Products Liability as Enterprise Liability

Background and Purpose: Consumers who suffer from injury or property damage due to the existence of a defect in a given product is entitled to bring a legal action in court based on product liability law provisions in Malaysia. This study aims to analyse the legal problems of strict civil liability in product liability law in Malaysia based on the Consumer Protection Act 1999 (Act 599) (hereinafter “CPA 1999”).
 
 Methodology: By applying a doctrinal approach based on qualitative methodology of legal research, this study involved a thorough analysis of the CPA 1999 as well as previous court cases. The findings of this study were analysed using content analysis and critical analysis methods in order to record the similarities and differences which exist, as well as to draw conclusions on the meaning and application of the said law.
 
 Findings: The findings prove that there are several weaknesses in the existing strict civil product liability provisions in Malaysia, which are still unresolved in terms of the meaning of product defect and proof of causation.
 
 Contribution: This paper recommends that any improvements on the legal provisions for strict civil liability under product liability law in Malaysia to be evaluated from a different perspective based on Islamic principles of product liability and the theory of Maqasid Syariah, which has rarely been analysed.
 
 Keywords: Causation, doctrinal, Maqasid Syariah, product liability, strict civil liability.
 
 Cite as: Mohd Shukri, M. H., Ismail, R., & Markom, R. (2020). A review of legal problems in Malaysian strict product liability law – Maqasid Syariah as a way forward. Journal of Nusantara Studies, 5(2), 239-260. http://dx.doi.org/10.24200/jonus.vol5iss2pp239-260

MALFUNCTION THEORY allows plaintiffs in a products liability case to prove the probability of a defect by eliminating normal causes of malfunctions, even without proving the specific existence of a product Plaintiffs have applied malfunction theory to devastating effect on the defense of a products liability case, which is already a plaintiff-friendly environment. Courts throughout the nation are utilizing and developing malfunction theory to relax, or even excuse proof of defect and causation in products liability cases. This article argues that malfunction theory poses a triple threat to defendants by: (i) removing the requirement that plaintiffs prove a specific product defect; (ii) relaxing the causation requirements that plaintiffs must show; and (iii) potentially allowing plaintiffs' experts to provide otherwise impermissibly unsupported opinions. However, at least one recent case provides the possibility that unsupported expert testimony presents the Achilles heel to this otherwise unbounded theory. I. Plaintiff-friendly Product Liability Law Product liability law essentially undid previous common law. Most notably, product liability law created a dangerous environment for any person operating in the stream of commerce by allowing claims against any defendant in the stream of commerce relative to the product with no privity requirement and without proof of fault. Courts also did away with the traditional requirement of proving fault, or negligence--allowing strict liability against any product seller. When neither privity of contract nor negligence is required, the burden often effectively shifts to defendants to figure out who is responsible for the harm allegedly caused to a plaintiff. Ordinarily in product liability cases in most jurisdictions, a plaintiff must prove that: a product was in a defective condition unreasonably dangerous to the consumer, the defect caused the injury, the defect existed at the time of sale, and the product was expected to and did reach the consumer without substantial change in condition. (2) The application of the malfunction theory to this already plaintiff-oriented body of law has the potential to expose defendants in the stream of commerce even further. Malfunction theory is being expanded in most jurisdictions, some in a very relaxed manner, to provide alternate ways in which plaintiffs may successfully bring a products liability case despite the lack of direct evidence of defect and/or causation due to factors such as destruction or loss of the product in question. Under varying circumstances in different jurisdictions, courts are permitting circumstantial evidence as the basis for a prima facie products liability case in the absence of direct evidence of defect, causation, or both. II. Malfunction Theory Basics A plaintiff in a product liability action may be able to establish a prima facie case by providing evidence of the nature of a product's malfunction under circumstances that give rise to an inference that the malfunction would not have occurred absent a defect existing at the time of sale. Product liability cases may arise out of a product malfunction that damages or completely destroys a product that is the basis of the products liability case. (3) As a result, plaintiff would not be able to produce direct evidence of a specific defect. The malfunction theory essentially allows a plaintiff to present circumstantial evidence of a defect or evidence of an unspecified dangerous condition when direct evidence is unavailable or there is insufficient evidence to identify the specific defect. Additionally, application of the malfunction theory allows the plaintiff to present circumstantial evidence that rules out reasonable secondary causes in lieu of direct evidence of causation. Given that the malfunction theory implicates permissible inferences for a fact-finder absent direct evidence, the theory essentially operates as a rule of evidence. …

