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Comparison: UK v/s India Product Liability Law

Consumers are believed to be the most important component of any economic activity; without them, no economy could exist, and in ancient times, consumers were equated to God. However, as time passed, profit-seeking manufacturers began to abuse consumers in a variety of ways. As the globe transitioned from socialism to capitalism, consumer exploitation began to rise. Concerning this several countries started to make provisions for the protection of consumers and India was not far behind.

Even though there were other provisions under which consumer rights can be safeguarded, consumers cannot readily assert their rights under those regulations. The passage of India's first consumer-oriented law, the Consumer Protection Act 1986, under which independent commissions were established to offer justice to consumers in consumer-related disputes, a separate department was established concerning consumer-related problems, etc. was a big victory for consumers.

Again, a breakthrough was achieved when Consumer Protection Act 2019 was approved, this time with a focus on protection from digital exploitation of customers, and other laws were rewritten to be more consumer-friendly. Similar developments were taking place in the UK with the introduction of the Consumer Protection Act 1987.

This paper attempts to compare product liability law in India from product liability of the UK which was introduced to conform with the product liability directive of the European Union.[1] First, this paper has traced the evolution of Product Liability in India and how the court considered product liability without it being in the Consumer protection act 1986. And then compared the law under different parameters.

Evolution Of Product Liability In India

From the 18th century to the beginning of the 20th century, the principle of "caveat emptor", which means "let the buyer beware," dominated basic consumer law. It is because it was the time where the lifestyle was modest and almost all the products were created locally and any customer who experienced any loss or suffered any damage due to a defective product could immediately approach the true manufacturer, without requiring the participation of courts or any legislators.[2]

Be that as it may, with the progressions in the method of production and utilization, due to the era of the industrial revolution, mechanical advancement in production facilities, among others, has prompted the state to introduce product liability law because of the increase in issues emerging out of defective product items.[3]

Today's competitive and modern market for customers for goods just as service has gone through extreme change with the rise of globally supplied goods, increase in global trade and the increasing emergence of e-commerce businesses have led to varieties of goods and services as well as a new delivery system with choices and opportunities for buyers. Along with these it also made the consumer prone to novel ways of unfair and fraudulent practices and the sale of goods based on misleading data. Therefore, a robust legitimate structure was needed to regulate the manufacturer and service provider and ensure the interests of customers.[4]

India very recently passed Consumer Protection Act, 2019 included a separate chapter for product liability. Before this act, there was no particular provision under any acts or rules in India that governed Product Liability and there was no complete and comprehensive legislation concerning this. Laws related to Product Liability were governed by different acts such as contracts, the Sales of Goods Act, 1930, and under the Consumer Protection Act 1986.[5]

Product Liability In Consumer Protection Act 1986

There was no explicit mention of Product Liability in the Consumer Protection Act 1986[6] but still, the judgements were given while using the concept of Product Liability under this act. In the case of H.S Guruja Rao Vs. Hindustan Motors Ltd. and Ors.[7] where judgement was given by Andhra Pradesh State Consumer Dispute Redressal Commission show the use of the term of Product Liability.

In this case, the complainant purchased the car from the dealer but after some days while the ignition key was applied, the vehicle's engine exploded and thereafter it caught fire. After inspecting the car's engine, it was found out that though it cannot be said conclusively whether the alleged accident was due to some manufacturing defect but it is possible that it was due to some manufacturing defect.[8]

The commission, in this case, referred to some English cases where it was held that in the cases of product liability, it has been established that the purchaser of the products does not have to prove a particular manufacturing defect and can instead rely on circumstantial evidence to infer that the accident was caused by some defect be it an identifiable or indistinguishable defect and that defects often do not become apparent to the purchaser of the product. A flaw may remain latent and unnoticed for months or years until the appropriate set of conditions causes it to appear as a product failure or catastrophe. Hence the court while following the ratio of judgement of English cases ruled in favor of the complainant and the company was held liable.[9]

Also in the case of Ram Nath Mishra Vs. Bharat Krishi Corporation and Ors.[10] it was held by the UP state consumer dispute commission that though there was no provision of a manufacturing defect in CPA 1986, manufacturing defect was still a defect and comes under the definition of defect under section 2(1)(f)[11]. Hence there was no principle of Product Liability in the CPA 1986, still, it was applied in many cases due to the other provision which was very similar to product liability.

