Liability For Negligence Of Manufacturer Or Distributor Of Appliance In Tort Law

1.For the injured users explain the basis of possible liability in the tort of negligence that any manufacturer or distributor of the Thermomix appliance might have to those users. Leave aside the question of the amount of damages?

2.Why do caps on personal injuries damages exist in Australia? 

3.Do the injured users have possible rights under Part 3-5 of Australian Consumer?

1. In circumstances, where a person is obliged to take proper care of another person, does or omits to do any act that any prudent person would or would not do and the act causes injury to the other person, the person doing or omitting to do the act is said to be negligent towards the aggrieved person (Martin, 2016). The claimant in order to claim compensation for an act of negligence must establish the following essential elements:

• The defendant owed a duty of care
• The defendant has infringed such duty of care
• The claimant has sustained injuries and has suffered damages or loss directly for the breach of such duty

Section 48 of the Wrongs Act 1958 deals with the general principles of duty of care. A person is said to be negligent if he fails to take necessary precautions to avert the risk, which was foreseeable; if the risk was substantial; if the circumstance was such that any prudent person would have taken necessary precautions had he been in the person’s place (Barravecchio, 2013).

For determining whether a person has committed infringement of the duty of care, the court will ensure that the expected standard of care has been exerted by the defendant or not in the given circumstances. The court in order to determine if reasonable care has been exerted, shall perceive what a prudent person would have done or omitted to do in similar circumstances. If the court is of the opinion that the the actions of the defendant involved high amount of risks, then it is the duty of the defendant to exercise additional precautionary measures to avert the same in order to prevent any damages or injuries. In specific cases, the facts of the case may be in favor of the plaintiff to such an extent that the facts of the case itself speaks that the defendant is at fault. The burden of proving that the act was not a negligent act is shifted to the defendant. The legal maxim applied to describe such circumstances is known as res ipsa loquitur, which means that the facts of the case speak for themselves.

The aggrieved person or the claimant must establish that the damage or the injury sustained was a direct result of the defendant’s contravention of the duty of care. The claimant must prove that if it were not but for the defendant’s act then the aggrieved person would not have sustained any injuries, loss or damages. However, the damage caused must necessarily be the immediate outcome of the actions of the defendant and must not be too remote. The defendant shall not be held liable for any loss or damages that have not resulted from the acts that the defendant could have reasonably foresee (Mendelson, 2014).

Caps on Personal Injuries Damages in Australia

In the the context of the landmark case Donoghue v Stevenson, it was held by the House of Lords that every person has a duty to exercise care towards their neighbor and that any person who suffers damages or loss because of an negligent act by the other person, is entitled to be compensated by the wrongdoer.

Section 51 of the Wrongs Act 1958 lays down that the negligence was a factual causation of the harm. The claimant must establish any fact that is relevant to the cause of issue. Under section 56 of the Act, it is necessary for the claimant to establish that he was not aware of the peril. However, a person cannot be held liable for an act of negligence if the damage or injury is caused as a result of an inherent risk. An inherent risk may be defined as a risk of the occurrence of an incident that cannot be averted even after exercising due standard of reasonable care.

The determination of an injury whether it is significant or not can be evaluated from the extent of harm that has resulted from the injury suffered by the aggrieved person. After assessing the injury, the extent of harm it causes must fulfill the threshold level to be considered as a significant injury. 

Here, the Thermomix Company has committed negligence by contravening its duty of care towards the consumers of their products. The consumers are entitled to claim damages for personal injury sustained while using the products of the Company. The Wrongs Act 1958 imposes numerous restrictions while claiming damages for non-monetary or monetary loss arising as a result of the personal injury in Victoria. According to the Wrongs Act 1958, an aggrieved person cannot claim non-monetary loss, that is, damages for the pain or injuries sustained by that person unless the aggrieved person has been assessed to have sustained more than 5% injury as per the Medical Association Guidelines (AMA). The Amendments made in the Wrongs Act 1958 have modified and increased the cap on non-monetary damages to $577,050. The increase in the limit on non-monetary damages has been increased and is applicable only when the injuries suffered by the aggrieved person are of serious nature. The injured or the aggrieved parties may claim damages for the injuries sustained within the stipulated period of 3 years. The relevant documents must be filed within 90 days before the expiry of the stipulated period.

