EXECUTIVE SUMMARY
Product liability is a growing interest in almost all parts of the world. The doors of justice are opened to innocent and helpless consumers who can ask manufacturers of products to compensate them for damages incurred after using their products. The burden of liability is placed upon manufacturers and producers who could not use any defense to exculpate themselves from strict liability law.
There are two principles that form the foundations on product liability, namely, strict liability, and negligence.
Thus, manufacturers are bound to make a wise estimate of how much damage it may be liable in the future should any case be filed against it on product liability. In effect, any manufacturer should ensure that the “good” of the product outweighs the “harm” that it may cause to any consumer if such product is put in the market. This is the social responsibility of manufacturers and a safeguard to consumers. Never mind if the cost is passed on to the consumers as may be incorporated in the cost of the product for as long as there is an assurance that in any future eventuality, the manufacturer would be able to answer to the liability and pay the cost of damage.
Punitive damages that may be awarded on top of the actual damages incurred would be up to the courts of justice to determine. The reason behind the grant is to deter similar cases in the future. Putting a cap on punitive damages is depriving a plaintiff his day in court while it also limits the authority that our laws have vested in the courts of justice. Any law to that effect is simply negating an individual’s right to be fully recompensed for any damage that may be incurred due on product liability cases. Thus, as in other cases on torts and delicts, it is best left to the courts of justice to establish the punitive damage that may be imposed against manufacturers whose product caused damage to any of its consumers.
Should Punitive Damages In Products Liability Cases Be Capped
The history of product liability law dates back to the 1800’s when one Englishman, Mr. Winterbottom filed a case against the manufacturer of a mail coach due to poor construction. Mr. Winterbottom, who was the driver of the mail coach of the Postmaster General, was seriously injured when the mail coach collapsed. The theory advanced at that time was to limit the liability to persons with privity of contracts. Mr. Winterbottom was not privy to the contract of purchase between the Postmaster General and the manufacturer of the mail coach. Thereby, the case was dismissed.
As the manufacturing industry advanced, quality control of the products being produced by manufacturers has become a subject of interest to many sectors of society. The concern naturally required the governments to enact laws which would ensure protection of consumers. However, while many laws could be enacted to ensure full protection of the consuming markets, compliance to these laws would also remain a question. Thus, it has been inevitable that cases on product liability piled up in the courts of justice in all countries of the world. The difference, though, is that where before the “little and helpless” consumers would have a difficult time to raise their concerns and seek redress; in these times where awareness on product liability has been brought to the fore, manufacturers with big pockets are made to compensate consumers for damages incurred.
There is no question that manufacturers should be made liable to pay for damages that any of their products may have caused on the consuming public. The law on strict liability has become the basis on findings of the court as it decides on how much liability any manufacturer is to shoulder and pay to the consumer in a particular case. Strict liability law stresses the liability on the product in contrast to the principle of negligence which places the responsibility on some acts of the manufacturer.
In the case of Greenman v Yuba Power Products, Inc. the California Supreme Court assigned strict liability to a manufacturer,
“…….. who placed on the market a defective product even though both privity of contract and notice of breach of warranty were lacking. The court rejected both contract and warranty theories, express or implied, as the basis for liability. Strict liability does not rest on a consensual foundation but, rather, on one created by law. The liability was created judicially because of the economic and social need for the protection of consumers in an increasingly complex and mechanized society, and because of the limitations in the negligence and warranty remedies. The court’s avowed purpose was “to insure that the costs of injuries resulting from defective products are borne by the manufacturer that put such products on the market rather than by the injured persons who are powerless to protect themselves.” (Greenman v. Yuba Power Products, Inc. [1963] 59 Cal.2d 57 [13 A.L.R.3d 1049].
Negligence, on the other hand, places upon the plaintiff to prove that the manufacturer acted or failed to act on something which resulted to the damage caused by the product. While the manufacturer, in such case, would still be held liable to compensate for damage incurred by the consumer, the amount and degree of liability would be abated based on the extent of defense that the manufacturer could successfully bring forth to the court in the instant case. Thus, following this line of reasoning, there is a risk that the plaintiff may not be fully recompensed for the damage incurred. In fact, there is a chance that the cause of the plaintiff may be denied.
“The most objectionable aspects of asbestos litigation can be briefly summarized: dockets in both federal and state courts continue to grow; long delays are routine; trials are too long; the same issues are litigated over and over; transaction costs exceed the victims’ recovery by nearly two to one; exhaustion of assets threatens and distorts the process; and future claimants may lose altogether.” Report of The Judicial Conference Ad Hoc Committee on Asbestos Litigation 2-3 (Mar. 1991).
In recent cases, products liability claims are based not on negligence, but rather on strict liability. In the hands of good and responsible people, this development is for the benefit of the greater number of society – the consumers and the market. The burden of proving liability is no longer solely borne by the plaintiff. Proof of liability is much easier to raise and bring to the appreciation of the courts. Thus, more and more plaintiffs have been fully compensated.
Punitive damages which are awarded on top of actual damages create a different bearing in the case. Its main purpose is to deter others similarly situated to create unconscionable and similar acts in the future. The objective is to impress upon the mind of the defendant and to the whole world that such and similar acts would not be tolerated by society in general. Thus, in most cases, punitive damages are almost always very high.
As in tort cases, the laws of the land have placed upon our courts of justice the authority to determine the amount of punitive damages that may be rightfully granted in a particular case. Putting a cap to punitive damages would be limiting the authority of our courts of justice to act for and in behalf of the greater number for the greater good. Unconscionable punitive damages that are awarded and which are unacceptable to some parties could be raised to proper legal authorities through proper legal course of action.