This paper assesses the impact of changes in products liability law by measuring liability insurance expenditures. Expenditure for liability insurance premiums is used as an index of resource redistribution from sellers of defective products to individuals who have been harmed by such products. Using multiple regression, comparative state data are analyzed for the period immediately prior to the enactment of the Consumer Products Safety Act in 1972, when doctrines concerning manufacturers' liability for defective products were changing in the direction of stricter negligence standards and thus greater liability for the manufacturer. Three types of products liability policies were in effect among the 50 states at that time. They were strict liability in tort, negligence plus warranty with no privity requirement, and negligence plus warranty with privity of contract required. Data from states with strict liability policies are compared with data from states where the negligence plus warranty standards were used. In states where manufacturers were subject to greater liability for defective products, more money was spent on liability insurance. This example from one area of tort law shows that common law decisions can have important social effects, and suggests a method for measuring those effects.

This essay does not question whether, or to what extent, product liability law 6/1 should be harmonised. It simply seeks to assess whether harmonisation has been achieved by the Product Liability Directive1 as regards strict liability.

Japan's Product Liability Law was introduced on 1 July 1995. Engineers in Japan tend to maintain a negative attitude towards product liability (PL) laws because of the extreme examples of PL litigation cases presented in the US courts. The 'concept of defect' is a crucial aspect in PL litigation. In this paper, the warning, caution, and instruction defect, a common defect encountered with Japanese products, is discussed using examples found in the marketplace, with emphasis on how the particular structure of Japanese grammar affects this type of defect. The model cases are revised to a more effective form so that the warnings and cautions serve their main purpose, which is to draw the user's attention to the potential dangers first and afterwards to describe the handling prohibitions.

In February, 2000, the European Commission issued the long-awaited White Paper on Environmental Liability. The White Paper outlines the Commission's views on the key elements of a proposed environmental liability directive. This directive would provide for strict liability for conventional and environmental damage caused by "dangerous" activities regulated by EC law (i.e. virtually all industrial activities), and fault liability for natural resource damage caused by non-dangerous activities. In the Commission's view, such a regime would implement the EC Treaty's grand principles of environmental policy (the preventive, precautionary, and polluter pays principles) and improve the enforcement of EC environmental law. The existing national liability regimes are deemed inadequate by the Commission. This article reviews the main substantive law (and some related procedural law) features of the liability scheme outlined in the White Paper. The first part discusses the justifications for EC legislation on environmental liability. It analyzes whether under the subsidiarity principle, or for reasons of improving the functioning of the internal market, the EC, rather than the Member States, should set any necessary policy in this area. It addresses also the key principles of the EC's environmental policy that the Commission invokes to support its proposal. The second part focusses on the critical question of strict versus fault liability, and the burden of proof. The White Paper argues that strict liability should be preferred over fault liability. The arguments to support strict liability are reviewed. In the third part, the scope of the regime proposed by the Commission is reviewed. Dangerous and non-dangerous activities would be treated in different ways, and the Commission proposes certain exemptions to the directive's scope. The fourth part discusses the issue of insurance and financial security. To secure funds for compensating environmental harm, the White Paper suggests that insurance should play an important role. In part five, the liable persons and available defenses are discussed. Part six analyzes the White Paper's proposals with respect to valuation of natural resource damage, contaminated sites, and standing to sue. Some conclusions are set forth in part seven.

