PRODUCT LIABILITY

Product Liability

Product Liability

Referring to the scenario and Outback's position a firm which specializing in the manufacture of tents, trailer tents and camping equipment. Maggie and Ken should firstly know that product liability and consumer rights are two important issues that they will have to face as long as they are selling tents, trailer tents and camping equipment. With regards to the accident and their liability they have to reinsure the quality and workmanship of the towbars and its conformance to the industrial standard its being manufactured according to.

Once the application and inspection standards are defined the consumer rights and product liability issues will not affect the business operation. If the manufacturer can reasonably be expected to have been aware of the defect, he will be liable. The problem here is that the manufacturer may be at the forefront of design technology - perhaps this will accord him a defence.

While product liability, from a legal perspective includes a contract claim against the seller of the goods, from the consumer's viewpoint, product liability relates more to product safety and the culprit is the manufacturer instead of the seller.

Moreover, how do we ascertain the level of care to be given in regard to a design defect as in the case of Adelaide Chemical & Fertilizer v Carlye (1940) The standard of care remains "that which is reasonable in the circumstances, that which a reasonably prudent man would exercise in the circumstances": Adelaide Chemical &Fertilizer Co Ltd v Carlyle [1940] 64CLR514 In the case of such substances or activities, however, a reasonably prudent person would exercise a higher degree of care. In regard to dangerous goods, look at the narrow-rule in Donohue v Stevenson (1932) - “A manufacturer of products, which he sells in such a form as to show that he intends them to reach the ultimate consumer in the form in which they left him with no reasonable possibility of intermediate examination, and with knowledge that the absence of reasonable care in the preparation or putting up of products will result in an injury to the consumer's life or property, owes a duty to the consumer to take that reasonable care.

A court considering a claim in negligence or breach of statutory duty may, in determining whether the defendant should have taken particular steps to meet a standard of care (whether by taking precautions against a risk or otherwise), have regard to whether a requirement to take those steps might — (a) prevent a desirable activity from being undertaken at all, to a particular extent or in a particular way, it is not unusual to see this kind of consideration in the decision of whether or not to recognize a duty of care, particularly in cases relating to purely economic loss; for example, McHugh J in Sandal Finance Corporation Ltd v Peat Marwick Hungerfords (Reg)56 on the potential impact on auditing services if the court were to impose a duty of care to third ...