Sunday, January 11, 2009

What limits require producers to balance production cost with consumer safety?

What limits require producers to balance production cost with consumer safety?

Product liability laws are intended to encourage manufacturers and their distributors to ensure that products are safe enough to meet certification standards. Contract laws and tort laws are designed to establish minimum safety requirements with the intention of minimizing exposure to liability. Collateral liability laws also are intended to prevent excessive misrepresentation of products marketing and warranties regardless of whether the manufacturer or retailer is the subject of a liability claim.

Could the John Deere Company have foreseen that Mrs. Nicholson would lose her house to fire as a result of the defective lawn mower?

John Deere might argue that the lawnmower was purchased used at auction without standard instructions or manufacturer's battery cover and that cavet empor or "buyer beware" would more likely apply in terms of negligence or manufacturer liability. If for example, John Deere had advertised that its products were safe and warrantied only from recognized and certified sales agents the decision on the case might have been different. Also as it was a used product, without warnings or notifications of danger of use, newer models might be analyzed to see whether the particular safety issue had been recognized and then repaired, recalled or redesigned since that model year. A progessive safety conscious manufacturer might then be found responsible for not issuing product warnings on future or past models as might be expected. Especially if the safety hazard was known and no consumer warnings were made then the product problem may have been forseen.

What are the practical limits of foreseeability?

These include the defences to negligence which include:

1. Voluntary assumption of risk: For example, I remember signing a waiver and assumption of risk affidavit prior to embarking on a champagne hot air balloon ride in Langley, BC. This would apply if the balloon operator had complied with all regulations in case of injury they would not be considered liable. If however product failure such as balloon seams, gas rupture or burner malfunction occurred and led to injury manufacturer liabilities might still apply. As for the bumpy landing I was on my own.

2. Unforseeable use of product: Recent youtube videos demonstrating the chemical effects of combining mentos a caustic candy, with diet coke a carbonated beverage illustrate a possible unforseen use of products which might limit the liability of either manufacturer in the case of any claims of injury.

3. Product Tampering: The most horrendous example, while excluding the rat poisoning of an entire season of Christmas turkeys in Vancouver in the mid-nineties must be the Johnson & Johnson tylenol tampering murders of 1982. While Johnson & Johnson were never found liable for the product tampering ( they chose out of court settlements) a thorough investigation to the origins of the potassium cyanide were made which exonerated the company from liability and ensured new packaging and tampering laws and requirements. At the same time while enduring horrible losses Johnson & Johnson remains one of America's most admired companies.

4. Contributory Negligence: Several cases made by obese people against MacDonalds for feeding them fatty foods have been thrown out of court as the plaintiffs were found to have committed contributory negilgence in their eating habits rather than any liability on MacDonalds part.

What ought to be the legal limits to the damages awarded in cases where the injury could not have been foreseen?

As our text relates: manufacturing defects, design defects and failure to warn customers of dangers should be the limits to damages awarded in case of injury. For example, I was once tempted to purchase a used Chrysler New Yorker at a Saturday evening show and sale at the rotunda in Abu Dhabi. Following a brief review of its model and year recalls and repairs schedule or history I was chastened.

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