The University of Texas at Austin   School of Law

Main menu:

Case:
RGZ 78, 171 VI. Civil Senate (VI 86/11)
Date:
11 January 1912
Judges:
Professor Basil Markesinis
Copyright:
F H Lawson and B S Markesinis

On 5 August 1908, while flying from Mainz to Friedrichshafen, the defendant’s airship was forced by engine failure to land on a field near Echterdingen. Since thousands flocked to see the sight, the landing area was sealed off by the military, while the fire brigade, and various army units were placed at the defendant’s disposal. Around 3 p.m. a sudden storm caused the airship to break loose from its moorings and to be dragged for some 1200 metres before exploding and burning up. The plaintiff, who was among the spectators standing near the place of anchorage, was struck by the anchor-chain. He sued the defendant for damage alleging that the accident was caused by the defendant’s negligence.

Both lower courts rejected the plaintiff’s claim and his application for review was denied for the following

Reasons

1. The claim was considered by the Court of Appeal in the light of §§ 823 and 831 BGB and it refused to consider the applicability of other statutory provisions imposing liability for dangerous objects (Gefährdungshaftung). This conclusion is entirely justified by existing law. In cases such as this, where the plaintiff’s injuries have been sustained outside any contractual relations, the provisions of the Civil Code dealing with torts are the only ones that can apply. According to these provisions, however, the defendant can only be liable to the plaintiff if the latter’s damage is due to the former’s culpable conduct. Special provisions of the Civil Code imposing liability without fault, e.g. § 833 BGB concerning the liability of keepers of animals, the principles of the Imperial Act on Liability (Reichshaftpflichtgesetz), or of the statute of 3 May 1909 (Strassenverkehrsgesetz) concerning automobile accidents, which (statutes) impose liability based on risk, cannot be applied to aerial navigation given their exceptional character.

2. With regard to liability for damages resulting from illegal acts, the older view can no longer be accepted which postulated with respect to the dangerous nature that constitutes a fault (Verschulden). Consequently, it cannot be said that because aerial navigation is fraught with great dangers the defendant, as initiator of this dangerous undertaking, can be regarded as being at fault in the sense required by § 823 I BGB. This approach has not been misapplied by the Court of Appeal taking the view, which pays due attention to the requirements of general safety and which is legally correct, that in the circumstances the defendant was under a duty to take particular care. The Court thus held the defendant was under a duty to take exceptional care, not least because at the time of the accident there was little experience in landing such an airship . . .

3. Given that in view of the above points the position taken by the Court of Appeal is free from legal error, the question arises whether the findings of fact justified it in holding that the defendant had discharged this duty. The plaintiff denies this on two grounds.

(a) First, he insists that the defendant was at fault, if for no other reason than the fact that he decided to go ahead with the flight even though he had insufficient experience in landings. In his appeal he therefore alleges that the defendant should not have gone ahead on the assumption that everything would necessarily proceed smoothly. At the very least he should have, from the outset, warned the public of all incidental dangers; and, if common sense and experience suggested that such warning of possible dangers would not be sufficient to avert them, then he should have cancelled the flight altogether.

This argument is misconceived. The facts of this case show that the defendant embarked upon this journey, which would have lasted for several days, in excellent weather conditions and was aided by an experienced crew. As the Court of Appeal suggested, he had every reason to believe that a carefully executed landing would pose no dangers to any crowd assembled for the spectacle. His principles of anchorage were correct and his means for anchoring were ample. And the defendant knew that wherever this happened competent assistance would be on hand. In his opinion his experience in such matters was more than adequate and he entertained no doubt that, even in the event of a storm he would be able to anchor his airship safely. Given all this he could undertake this flight without hesitation. And past experience had also shown that public warnings against possible future risks were ineffective. Instead he is entitled to believe that if need be injuries could be prevented by a cordon and by warning the crowds.

In view of the above no legal error can be found in the conclusion that the defendant’s conduct during the preparation of the flight was careful in the sense of § 276 BGB. The applicant’s view that the defendant should have had absolute certainty that the flight posed no dangers whatsoever is too far-fetched. Any enterprise of this type is bound to entail some dangers, also for third parties, and this could never be entirely eliminated, even if great care was taken. In the circumstances, therefore, it would be unjust to demand that such flights were banned altogether because their inherent dangers cannot be entirely eliminated. All that one can demand is that all care required in the circumstances should be taken. This, indeed, occurred since the defendant undertook the flight after proper preparations were carried out in accordance with prevailing experience. The flights went ahead when the weather conditions were good and everything could normally be expected to go well and safely. Consequently, he is not guilty of any recklessness constituting a danger to the community nor, indeed, can he be regarded as having carelessly breached his duty to take care.