Product Liability is a recognised authority in the field and covers the product liability laws through which manufacturers, retailers, and others may be held liable to compensate persons who are injured, or who incur financial loss, when the products which they manufacture or sell are defective or not fit for their purpose. Product defects may originate in the production process, be one of design, or be grounded in a failure to issue an adequate warning or directions for safe use and practitioners advising business clients or claimants will find this book provides all the necessary information for practitioners to manage a product liability claim. This new edition has been fully updated to take account of 10 years of development in case law and regulation, and the increasing impact of cross-border and transnational sale of goods. The Court of Justice of the European Union handed down major rulings concerning the Product Liability Directive which affect the application of the Directive and national arrangements and Fairgrieve and Goldberg examines this in detail. For any legal practitioner operating in areas which require knowledge of European product liability law, an understanding of the impact of recent developments is essential and this work is an essential resource for practitioners working on product liability, sale of goods, personal injury and negligence. The work provides comprehensive coverage of the law of negligence as it applies to product liability, of the strict liability provisions of the Consumer Protection Act 1987, and of the EU's Product Liability Directive on which the Act is based. Although the majority of cases involve pharmaceuticals and medical devices, in recent English cases the allegedly defective products have been as diverse as a child's buggy, an All Terrain Vehicle, and even a coffee cup. Many cases are brought as group actions, and the book examines the rights of those who are injured by defective products. As well as considering the perspective of the law as it has developed in the UK, this edition contains detailed discussion of case law from other jurisdictions including the USA, Australia, New Zealand, Canada, France and Germany. The coverage in the work is complemented by a full analysis of issues which arise in transnational litigation involving problems of jurisdiction and the choice of laws.

PurposeAlmost 20 years ago one of the present authors wrote an article entitled “Product liability: a global problem”. The brief paper seeks to provide a summation of what has happened in the meantime.Design/methodology/approachThe article is a brief discussion of the issues: the first section comments on products liability outside Europe and the final part concludes with an overview of what happened in the UK and Europe.FindingsThe article finds that the EU Directive's approach to strict liability has become the most common influence on law reform around the globe and that there is still much uncertainty in Europe and the USA as to what the law of product liability actually is.Originality/valueThe paper illustrates how, for the foreseeable future, businesses may continue to be most concerned about product liability exposure in the USA.

Autonomous vehicles are said to bring safety to the roads. Machines are expected not to make the same driving mistakes as humans. Indeed, machines will not drive intoxicated or get too tired to drive. However, the application of adversarial machine learning to autonomous vehicles has shown that the reaction of these vehicles to altered traffic signs may be the cause of unpredictable reactions. Rather than stopping in front of a vandalized stop sign, the autonomous vehicle may speed. This may lead to accidents. Therefore, scholars have developed various liability and compensation schemes to deal with accidents by autonomous vehicles. The following liability and compensation schemes have been suggested to deal with the civil liability of accidents of autonomous vehicles: operator liability, product liability, strict liability, no-fault compensation, and negligence. Each of these schemes are judged against victim and innovation friendliness. The former is being framed as easiness to obtain compensation, while the latter is understood as a burden on the industry. Operator liability, strict liability and no-fault compensation are considered as victim friendly. Product liability and negligence put a burden on the victim to prove either a defect of the product or a fault of the manufacturer. Only by shifting the burden of proof to the manufacturer would these systems be made victim friendly. In terms of innovation, the situation is not obvious. Operator liability, product liability and negligence make it difficult for a manufacturer to anticipate the size of the financial burden in case of an accident. This would be different with strict liability and no-fault compensation. Much of the discussion above is framed in relation to vehicles that are operating autonomously on their own. There is, however, more and more research on infrastructure enabled autonomy. In system, autonomous vehicles will be operating in connection with road side units, cloud services, and other traffic participants. As this will bring together products, services, and behavior, a mix of different liability regimes will make it difficult for the victim to obtain compensation. Therefore, a one-stop window may facilitate obtaining compensation. No-fault compensation could be ideal.KeywordsAutonomous vehiclesCivil liabilityRoad accidentsVictim centralityInnovationOperator liabilityProduct liabilityStrict liabilityNo-fault compensationNegligenceReasonable algorithmInfrastructure enabled autonomyConnectivity

Under relevant Malaysian laws, manufacturers or distributors who falsely claim that their cosmetics are safe are subject to criminal penalties. The question arises as to whether the producers can be responsible for physical as well as emotional injury caused to the consumers of such products. This paper seeks to investigate the potential liability of the manufacturer and distributor of defective cosmetics under the product liability law, which generally aims to protect consumers from unsafe products. The paper concentrates on the provisions of strict liability for defective products under Section X of the Consumer Protection Act 1999. The main issues to be resolved are whether cosmetics containing harmful substances can be considered as 'defective' and what kind of injury can be recovered by the victims. This study's findings provide producers and suppliers with information regarding their civil liability for supplying presumably safe cosmetics and the consumer's ability to obtain redress for harm caused by cosmetics comprising harmful ingredients.

