Spanish product liability today – adapting to the ‘new’ rules

or LRPD))2 only obiter dicta, as a sort of reminder of its existence. They dealt with facts that had taken place before the new regulation implementing the Product Liability Directive was applicable and, therefore, they applied the rules of the General Act for the Protection of Consumers and Users (Ley general para la defensa de consumidores y usuarios (hereafter, Consumer Protection Act or LGDCU)),3 an Act which had governed product liability in Spain since 1984.4

Errors and omissions excepted, STS 21.2.2003 (RJ 2003\2133) was the first judgment where the Supreme Court applied the Product Liability Act implementing the Directive. In this case, a bottle of white lemonade exploded while the claimant was putting it into his shopping basket in the supermarket. The splinters of glass injured both his face and one eye, and caused him the partial loss of sight in his left eye. The victim filed a claim against the soft-drink and the bottling companies seeking a damages award of 36,520,000 Pta (approx. €220,000). The Court of First Instance decided in favour of the claimant, but awarded the substantially lesser sum of 7,720,000 Pta (approx. €46,000), and this judgment was confirmed by the Court of Appeal and, finally, by the Supreme Court.5

Whereas decisions of the Supreme Court have been scarce so far, there has been an ever-growing body of judgments of the Courts of First Instance and Courts of Appeal – increasing dramatically from 2001 to 2003 – that have been applying the Product Liability Act.

In this paper I am going to analyse the application of the Product Liability Act by the Spanish Courts of Appeal. The decisions of these courts show a knowledge of the Act that is still somewhat superficial, and this frequently gives rise to decisions that are often ambiguous or equivocal, sometimes doubtful, and, occasionally, even blatantly wrong. Some misunderstandings of key concepts of the Product Liability Act result from the fact that judges seem to have put the rules of the Product Liability Act ‘on top’, so to speak, of the knowledge that they already had of the rules dealing with product liability in the 1984 Consumer

2Ley 22/1994, de 6 de julio, de responsabilidad civil por los da˜nos causados por productos defectuosos (BOE n◦ 161, 7.7.1994).

3Ley 26/1984, de 19 de julio, general para la defensa de los consumidores y usuarios (BOE n◦ 176, 24.7.1984).

4So, for instance, among many others, SSTS 28.12.1998 [RJ 1998\10161]; 9.3.1999 [RJ 1999\1368] or Auto TS 20.7.1999 [RJ 1999\5055].

5For a comment on this decision see Miquel Mart´ın Casals and Josep Sole´ Feliu, ‘Aplicacion´ de la Ley de responsabilidad por productos defectuosos: la explosion´ de una botella y el defecto de fabricacion’,´ in Diario La Ley, 20. junio 2003, p. 1 et seq.

Protection Act. In these cases, the courts have not always been aware of the relationship between the new Act and the old one or, even, of the relationship between the new Act and the general tort and contract law rules. Inconsistencies or misleading interpretations have also arisen from the fact that courts have tried to make a construction of the Product Liability Act which is consistent and coherent with general principles of Spanish law, but which might run counter to a proper interpretation of the product liability provisions implementing the Directive.

Consumer Protection Act or Product Liability Act: which rules apply?

It is well known that the Spanish Product Liability Act implementing the Directive came into force on 8 July 1994 and that one of the first things the implementing Act had to resolve was its compatibility with the 1984 Consumer Protection Act.

