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Strict liability for damages proximately caused by an abnormally dangerous, or ultra hazardous, activity is one application of strict liability. Activities cannot be completely guarded against by the exercise of reasonable care.

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Abnormally Dangerous Activities

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1. The manufacturer can better bear the cost of injury because it can spread the cost throughout society by increasing the prices of its goods. 2. The manufacturers making a profit from its activities and therefore should bear the cost of injury as an operating expense.

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Liability of manufacturers and sellers for harmful or defective products is a matter of social policy and is based on two factors:

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exists when goods are transferred temporarily into the care of another.

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bailment

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Those who make, sell, or lease goods can be held liable for physical harm or property damage caused by those goods to a consumer, user, or bystander.

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product liability

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If a manufacturer fails to exercise "due care" to make a product safe, a person who is injured by the product may sue the manufacturer for negligence.

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Strict Liability Based on Negligence

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1. Designing the products 2. Selecting the materials 3. Using the appropriate production process 4. Assembling and testing the product 5. Placing adequate warnings 6. Inspecting and testing any purchased components used in the product

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Manufacturers must use due care in all of the following areas:

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refers to the relationship that exists between the parties to a contract

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privity of contract

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When a user or consumer is injured as a result of a manufacturer's or seller's fraudulent misrepresentation, the basis of liability may be the tort of fraud. The misrepresentation must have been made knowingly or with the reckless regard for the facts.

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Strict Liability Based on Misrepresentation

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Misrepresentation on a label or advertisement is enough to show an intent to induce the reliance of anyone who may use the product. The buyer must have relied on the misrepresentation.

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How to show Misrepresentation?

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1. Consumers should be protected against unsafe products. 2. Manufacturers and distributors should not escape liability for faulty products simply because they are not in privity of contract with the ultimate user of those products. 3. Manufacturers and distributers can better bear the costs associated with injuries caused by their products- because they can ultimately pass the costs on to all consumers in the form of higher prices.

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Strict Product Liability and Public Policy rests on the assumption that:

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1. The product must be in a defective condition when the defendant sells it. 2. The defendant must normally be engaged in the business of selling (or otherwise distributing) that product. 3. The product must be unreasonably dangerous to the user or consumer because of its defective condition (in most states). 4. The plaintiff must incur physical harm to self or property by use or consumption of the product. 5. The defective condition must be the proximate cause of the injury or damage. 6. The goods must not have been substantially changed from the time the product was sold to the time the injury was sustained.

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Restatement of torts summarized in six requirements:

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The plaintiff has to prove that the product was defective at the time it left the hands of the seller or lessor. The plaintiff must also show that this defective condition made the product "unreasonably dangerous" to the user or consumer.

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Proving A Defective Condition

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1. The product was dangerous beyond the expectation of the ordinary consumer. 2. A less dangerous alternative was economically feasible for the manufacturer, but the manufacturer failed to produce it.

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A court would consider a product as an unreasonably dangerous in either of the following situations:

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manufacturing defects, design defects, and inadequate warnings.

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Three types of product defects that have traditionally been recognized in product liability law-

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a defect is a departure from a product unit's design specifications that results in products that are physically flawed, damaged, or incorrectly assembled.

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Manufacturing defect

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made in conformity with the manufacture's design specifications. "Is defective in design when the foreseeable risks of harm posed by the product could have been reduced or avoided by the adoption of reasonable alternative design.

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Design defects

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1. A reasonable alternative design was available 2. The defendants failure to adopt the alternative design rendered the product not reasonably safe. **the defendant is liable only when the harm was reasonably preventable.**

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To assert design defect, a plaintiff has to show that

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Most courts engage in a risk-utility analysis to determine whether the risk of harm from the product as designed outweighs its utility to the user and to the public.

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Risk Utility Analysis

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A product is unreasonably dangerous when it fails to perform in the manner that would reasonably be expected by an ordinary consumer.

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Consumer-Expectation Test

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when the foreseeable risks of harm posed by the product could have been reduced or avoided by th provision of reasonable instruction or warnings by the seller or other distributor.. and the omission of the instructions or warnings renders the product not reasonably safe.

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Inadequate Warnings

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There is no duty to warn about risks that are obvious or commonly known.

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Obvious risks

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A seller must warn those who purchase its product of the harm that can result from the foreseeable misuse of the product as well.

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Foreseeable Misuses

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a court can hold each manufacturer responsible for a percentage of the plaintiff's damages that is equal to the percentage of its market share. Used when plaintiff could not prove which the many distributors of a harmful product supplied the particular product that caused the injuries.

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Market-Share Liability

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A defense that has successfully raised by defendants in recent years is preemption- that governments regulations preempt claims for product liability.

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Preemption

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1. The plaintiff knew and appreciated the risk created by the product defect. 2. The plaintiff voluntarily assumed the risk- by express agreement or by words or conduct- even though it was unreasonable to do so.

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Establishing Assumption of Risk

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Occurs when a product is used of purpose of which it was not intended. This is used as a defense only when the particular use was not foreseeable.

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Product Misuse

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Used by the defendant in order to limit some of its liability if it can show that the plaintiff's misuse of the product contributed to his or her injuries. Comp Negligence does not completely absolve the defendant of liability, but it can reduce the total amount of damages that will be awarded t the plaintiff.

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Comparative Negligence

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If a particular danger is or should be commonly known by particular users of a product, the manufacturer need not warn these users of the danger.

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Knowledgable User

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suspended

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Tolled

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place outer time limits on product liability cases.Used to ensure that sellers and manufacturers will not be left vulnerable to lawsuits indefinitely. If a plaintiff does not bring an action before the prescribed period expires, the seller cannot be held liable.

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Statues of repose

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A seller must warn those who purchase its product of the harm that can result from the foreseeable misuse of the product as well.

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Foreseeable Misuses

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a court can hold each manufacturer responsible for a percentage of the plaintiff's damages that is equal to the percentage of its market share.

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Market-Share Liability

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A seller must warn those who purchase its product of the harm that can result from the foreseeable misuse of the product as well.

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Foreseeable Misuses

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A product is unreasonably dangerous when it fails to perform in the manner that would reasonably be expected by an ordinary consumer.

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Consumer-Expectation Test

Chapter 13 Strict Liability and Product Liability – Flashcards

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