Product Liability

Section 85: the product service provider. He is liable if the service was faulty, imperfect, deficient or inadequate in quality, nature or manner of performance as required by law or by contract; or there was an act of omission or commission or negligence or conscious withholding of information which caused harm; or he did not issue adequate instructions or warnings to prevent harm; or the service did not conform to the express warranty or the terms of the contract.

Section 86: the product seller who is not the manufacturer. He is liable if he exercised substantial control over the designing, testing, manufacturing, packaging or labelling of the product that caused harm; or he altered or modified the product and that was a substantial factor in causing the harm; or he made an express warranty of his own, independent of the manufacturer's, and the product failed to conform to it; or the identity of the manufacturer is not known, or is known but process cannot be served on him, or he is not subject to Indian law, or an order cannot be enforced against him; or he failed to exercise reasonable care in assembling, inspecting or maintaining the product, or did not pass on the manufacturer's warnings or instructions, and that failure was the proximate cause of the harm.

The exceptions: section 87

Against the seller. No product liability action lies against a product seller if, at the time of harm, the product was misused, altered or modified.

Against the manufacturer, in warning cases. In an action based on the failure to provide adequate warnings or instructions, the manufacturer is not liable where the product was purchased by an employer for use at the workplace and warnings or instructions were given to the employer; where the product was sold as a component or material for use in another product and the necessary warnings were given to the purchaser of the component; where the product was legally meant to be used or dispensed only by or under the supervision of an expert and the manufacturer employed reasonable means to give the warnings to that expert; or where the complainant, while using the product, was under the influence of alcohol or a prescription drug not prescribed by a medical practitioner.

And two more. A manufacturer is not liable for failing to warn about a danger that is obvious or commonly known to the user, or which the user ought to have known taking into account the characteristics of the product.

Product liability against the ordinary law

A worked example

A pressure cooker explodes and injures Vidya in her kitchen, ruining the kitchen as well.

Against the manufacturer. A product liability action under section 84 on the ground of a manufacturing defect, or defective design, or the absence of adequate instructions or warnings. It is no answer that he was not negligent, because of section 84(2).

Against the shop that sold it. Under section 86 only if one of its five grounds is made out, for example that it altered the cooker, gave its own warranty, failed to pass on the manufacturer's warnings, or that the manufacturer cannot be identified or reached.

Against the service centre that serviced it badly, under section 85.

What can she recover? Compensation for her injury, for the damage to the kitchen, and for the mental agony accompanying them. Not the value of the cooker itself, which is harm to the product, and not lost profits.

If she had removed the safety valve herself, section 87(1) protects the seller, because the product was altered at the time of harm.

And if the explosion happened at her employer's canteen, and the manufacturer had given the warnings to the employer, section 87(2)(a) protects the manufacturer in a warning-based claim.

What it does NOT mean

It is not a claim for the product itself. Harm excludes damage to the product, and the remedy for that is a defect complaint under section 39.

It is not confined to manufacturers. Service providers and sellers have their own grounds.

A seller is not liable merely because he sold the thing. Section 86 requires one of five grounds.

It does not cover commercial or economic loss. Loss of profits is excluded.

Quick revision

1. Chapter VI, sections 82 to 87, is new with the Act of 2019.
2. Section 83: an action lies against a product manufacturer, a product service provider or a product seller.
3. Section 84: five grounds against a manufacturer, and sub-section (2) makes him liable even if he proves he was not negligent or fraudulent in making the express warranty.
4. Section 85: four grounds against a service provider.
5. Section 86: five grounds against a seller who is not the manufacturer, including that the manufacturer cannot be identified or reached.
6. Section 87: no action against a seller where the product was misused, altered or modified; and the warning exceptions for workplace purchases, components, expert-supervised products, and a complainant under the influence of alcohol or an unprescribed drug; no duty to warn of obvious or commonly known dangers.
7. Harm excludes damage to the product itself and commercial or economic loss.

Test yourself

1. What is a product liability action, and against whom does it lie? It is a complaint before a Consumer Commission for compensation for harm caused by a defective product or by a deficiency in services relating to it, and Chapter VI of the Consumer Protection Act 2019 governs it. Section 83 allows it against a product manufacturer, a product service provider or a product seller. A manufacturer is liable under section 84 where the product contains a manufacturing defect, is defective in design, deviates from manufacturing specifications, does not conform to the express warranty, or fails to contain adequate instructions of correct usage or a warning against improper usage; and section 84(2) provides that he is liable even if he proves he was not negligent or fraudulent in making the express warranty. A service provider is liable under section 85 where the service was faulty, imperfect, deficient or inadequate, where there was an act of omission or commission or negligence or conscious withholding of information causing harm, where adequate instructions or warnings were not issued, or where the service did not conform to the express warranty or the contract. A seller who is not the manufacturer is liable under section 86 on five grounds, including substantial control over design or manufacture, alteration of the product, his own express warranty, the manufacturer being unidentifiable or unreachable, and a failure of reasonable care in assembling, inspecting or maintaining the product or in passing on warnings.

2. What are the exceptions to a product liability action? Section 87 provides them. No action lies against a product seller if, at the time of the harm, the product was misused, altered or modified. In an action based on a failure to provide adequate warnings or instructions, the manufacturer is not liable where the product was purchased by an employer for use at the workplace and warnings were given to the employer; where it was sold as a component or material for use in another product and the necessary warnings were given to the purchaser of the component; where the product was legally meant to be used or dispensed only by or under the supervision of an expert and the manufacturer used reasonable means to warn that expert; or where the complainant, while using the product, was under the influence of alcohol or of a prescription drug not prescribed by a medical practitioner. A manufacturer is also not liable for failing to warn of a danger which is obvious or commonly known, or which the user ought to have known having regard to the characteristics of the product.