It's first important to note that products liability describes a type of claim, not a separate theory of liability. Products liability has strong emotional overtones— ranging from the pro-litigation position of consumer advocates to the conservative perspective of the manufacturers.
The theory of caveat emptor - let the buyer beware - that pretty much governed consumer law from the early eighteenth century until the early twentieth century made some sense at the time.
A horse-drawn buggy is a fairly simple device: Its workings are apparent; a person of average experience in the 1870s would know whether it was constructed well and made of the proper woods. Most foodstuffs 150 years ago were grown at home and “put up” in the home kitchen or bought in bulk from a local grocer, subject to inspection and sampling; people made home remedies for coughs and colds and made many of their own clothes. Houses and furnishings were built of wood, stone, glass, and plaster— familiar substances. Entertainment was a book or a piano.
The state of technology was such that the things consumed were, for the most part, comprehensible and locally made, which meant that the consumer who suffered damages from a defective product could confront the product’s maker directly. Local reputation is a powerful influence on behavior.
The free enterprise system confers great benefits, and no one can deny that. Modern life comes with a cost, and the fundamental political issue always is "Who has to pay?"
When the true cost of some money-making enterprise (e.g., cigarettes) becomes inescapably apparent, there are two possibilities. First, the legislature can in some way mandate that the manufacturer itself pay the cost; with the meatpacking plants, that would be the imposition of sanitary food-processing standards. Typically, Congress creates an administrative agency and gives the agency some marching orders, and then the agency crafts regulations dictating as many industry-wide reform measures as are politically possible.
Second, the people who incur damages from the product either suffer and die, or access the machinery of the legal system and sue the manufacturer. If plaintiffs win enough lawsuits, the manufacturer’s insurance company raises rates, forcing reform (as with high-powered muscle cars in the 1970s); the business goes bankrupt; or the legislature is pressured to act, either for the consumer or for the manufacturer.
Thus, for all the talk about the need for tort reform, the courts play a vital role in policing the free enterprise system by adjudicating how the true costs of modern consumer culture are allocated.
Obviously, conditions have improved enormously in a century, but one does not have to look very far to find terrible problems today. Consider the following, which occurred in 2009–10:
- In the United States, Toyota recalled 412,000 passenger cars, mostly the Avalon model, for steering problems that reportedly led to three accidents.
- Portable baby recliners that are supposed to help fussy babies sleep better were recalled after the death of an infant. The Consumer Product Safety Commission announced the recall of 30,000 Nap Nanny recliners made by Baby Matters of Berwyn, Pennsylvania.
- More than 70,000 children and teens go to the emergency room each year for injuries and complications from medical devices. Contact lenses are the leading culprit, the first detailed national estimate suggests.
- Smith and Noble recalled 1.3 million Roman shades and roller shades after a child was nearly strangled. The Consumer Product Safety Commission reported a five-year-old boy in Tacoma, Washington was entangled in the cord of a roller shade in May 2009.
- The Consumer Product Safety Commission reported that 4,521 people were killed in the United States in consumer-product-related incidences in 2009, and millions of people visited hospital emergency rooms from consumer-product-related injuries.
- Reports about the possibility that cell phone use causes brain cancer continue to be hotly debated. Critics suggest that the studies minimizing the risk were paid for by cell-phone manufacturers.
Products liability can thus be a life-or-death matter from the manufacturer’s perspective.
Here, we examine the legal theories that underlie products-liability cases that developed rapidly in the twentieth century to address the problems of product-caused damages and injuries in an industrial society.
In the typical products-liability case, three legal theories are asserted—a contract theory and two tort theories. The contract theory is warranty, governed by the UCC, and the two tort theories are negligence and strict products liability, governed by the common law.
Source: This content has been adapted from Lumen Learning's "Products-Liability Law" tutorial.