(b) The applicant’s second complaint is against the finding of the Court of Appeal that the defendant took sufficient measures at the landing-field both in respect of his anchoring his airship and in cordoning off the landing-space.

This argument, too, is unacceptable. With regard to the anchoring the Court of Appeal found the following facts. Prevailing experience, on which the defendant was entitled to rely, clearly suggested that since the emergency landing was only expected to last a few hours, the airship was quite properly anchored. Thus at the front, where it pointed downwards, the ship was secured to the ground by means of an anchor and posts and sacks while at the rear end the airship was held down by men, and deliberately kept in suspension so that it could swing in the direction of the wind. Forty men held the anchor rope and the front cabin of the ship while thirty men, properly instructed as to how to handle the side-movements of the airship, controlled the ship’s rear cabin. And reinforcements were also at hand should the need arise. When the defendant left the airfield, the weather did not indicate that there might be any change in the direction of the wind, but even if such a change occurred, the airship was sufficiently secured to remain on the ground so long as its back remained free to swing in the new direction of the wind. The Court of Appeal also examined how, despite the above, the airship could cut loose from its anchor. In its view what happened was that the first gust of wind was quite suddenly followed by a second and extraordinarily violent gust which hit the airship on its side before it had time to swing to its direction and raised it with great force. Whatever method of anchorage was adopted there was no absolute proof that it would have managed to secure the ship to the ground.

The applicant is also wrong in arguing that since no one was to be responsible to the defendants for such extraordinary occurrence, he should have taken precautions against such an exceptional situation. This allegation is unsupported by the findings of facts. For given the initially prevailing favourable weather conditions, no sudden changes of wind were foreseeable at the time of the landing; thus, the defendant was not in breach of the duty of care required in the circumstances given that he had anchored his ship in accordance with the dictates of human experience and knowledge believing that his anchor could hold well even in a storm. That the airship was nevertheless torn away, as a result of the unexpected and violent gust of wind, and would probably have been torn away whatever system had been adopted for the anchoring, must be seen as the consequence of an act of God (höhere Gewalt).

As for the cordoning off of the landing-place, the Court of Appeal admitted that the plaintiff would probably not have been hurt if the cordon had been considerably wider. But again it is established that in taking these measures the defendant had done all that could have been expected of him. Thus, towards Echterdingen—from where the wind was blowing—ropes were used and soldiers were employed, while in the direction of Berhausen soldiers alone were posted at a close distance since no more ropes were available to drive the surging crowds back over and over again.

Nevertheless, the applicant feels that the defendant took insufficient precautions in this respect and insists that ropes should have been used in the direction of Berhausen; and soldiers could also have been used at much shorter intervals. But on the findings of facts this argument, too, fails. For as stated, the defendant cordoned off the place with all disposable means and achieved this as best he could despite the fact that curious crowds kept surging in the direction of the airship. If this forced landing, which was only meant to last for a few hours and carried out in favourable weather conditions, had not been disturbed by an unforeseeable change of weather, taking place against all reasonable expectation, the cordon would have been perfectly sufficient and no accident would have occurred. The defendant had no reason to anticipate that a storm, the result of an act of God, would suddenly blow up and tear his airship away from its moorings and then carry it over the heads of the public at such low height as to cause injury to some bystander. The requisite standard of crew did not, therefore, require the taking of such precautions that might protect the public against dangers which could in no way be foreseen as the likely consequence of a more or less normal forced landing . . .

Notes to the Strict Liability Act

1. Reading the text of the Strict Liability Act in conjunction with the commentary in Chapter 3, section A, above, one immediately becomes aware of the considerable historical and methodological differences that exist between the German law on the one hand and the French and Common law on the other in the area of strict liability. For the French, unlike the Germans, have, by skilfully developing—one might even say perverting—an unpromising provision of their Code, brought strict liability within the codal context. This technique, however, has not blinded them to the advantages of special legislation dealing with specific areas where strict liability is desirable.

