Product liability

Martin Ewen reviews product liability law in England and Wales and also whether there is a limit on the level of damages awarded in actions for wrongful death arising from defective products.

A building (or any other) product liability claim can be based on one or more of the following grounds: (i) negligence; (ii) the Consumer Protection Act 1987; (iii) the Fatal Accidents Act 1976; (iv) contract; and (v) criminal liability.

(i) Negligence

Since 1987 England and Wales have had strict liability legislation (the Consumer Protection Act 1987) to deal with claims by those who have suffered damage caused by a defective product. Under that legislation liability is dependent not upon fault, but upon mere defectiveness.

Claims brought on the basis of fault liability or liability in negligence are primarily concerned with the question of whether the defendant breached his duty of care by failing to act to an acceptable standard (otherwise known as acting with reasonable care), rather than whether the product was defective. In negligence, an injured party has a direct right of action against any person in the chain of supply who has breached his duty to the injured party.

The primary remedy for a claim in negligence will generally be damages for the losses sustained by the claimant.

An action under the Consumer Protection Act 1987, with its strict liability, is generally far more likely than a claim in negligence. The primary reason for this is because in negligence a claimant must prove that the manufacturer breached his duty of care, whereas under the Consumer Protection Act 1987 it is enough simply that the product is defective (strict liability).

(ii) Consumer Protection Act 1987

As touched on above, strict liability is a concept whereby a successful claim does not depend on proof of the existence of a contract or of fault, and liability accrues to any party responsible for a defect in a product which causes injury. Strict liability, however, is not the same as absolute liability; the burden of proof still lies with the consumer and there are several defences available to a strict liability claim.1

Strict liability in the European Union is based on the Product Liability Directive (85/374/EEC). Member states of the European Union have the option under the Product Liability Directive to fix a cap of ECU 70 million (70 million euros), for liability resulting from death or personal injury “caused by identical items with the same defect” (Article 16(1)). This option has not been exercised by the United Kingdom. There is no cap on damages that can be awarded in wrongful death actions in the United Kingdom under the Product Liability Directive, as implemented in the United Kingdom by virtue of the Consumer Protection Act 1987.

The Consumer Protection Act 1987 introduced statutory liability for defective products. A claim can be brought for death, personal injury or damage to private property. The Consumer Protection Act 1987 imposes no financial limit on the producer’s total liability.

Section 2(1) of the Consumer Protection Act 1987 provides that “where any damage is caused wholly or partly by a defect in a product, every person to whom subsection (2) below applies shall be liable for the same damage”. Subsection (2) includes the producer of the product, any person who has put his name to the product and held himself out to be the producer of the product, and any person who has imported the product.

Builders generally face no liability under the Consumer Protection Act 1987 for the design and construction of the things they build. However, “movables” or substandard materials may give rise to liability.

The presence of a defect is essential if there is to be liability under the Consumer Protection Act 1987.

Section 5(1) of the Consumer Protection Act 1987 defines “damage” as “death or personal injury or any loss of or damage to any property (including land)”.

Section 7 of the Consumer Protection Act 1987 prevents liability being excluded by any contract term, notice or other provision. This applies to any person who has suffered damage wholly or partly from a defect in a product as well as any dependant and relative.

Calculation of personal injury damages and those arising from wrongful death is a complex process with many factors and will be different in each case. There is no overall limit on the level of damages.

(iii) Fatal Accidents Act 1976

If a product causes the death of someone, there is the added possibility of a claim by dependants under the Fatal Accidents Act 1976.

Section 1(1) of the Fatal Accidents Act 1976 provides that:

“If death is caused by any wrongful act, neglect or default which (if death had not ensued) would have entitled the person injured to maintain an action and recover damages in respect thereof, the person who would have been liable if death had not ensued shall be liable to an action for damages, notwithstanding the death of the person injured.”

Therefore an action could be brought by the deceased’s dependants under the Fatal Accidents Act 1976.

(iv) Contract

A claim for breach of an express or implied term of a contract can be brought on a strict liability basis. Liability is established on proof of breach of contract and the claimant does not need to prove that the seller/producer was negligent.

