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Product Liability under the Consumer Protection Act 1987 |
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By contrast, in the United Kingdom, claimants are allowed to recover the full |
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sum as long as it exceeds the threshold limit. |
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Q13 Are the categories of recoverable damage sufficiently comprehensive for |
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the purposes of the 1987 Act? |
8â Limitations on liability
(a)â Time limits
There are two limitation periods that are relevant to a product liability claim under the Consumer Protection Act 1987. First, any claim under the Act must be brought within three years.122 For the purposes of making the claim, loss or damage to property is deemed to have occurred at the earliest time at which a person with an interest in the property had knowledge of the material facts.123 This will occur when a reasonable person would consider the loss or damage to be sufficiently serious to justify commencing proceedings against a defendant who does not dispute liability and is able to satisfy any judgment.124
In addition to the three-year limitation period, there is also a ten-year cut-off period, which provides that claims under Part I of the Consumer Protection Act 1987 cannot be commenced after the expiration of ten years from the relevant time,125 that being the time at which the product was put into circulation. This cut-off period allows the producer to draw a line under his legal liability and, arguably, will increase his ability to get insurance cover for the product because there is a definite end to his potential liability. The producer should keep thorough records for the ten-year period to ensure that he has all the information available should he want to use this cut-off period to defeat a claim. While the ten-year cut-off period may be a pragmatic approach to product liability, commentators have suggested that it is not necessarily in the best interests of injured users.126 Some injuries take longer than ten-years to become apparent and thus a claim may be statute-barred before the cause of action for personal injury has even accrued. Examples would include damages for drug-related injures where the damage may not become apparent for many years after the relevant incident, such as occurred in Sindell v. Abbott Laboratories,127 the ‘DES daughters’ case discussed previously,128 where the ovarian cancers suffered by the daughters of women who had used the drug during pregnancy were not apparent until the plaintiffs reached their teens or twenties. Equally, the effects of exposure to carcinogenic products may not be apparent for twenty or thirty years after the exposure has occurred. Such
122Limitation Act 1980, s.11A(4).
123Consumer Protection Act 1987, s.5(5).
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Ibid. s.5(6).â 125â Limitation Act 1980, s.11A(3). |
126 |
See Howells and Weatherill, above n. 19, at 251 and Griffiths and Griffiths, above n. 114, at 186. |
127 |
26 Cal. 3d 588 (1980).â 128â See Part 4 chapter 1. |
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victims will be denied any claim in strict product liability and will have to rely instead on a claim in negligence.
However, there is one example of the ten-year cut-off period being circumvented. In Horne-Roberts v. SmithKline Beecham plc,129 an extension to the period was permitted by the Court of Appeal based on the meaning of the Limitation Act 1980. The case related to damage suffered by the defendant following use of the MMR vaccine. The plaintiff’s representatives issued a claim against Merck and Co. Inc., who they wrongly believed to have produced the vaccine. On discovering that the vaccine had actually been produced by SmithKline Beecham plc, they applied to have SmithKline substituted as the defendant, an application which was approved by the Court of Appeal despite the expiration of the ten-year cut-off period. The substitution was allowed on the basis that the representatives had been genuinely mistaken within the meaning of the Limitation Act 1980 and the Civil Procedure Rules 1998.130
(b)â Global financial limit
While there is a lower financial threshold for property damage, there is no upper limit to the size of the claim that can be made in respect of death or personal injury suffered as a result of a product-related injury. Under Article 16.1 of the Product Liability Directive, Member States had the option of restricting the global liability of a producer to 70 million ECU, the restriction applying to claims of death or personal injury caused by ‘identical items with the same defect’.
As discussed in the previous chapter, the difficulty with a global financial limit is that, by setting an artificial ceiling to the total compensation that can be paid, a strategy must be implemented to deal with cases where that financial limit is not sufficient to satisfy all of the legitimate claims that may be brought. There are two possible strategies, neither of which is really desirable. The first involves paying out claims on a ‘first come, first served’ basis. This is somewhat of a lottery and may result in some valid claims being rejected purely because the money has run out. Claimants who make their claims in the early part of the ten-year period may receive full compensation, while those whose claims arise during the latter part of the period may not receive anything. The alternative strategy is equally unsatisfactory. If claims are to be dealt with equitably, with all claimants receiving the same proportion of their claim (whether that be 100 per cent of the claim or less), it is necessary to hold on to all of the claims and not pay out on any of them until the ten-year period has expired and any further claims would be statute-barred.
129[2002] 1 WLR 1662. See also H (a Child) v. Merck & Co. Inc. (2001) WL 98168 and the discussion in Miller and Goldberg, above n. 10, para. 17.132.
130SI 1998/3132.