By contrast, the English Common law has experienced some difficulty in abandoning the idea that where there is no fault there can be no liability. On the whole, the attack on the notion of fault has not been a frontal one, but has taken the form of guerrilla warfare (waged through the concept of res ipsa loquitur and the objectivization of the notion of negligence) thus affecting the fringes only of the notion. The position is considered by many to be unsatisfactory; and the Pearson Committee recommended that strict liability should be introduced in a number of areas of tort law. At the time of writing, however, the prospects of that happening appear slim with the result that in English law strict liability can only be found in a limited number of statutes (e.g., the Nuclear Installations Acts 1959–65); in the rule of Rylands v. Fletcher (1868) LR 3 HL 330 (considerably restricted over the years by successive timorous judicial pronouncements); and in certain instances of damage caused by animals. Incidentally, this latter subject is now embodied in the Animals Act 1971—a prime example of the long-winded and unnecessarily complicated English drafting techniques.

2. As is often the case, the position in the United States is much more interesting and, indeed, advanced than it is in England. The traditional strict liability areas—animals, Rylands v. Fletcher—can be found there, as well. But the reception that the latter rule has had in the different parts of the United States has varied depending on the prevailing socio-economic and geographical conditions of the area in question. A well-known extract from Turner v. Big Lake Oil Co. 62 SW 2d 491 (Tex. App. 1933) makes this clear:

In Rylands v. Fletcher the court predicated the absolute liability of the defendants on the proposition that the use of land for the artificial storage of water was not a natural use, and that, therefore, the landowner was bound at his peril to keep the waters on his own land [Citations omitted]. This basis of the English rule is to be found in the meteorological conditions which obtain there. England is a pluvial country, where constant streams and abundant rains make the storage of water unnecessary for ordinary or general purposes. When the court said in Rylands v. Fletcher that the use of land for storage of water was an unnatural use, it meant such use was not a general or an ordinary one, not one within the contemplation of the parties to the original grant of the land involved, nor of the grantor and grantees of adjacent lands, but was a special or extraordinary use, and for that reason applied the rule of absolute liability. This conclusion is supported by the fact that those jurisdictions which adhere to the rule in Rylands v. Fletcher do not apply that rule to dams or reservoirs constructed in rivers and streams, which they say is a natural use, but apply the principle of negligence. [Citations omitted.] In other words, the impounding of water in streamways, being an obvious and natural use, was necessarily within the contemplation of the parties to the original and adjacent grants, and damages must be predicted upon negligent use of a granted right and power; while things not within the contemplation of the parties to the original grants, such as unnatural uses of the land, the landowner may do only at his peril. As to what use of land is or may be a natural use, one within the contemplation of the parties to the original grant of land, necessarily depends upon the attendant circumstances and condition which obtain in territory of the original grants, or the initial terms of those grants.

In Texas we have conditions very different from those which obtain in England. A large portion of Texas is an arid or semi-arid region. West of the 98th meridian of longitude, where the rainfall is approximately 30 inches, the rainfall decreases until finally, in the extreme western part of the State, it is only about 10 inches. This land of decreasing rainfall is the great ranch or livestock region of the State, water for which is stored in thousands of ponds, tanks, and lakes on the surface of the ground. The country is almost without streams; and without the storage of water from rainfall in basins constructed for the purpose, or to hold waters pumped from the earth, the great livestock industry of West Texas must perish. No such condition obtains in England. With us the storage of water is a natural or necessary and common use of the land, necessarily within the contemplation of the State and its grantees when grants were made, and obviously the rule announced in Rylands v. Fletcher, predicated upon different conditions, can have no application here.

Again, in England there are no oil wells, no necessity for using surface storage facilities for impounding and evaporating salt waters therefrom. In Texas the situation is different. Texas has many great oilfields, tens of thousands of wells in almost every part of the State. Producing oil is one of our major industries. One of the by-products of oil production is salt water, which must be disposed of without injury to property or the pollution of streams. The construction of basins or ponds to hold this salt water is a necessary part of the oil business. . . .

Other references are given by Leon Green, ‘Tort Law Public Law in Disguise’, 38 Tex. L. Rev. 1, 5 (1959), who puts great stress on the ‘environmental factor’. But not all courts have taken such a hostile view and the trend is to adopt in substance, if not always in name, the Rylands v. Fletcher rule. See, for example, Cities Service Co. v. State 312 So. 2d 799 (Fla. App. 1975). But if the accumulation and escape of liquid substances have at times left the courts divided, blasting operations have been dealt with with greater severity and uniformity. See, for example, Sullivan v. Durham 161 NY 290, 55 NE 923 (1900) (and many others since). The underlying idea here is that extra-hazardous activities must pay their own way (cf. Smith v. Lockheed Propulsion Co., 247 C.A. 2d 774, 56 Cal. Rptr. 128 (1967)).

The Restatement (Second) of Torts has phrased the rule, which stems from Rylands v. Fletcher but is also stripped of many of its limitations, in the following way:

§ 519 (1) One who carries on an abnormally dangerous activity is subject to liability for harm to the person, land, or chattels of another resulting from the activity, although he has exercised the utmost care to prevent such harm.

