For many products, there are laws that a producer must comply with. These include the Consumer Protection Act 1987. This Act enforces rules to ensure a product isn't defective. If you sell a defective product to a consumer, this section looks at how they'll be protected.
Under the Act, 'product' means any goods or electricity. It includes a product contained in another product, such as a component part or raw material.
Therefore, products are very wide ranging. All consumer goods are included. They include washing machines, televisions, cars, boats, furniture, etc. Electricity is specifically included. Gas and water, by their very nature, are also included. Furthermore, food and drugs are products. The product must have been supplied in the course of business.
Although land and buildings aren't included, components supplied for their construction or improvement are. Building materials like bricks, wood and cement, and things supplied to be attached to the land or building, like a fitted kitchen and fitted furniture, are products supplied by the builder. If these are defective, a consumer could claim against the builder.
If damage is caused by defective products, each of the following people is legally responsible (liable) when acting in the course of business:
Manufacturers and processors of products are the most common types of producers of the product.
These include businesses that place their own brand name on a product (own-branders), and then hold themselves out to consumers as the producer. These businesses are liable if the product they supply is defective. (A visit to Tesco or Sainsbury's, for example, will reveal many examples of own-brand products.)
The importer who brings goods into the EU from outside the EU is liable if these products are defective.
If you're a supplier of a product, you could be liable to a consumer for any defects in the product if:
1. The consumer asks that you identify one or more of the producers, own-branders or EU importers
2. The consumer makes the request within a reasonable time of the damage arising; and
3. You don't comply with the request within a reasonable period.
You can avoid liability simply by identifying the producer, own-brander or importer to the consumer within a reasonable time, whether or not these businesses are still in existence.
The concept of supply is very wide. It includes the obvious - selling, hiring out or lending goods. It also includes entering into a hire-purchase agreement to provide the goods, and the performance of any contract for work and materials to furnish the goods. There are a number of extra circumstances, which include providing goods in exchange for payment other than money or in giving goods as a prize or other gift.
The liability created by the Act is strict. This means that the consumer doesn't need to prove that the person liable was negligent. The consumer only needs to show that an injury resulted from a defective product.
The Act defines a defect in a product as something that makes it unsafe compared to what a person is generally entitled to expect. Safety is judged in light of damage to property as well as risks of personal injury or death. All the surrounding circumstances, such as the manner and purposes for which the product is marketed, are taken into account. Factors such as any warnings relating to using it, and what the producer might reasonably expect to be done with the product, are also taken into account.
Damages will be awarded if death or personal injury occurs, or any loss of or damage to any property, including land.
However, if there's loss or damage to property, there are distinctive rules that apply and there are certain exclusions. A consumer can't claim for the loss of the product itself, but can claim for any damage that the product causes. The consumer would claim for loss in the value or damage to the product itself as a breach of contract instead of under the Act, i.e. the goods not being of satisfactory quality.
The Act only covers situations where damage is caused from the private use of products. It doesn't cover damage to property used commercially in a business, occupation or profession.
A claim under the Act must be for an amount greater than £275 including interest. This is to help avoid or discourage small claims.
Although the Act doesn't define who can bring a claim, it's intended to compensate the individual and not commercial firms or companies. It only applies to loss or damage to property intended for private use, occupation or consumption.
A person sued under the Act would have a good defence if they didn't produce, place their trademark on, or import the product. A producer of parts would have a good defence if they can show that they didn't produce the defective part of the product.
You won't be liable as an own-brander unless you also hold yourself out to be the producer. If the claim is against an importer then the importer must show that they imported from outside the EU.
Under the Act, anyone not acting in the course of business isn't liable.
Furthermore, if someone asks a supplier for the identity of a producer, the supplier can successfully defend the claim if:
Furthermore, there will be no claim if:
For any claim, the court will consider all the factors to establish who is liable for any damage caused by a defective product.
Apart from the Consumer Protection Act, there is other legislation covering specific types of goods and the standards they must comply with. These laws place duties on manufacturers, distributors and retailers to protect consumers from unsafe products. They can require notices, instructions or warnings to be supplied with the goods.
If a manufacturer or other person breaches a statutory duty when selling goods and services, it doesn't necessarily mean that they'll be liable to a claim by the buyer. Much of the legislation about the sale of goods and services only provides for criminal penalties for breach, such as a fine. It doesn't give anyone the right to bring a claim for compensation.