Products Outline

1) INTRODUCTION a) Early Privity Requirement - Duty i) Winterbottom v. Wright (Euro 1842) (holding that lack of privity between Π/Δ precluded Π's suit against Δ for negligent maintenance of a stage coach) ii) Concerns (1) Unlimited liability (2) Disincentivize people from doing the work (higher prices, unavailability of products, etc.) b) Social Problems i) Borel v. Fireboard Paper Products Corp. (5th Cir. 1973) (holding that Δ-asbestos manufacturer has to warn of dangers that the application of reasonable foresight would reveal measured in light of manufacturer's status as an expert and duty to test the product - Rejecting privity requirement) ii) Consider: Strict liability theoretically limits litigation costs by removing the fault issue from the case - more money to the hands of victims faster iii) Hammontree v. Jenner (CA 1971) (holding that Δ car driver that has seizure only faces negligence as opposed to strict liability even though Δ is best cost-avoider) iv) Strauss v. Belle Realty Co. (NY 1985) (holding that lack of privity between Π/Δ meant Δ didn't owe duty to Π when Π slipped and fell on negligently maintained stairs in common area due to black-out caused by Δ's negligent maintenance of the electrical system) (1) Concern about unlimited liability 2) IMPLIED WARRANTY a) RST § 402A i) (1) One who sells any product in a defective condition unreasonably dangerous to the user or consumer or to his property is subject to liability for physical harm thereby caused to the ultimate user or consumer, or to his property, if (1) (a) the seller is engaged in the business of selling such a product, and (2) (b) it is expected to and does reach the user or consumer without substantial change in the condition in which it is sold ii) (2) The rule in (1) applies although (1) (a) the seller exercised all possible care in preparation and sale of the product and (2) (b) the user or consumer has not bought the product from or entered into any contractual relationship with the seller b) Consumer Expectations Test (RST § 402A cmt (g)/(i)) i) Defect - Condition not contemplated by the ultimate consumer, which will be unreasonably dangerous to him ii) Unreasonably Dangerous - Article sold that is dangerous to an extent beyond what would be contemplated by the ordinary consumer with ordinary knowledge common to the community as to its characteristics 2 c) Policy i) Place liability where it will most effectively reduce hazards ii) Modern manufacturing makes it so consumers can't investigate soundness of the product, and manufacturers encourage the lack of vigilance through trademarks, etc. d) Cases i) Van Bracklin v. Fonda (NY 1815) (1) Δ sold bad beef (cow sick), made no representations about quality (2) Rule - Implied warranty that food sold is wholesome, liability if it is not irrespective of fault of seller ii) Jacob E. Decker & Sons v. Capps (TX 1942) (1) Δ sold sausage to middle man who sold to Π, made family sick (2) Found no negligence in food processing, but food was proximate cause of injuries (3) Rule - Manufacturer is liable for injuries caused by the products (a) Implied warranty based on public policy, not negligence, no privity required (4) Policy - It is impracticable, if not impossible for the ultimate consumer to analyze whether food is suitable for human consumption iii) Seixas and Seixas v. Woods (NY 1804) (1) Action for selling crappy wood held out as nice wood though neither side realized the mistake in identifying the wood (2) Held: No express/implied warranty, no fraud in the sale Æ no liability (a) Rule - Purchaser is required to pay attention to things within reach of his observation and judgment - caveat emptor without express warranty here (3) Policy - Buyer had knowledge/ability to inspect the product iv) Escola v. Coca Cola Bottling Co. (CA 1944) (Traynor, J. Concurring) (1) Waitress injured by exploding coke bottle, jury found Δ negligent (2) Argument that implied warranty should apply to product defect (a) Δ places into stream of commerce knowing it will be used without inspection (b) Public policy - Liability where it will be most effective at reducing hazards (c) Modern manufacturing makes it so consumer is no longer capable of investigating soundness of the product and manufacturers encourage the lack of vigilance through trademark, etc. v) Greenman v. Yuba Power Products (CA 1963) (holding strict liability for manufacturer of defective power tool) (Traynor gets a majority) vi) Henningsen v. Bloomfeld Motors, Inc. (NJ 1960) (holding that when manufacturer puts new car in stream of commerce and promotes purchase, they make an implied warranty it is suitable for use) (1) Car veered into a tree close in time to when it was purchased 3 3) NEGLIGENCE PRINCIPLE a) RTT § 1 - One engaged in the business of selling or otherwise distributing products who sells or distributes a defective product is subject to liability for harm to persons or property caused by the defect b) RTT § 2 - A product is defective when, at the time of sale or distribution, it contains a manufacturing defect, is defective in design, or is defective because of inadequate instructions or warnings. A product: i) (a) contains a manufacturing defect when the product departs from its intended design even though all possible care was exercised in the preparation and marketing of the product ii) (b) is defective in design when the foreseeable risks of harm posed by the product could have been reduced or avoided by the adoption of a reasonable alternative design by the seller or other distributor, or a predecessor in the commercial chain of distribution, and the omission of the alternative design renders the product not reasonably safe iii) (c) is defective because of inadequate instructions or warnings when the foreseeable risks of harm posed by the product could have been reduced or avoided by the provision of reasonable instructions or warnings by the seller or other distributor, or a predecessor in the commercial chain of distribution, and the omission of the instructions or warnings renders the product not reasonably safe c) Policy i) No real ability for end consumer to inspect the product (Winchester) ii) If the nature of a product is such that it is reasonably certain to place life and limb in peril when negligently made, it is a thing of danger (Macpherson) iii) Requires (1) Almost never going to have privity between Π/Δ (compare Strauss/Macpherson) (2) Almost never going to inspect/test the product before use iv) Res ipsa loquitur - Infer negligence when (1) accident causing harm is the type that ordinarily happens because of negligence (i.e. more often than not), (2) Δ had exclusive control of the instrumentality causing the injury v) Strict liability enforces BBuy the full version of these notes or essay plans and more in our Advanced Torts: Products Liability Outlines.