PRODUCT LIABILITY: IS THE SUPPLIER LIABLE FOR HARM SUFFERED BY A CONSUMER?

PRODUCT LIABILITY: IS THE SUPPLIER LIABLE FOR HARM SUFFERED BY A CONSUMER?

In a previous article entitled “The responsibility of a supplier to conduct a consumer product safety recall“, we dealt with various matters around product safety recalls. As a follow-on to that, this article deals with the “product liability” concept which goes hand-in-hand with “product safety recall“.

INTRODUCTION

From as far back as the early days of the Romans, a plethora of claims for damage suffered or loss incurred as a result of defective or unsafe goods or products have been a part of the ever-evolving legal fraternity. These claims ranged from a claim against a horse-drawn coach manufacturer, to a claim against a man who sold a diseased horse which later dies in the possession of the buyer, or anything in between. To date, product liability claims is still a practice in most legal systems around the world – including South Africa.

PRODUCT LIABILITY

In essence, the concept “product liability” refers to a supplier’s liability towards the consumer or third-party for damage suffered or for loss incurred as a result of the supplier’s defective or unsafe goods/products supplied.

Product liability is regulated by the Consumer Protection Act 68 of 2008 (the “CPA“). As the name suggests, the main objective of the CPA is to regulate relations between the supplier and the consumer. In line with that objective, the provisions of the CPA relating to product liability focus on regulation of the relationship between the supplier (i.e. manufacturer, designer, distributor or retailer) and the consumer, rather than between suppliers themselves.

SUPPLIER’S LIABILITY FOR HARM SUFFERED BY A CONSUMER

Until the inception of the CPA, claims arising from damage suffered or loss incurred by a consumer or third party as a result of defective product were regulated by our common (i.e. uncodified) law. As such, liability for such damage or loss could only be determined in terms of the common law of delict. Given the burden an aggrieved party is required to discharge in order to succeed with a delictual claim, it was often difficult for many consumers to successfully prove their claims in this regard.

To plug this gap, the Legislature introduced a different approach with regards to the consumer’s burden of proof through the CPA. In terms of section 61 of the CPA, a supplier may be held liable to a consumer for any damage or loss arising from (i) the supply of a defective/unsafe product or (ii) where damage or loss arises from the supplier’s failure to provide adequate information relating to the risks associated with the use of a product. The main benefit to the consumer lies in the fact that the supplier may be held liable regardless of whether it (the supplier) was negligent or not.

Consideration of whether there is any probability of success in a claim in terms of section 61 hinges on the following three questions:

  • whether goods and/ or services as defined in CPA are involved;
  • if so, whether the person (against whom the claim has been instituted) is in fact the “supplier” as defined in the CPA; and
  • whether the claimant suffered harm as a result of defective goods supplied by the such supplier?

CONCLUSION

The purpose of this article is to provide an insight into the supplier’s liability towards the consumer for damage or loss arising from supply of defective goods/product and should not be considered as advice.

In our last article of this series, we will discuss some aspects around whether the role-players in the supply chain can decide, among each other, who will be liable to the consumer.