Section 84 1(a) and 84 1(b) CPA 2019 mentions that:
A product manufacturer shall be liable in a product liability action, if:
  1. The product contains a manufacturing defect; or
  2. The product is defective in design.

[12] which also comes under the general definition of defect under CPA 1986 which says "defect" means any fault, imperfection or shortcoming in the quality, quantity, potency, purity or standard which is required to be maintained by or under any law for the time being in force or 2 [under any contract, express or implied, or] as is claimed by the trader in any manner whatsoever in relation to any goods."[13] as also confirmed in the case of Ram Nath Mishra Vs. Bharat Krishi Corporation and Ors.

The act of 1986 makes any manufacturer, importer, distributor, or retailer of products accountable for any injury produced entirely or partially as a result of a product failure, defective goods. This shows that though there was no product liability under this act, still manufacturers could be held liable for their acts.

Comparison: Product Liability Law In India V. UK

Product
According to Indian law, product means any article or goods or substance or raw material or any product, that can be any of form be it solid, liquid or gaseous state and that product possess such value that can be supplied as wholly or component in part and is produced for trading or commerce, but the definition excludes human tissues, blood, blood products, and organs.[14]

According to Part 1 of the Consumer Protection Act 1987 of English Law, the definition of product is any good or electricity and other products which are used in another product as a component or raw material or in any other way.[15] But human blood is also included in the definition of product in England Law as identified by the queen's bench in the case of the A and others v. National Blood Authority and another[16]

Person Against Whom Liability May Incur

In the Indian case action under product liability can be asserted against the manufacturer of the products, product service provider or a product seller and it will be decided as per the case on which the liability arises.[17] Action under Product Liability can also arise against the manufacturer even though he shows that he was not careless, negligent or fraudulent in making the claims about the warranty of the product.[18]

Product seller can be held liable if he altered or changed the product or he has substantial control over packaging, manufacturing, designing, etc. He can also be held liable if he does not pass true information regarding the inherent danger involved in using that product while selling them.[19] Section 84, 85, and 86 explain the provision in detail under which manufacturer, product service provider, and product seller can be held liable respectively.

According to English law, liability is primarily attributed to the producer i.e., manufacturer but it also includes the person who "won or abstracted" the product. Similarly, the producer includes the person who processes products but is not the one who manufactured, won, and abstracted. A person who just packs an unprocessed product is not a producer, but if such a person cannot recognize the person who had supplied the product, he would not be excluded from the law.[20]

When Liability Arises
According to section 2 (35) of the act of the product, liability means "the responsibility of a product manufacturer or product seller, of any product or service, to compensate for any harm caused to a consumer by such defective product manufactured or sold or by a deficiency in services relating thereto."[21] In English Law Part 1 of Consumer Protection Act 1987 talks about Product Liability arises when "where any damage is caused wholly or partly by a defect in a product".[22]

Defectiveness
Section 2(10) of Indian law provides a very exhaustive definition of defects as it refers to any flaw, imperfection in the quality, quantity, potency, purity or standard of the product which must conform to by the concerned person under any law at the time being or as is claimed by the person in any manner in relation to any goods or product and the expression "defective" should be interpreted accordingly.[23]

Under Section 3(1) of the English act the product is defective if a product's safety falls short of what people are "generally entitled to expect". "Safety" also includes the risk of death and personal injury and risk of damage to property. Section 3(2) goes on to explain all the circumstances that must be considered while interpreting the meaning of defectiveness in section 3(1), including the way the product was marketed, the purposes for which it was marketed, and the use of warnings or directions; what may reasonably be expected to be done with the product or in connection to it; and the time during which the product was supplied from its manufacturer to another.[24] The term "generally entitled to expect" is a broad definition of defectiveness that can encompass a wide range of defects in various products.

Defenses
According to CPA 2019, a product seller cannot be held accountable if the product was misused, changed, or modified at the time of injury. The Product manufacturer will also not be held liable for failing to provide information about the hazard if it is evident or well known to consumers given the product's qualities.[25] Under the following cases product manufacturer cannot be held liable if he had employed reasonable means in providing proper instruction and warnings about the usage of the product:[26]
  1. if the product is bought by an employer for use at the workplace,
  2. if the product was of such nature which was meant to be used under the supervision of an expert and,
  3. if the complainant was under the influence of alcohol while using the product.