(2) Such strict liability is limited to the kind of harm, the risk of which makes the activity abnormally dangerous.

§ 520. In determining whether an activity is abnormally dangerous, the following factors are to be considered:
(a) whether the activity involves a high degree of risk of some harm to the person, land, or chattels of others;
(b) whether the gravity of the harm which may result from it is likely to be great;
(c) whether the risk cannot be eliminated by the exercise of reasonable care;
(d) whether the activity is not a matter of common usage;
(e) whether the activity is inappropriate to the place where it is carried on; and
(f ) the value of the activity to the community.

3. For further discussion of the rich case law see Franklin and Rabin, 498ff.; Henderson, Pearson and Siliciano, 481 ff. Rylands v. Fletcher, and its reception in the USA, has given rise to an interesting socio-legal literature. Thus see, inter alia, Bohlen, ‘The Rule in Rylands v. Fletcher’ 59 U. Pa. L. Rev. 298, 373, 423 (1911); Molloy, ‘Fletcher v. Rylands—A Re-examination of Juristic Origins’ 9 U. Chi. L. Rev. 266 (1942). These have, in turn, been scrutinised by Professor Simposon’s masterly “Legal Liability for Bursting reservoirs: The Historical Context of Ryands v. Fletcher” (1984 13 Jo. LS ,209, reprinted in a slightly different form as ch. 8 of his Leading Cases in the Common Law (1995.)

4. In addition to the above-mentioned developments of ‘traditional’ strict liability doctrines, one can also find in the US new areas of strict liability. The modern law of product liability offers such an example in the key provisions of the Restatement (Second) of Tort. Good accounts and further references to this dynamic part of modern tort law can be found in all the textbooks and case-books referred to throughout this work.

One must further note the existence of new compensation systems which have emerged as alternatives to the system of tort liability based on fault. Some of these, e.g. workers’ compensation schemes (replacing in all but some isolated instances the Common law tort action) have already acquired a respectable history. The Massachusetts statute enacted in 1911 (Mass. Gen. Laws, ch. 152) is a fairly representative example. No-fault automobile insurance is, on the other hand, a relative newcomer and despite many statutory variations and even more proposals for reform, has never quite aspired to replacing tort law completely. Finally, what was in the 1970s described as the ‘medical malpractice crisis’ prompted many to contemplate the possible advantages of a no-fault system of compensation for this type of injury. An example of such thinking can be found in a feasibility study prepared in 1979 by the American Bar Association on Medical Professional Liability. These ‘alternatives’ discussed at varying lenghts by Henderson, Pearson and Siliciano, 721-748; Franklin and Rabin, 785-863; Prosser, Wade and Schwartz, 1190-1214. The American Bar Association also published in 1979 a useful annotated bibliography of the growing literature on this topic under the title Tort Reform and Related Proposals: Annotated Bibliographies on Product Liability and Medical Malpractice, (ed. B. A. Levin and R. Coyne) but the literature, which has grown further since those days, must be sought elsewhere.

5. The legal aspects of case 128, RGZ 78, 171, are discussed at p. 704; but its non-legal background is also interesting for the accident described in the case happened in the process of perfecting the lighter than air dirigible aircraft first manufactured by the Frenchman Giffard in 1852—his airship was steam-powered and could travel at 5 m.p.h.—but perfected by the German Count Ferdinand von Zeppelin. (The British did not, initially, enter this Franco-German race; and it was only in 1917 that their first airship—the R33—was successfully launched, though its design was based on a German Zeppelin—the L33—which was brought down in England in September 1916 in an almost intact condition.)

The accident described in the leading case happened as the airship was returning to its base in Friedrichshafen, the old capital of Württemberg, on the north-eastern side of lake Constance where Zeppelin had set up his famous factory. During the First World War the Zeppelin was put to military use; and some fifteen years later, again in Friedrichshafen, another lethal air machine—the Dornier—was manufactured.

The French competed with the Germans not only in the manufacture of these dirigibles but also in making legal history through their misfortunes. See: Coquerelc. Clément-Bayard, Cass. Req. 3 août 1915, D.P. 1917, 1. 79.

5. Environmental Liability Act of 10 December 1990
(Translated from the German by The Cologne Re.)

With the consent of the Bundesrat, the Bundestag has enacted the following into law:
Article 1
Environmental Liability Act (ELA)

§ 1. Facility liability for environmental impacts
If a person suffers death or injury to his body or health, or if property is damaged, due to an environmental impact that issues from one of the facilities named in Appendix 1,┬┐ then the operator of the facility shall be liable to the injured person for the damage caused thereby.