Putting a cap to punitive damages that may be granted on product liability cases is limiting the right of a plaintiff to seek redress of grievances and damages incurred when and where proper. Both plaintiff and defendant have the opportunities to be heard in court and almost always, manufacturers have the best chances to protect their interests with the extent of their capability to litigate and pursue their rights.
Putting a cap to punitive damages is not the solution to exculpate manufacturers from liabilities. Preventive measures and full quality control of their goods from manufacture to market delivery should be enhanced and made the order of the day. Shifting responsibilities from the manufacturer to the consumer is something that is not fair and something that would work to the disadvantage of the consuming public in the long run.
Putting a cap on punitive damages to product liability could be interpreted as putting a limit to how much a consumer could be compensated for incurring damage. This is somehow dangerous and risky as no manufacturer could foresee the extent of damage that their products may cause upon an individual. Putting a cap to punitive damages simply works as insurance to consumers that whatever may happen, they are entitled to a certain extent of compensation depending on how they can prove the liability. Again the burden of proof is shifted to the consumer and away from the manufacturer.
“The distinction between products liability and negligence was explained in Jiminez v. Sears, Roebuck & Co. (1971) 4 Cal.3d 379, 383 [52 A.L.R.3d 92]: “It is pointed out that in a products liability case the plaintiff in order to recover in strict liability in tort must prove that he was injured by a defect in the product and that the product was defective when it left the hands of the retailer or manufacturer; whereas to recover in negligence the plaintiff must prove the same two elements plus an additional element, namely, that the defect in the product was due to negligence of the defendant.”
This is a discreet departure from the strict liability law. In the case of Green v. General Petroleum Corp., where an oil well blew out through no fault of the defendant, the court relying on Section 3514 of the Civil Code held that:
“The defendant was nevertheless liable. The case has been generally interpreted as one involving strict liability for damages resulting from an ultrahazardous activity. It is not significant that a property damage, as distinguished from a personal injury, was there involved. The important factor is that certain activities under certain conditions may be so hazardous to the public generally, and of such relative infrequent occurrence, that it may well call for strict liability as the best public policy.” Green v. General Petroleum Corp. (1928) 205 Cal. 328 [60 A.L.R. 475].
Cases on product liability are pretty much similar to tort cases. Tort is a civil wrong which results to an injury or harm giving a person a cause of action to seek redress of the wrong mostly through relief of damages incurred. Sanctions for criminal acts may also be imposed but the injured person would almost always seek for monetary recompense for damages incurred such as loss of earning capacity, pain and suffering, and reasonable medical expenses.
Therefore, like any other tort cases under the civil law where no cap to punitive damages is imposed or established, it is unfair and unconstitutional to place a cap on punitive damages on product liability cases. It is unconstitutional as it impinges on the right of a person to be compensated for damages incurred as granted to him under the civil law.
In an important but split decision, State Farm v. Campbell, the U.S. Supreme Court in April held that “the Due Process Clause [of the 14th amendment] prohibits the imposition of grossly excessive or arbitrary punishments on defendants in tort cases. This was the second High Court ruling in the past few years that rightly objected to steep punitive damage awards.
There are measures which ensure that the courts do not grant unconscionable amounts of damages – actual and punitive. Putting a cap to punitive damages is not the answer for manufacturers to get an assurance and security that they would not be liable to pay for damages that would bring their business down. Well, first and foremost, manufacturers’ concern should be on the safety of its products.
Secondly, being responsible corporate citizens would spell the difference when any manufacturer is faced with the case on product liability. Actual, sincere, and timely concern to a case brought by any plaintiff would ensure that punitive damages that may be awarded would be commensurate to the strategy and action plan that the manufacturer has undertaken to ensure that the plantiff’s concern was addressed responsively and proactive measures are being strategized to prevent any other future occurrence. The burden of proof still rests upon the manufacturer and never on the consumer.
References
- White, Robert Jeffrey. “Top 10 in torts: evolution in the common law.” Trial 32, no. 7 (July 1996): 50-53.
- McMahon&Binchy, Law of Torts, Butterworths 3rd Ed., par. 11.113-114
- Jimenez v. Superior Court (T.M. Cobb Co.), 29 Cal. 4th 473 2002)
- Supreme Court of Ireland Judgment, 3 November 1988.
- Fischer, David A; Green, Michael; Powers, Jr. William; Sanders, Joseph. Fischer, Green, Powers and Sander’s Cases and Materials on Products Liability. 4th, American Casebook series. Copyright 2006.
- Owen, David G; Phillips, Jerry J. Owen and Phillips’ Products Liability in a Nutshell. 7th Edition (Nutshell Series)
- Green v. General Petroleum Corp. (1928) 205 Cal. 328 [60 A.L.R. 475]
- Owens, Phillips. Products Liability. 7th ed., 2005. 13-ISBN: 9780314155108
Format: Paperback-New SKU: - Sumner, L. “Quality Assurance and Product Liability.” Product Liability in Engineering, IEE Colloquium on Volume, Issue 6 Mar 1989. Pages 2/1 to 2/7.
- Greenman v. Yuba Power Products, Inc. (1963) 59 Cal.2d 57 [13 A.L.R.3d 1049].
- Green v. General Petroleum Corp. (1928) 205 Cal. 328 [60 A.L.R. 475].
- Jiminez v. Sears, Roebuck & Co. (1971) 4 Cal.3d 379, 383 [52 A.L.R.3d 92]:
