Litigationi Forum and jurisdiction
Under the European regime, a manufacturer, supplier or importer can be sued in England and Wales in any of the following circumstances:
- if the contract for the supply of the product in question contains a choice of jurisdiction clause conferring jurisdiction upon the courts of England and Wales;
- if the defendant is domiciled in England and Wales;
- if the place of performance of a contractual obligation is England and Wales;
- if a tortious act causes loss or damage in England and Wales; and
- if there are multiple defendants and the claims are closely connected, the claimant can bring proceedings in the place where any one of the defendants is domiciled.
The common law applies to cases that fall outside the European regime. Where the defendant is physically present in England and Wales, proceedings may be served on him or her regardless of whether the claim has any connection with the jurisdiction. If a claimant wishes to serve proceedings on a defendant outside the jurisdiction it is necessary to seek the permission of the court.ii Burden of proof
The burden of proof rests with the claimant. In most cases, the civil standard is applied. This means that the claimant must prove its case on the balance of probabilities. Where a party makes allegations of deliberate wrongdoing, a raised civil standard may be applied. This is based upon the notion that a party is:
entitled to be protected against … a serious allegation by evidence of greater weight or by a higher standard of proof than would otherwise be required in an ordinary civil case.iii DefencesLimitation
Limitation varies depending on the type of claim:
- in contract, limitation expires six years after the breach of the contract. In the context of product liability, this is commonly the date of supply;
- in tort claims in general, limitation expires six years after the date of damage;
- in tort claims specifically relating to personal injury or death, limitation expires three years after the date of damage or the date of the victim's knowledge of the damage. This is subject to a 15-year longstop;
- under the CPA, limitation expires three years after the date on which the claimant became aware, or should reasonably have become aware, of the damage, the defect and the identity of the producer. This is subject to a 10-year longstop. There is scope for divergence between the CPA and Product Liability Directive on this front; the former calculates the longstop from the time when the producer or importer 'supplied the product to another', whereas the latter calculates the longstop from 'the date on which the producer put into circulation the actual product which caused the damage'; and
- in claims for contribution, limitation expires two years from the date that the claimant is held liable for that damage by way of a court judgment, an arbitral award or a settlement.
A user's own negligent conduct or misuse of the product may provide a defence to liability in tort, in contract (where there is a parallel liability in tort) and under the CPA. The user's negligence may be so serious as to break the chain of causation between the wrongdoing and the damage, in which case the manufacturer will face no liability. In less serious cases the user's claim will be reduced in proportion to his or her own negligent contribution to the injury or damage.State of the art
No negligence attaches to a product that is designed, manufactured and sold in accordance with current scientific knowledge.
A specific state of the art defence is available under the CPA. Its application has been considered in various cases including Gee, where the court focused on the reasonable beliefs of the producers and orthopaedic surgeons involved at the time rather than facts that became known in hindsight.
A state of the art defence will not assist in defending a claim for breach of the requirement that a product is fit for purpose, but it is likely to be helpful in defending allegations of unsatisfactory quality.Sophisticated user or learned intermediary
To decide whether a product is defective, courts take into consideration all the relevant circumstances including the way in which the product has been marketed, and any instructions or warnings that come with the product.
The learned intermediary defence applies where the manufacturer supplies the necessary information about its product to an expert intermediary, such as an architect or doctor, who then deals directly with the end consumer. The rationale is that, where the learned intermediary fails to pass on any instructions or warnings regarding the product, it is the intermediary (and not the manufacturer) that should face liability for loss.
The 'learned intermediary' is a defence in tort. It is not strictly a defence under the CPA, but it is one of the factors to be taken into account in deciding whether a product is defective.Regulatory compliance
No negligence is likely to attach to a product if the design, manufacture and sale comply with all applicable regulations. Regulatory compliance is not an automatic defence under the CPA, although it will be taken into account as an indication that the level of safety of the product was as persons generally were entitled to expect. Upon proof of regulatory compliance, it is generally for the claimant to persuade a court that the product was unsafe.Miscellaneous defences under the CPA
There are a number of additional defences available under the CPA:
- the defect in the product is attributable to compliance with a requirement imposed by or under UK and EU law;
- the defendant did not supply the product to another person;
- the defendant supplied the product outside the course of its business and without a view to profit;
- the defect did not exist at the time of the supply of the product. For example, if the product developed the defect as a result of being handled, transported or stored incorrectly;
- the product was part of another defective product, and the defect arose in that other product. This defence does not apply if the manufacturer of the component was involved in the design of the final product, or if the component was partly responsible for the defect in the final product; and
- the claimant was engaged in illegal activity when the loss was suffered.