§ 2. Liability for non-operating facilities
(1) If the environmental impact issues from a facility that is not yet completed and arises from circumstances forming the basis of the hazard posed by the facility after completion, then the operator of the not yet completed facility shall be liable pursuant to § 1.

(2) If the environmental impact issues from a facility that is no longer in operation and arises from circumstances forming the basis of the hazard posed by the facility prior to its ceasing operations, then the operator of the facility at the time of the ceasing of operations shall be liable pursuant to § 1.

§ 3. Definitions
(1) Damage arises from an environmental impact if the damage is caused by materials, vibrations, noises, pressure, rays, gasses, steam, heat, or other phenomena that have been dispersed in soil, air, or water.

(2) Facilities are permanent structures such as plants or storage facilities.

(3) Facilities include:
(a) machines, instruments, vehicles and other mobile technical structures, and
(b) ancillary structures
that stand in a spatial or operational relation to the facility or part thereof and could be significant for the occurrence of an environmental impact.

§ 4. Exclusion of liability
No liability shall exist insofar as the damage has been caused by force majeure.

§ 5. Limitation of liability for property damage
If the facility has been operated properly (§ 6 II second sentence), then liability for property damage shall be excluded if the property has only been impaired insignificantly or to a degree that is reasonable according to the local conditions.

§ 6. Presumption of causation
(1) If a facility is inherently suited, on the facts of the particular case, to cause the damage that occurred, then it shall be presumed that this facility caused the damage. Inherent suitedness in a particular case is determined on the basis of the course of business, the structures used, the nature and concentration of the materials used and released, the weather conditions, the time and place at which the damage occurred, the nature of the damage, as well as all other conditions which speak for or against causation of the damage in the particular case.

(2) Paragraph (1) shall not apply if the facility has been properly operated. A proper operation is present if the special operational duties have been complied with and no disruption of operations has occurred.

(3) Special operational duties are those duties imposed by administrative permits, requirements, and enforceable administrative orders and regulatory laws, insofar as their purpose is to prevent such environmental impacts that could be considered to be the cause of the damage.

(4) If, for the purpose of supervision of a special operational duty, controls are prescribed in the permit, in requirements, in enforceable administrative orders or in regulatory laws, then compliance with this operational duty shall be presumed, if:
1. the controls were carried out during the period in which the environmental impact in question may have issued from the facility, and these controls give rise to no inference of a violation of the operational duty, or
2. at the time the claim for compensation is made, more than ten years have passed since the environmental impact in question occurred.

§ 7. Rebuttal of the presumption
(1) If multiple facilities are inherently suited to cause the damage, then the presumption shall not apply if another circumstance is, on the facts of the particular case, inherently suited to cause the damage. Inherent suitedness in a particular case is determined on the basis of the time and place at which the damage occurred, the nature of the damage, as well as all other conditions which speak for or against causation of the damage.

(2) If only one facility is inherently suited to cause the damage, then the presumption shall not apply if another circumstance is, on the facts of the particular case, inherently suited to cause the damage.

§ 8. Injured party’s right to disclosure from facility operator
(1) If there are facts justifying the assumption that a facility has caused the damage, then the injured party may demand information from the operator of the facility insofar as this is needed to determine the existence of a claim for damages pursuant to this Act. The demand shall be limited to data about the structures used, the nature and concentration of the substances used or emitted, and other effects issuing from the facility as well as the special operational duties as provided in § 6 (3).

(2) The right to disclosure pursuant to paragraph (1) shall not exist to the extent that the events must be kept secret pursuant to legal norms or the countervailing interests of the facility operator or of a third party requiring secrecy.

(3) The injured person may demand from the facility operator an opportunity to review existing documents insofar as the assumption is justified that the information provided is incomplete, incorrect, or insufficient, or if the information is not provided within a reasonable time. Paragraphs (1) and (2) shall apply accordingly.

(4) §§ 259–261 of the Civil Code shall apply accordingly.

§ 9. Injured party’s right to disclosure from administrative agency
If the facts justify the assumption that a facility has caused the damage, then the injured party may demand information from administrative agencies that have issued a permit in respect of the facility, that supervise the facility, or that are responsible for recording impacts on the environment, insofar as this is needed to determine the existence of a claim for damages pursuant to this Act. The agency shall not be required to provide information if to do so would impair the performance of the tasks of the agency, if the disclosure would disserve the wellbeing of the Federal Republic or of a state thereof, or to the extent that the events must be kept secret pursuant to law or due to their nature, in particular due to lawful interests of the parties or of third parties. § 8 I, second sentence, shall apply accordingly for those agencies which have issued a permit in respect of the facility or which supervise the facility; information regarding the name and address of the facility operator, his legal representative, or agent for service of process may be demanded from these agencies.

