PRODUCT LIABILITY
INTRODUCTION
The modern age is an age of the industrial revolution. A new product is introduced to the consumer market every day. With the introduction of these products, we also need to take care of its “Product Liability” and risks involved. “Product Liability” deals with the problems of product-caused accidents and “Product Liability Risk “refers to the risk associated with facing legal actions from customers due to product defects. The term “Product Liability” was absent from the Consumer Protection Act, of 1986, which led to contradictory judgements. It was introduced in the Consumer Protection Act, of 2019, and dedicated Chapter VI to product liability action which can be considered derivations from product liability regimes of states like the USA. In ancient manuscripts like Manu Smriti and Kautliya’s Arthsastra, the concept of Product Liability is highlighted. The Manu Smriti prescribes a code of conduct to the traders and provides for punishment to the sellers who commit crimes like adulteration. In Kautliya’s Arthsastra, the role of the state in controlling trade is described, and the state’s duty to protect the interest of the consumer is highlighted. The foundation of product liability can be traced to jurisprudence about tortious and contractual liability in English Law.
ANALYSIS OF THE CONCEPT OF PRODUCT LIABILITY
Initially to claim compensation the complainant needed to be in privity with the defendant, usually the manufacturer. In reference to the above statement, we could refer to the case Winterbottom v Wright[1] (1842), wherein the complainant was denied compensation because the plaintiff was not in a contract with the defendant as the law’s only recognition of “negligence” was a breach of contract. But with the celebrated decision of the House of Lords in the case Donoghue v Stevenson[2], the courts considered the duty of the manufacturer or seller towards the third party without any contractual relationship. This case also highlighted that the manufacturer has a duty of care toward the consumers.
For the consumer's protection, the tort law focuses on the principle of “ibi jus ubi remedia” which means that where there is a right, there is a remedy. The law recognizes two bases for imposing liability for damages on the product manufacturer. First is tort theory where the product manufacturer is liable for the defect as the crux of the liability is the fault, which could be intentional or negligent. In such cases the doctrine of “res ipsa loquitor” (the things speak for themselves) is applicable, and the manufacturer is faced with absolute liability. The Second is a contractual warranty, which can either be implied or express.
For a consumer to get compensation in product liability litigation, the consumer should have adequate proof to prove the manufacturer's negligence and that the loss incurred by the consumer is due to the defect of the product. It is also important to note that the manufacturer should be liable for the defect, not the seller. The Consumer Protection Act, 2019 states in its Section 86 that “A product seller who is not a product manufacturer shall be liable in a product liability action, if (a) he has exercised substantial control over the designing, testing, manufacturing, packaging or labelling of a product that caused harm; or (b) he has altered or modified the product and such alteration or modification was the substantial factor in causing the harm; or © he has made an express warranty of a product independent of any express warranty made by a manufacturer and such product failed to conform to the express warranty made by the product seller which caused the harm; or (d) the product has been sold by him and the identity of product manufacturer of such product is not known, or if known, the service of notice or process or warrant cannot be effected on him or he is not subject to the law which is in force in India or the order, if any, passed or to be passed cannot be enforced against him; or (e) he failed to exercise reasonable care in assembling, inspecting, or maintaining such product or he did not pass on the warnings or instructions of the product manufacturer regarding the dangers involved or proper usage of the product while selling such product and such failure was the proximate cause of the harm.” In ANNAMA EARNEST VS PRINCE ENGINEERING Co[3], the consumer’s claim was rejected by the Kerela State Consumer Disputes Redressal Commission on the basis that the claim was registered against the dealer of the product who was not liable for the defect. Secondly, the claim was dismissed because the complainant could not present adequate evidence to prove the product's defect.
