The Gazette 1986

GAZETTE

MARCH 1986

Certainly the experience of other countries with a strict

liability system for defective products suggests that

negligence notions tend to have a continuing influence.

(1) The Meaning

of "Pr oduc t"

A " p r o d u c t" is defined in Article 2 as including all

movables except "primary agricultural products" and

game, even where the movables are incorporated into

other movables or into immovables. "Primary agricul-

tural products" are defined by the same Article as

meaning " t he products of the soil, of stock-farming and

of fisheries, excluding products which have undergone

initial processing." Electricity is deemed a " p r o d u c t"

for the purpose of the Directive.

This exception relating to "primary agricultural pro-

ducts" is an important one for this country, but the

dividing line between products that have undergone

"initial processing" and those that have not may some-

times be different to draw. As the English and Scottish

Law Commissions have observed:

"even fresh vegetables, which at first sight would seem

to be a good example of unprocessed natural products,

may have been sprayed by chemicals and the land in

which they grew artificially fertilised."

Any Member State may, by way of derogation from

Article 2, provide in its legislation that " p r odu c t s" are

to include primary agricultural products and game.

The general exclusion of immovables should be noted.

In the law of negligence, immovables (or, in ordinary

tort parlance, land) tended to remain outside the scope

of a full duty of care. It is only in recent years that the

exemptions from liability for owners and builders have

gradually been swept away." The Directive will not apply,

for example, to a defective house which collapses, save

to the extent that any movable "incorporated i n t o" the

house is defective. Thus, if a girder installed in a home is

defective and this brings about the collapse, the Direct-

ive may apply. Since most immovables are composed of

movables which are "incorporated i n t o" the whole, this

potential range of application should not be ignored.

But in such cases it would be necessary to show that the

particular movable (or movables) was itself (or were

themselves) defective; in other words, a

defective com-

bination

into an immovable of movables which them-

selves are not defective would not appear to fall within

the scope of the Directive.

Finally, it should be noted that Article 17 provides

that the Directive is not to apply to products (as defined

by Article 2) put into circulation before the date on

which the legislative and administrative provisions nec-

essary to comply with the Directive enter into force. By

virtue of Article 19 (as has already been mentioned)

Member States are required to do this before 30 July 1988.

Who is a "Producer"?

A " p r o d u c e r" is defined by Article 3, para. 1 as one

who is:

(a) the manufacturer of a finished product;

(b) the producer of any raw material;

(d) any person who, by putting his name, trade mark

or other distinguishing feature on the product,

presents himself as its producer.

Moreover, para. 2 of Article 3 provides that a person

who imports into the Community a product for sale,

hire, leasing or any form of distribution in the course of

his business is to be deemed to be a producer within the

meaning of the Directive and is responsible as a pro-

ducer. Finally, where the producer of the product

cannot be identified, each supplier of the product is

treated as its producer unless he informs the injured

person "within a reasonable time" of the identity of the

producer or of the person who supplied him with the

product: Article 3, para. 3. The same rule applies, in the

cases of an imported product, if this product does not

indicate the identity of the importer referred to in Article

3, para. 2, even if the name of the producer is indicated:

Article 3, para. 3.

It is scarecely surprising that manufacturers of finished

products, producers of raw materials and manufacturers

of component parts should be treated as " p r oduc e r s"

for the purposes of the Directive. Nor, on reflection,

should it be a matter of serious debate that those who

present themselves as producers by putting their name,

trade mark or other distinguishing feature on a product

should also be treated as "p r oduc e r s ". This practice is

"particularly common amongst large retail organisations"

and has been part of Irish mercantile life for several

years. It would be curious if, having presented a product

as their own to the public, the retail organisation

should then be allowed to disclaim strict liability on the

basis that really the article was not really "their" product.

It is perhaps worth mentioning the argument, rejected

by the terms of the Article, that strict liability should be

limited to producers of the finished product rather than

extending to the producers of raw materials. The impos-

ition of liability on the latter group does after all

increase the costs of insurance, administration and litig-

ation. Nevertheless, as the Pearson Commission pointed

out

limiting strict liability to producers of the finished

product would be open to a number of objections:

"The main one is that there would be a greater risk

that the injured person would be deprived of a remedy,

for example if the producer of the finished product

proved to be either bankrupt or uninsured. There

might even be a deliberate evasion of liability by

setting up an expendable company as a front for the

real producer; and, even where that was not done,

component producers would often be more substantial

companies than the producer of the finished product,

and to that extent better able to bear the burden of

insurance . . . If strict liability were to be confined to

the producer of the finished product, there might

sometimes be difficulty in distinguishing the finished

product fróm the component, perhaps especially with

respect to natural products".

It is also of interest to note the English Law Commis-

sion's argument in favour of including the manufacturers

of component parts within the definition of "producer":

"Some components such as altimeters or television

tubes, are extremely sophisticated instruments and it

would be reasonable to expect greater facilities for

checking the safety of the component to be available

to the person who made it than to the maker of the

product into which the component was finally incor-

porated. It might be wholly unreasonable to expect a