§ 10. Facility operator’s right to disclosure
(1) If a claim pursuant to this Act is brought against the operator of a facility, he may demand from the injured person or from the operator of another facility information or an opportunity to review documents or demand information from the agencies named in § 9, insofar as this is needed to determine the scope of his liability to the injured person or of his claim for indemnity against the other operator.

(2) The provisions of § 8 (2), (3) sentence 1, and § 8 (4) shall apply to the right to disclosure from the injured person; § 8 (1) sentence 2 and (2)–(4) shall apply to the right to disclosure from an administrative agency pursuant to § 9.

§ 11. Contributory negligence
If the fault of the injured person contributed to the cause of the damage, § 254 of the Civil Code shall apply; in case of property damage, the fault of the person having actual control of the property shall be considered to be the fault of the injured person.

§ 12. Scope of liability for death
(1) In case of death, compensation shall be paid for the costs of healing efforts as well as for the financial loss which the deceased suffered because his earning capability was eliminated or diminished or his needs were increased during the illness. In addition, the liable person shall pay funeral costs to the person who has to bear these costs.

(2) If, at the time of injury, the deceased stood to a third party in a relationship whereby he was obligated to that person, as a matter of law, to provide support or could become so obligated, and if the third party is deprived of the right of support as a consequence of the death, then the liable person shall pay to the third party damages to the extent that the deceased would have been obligated to provide support during his presumed lifetime. Liability shall also attach if, at the time of the injury, the third party was conceived but not yet born.

§ 13. Scope of liability for bodily injury
In case of bodily injury or injury to health, compensation shall be paid for the costs of treatment as well as for the financial loss which the injured person suffers thereby because his earning capability is eliminated or diminished temporarily or permanently or his needs are increased.

§ 14. Compensation by annuity
(1) Future compensation for elimination or diminution of earning capability and for increased needs of the injured person, as well as future compensation to a third party pursuant to § 12 (2), shall be provided by means of an annuity.

(2) § 843 (2) of the Civil Code shall be applied accordingly.

§ 15. Maximum limits of liability
The person liable shall be liable for death, bodily injury or injury to health only up to a maximum amount of 160 million Deutsche Mark and also for property damage only up to a maximum amount of 160 million Deutsche Mark, insofar as the damage is caused by a unitary environmental impairment. If the multiple losses to be indemnified on the basis of a unitary environmental impairment exceed the applicable maximum amounts provided in the first sentence, then the amount of each indemnification shall be reduced in the proportion that the total bears to the maximum amount.

§ 16. Expenses incurred for restoration measures
(1) If damage to property also impairs nature or scenery, then, insofar as the injured person restores the condition that would exist but for the occurrence of the impairment, § 251 (2) of the Civil Code shall apply, but the expenses incurred for restoring the prior condition shall not be considered unreasonable for the sole reason that they exceed the value of the property.

(2) Upon demand by the person entitled to compensation, the person liable shall make advance payment for the necessary expenses.

§ 17. Limitation of actions
The limitation provisions of the Civil Code pertaining to torts shall apply accordingly.

§ 18. Effect on liability under other laws
(1) This Act shall have no effect on liability arising under other legal provisions.

(2) This Act shall not apply in case of a nuclear event insofar as the Atomic Act applies in connection with the Paris Convention on Atomic Liability of 29 July 1960 (as published on 15 July 1985, BGBl. 1985 II p. 963), the Brussels Convention on Reactor-Powered Ships of 25 May 1962 (BGBl. 1975 II p. 957, 977) and the Brussels Convention on the Transportation of Nuclear Materials by Sea of 17 December 1971 (BGBl. 1975 II p. 957, 1026), as amended.

§ 19. Provision of coverage
(1) The operators of facilities named in Appendix 2 shall ensure that they are able to fulfil their legal obligation to provide compensation for damages that arise from a person suffering death or injury to his body or health, or from property being damaged, as a result of an environmental impact that issues from the facility (provision of coverage). If a facility that is no longer in operation presents a special hazard, the competent administrative agency may order the person who operated the facility at the time of the ceasing of operations to provide for coverage for a period of up to ten years.