Possible Rights of Injured Users under Part 3-5 of Australian Consumer Law

However, the manufacturers may use the following defenses against the legal actions brought by the injured parties for the act of negligence:

Volenti non fit injuria- In simple words, it means that the aggrieved person has accepted the danger of injury voluntarily (Del Monte, 2015). If the defendant succeeds in establishing that the claimant has accepted the peril of the damage or loss on his own accord, the defendant shall be exempted from his liability. The acceptance may be made either expressly or impliedly (Mullins, 2013).

Contributory negligence- The defendant to establish that the plaintiff was equally responsible for the injuries sustained or loss or damages suffered may use the defense of contributory negligence (Ahmed, 2014). The defendant must prove that the plaintiff has failed to take proper care of his own safety (Goudkamp, 2015). The defendant, although, will still be held liable for negligee      nce but the amount of compensation shall be reduced by the courts (section 63) (Goudkamp & Nolan, 2015).

Novus Actus Intervieniens- If the defendant succeeds in establishing that despite taking reasonable care the actions of the aggrieved party were such that it was beyond the control of the defendant to foresee the consequences of the act.

Act of third party- The defendant can only be held liable for his own actions or when the loss or damages suffered by the injured party are a direct result of the actions of the defendant. The defendant cannot be held liable when the cause of such loss or damages suffered by the aggrieved party is an intervening act by any third party (Goudkamp, 2013).

Natural incidents- In case of natural events, which the defendant is unable to foresee, no legal action, can be brought against him.

2. The main rationale of tort damages in common law is to compensate the aggrieved person for the loss or damages suffered from the action of the wrongdoer. The judges after perusing the evidences of the loss or damages suffered by the aggrieved party awards damages in the form of compensation in order to restore the plaintiff to the position he was in prior to the damage or injuries caused by the actions of the defendant (McGivern & Handford, 2015). The damage or harm suffered by the aggrieved party includes permanent or temporary physical injury, economic or non- economic loss. The non- pecuniary losses suffered by the claimant may arise in the form of personal injury, which includes physical pain and sufferings, emotional trauma, loss of life, disfigurement, loss of amenities. The damages awarded to the aggrieved party for the non-pecuniary loss or damages may be referred to as general damages. The underlying reason behind compensating the claimant by way of compensation is that money can console the plaintiff and aid him to purchase substitute source of satisfaction and to meet expenditures (Sekendiz, Ammon & Connaughton, 2016).

The statutes and the legal framework of various states have imposed numerous restrictions on claiming damages for personal injuries. Unlike pecuniary damages, the judiciary does not award damages to the aggrieved party based on previous losses and upcoming calculations, instead the courts have to devise a more personal assessment (Mendelson & Mendelson, 2016). Several states in Australia have introduced caps on non-pecuniary damages only for cases that are related to the issues of medical malpractice (Leslie et al., 2014). Very few states have introduced caps on non-economic damages for cases involving personal injuries. The amount of limitations or caps varies in several states ranging from $350,000 to $750,000. However, there are exceptions available on the laws of damage caps, which are applicable in cases involving serious injuries or death (Tobin, 2014). In such circumstances, the exceptions either allow a higher damage cap or eradicate the damage cap. In the state of Victoria, any aggrieved person sustains non-pecuniary or personal injuries shall be compensated if the claimant succeeds in establishing 30% impairment or that the injury suffered is of serious nature. The cap on damages for non-pecuniary loss is $527,610 (Carvalho et al., 2015).

The Wrongs Act imposed various restrictions on claiming compensation for pecuniary and non-pecuniary loss resulting from personal injury. The Australian Law Reform Commission has incorporated caps for non-pecuniary damages to provide equal importance to the status and privacy interest of the aggrieved party and the wrongdoer.

The damages have been introduced for the loss suffered and the injuries sustained by the aggrieved party in order to punish the wrongdoer and to prevent him for conducting in similar manner in the future. However, the thresholds that have been introduced in the Act have the following adverse consequences:

• The thresholds signify that a certain amount of negligent acts exempt the wrongdoer from any monetary consequences. The risks associated with the standard of safety gradually decreases.
• The thresholds reduces the motivation for incorporating the risk management measures;
• The decline of the eligibility of the wrongdoer to compensate the injured party reduces
• The thresholds on the non-pecuniary losses have an adverse impact on the the stay at home fathers and mothers in particular.