This essay proposes a way of dealing with the strict liability of Internet sellers of other manufacturers’ products, such as Amazon under its ‘Fulfillment by Amazon’ program. I discuss and reject two approaches to the problem that have been proposed by the courts, and advance a view according to which the relevant inquiry is whether Internet intermediaries such as Amazon could have prevented a defective product from reaching the US market. This view accounts in a satisfactory manner for the notion of responsibility that is at the core of US strict products liability law, and avoids the pitfalls of alternative policies. However, since this view also entails a de facto quasi-immunity to lawsuits for Internet intermediaries in many cases, safeguards to that quasi-immunity are also addressed. While the essay focuses on US law, the principles and policies under discussion should be applicable in other jurisdictions as well.

The case Professor Alexander poses at the beginning of his rejoinder, that of the intentionally drunken officer, is a variant of a familiar problem. One does something, usually ingesting drugs or alcohol voluntarily, which then makes one's, subsequent behavior involuntary. Alexander's case is slightly different in that the officer intentionally gets drunk with the further intention (as part of the course of action) of sinking the Bismarck. Why is this a problem for my analysis? He proposes three escape routes from his argument (though I confess, I'm not sure what I'm escaping from). In discussing the second route, he seems to concede that my analysis would work for his counter example since . . the officer's past voluntary acts led him to be where he was when the wave caused him to lose his balance. But, he goes on, . . This route will not allow us to distinguish cases of proper strict liability and negligence liability from cases of no liability due to the absence of a voluntary act. Why not? The issue is the existence of an independently specifiable act or course of action or voluntary omission preceding an involuntary motion that somehow makes us responsible for the involuntary motion. Let us take an example. Suppose one reads but ignores a clear warning label on drugs, then operates a vehicle, then--lapsing into unconsciousness--injures someone. Surely, this is a case of negligence. Following my analysis, it requires the injurious consequence and an act intentional under a variety of descriptions (taking medication, ignoring the directions, and so on) carried out in a proscribed manner, that is, violative of a duty of due care. In the involuntary motion cases, there is no series of prior voluntary acts which we could specify and would characterize as negligence. Of course, all involuntary motions are preceded by various voluntary acts. But not all are preceded by a series of such acts which both cause those involuntary motions to cause injury and are done in a negligent manner. Alexander offers no argument that we cannot distinguish cases of negligence from what Holmes calls no act cases, only the naked assertion that we cannot. But the above approach, following my discussion of negligence in the paper, seems clearly to do that. The one example Alexander does offer as counterargument is the strict liability case, the one in which sinking the Bismarck is a strict liability offense. Note first that this offense is defined by a consequence alone. Typically, this is not how strict liability offenses are defined. Rather, they are constituted by a course of action producing death, injury, or property damage, such as manufacturing impure drugs or causing injury while doing demolition work. …

This chapter examines three principal routes to liability in respect of medicinal products: contractual liability, tortious liability in negligence, and the ‘strict’ liability regime contained in Part I, Consumer Protection Act 1987, which implemented the Product Liability Directive 85/374/EEC. The main considerations and requirements under each cause of action are outlined, including the role of regulation and risk/benefit considerations. The impact of Brexit on the statutory regime, and proposals for reform of strict liability, are considered. Some reflections are then offered on the challenges presented by litigation in this sphere, including in relation to multiparty actions.

It is argued that supply chain liability could be based either on tort law or on contract law and – drawing on experience from product liability law – it is examined whether there is a basis for assuming that these two approaches might end up merging into one unified approach forming the basis of a new concept of ‘production liability’.

The theory and practice of enterprise liability are oddly disjoined. On the one hand, case rhetoric insists that considerations of fairness are among the primary justifications for imposing enterprise liability. On the other hand, normatively inclined and theoretically ambitious scholarship on enterprise liability is overwhelmingly economic in cast. Economically inclined scholars have flocked to the field, while other kinds of tort theorists have shunned it, implicitly or explicitly conceding it to economic analysis. This paper argues that, contrary to this consensus, there is a powerful and important fairness case to be made for enterprise liability. This case fits the rhetoric of the decisions and the structure of the doctrines, and draws philosophical support from Kantian social contract theory. When enterprises are in a position to spread the costs of nonnegligent accidents across the class of those who benefit from the risks that inevitably issue in such accidents, enterprise liability is more reasonable than negligence liability. Under these circumstances, enterprise liability reconciles the competing claims of liberty and security more fairly, and more favorably, than negligence