(2) Coverage may be provided
1. in the form of liability insurance issued by an insurance company licensed to do business in the territory in which this Act applies;
2. in the form of an indemnity agreement or guarantee made by the Federal Government or by a state; or
3. in the form of an indemnity agreement or guarantee made by a credit institution licensed to do business in the territory in which this Act applies if such agreement or guarantee provides security comparable to that provided by liability insurance.
(3) The persons named in § 2 (1), Nos. 1 to 5 of the Compulsory Insurance Act as published 5 April 1965 (BGBl. I p. 213), last amended by the Act of 22 March 1988 (BGBl. I page 358), are exempt from the duty to provide for coverage.
(4) The competent administrative agency may prohibit, in whole or in part, the operation of a facility named in Appendix 2 if the operator does not comply with his duty to provide for coverage and fails to prove, within a reasonable time to be set by the competent agency, that coverage has been provided for.

§ 20. Authorization to issue executive orders
(1) The Cabinet shall, with the consent of the Upper House of the German Parliament, issue executive orders regulating:
1. the point in time after which the operator of a facility shall be required to provide for coverage pursuant to § 19;
2. scope and amount of the provision of coverage;
3. the requirements to be set for indemnity agreements and guarantees by credit institutions;
4. the procedures and powers of the administrative agency having jurisdiction to monitor the provision of coverage;
5. the proper office pursuant to § 158 c (2) of the Insurance Contract Act and the giving of notice pursuant to § 158 c (2) of the Insurance Contract Act;
6. the duties of the operator of a facility, of the insurance company, and of a person making an indemnity agreement or guarantee to the administrative agency having jurisdiction to monitor the provision of coverage.

(2) Any executive order shall be presented to the Lower House before presentment to the Upper House. The order may be amended or rejected by resolution of the Lower House. The resolution of the Lower House shall be presented to the Cabinet. If, after three session weeks following receipt of an executive order, the German Lower House has not deliberated on it, the order shall be returned to the Cabinet unamended. The Lower House shall deliberate on an executive order upon petition by the number of members required for forming a parliamentary group.

§ 21. Criminal penalties
(1) Any person who
1. fails, wholly or partly, adequately to provide for coverage in violation of § 19 (1), sentence 1, in connection with an executive order pursuant to § 20 (1), No. 1 or 2; or
2. violates an enforceable order issued pursuant to § 19 (1), sentence 2, shall be imprisoned for a term not to exceed one year or fined.

(2) If the violation is committed negligently, the imprisonment shall not exceed six months or the fine shall not exceed 180 day-sentences (Tagessätze).

§ 22. Administrative penalties
(1) Any person who violates an executive order pursuant to § 20 (1), Nos. 3 to 6, commits an administrative offence insofar as the particular order refers to this provision on administrative penalties for a specific violation.

(2) The administrative offence may be penalized with a fine of up to ten thousand Deutsche Mark.

§ 23. Transitional provisions
Where the damage was caused before the entry into force of this Act, this Act shall not apply.

Article 2
Amendment to the Code of Civil Procedure

The Code of Civil Procedure, as revised and published in the Bundesgesetzblatt, Part III, 310–14, most recently amended by Schedule 1, Chapter III, Area A, Section II No. 1 of the Unification Treaty of 31 August 1990 in connection with Article 1 of the Act of 23 September 1990 (BGBl. 1990 II pp. 885, 921), shall be amended as follows:

The following shall be inserted after § 32:
‘§ 32a Jurisdiction in actions against the operator of a facility namedin Appendix 1 of the Environmental Liability Act seeking compensation for damagecaused by an environmental impact shall be vested exclusively in the court sittingin the district in which the impact issued from the facility. The aforesaid shallnot apply if the facility is located abroad.’

Article 3 - Transitional Provision
Insofar as the damage was caused before the entry into force of this Act, the Code of Civil Procedure, unamended by this Act, shall apply.

Article 4 - Amendment to the Federal Emissions Protection Act
The Federal Emissions Protection Act, as published on 14 May 1990 (BGBl. I p. 880), as amended by Schedule 1, Chapter XII, Area A, Section II of the Unification Treaty of 31 August 1990 in connection with Article 1 of the Act of 23 September 1990 (BGBl. 1990 II pp. 885, 1114), shall be amended as follows:

The following § 51b shall be inserted after § 51a:
Ԥ 51b Provision for service of documents

The operator of a facility for which an operating permit is required shall ensure that certain documents may be served on him within the territory to which this Act applies. If service may be ensured only by the appointment of an agent for service, then the operator shall provide the name of the agent to the competent administrative agency.’