The Consumer Protection Act had been poorly drafted in the wake of the colza or rape oil case, which caused the intoxication of over 15,000 persons, and whose eventual result was 300 deaths and several thousand severely impaired victims.6 This Act referred both to defective products and services and provided for two liability regimes: (1) a fault regime, with a rebuttable presumption of fault (Art. 26 LGDCU) and (2) a strict liability regime for products and services that met certain general conditions (of purity, efficiency or security, undergoing technical, professional or systematic control, etc.), or that had been enumerated in the Act (for instance, food products, cleaning products, medicines, healthcare services, gas and electricity services, electrical appliances, means of transport, motor vehicles, toys and other products targeting children) (Art. 28 LGDCU).7

When the implementation of the Product Liability Directive was under analysis, some legal scholars and the Ministry of Health and Consumption contended that it was a minimum Directive and that Art. 13 Directive permitted the preservation of the Spanish product liability regulation in

6The case has been dealt with in the decisions SAN 20.5.1989, STS 23.4.1992 [RJ 1992\6783] and STS 2a 26.9.1997 [RJ 1997\6366] and has given rise to a damages award of over 500 billion Pta (approx €3 billion).

7See Rodrigo Bercovitz Rodriguez Cano, in Rodrigo Bercovitz and Javier Salas, Comentarios a la Ley general para la defensa de los consumidores y usuarios (Madrid: Civitas, 1992), Com. Art. 28, p. 715.

force, since it was deemed to be more protective and was ‘pre-existent’ to the notification of the Directive. However, this position was rejected by the Ministry of Justice, which prepared the draft of the Act finally passed by Parliament. This Act now in force states: (1) ‘This Act shall not apply to those products that have been put into circulation before the Act came into effect, which shall be governed by the provisions in force at the time’ (Sole Transitional Provision LRPD) and (2) ‘Arts. 25 to 28 of the Consumer Protection Act shall not be applicable to civil liability resulting from damage caused by defective products included in Article 2 of this Act’ (First Final Provision LRPD).

According to the interpretation which some Spanish scholars thought correct,8 the Product Liability Directive is not, as a matter of fact, a minimum Directive and the provisions of the Consumer Protection Act can apply solely to products put into circulation before 8 July 1994, i.e. the date on which the Product Liability Act came into force, or to damage caused by defective immovables and services, irrespective of the date on which they were made or rendered, i.e. to other situations not coming within the scope of the Product Liability Act.

However, the Court of First Instance no. 5 of Oviedo, dealing with the case of a claimant who had received a blood transfusion in an institution operated by the defendant, Medicina Asturiana, in the course of which she was allegedly infected with the hepatitis C virus, entertained some doubts about the relationship between the old Consumer Protection Act and the new Product Liability Act. In this case, the claimant had sought compensation from the defendant for the damage suffered according, inter alia, to Arts. 25 to 28 of the Consumer Protection Act, which offered more extensive rights than those which the victims of damage may rely on under the Product Liability Act. Medicina Asturiana had challenged the applicability of those articles of the Consumer Protection Act in the light of the already mentioned First Final Provision of the Product Liability Act and, so, the Court of First Instance requested a preliminary ruling on the proper interpretation of Art. 13 of the Product Liability Directive. This article provides that this Directive ‘shall not affect any rights which an injured person may have according to the rules of the law of contractual or non-contractual liability or a special liability system existing at the moment when this Directive is notified’.

8In this sense see, inter alia, Jimenez´ Liebana,´ Responsabilidad civil, p. 498 and Mart´ın Casals and Sole´ Feliu, ‘Responsabilidad por productos en Espana’,˜ pp. 4–6.

On 25 April 2002, the European Court of Justice, in deciding this case (Mar´ıa Victoria Gonz´alez S´anchez v Medicina Asturiana), as well as in two other judgments issued on the very same day, confirmed that the Product Liability Directive is not a minimum Directive.9 In the case at stake, it held:

[N]or can Article 153 EC . . . be relied on in order to justify interpreting the directive as seeking a minimum harmonisation of the laws of the Member States which could not preclude one of them from retaining or adopting protective measures stricter than the Community measures . . . the margin of discretion available to the Member States in order to make provision for product liability is entirely determined by the Directive itself and must be inferred from its wording, purpose and structure . . . [I]t is important to note that unlike, for example, Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts (OJ 1993 L 95, p. 29), the Directive contains no provision expressly authorising the Member States to adopt or to maintain more stringent provisions in matters in respect of which it makes provision, in order to secure a higher level of consumer protection.10

