligence (section 2). Also, they cannot be used to cover a breach of contract (section 3). The Sale of Goods Act 1979 states that goods that are sold must conform to their description (section 1). In cases where the goods sold are different from what was advertised, the buyer can repudiate the contract (section 15). Case 2 Concerning the second case, there are some rules in English law that are applicable to the scenario. First of all, in the traditional position of the law, a contract is binding and parties are required to carry out their terms of the contract. In Curie V Misa (1809), two ship mates deserted. Clearly, the work load increased as there were no other people to do it. Thus, the remaining ship mates were told by the captain that they will be given the salary of the others who had deserted. When they got ashore, the captain refused to pay the money. The court held that the agreement they signed required that they work on the ship irrespective of the circumstances. However, in Williams V Roffey Brothers (1990), this position was changed. It was held that if one party goes beyond his contractual obligation, he can seek to get extra consideration for the extra work done. Also, in the Unfair Contract Terms Act 1977, it is stated that a trade description of a given activity in a contract must be followed. This involve the fact that the trade description must be followed in the contract and must not be departed from. In the Unfair Consumer Purchases Directive 2005/29/EC, it is stated that there in a contract with misleading actions or omissions, an aggrieved party can sue to recover damages. Advice to David Case 1 In the case at hand, it is apparent that the submission made on the website of Righttablets Ltd that the computers are no more than two years old is an operative misrepresentation. This is because they were made about the trade and the way they carry out their operations. And this is a mild form of misrepresentation that renders the contract voidable. This is because such representations can on some levels, be considered as an invitation to treat. In this case, David can either opt out of the contract or continue with it, because Righttablets clearly misrepresented themselves. In the case of the computer that was sold, it is apparently older than the 2013 as was represented by the seller. This is a misrepresentation of condition and it is serious. This form of misrepresentation is against the fundamental contracts of the company. And as such, David has the right to repudiate the contract and even sue under the Misrepresentation Act 1967. This is because the statement about the date of manufacture influenced his choice to buy the tablet. Hence, he has the right to repudiate the contract and sue for damages. Due to the fact that the computer purchased by David did not meet its targets and estimations, David has the right to return the product. This is because the Sale of Goods Act 1979 gives buyers the right to repudiate the contract where the goods sold do not meet the requirements or expectations. Righttablet Ltd cannot stand behind their sales and return agreements against David because the Unfair Contract Terms Act 1977 only allows exclusion clauses to be included if and only if they are reasonable. Clearly, they have breached the contract terms and they do not have the reasonable right to refuse to accept returned products. Case 2 According to the Currie V Misa (1809) ruling, the invoice will form the basis of the agreement between David and Fititright. This is because the ruling states that a contract involves a consideration and that consideration must be adhered to. However, Fititright can rely on the William V Roffey Brothers ruling (1990) and show proof of extra work and extra consideration that they gave which allows them to merit an extra payment. To this end, they will have to show proof to the courts that they did extra work beyond what they submitted the invoices for. In that case though, David can sue under the Unfair Consumer Purchases Directives of 2005 because the trade description, which was stated in the invoice was not adhered to. Therefore he can sue for the payment of just £8,000. In terms of delay, it is apparent that there was no contract that was signed which defined the completion date of the contract. Therefore, David has limited rights under the law of contract to sue for damages in any way or form. However, the Sale of Goods and Services Act 1981 requires contracts to be completed within reasonable time. This means that David can sue and seek damages for delays if the project was done in a timeframe that he considers to be unreasonably long. However, the burden of proof is on David to show that the period was unreasonably long. The Unfair Contract Terms Act and Sale of Goods and Services Act as well as English Common Law gives David the right to sue for damages for the defective goods. To this end, David can either go to court and seek an order of specific performance to force Fititright to redo the defective sections of his house or he could sue for damages that will be paid to him for the defects in the service they rendered. References Giesen, A. (2009) International Medical Law Practice Lieden: BRILL Publishing. Hunt, M. (2009) Law of Contract London: Sweet and Maxwell. Jacoby, D. B., Youngson, R. M. (2004) Encyclopedia of Family Health London: Marshall Cavendish Kelsey, O. (2012) Thalidomide London: Science Museum. Roach, L. (2012) Card and James Business Law for Business, Accounting and Finance Students Oxford: Oxford University Press. Stapleton, J. (1994) Product Liability Cambridge: Cambridge University Press. Read More