Damages under contract are not limited to compensation for personal injury, physical damage to property and consequential loss. Pure economic loss (usually loss of profits) can also be recovered in a contractual claim.

A third party who suffers loss as a result of a defective product generally has no right of contractual action; only the purchaser of the product who suffers loss may sue in contract.

Therefore unless there is a direct contractual link between the manufacturer and consumer (e.g. a guarantee), it will not generally be possible for a consumer to bring a contractual claim against a manufacturer.

It is worth mentioning the General Product Safety Regulations 2005 (“GPSR”). These Regulations implemented the revised EU General Product Safety Directive.

The GPSR requires producers and distributors (including, in certain circumstances, individual directors, managers or other similar officers) to ensure that their products are safe. If products are not safe, the GPSR allows courts to impose fines or, in certain cases, even a term of imprisonment (Regulation 20). They impose a general safety requirement on producers, obliging them to place “safe” products on the market. A product is “safe” if, under normal or reasonably foreseeable conditions of use, it presents no risk or “only minimum risks compatible with the product’s use, considered to be acceptable and consistent with a high level of protection for the safety and health of persons” (Regulation 2). Various matters are taken into account when assessing a product’s safety and a product will be presumed to be safe if, for example, it conforms to a UK national standard giving effect to a European standard.
The GPSR specifies the types of conduct that will amount to an offence and which may be punished by a fine or imprisonment (or both). These include the placing on the market by a producer of a product that does not conform to the general safety requirement and the supply by a distributor of a product that he knows or should have presumed to be dangerous (Regulation 20(1)).

Products used in the workplace are subject to the Health and Safety at Work Act 1974. Therefore where products are to be sued in the workplace, the provisions of this legislation should be given careful consideration.

(v) Criminal Liability

Manufacturers and suppliers of products may face criminal, as well as civil, liabilities if their products are defective. The Corporate Manslaughter and Corporate Homicide Act 2007 sets out that the offence of corporate manslaughter is committed where the way in which a company’s activities are managed or organised both:

  • causes a person’s death; and
  • amounts to a gross breach of a relevant duty of care owed by the company to the deceased.

Individual directors cannot be convicted of an offence, only the company.

The court may impose an unlimited fine upon a company convicted of corporate manslaughter, the scale of which will be determined by reference to the facts of a particular case and the company’s annual turnover in accordance with sentencing guidelines effective from 1 February 2016.

Are punitive damages available in wrongful death products liability or construction matters in the UK?

The primary objective of an award of damages is to compensate the claimant for the harm done to him. A possible secondary objective is to punish the defendant for his conduct in inflicting that harm. Such a secondary objective can be achieved by awarding, in addition to the normal compensatory damages, damages which are punitive. Punitive damages tend to come into play whenever the defendant’s conduct is sufficiently outrageous to merit punishment.

The leading case in the area of punitive damages is Rookes v Barnard2. In this case the House of Lords held that, except in a few exceptional cases, it was no longer permissible to award punitive damages against a defendant, however outrageous his conduct. The exceptional circumstances set out in that case are very unlikely to arise in the context of a building product liability claim.

Concluding remarks

Those concerned in the supply and production of building products should pay particular attention to the Consumer Protection Act 1987. If it is established that there is a defect in a building product, liability accrues to any party responsible for the defect, and there is no cap on damages for death or personal injury.

If a product causes the death of someone, there is the added possibility of a claim by dependants under the Fatal Accidents Act 1976.

Consideration must also be given to the GPSR, where an offence can be punished by a fine or imprisonment (or both).

Criminal liability under the Corporate Manslaughter and Corporate Homicide Act 2007 could result in an unlimited fine, based on the company’s turnover. Clearly this could result in a fine of a very substantial sum of money.

It is important to remember that it must be established that a building product is in fact defective. If a product satisfies relevant legislation and regulations and then following an event it is considered that a different product would have been better suited, that in itself will not establish that the product used was defective.

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  • 1. These include compliance with mandatory rules, non-supply of the product in question, not defective at time of supply, among others set out in section 4 of the Consumer Protection Act 1987
  • 2. [1964] A.C. 1129