Under English law, the following defenses are provided [27]:
  1. if the defect is due to the compliance of any condition imposed under any act or rules.
  2. The defendant did not supply the product to another
  3. The defect was not in existence at the relevant time

Under section 4(1)(e) it provides the defense of "development risks" in which it is mentioned that the product manufacturer will not be held accountable if it is established that the level of scientific and technological knowledge at the relevant time (i.e. when the product was put on the market) was not such that a manufacturer "could anticipate" to detect the flaw.[28]

This is a very controversial defense as this clause is included irrespective of the Law Commission and Pearson Commission being against it. By including this phrase, a loophole in the compensation cover would be created, through which, accused in different cases may slip. So, it completely depends on the court whether the product was defective or not at the relevant time.[29]

In the case of Abouzaid v. Mothercare Ltd.[30], wherein 1990, the child's eye was damaged due to a defect in the Coseytoes' strap, and in a judgement issued in 2000, the court stated that while the manufacturer could not have foreseen or detected the damage that could be caused by the defect in 1990, it was still the defect, and thus the manufacturer was held liable.[31] The judgement was made also owing to the broader inclusivity of the term "safety that people generally are entitled to expect".

Conclusion
In this paper at the outset, I have traced the evolution of the product liability doctrine in the Indian context subsequently I canvassed through the landscape of the jurisprudence with regard to the product liability laws that developed in India through the course of judgements handed down by the courts. Then I juxtaposed the position of the product liability doctrine in India and England after which I underscored the similarity and the differences in the doctrinal position in India and England.

After comparison, I suggest that India should reconfigure its definition of product liability in keeping with the definition in England effectively widening the ambit of the law. This can be more consumer-oriented as it will allow to include a wide spectrum of cases of consumer exploitation concerning defectiveness.

Bibliography
Journal Article
  • Kathleen Cardwell, 'The Consumer Protection Act 1987' (1987) 50 Modern Law Review 614-638.
Website
  • Anindya Ghosh and Nabarun Chandra Ray, 'India: Product Liability Law in India: An Evolution' (INDUSLAW, 07 August 2020) < https://www.mondaq.com/india/dodd-frank-consumer-protection-act/974270/product-liability-law-in-india-an-evolution>
Table Of Authorities
Legislations
  • Consumer Protection Act, 1986
  • Consumer Protection Act, 2019
  • Consumer Protection Act, 1987 (UK)
Cases
  • H.S Guruja Rao Vs. Hindustan Motors Ltd. and Ors.
  • Ram Nath Mishra Vs. Bharat Krishi Corporation and Ors.
  • Abouzaid v. Mothercare Ltd.
  • A and others v. National Blood Authority and another
Citations:
  1. Consumer Protection Act 1987 (CPA 1987), s 1.
  2. Anindya Ghosh and Nabarun Chandra Ray, 'India: Product Liability Law in India: An Evolution' (INDUSLAW, 07 August 2020) < https://www.mondaq.com/india/dodd-frank-consumer-protection-act/974270/product-liability-law-in-india-an-evolution> accessed 9 December 2021.
  3. n 2.
  4. ibid.
  5. ibid.
  6. Consumer Protection Act 1986 (CPA 1986).
  7. MANU/SA/0040/1997
  8. ibid, para 1.
  9. ibid, para 22,23,24
  10. MANU/RG/0008/2016
  11. ibid.
  12. CPA 2019, s 84.
  13. CPA 1986, s 2(f)
  14. CPA 2019, s 2(33)
  15. CPA 1987, s 2(c)
  16. [2001] 3 All ER 289
  17. CPA 2019, s 83.
  18. CPA 2019, s 84(2)
  19. CPA 2019, s 85(c)
  20. Kathleen Cardwell, 'The Consumer Protection Act 1987' (1987) 50 Modern Law Review 614-638.
  21. CPA 2019, s 2(35)
  22. CPA 1987, s 2(1)
  23. CPA 2019, s 2(10).
  24. n 20.
  25. CPA 2019, s 87.
  26. ibid.
  27. CPA 1987, s 4(1).
  28. CPA 1987, s 4(1)(e).
  29. n 20.
  30. [2000] AII ER (D) 2436
  31. ibid.

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