Moreover, it added that:

Although Articles 15(1)(a) and (b) and 16 of the Directive permit the Member States to depart from the rules laid down therein, the possibility of derogation applies only in regard to the matters exhaustively specified and it is narrowly defined. Moreover, it is subject inter alia to conditions as to assessment with a view to further harmonisation, to which the penultimate recital in the preamble expressly refers. In those circumstances Article 13 of the Directive cannot be interpreted as giving the Member States the possibility of maintaining a general system of product liability different from that provided for in the Directive.11

However, this impossibility of maintaining a general system of product liability different from the one resulting from the implementation of the

9On this and other decisions of the ECJ on product liability, see Luis Gonzalez´ Vaque,´ ‘La Directiva, 85/374/CEE relativa a la responsabilidad por productos defectuosos en la jurisprudencia del TJCE: de los riesgos del desarrollo a la franquicia de 500 euros’, Enero 2003, Union´ Europea Aranzadi: 5–17.

10See Judgment of the Court (Fifth Chamber) of 25 April 2002. Mar´ıa Victoria Gonz´alez S´anchez v Medicina Asturiana SA. Reference for a preliminary ruling: Juzgado de Primera Instancia e Instruccion´ n◦ 5 de Oviedo – Spain. Approximation of laws – Directive 85/374/EEC – Product liability – Relationship with other systems of liability. Case C– 183/00. European Court reports 2002, p. 1–03901, paras. 24–7.

11Ibid., paragraphs 29–30.

Directive, even after this and other judgments of the European Court of Justice had been issued, was still not clear to some Courts of Appeal. So, for instance:

The Court of Appeal of the Balearic Islands, in a decision issued in July 2002 (SAP Baleares 15.7.2002 [JUR 2002\245264]) (i.e. almost three months after the judgment of the European Court of Justice was issued), holds the supplier of a defective component part of a toilet strictly liable pursuant to the old Consumer Protection Act, arguing that this Act is still applicable to products in accordance with the compatibility with the domestic provision dealing with contract and tort liability provided by Art. 13 Directive.

In a similar way, the Court of Appeal of Cordoba, in a decision issued in June 2002 (SAP Cordoba´ 19.6.2002) (i.e. also after the judgment of the European Court of Justice), considers that a discussion of which rules apply is ‘a trivial matter’, holds the defendant liable for the damage caused, and declares that the defendant must be compensated for the property damage caused by a power surge which is assessed at an amount of €105.18 ‘no matter which rules are applied’. Furthermore, it is worth noting that this amount is well below the threshold established by the LRPD.

Sometimes decisions do not even bother to consider which rules apply. In SAP Segovia 31.7.2002 (AC 2002\1233), dealing with personal injuries suffered by the victim who drank, in a bar, a liquid from a bottle which was labelled ‘grape juice’, but which in fact contained a caustic liquid, the court held the manufacturer, its insurer and the owner of the bar jointly and severally liable according to Art. 28 LGDCU. Although the decision does not refer to the moment when the bottle was put into circulation, it is very unlikely that this happened before the Product Liability Act came into force, i.e. before 8 July 1994.

Alongside these decisions, the decisions that take into account the First Final provision of the LRPD and correct the wrong allegation of the parties with regard to the applicable rules are becoming more and more frequent (for instance, SAP Sevilla 5.3.2002 [JUR 2002\205647], SAP La Coruna˜ 21.6.2002 [AC 2002\1348] or SAP Vizcaya 9.2.2002 [AC 2002\104]). However, with regard to the applicable norms some fine-tuning is still very necessary: so, for instance, by contrast to what SAP Vizcaya 9.2.2002 [AC 2002\104] states, the moment when a defective airbag is put into circulation is not related ‘to the moment when the permit allowing the car to circulate was issued’.