However, many scholars have put forward arguments in favor of the thresholds that have been imposed on the non-economic losses suffered by the injured party.

• The scholars are of the opinion that the the injured parties are awarded damages for the personal injuries sustained only when they meet the threshold imposed for becoming entitled to such compensation. The person who has suffered 30% impairment is entitled to pecuniary compensation.
• The imposition of the thresholds has reduced the chances of making false claims for unnecessary care costs against the defendant regarding the injury suffered.
• The aggrieved parties are entitled to pecuniary damages for the personal injuries sustained depending upon the magnitude of the harm suffered by them.

The ACL lays down statutory provisions regarding the legal responsibility of the manufacturers of goods having safety defects. The part 3-5 of the ACL deals with the liability of the manufacturer in case of any personal damage or monetary loss suffered by the consumers for the goods supplied. Section 138 of the ACL states that any individual person who has sustained injuries as a result of the loss or damages caused by the supplied goods may bring legal action against the manufacturer of the defected goods. The aggrieved persons may request the suppliers of the goods to aid them in identifying the manufacturer of the faulty goods to bring a legal action against him (Giliker, 2014). In case, the supplier fails to provide with the information about the manufacturer, the aggrieved person may become entitled to compensation by the supplier for the damages or loss suffered due to the unavailability of the required information.

Here, as per the report provided by CHOICE, the aggrieved consumers may claim a legal action against the manufacturers of the Thermo mix products for the damages suffered as a result of the safety defects in the TM 31 model (Ward, 2016).

However, there are defenses available to the manufacturers as laid down under sections 142 and 148 of the ACL. The defenses include:

• The defect in the safety of the goods was non-existing at the time of supplying the goods;
• The technical and scientific department failed to permit the manufacturer to find the default in the goods;
• The defect occurred because it was in conformity with only a compulsory standard;
• The loss suffered was due to destruction of a building or a land because of the defected goods (Viscusi, 2013).

In case a defected good has met with only a commonwealth mandatory standard, then the Commonwealth and not the manufacturer of the defected goods shall be held liable for the loss suffered by the aggrieved person. The ACL does not lay down the penalties and remedies regarding the infringement of the provisions under part 3-5. The provisions laid down under this part of the ACL act as guidelines to the judges in dealing with the breach of the statutory provisions.

However, part 4-3 of the ACL states that infringement of specific statutory provisions that leads to serious injuries may amount to criminal offenses for which the court may impose necessary criminal penalties. There are reported complaints where damages and injuries was caused to the consumers indicates that the Thermomix company did not effectively comply with the provisions for recall of consumer goods and shall be liable to pay fine of $1.1 million. In addition, where the defected goods have resulted in serious injuries to the consumers, the injured customers shall be entitled to monetary compensation up to $16,650 by the manufacturer. Part 4-6 of the ACL provides defenses that are applicable to the manufacturers. If the manufacturer succeeds in establishing that:

• The injury was caused due to the act of the third parties and proper steps were taken to avert the injury;
• The injury was caused because of rational mistakes of fact;

Part 5 of the ACL deals with the civil pecuniary penalties that may be imposed by the court on the infringer. A court may impose civil pecuniary penalty only if it is established that the corporate boy or any individual have violated the statutory provisions laid down by the ACL relating to the civil standard of the goods manufactured. The Thermomix Company has failed to comply with the statutory provisions regarding the safety standard of the kitchen appliances under sections 106(1) to pay an amount of $1.1 million. In case of serious injuries caused due to the defected goods, the company is liable to pay $16,500 under sections 131 or 132 (Corones, 2013).

The aggrieved consumers may approach the court and the court may issue injunctions against the company for the contravention of the statutory provisions as mentioned under section 232 of the ACL. The aggrieved consumers under the section 271 may also be entitled to receive compensation by the infringing company for the injuries sustained and the damages or loss suffered. However, a consumer after being aware of the fact that a guarantee has not been met with, legal action can be brought against the manufacturer for a period of three years (Baker, 2016).

References

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Barravecchio, J. A. (2013). The tort of negligence. Legaldate, 25(4), 4.

Carvalho, N., Salomon, J., Grant, G., Fish, D., & Studdert, D. M. (2015). Feasibility of a Health Utilities Approach for Quantifying Noneconomic Losses from Personal Injury. Available at SSRN 2629024.

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Mendelson, D. (2014). The new law of torts. Oxford University Press.

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