The Civil Procedure Rules permit parties to a dispute to appoint either a single joint expert or their own individual experts. In most cases, parties opt to have their own experts unless the court orders otherwise. The participation of expert witnesses is governed by Part 35 of the Civil Procedure Rules (CPR). The key points are as follows:
- the parties must obtain the court's permission to rely on an expert from a particular discipline. That expert's evidence must be 'reasonably required to resolve the proceedings' and the instructing party must provide an estimated cost of obtaining the evidence;
- each expert's duty is to the court, not to the instructing party;
- each expert must provide its evidence by way of written report addressed to the court, unless otherwise specified. That report must be compliant with the form and content requirements set out in CPR Part 35 and the accompanying Practice Direction;
- each party then has the right to put questions to the expert to clarify any conclusions; and
- the court can direct the parties' experts to meet to discuss the issues in the proceedings and prepare a statement of points on which they agree and disagree.
Although expert evidence provides helpful guidance for the court, it should be approached with care. In Gee, for example, the court was required to consider expert evidence in the fields of biostatistics and epidemiology. It did so carefully, noting that 'some aspects' of the evidence were 'less satisfactory than others'.v Discovery or disclosure
There are two stages to the discovery of documents, which in England and Wales is called 'disclosure'. The first is pre-action disclosure in accordance with the Pre-Action Protocols of the CPR; the second is following the commencement of proceedings. The purpose of pre-action disclosure is to encourage the parties to disclose the documents that support their case, support the efficient management of proceedings and allow the parties to:
- understand each other's positions;
- make decisions about how to proceed;
- try to settle issues without proceedings;
- consider engaging in Alternative Dispute Resolution (ADR) to assist with settlement; and
- reduce the costs of resolving the dispute.
Once proceedings have commenced, the discovery obligations become more onerous. Each party is required to disclose to the other the existence of:
- the documents on which he or she relies;
- the documents that adversely affect his or her own case; and
- the documents that support another party's case.
Product liability cases often involve very extensive design documents and production records, which can run to thousands of documents. This can become strategically relevant – for example, when deciding on the best timing for settlement offers.vi Apportionment and contribution
Under the Contribution (Civil Liability) Act 1978, a party can seek contribution from another party where that other party is responsible for the same harm. In the product liability context, a right of contribution frequently arises in the context of multi-party supply chains, or where a learned intermediary is involved in the chain of supply. In those cases, in deciding the appropriate apportionment of liability, the court will consider the relative blameworthiness and causative potency of each defendant's conduct.vii Mass tort actions
There is no class action procedure. The closest concept is that of the Group Litigation Order (GLO). A GLO is an order that allows a number of different claims, which give rise to related issues, to be managed collectively. A GLO is not a separate cause of action. It is a procedural tool to help courts manage multiple cases efficiently. GLOs are rarely used: since they were introduced in 2000 only 105 have been issued.viii Damages
There are four types of damages that can be awarded in England and Wales:
- general damages;
- special damages;
- punitive damages; and
- exemplary damages.
Punitive and exemplary damages are rarely awarded because the general approach is that damages are compensatory. The courts draw a distinction between losses arising from property damage or personal injury (consequential losses) and those that do not (pure economic losses, such as loss of profit). The recoverability of these types of loss is dependent on the cause of action.Contract
Damages in contract are awarded on the basis of expectation – to put the claimant in the position it would have been if the contract had been performed as expected. This is subject to the rules on the remoteness of damage, which limit the scope of recovery to losses:
- that arise naturally from the breach; or
- whose existence in the event of breach should have been within the reasonable contemplation of the parties when the contract was made.
If they meet the test for remoteness, damages for the following losses are recoverable: personal injury, property damage, pure economic loss and loss of enjoyment (in limited cases). However, the recoverability of damages can be excluded or limited by the express terms of the agreement between the parties.Negligence
Damages in negligence are awarded with a view to restoring the victim of negligence to their former position had the negligence not occurred. Damages for property damage and personal injury are most routinely awarded in negligence. Damages for pure economic losses are generally not recoverable unless a special relationship has arisen between the parties. This is rare, but occurs where the defendant has used its expertise to give advice and:
- the advice was required for a specific purpose of which the defendant was aware;
- the defendant knew that the claimant was likely to act on the defendant's advice for that purpose; and
- the claimant reasonably did so to his or her detriment.
The recoverability of losses also depends on the losses being reasonably foreseeable.Deceit and misrepresentation
Damages in deceit are recoverable for property damage, personal injury and pure economic loss. The rules of remoteness, however, differ from those in negligence. In relation to deceit, the defendant will be liable for all losses that flow directly from the deceit – whether they are foreseeable or not. This means that, where losses have been exacerbated by an unforeseen event, they will still be recoverable from the defendant. This is, however, subject to the claimant's duty to mitigate its potential losses.Consumer Protection Act
Damages under the CPA, as in tort, are intended to restore the injured party to the position had the product not been defective. There is no provision for the award of punitive damages. Damages for personal injury and property damage are recoverable only where the loss exceeds £275. The following are not recoverable:
- pure economic losses (this includes damage to the defective product itself);
- where the product is a component of a bigger product, damage to the greater product; and
- damage to business property.
It is thought that the test of reasonable foreseeability would apply to the remoteness of loss under the CPA.