An important message to importers, manufacturers,
retailers and consumers about product liability.
The product
liability provisions of the Trade Practices Act allow
persons who suffer injury or loss as the result of a defective
product to take legal action for compensation against the
supplier
of that product. These provisions apply to goods supplied
after 9 July 1992.
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When
is a product defective?
A product is defective
if it does not provide the level of safety which the
community
generally is entitled to expect. The level of safety
will
vary from case to case and it is ultimately for the
court to determine whether a product is defective.
However,
there are a number of factors the court will take into
account
when making its determination, including:
- the manner in which and the purposes for which the product
has been marketed;
- the packaging of the product;
- the use of any mark in relation to the product;
- instructions for or warnings with respect to doing or refraining
from doing anything with or in relation to the product;
- what might reasonably be expected to be done with the product;
and
- the time when the product was supplied.
Products which are older and subject to more use would not necessarily
be expected to be as safe as brand new ones. Similarly, products
would not necessarily be defective simply because the safety of
later models had been improved.
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Who may be liable for supplying a defective
product? Generally speaking the product liability provisions
of the TPA will apply to a company that:
- manufactured the product; or
- imported the product; or
- sold 'own brand' goods manufactured for it under licence.
Also, in some circumstances the retailer may be deemed to be the
manufacturer of the product and hence liable.
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Who can bring an action for compensation?
What
type of loss may be compensated? The TPA allows anyone to
claim for personal injury or damage to private property (including
land or buildings)
arising as a result of the defect in the product. Dependants of a
person injured or killed by a defect in goods can also claim for
the losses
they suffer as a result. Damage to commercial property is not covered
nor is any loss arising from a business relationship, such as loss
of profits. The TPA also excludes losses in respect of which a claim
might be made for workers compensation and losses regulated by international
agreements.
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Time
limits for bringing a product liability action
A person has three
years to
bring an action from the time he or she becomes aware (or ought
reasonably to have become aware) of the loss, the defect and
the identity of
the manufacturer. Also, any action must be commenced within ten
years of
the time the defective goods were supplied by the manufacturer.
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In some cases the manufacturer
may not be liable for the defective product
A range
of statutory defences
are
provided to a manufacturer in respect of a product liability
action. The defences are available where:
- The defect in the product was not the manufacturer's fault;
- The product was a component part comprised in a finished
product and the defect is attributable only to the design of
the finished goods or the packaging, instructions or warnings
included in those finished goods. In this case the manufacturer
of the finished goods will be liable and not the component
maker;
- The defect that arises could not have been discovered at
the time the manufacturer supplied the goods because there
was insufficient scientific or technical knowledge at that
time; or
- Compliance with a mandatory Commonwealth or State standard
was the sole cause of the defect.
It should also be noted that where an injured person's acts or
omissions contribute to the loss the court can reduce the amount
of compensation payable to whatever extent is appropriate. This
may be to nil in some cases.
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What can a manufacturer or importer do to
reduce the risk of action?
Minimising the risk of action under
the product liability provisions generally requires no more of
manufacturers,
importers and retailers than responsible business practice. A culture
of safety is an important attribute of any responsible organisation
which should include an awareness of the firm's product in the
hands of the consumer. Prudent firms review design, production,
record
keeping and marketing procedures as well as customer information
material to ensure the safety of their products with consumers.
Particular attention should also be paid to quality assurance systems.
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What is the ACCC's role in relation to the product liability provisions of the TPA?
While the TPA provides rights which people will generally pursue through the courts for themselves, in some instances, the ACCC can take representative action on behalf of one or more people who have suffered harm from a defective product. This is intended to improve access to the law and will allow the ACCC to act where goods have (or may) cause widespread detriment. An important role of the ACCC is also to inform businesses and consumers about their rights and obligations in respect of the product liability provisions of the TPA.
FIND OUT TODAY WHAT YOUR DEFECTIVE PRODUCT
LEGAL RIGHTS ARE, GET THE LEGAL ADVICE YOU & YOUR FAMILY DESERVE!
YOU may be entitled to gain financial compensation.
Click here to contact
a product liability lawyer in your area
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