Transcript L'Assicurazione Merci

US Product Liability
United States case-law identifies three grounds bringing to strict product liability:
Manufacturing defect:
The product is well-designed but the way in which it was made makes it unsafe;
Design defect:
The design of the product is unsafe, so the entire product line is unreasonably
dangerous.
Failure to warn:
The manufacturer may design a product that’s perfectly safe and has no
manufacturing defects, but then the producer fails to include proper warnings or
instructions for safe operation.
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006
Manufacturing Defect Definition
California Federal Court
Barker v. Lull Eng'g Co., Inc.
1978
“A defective product is one that differs from the manufacturer's intended result or
from other ostensibly identical units of the same product line"
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006
Manufacturing Defect in AVN
Florida Appellate Court, 4 Dist
Piper Aircraft Corp. v Coulter
1983
In action against manufacturer of light aircraft, based on defective latch which
allowed door to open during flight, causing crash and deaths of occupants, jury
condemned the manufacturer under strict liability where egregious behavior of
manufacturer was shown, i.e., continued use of latch after knowledge from test pilot
that manufacture was defective.
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006
Design Defect
Court of Appeal of California, Second Appellate District, Division Two
FLUOR CORPORATION, Plaintiff, v. JEPPESEN & COMPANY, Defendant
July 23, 1985
In action against maker and producer of aerial navigation airport approach chart, for
loss of plane and death of passengers when it crashed into hillside, failure to show
hill, which was highest point in area, while showing lower hill which plane could
have cleared.
“A product is defective in design either if the product has failed to perform as safely
as an ordinary consumer would expect when used in an intended or reasonably
foreseeable manner”
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006
Liability for Design Defect
New York Southern District Court
In re: September 11 Litigation, 2003
In determining whether cockpit doors of jumbo jet hijacked by terrorists were
unreasonably dangerous the Court underlined:
“it is reasonably foreseeable that aircraft manufacturer's failure to design a secure
cockpit could contribute to a breaking and entering into, and a take-over of, a
cockpit by hijackers or other unauthorized individuals, substantially increasing the
risk of injury and death to people and damage to property.
This is sufficient to establish manufacturer's duty to victims who were killed or
injured when commercial aircraft crashed into building, for negligent design”.
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006
Failure to Warn
Pursuant to US Case Law:
Manufacturers and sellers, even after the purchase of the product, must give warnings
to users about newly discovered dangers which render the product defective or
dangerous.
Manufacturers and sellers must put into practice also an ‘after market warning
procedure’ with:
operation manuals amendments;
update kits;
service bulletins;
service communications.
The main reason of manuals failure to warn lies in the fact that manuals are often
prepared by technicians who do not have a broad enough risk management or
accident prevention perspective.
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006
Duty to Inform Aircraft Owners of
Defect Discovered After Manufacture
New York - Court of Appeal, 1969
Braniff Airways, Inc. v Curtiss-Wright Corp.
The action was brought by injured passengers and an airline against the manufacturer
in respect of an engine used in a Douglas DC-7C airplane which crashed:
“the manufacturer was aware of a scuffing problem and of cylinder barrel
separation nearly eight months before the crash but took no effective action to remedy
the problem. Although a manufacturer is not under a continuing duty to improve its
product even if human safety is involved, after such a product has been sold and
dangerous defects in design have come to the manufacturer's attention, the
manufacturer has a duty either to remedy these defects or, if complete remedy is not
feasible, at least to give users adequate warnings and instructions concerning efforts
for minimizing the danger”.
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006
Post-Sale Duty to Warn
Pennsylvania Supreme Court - 1992
Walton v Avco Corp.
In strict liability action arising from deaths of two persons in a crash caused by failure
of oil pump which was component of the engine. Jury found that engine was
defective, it is proper to impose liability on manufacturer based on its failure to warn
owners of danger posed by defective component.
“Manufacturer of finished product has duty to warn regarding defective component
discovered to be such after manufacture and sale, based on its having incorporated
defective part into its finished product. Moreover, where finished product
manufacturer has been informed by component manufacturer of defect in component,
finished product manufacturer also has duty to warn based on its having knowledge
of defect”.
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006
Combination of Liabilities
5th Circuit Court 1987
Moorhead v. Mitsubishi Aircraft Int'l, Inc.,
The pilot encountered icing conditions, causing the aircraft to lose airspeed, spin out
of control and crash.
The district court found that the plane's airspeed indicator was responsible for the
accident. The indicator had frozen during the flight, causing the indicated speed to
increase with altitude.
The aircraft manufacturer, after encountering similar malfunctions, had issued
advisory warnings.
The appellate court noted that there were alternate designs for this airspeed indicator,
and therefore condemned the manufacturer for defective design.
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006
China
Product Liability
Chinese Laws on Product liability:
PRC General Principles of Civil Law (1986)
Provides for civil compensation for damages due to product defects: (Articles 122,
130, 131, 132 and 136).
PRC Product Quality Law (1993)
Provides Strict Product Liability
According to the Product Quality Law sellers and manufacturers are liable for injuries
caused to consumers by their defective products.
PRC Consumer Right Protection Law (2004 - last review)
Where products may pose a threat (even a generic one) to the safety of consumers,
precise warnings must be given to consumers.
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006
Problems With Chinese Product
Liability Law
Chinese case law provides a broad definition of Defect.
“unreasonable danger existing in the product that threatens the safety of person or
property or a product’s non-conformity with common industry safety standards”.
There is no precise definition of unreasonable danger and there is no commonly
recognised industry safety standards.
In this scenario, unreasonable danger is usually interpreted as a danger which is
beyond the usual expectation of common people.
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006
Problems With Chinese Concept of
Failure to Warn
Article 27 of the PQL provides that products whose improper use is likely to cause
the products themselves to be damaged or to endanger personal safety and/or the
safety of property should carry warnings in Chinese.
It is crystal clear that the problem lies with the impossibility to foresee every
improper use.
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006
Who bears responsibility in China?
In China, under the strict liability scheme, responsibility for defective products rests
both on producers and sellers.
Producers include those who appear to be producers even only by connecting their
names, titles, trademarks or other distinguishable marks to the defective products.
Risk Management e Assicurazione per l’Industria e le Attività Aeronautiche
Alessio Totaro - Milano - 15 novembre 2006