As per section 84(1) of the Consumer Protection Act, 2019 “A product manufacturer shall be liable in a product liability action, if — (a) the product contains a manufacturing defect; or (b) the product is defective in design; or © there is a deviation from manufacturing specifications; or (d) the product does not conform to the express warranty; or (e) the product fails to contain adequate instructions of correct usage to prevent any harm or any warning regarding improper or incorrect usage” In the case Baxter v Ford Motor Company[4], the manufacturer was held liable for the injuries sustained and damages caused to the purchaser. The purchaser relied upon the representation of the non-shatterability of the windshield that was made in the manufacturer’s catalogue and hence the manufacturer was charged for breach of warranty. This case also highlights the concept of “misleading advertisement.” The Consumer Protection Act,2019 Section 2(28) defines “misleading advertisement” in relation to any product or service as an advertisement, which — (i) falsely describes such product or service; or (ii) gives a false guarantee to, or is likely to mislead the consumers as to the nature, substance, quantity or quality of such product or service; or (iii) conveys an express or implied representation which, if made by the manufacturer or seller or service provider thereof, would constitute an unfair trade practice; or (iv) deliberately conceals important information.” In the above case, the Ford Motor Company, in its catalogue falsely described the windshield of its cars as non-shatterable. A similar case in India was witnessed was General Motors (India) Private Limited v Ashok Ramnik Lal Tolat and another [5]; in the above-mentioned case, the complainant purchased the motor vehicle worth Rs 14 Lakhs and its accessories worth Rs 1.91 Lakhs fitted. The car was purchased based on an advertisement given by the respondent wherein the motor vehicle was shown as an SUV suitable for on-road and off-road driving. Later, the purchaser discovered that it was not an SUV and merely a passenger car not fit for the purpose of the purchaser. The judgement was in the favour of the purchaser, and the respondent was held liable for unfair trade practices as he had put misleading advertisements to sell his product; he was ordered by the State Commission to pay compensation and refund of 12.5 lakhs to the purchaser.
The National Redressal Commission at New Delhi in the case Post Office v Akhilesh Grover[6], commented about the Consumer Protection Act, “The provisions of this Act shall be in addition to any not in derogation of the provisions of any other law for the time being in force”, which implies that any statue which provides an exemption to the service provider or the manufacturer would not come in the way of the right of the consumer to be compensated for his loss.
Another basis for claiming compensation against the product manufacturer or service provider is negligence. Negligence occurs when the manufacturer or the service provider breaches the duty of care they owe the consumer. In a recent case of Vadodara Municipal Corporation v Purshottam V Murjani[7] and others, the contractor of the boats was held primarily responsible. The Vadodara Municipal Corporation was held vicariously responsible for the boat accident where the boat carried 38 passengers as against the capacity of 20 passengers, there was no lifeguard deployed, or no safety measures were taken care of.
CONCLUSION
To conclude this article, I would like to state that the consumer market in India is growing more than ever with the introduction of new products every day; the legal system must establish strict rules and regulations for product liability so that in the competitive market where producers want to cut costs to increase their profit margins and their sales, the quality of the products and services provided should not be compromised. The manufacturers should always give the safety of the consumer priority. Consumer Protection Act is a welfare-oriented law that protects the consumers against the deficiency of services and defects in goods. The concept of product liability helps consumers to seek remedy and claim compensation in an easier way because, before the Consumer Protection Act, consumers had to take their cases to civil courts. The consumer had to engage a lawyer and pay court fees, and it was a long, tedious process but after the introduction of the Act, claiming compensation has become easier and quicker, and the Consumer Forums and State Commissions charge no court fees. In my suggestion, it is important to spread legal awareness about the rights of the consumers and various remedies that is available to them because the right provided to a consumer could only be a boon when they know about it, and they use it. The lawmakers have clearly defined each term's meaning and formulated the rules of product liability.
The only disadvantage is that the burden to prove the damage and the loss is on the plaintiff and sometimes due to lack of proof the manufacturers and the service providers who have caused damage to the consumer get away with it without being held liable. The forums should make strict rules and tests so that the damages could be proved easily. No manufacturer or service provider could escape their liability.
[1] (1842) 152 ER 402
[2] (1932) SC (HL) 31
[3] ANNAMMA EARNEST VERSUS PRINCE ENGINEERING CO 35 2132 REP BY ITS MANAGING PARTNER SHAJI & ANOTHER LNIND 2012 SCDRCTHV 391
[4] 168 Wash. 456, 12 P.2d 409 (1932)
[5] 2014 SCC OnLine SC 814
[6] 2017 SCC OnLine NCDRC 532
[7] 2014 SCC OnLine SC 698