Article 5 - Entry into force
This Act shall enter into force on 1 January 1991.

6. Consumer legislation and defective products
(i) EEC Council Directive of 25 July 1985, on the approximation of the laws, regulations and administrative provisions of the Member States concerning liability for defective products

Article 1
The producer shall be liable for damage caused by a defect in his product.

Article 2
For the purpose of this Directive ‘product’ means all movables, with the exception of primary agricultural products and game, even though incorporated into another movable or into an immovable. ‘Primary agricultural products’ means the products of the soil, of stock-farming and of fisheries, excluding products which have undergone initial processing. ‘Product’ includes electricity.

Article 3
1. ‘Producer’ means the manufacturer of a finished product, the producer of any raw material or the manufacturer of a component part and any person who, by putting his name, trade mark or other distinguishing feature on the product presents himself as its producer.

2. Without prejudice to the liability of the producer, any person who imports into the Community a product for sale, hire, leasing or any form of distribution in the course of his business shall be deemed to be a pro-ducer within the meaning of this Directive and shall be responsible as a producer.

3. Where the producer of the product cannot be identified, each supplier of the product shall be 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. The same shall apply, in the case of an imported product, if this product does not indicate the identity of the importer referred to in paragraph 2, even if the name of the producer is indicated.

Article 4
The injured person shall be required to prove the damage, the defect and the causal relationship between defect and damage.

Article 5
Where, as a result of the provisions of this Directive, two or more persons are liable for the same damage, they shall be liable jointly and severally, without prejudice to the provisions of national law concerning the rights of contribution or recourse.

Article 6
1. A product is defective when it does not provide the safety which a person is entitled to expect, taking all circumstances into account, including:
(a) the presentation of the product;
(b) the use to which it could reasonably be expected that the product would be put;
(c) the time when the product was put into circulation.

2. A product shall not be considered defective for the sole reason that a better product is subsequently put into circulation.

Article 7
The producer shall not be liable as a result of this Directive if he proves:
(a) that he did not put the product into circulation; or
(b) that, having regard to the circumstances, it is probable that the defect which caused the damage did not exist at the time when the product was put into circulation by him or that this defect came into being afterwards; or
(c) that the product was neither manufactured by him for sale or any form of distribution for economic purpose nor manufactured or distributed by him in the course of his business; or
(d) that the defect is due to compliance of the product with mandatory regulations issued by the public authorities; or
(e) that the state of scientific and technical knowledge at the time when he put the product into circulation was not such as to enable the existence of the defect to be discovered; or
(f) in the case of a manufacturer of a component, that the defect is attributable to the design of the product in which the component has been fitted or to the instructions given by the manufacturer of the product.

Article 8
1. Without prejudice to the provisions of national law concerning the right of contribution or recourse, the liability of the producer shall not be reduced when the damage is caused both by a defect in product and by the act or omission of a third party.

2. The liability of the producer may be reduced or disallowed when, having regard to all the circumstances, the damage is caused both by a defect in the product and by the fault of the injured person or any person for whom the injured person is responsible.

Article 9
For the purpose of Article 1, ‘damage’ means:
(a) damage caused by death or by personal injuries;
(b) damage to, or destruction of, any item of property other than the defective product itself, with a lower threshold of 500 ECU, provided that the item of property;
(i) is of a type ordinarily intended for private use or consumption, and
(ii) was used by the injured person mainly for his own private use or consumption.

This article shall be without prejudice to national provisions relating to non-material damage.

Article 10
1. Member States shall provide in their legislation that a limitation period of three years shall apply to proceedings for the recovery of damages as provided for in this Directive. The limitation period shall begin to run from the day on which the plaintiff became aware, or should reasonably have become aware, of the damage, the defect and the identity of the producer.
2. The laws of Member States regulating suspension or interruption of the limitation period shall not be affected by this Directive.

Article 11
Member States shall provide in their legislation that the rights conferred upon the injured person pursuant to this Directive shall be extinguished upon the expiry of a period of 10 years from the date on which the producer put into circulation the actual product which caused the damage, unless the injured person has in the meantime instituted proceedings against the producer.

Article 12
The liability of the producer arising from this Directive may not, in relation to the injured person, be limited or excluded by a provision limiting his liability or exempting him from liability.

Article 13
This Directive shall not affect any rights which an injured person may have according to the rules of the law of contractual or non-contractual liability or a special liability system existing at the moment when this Directive is notified.

Article 14
This Directive shall not apply to injury or damage arising from nuclear accidents and covered by international conventions ratified by the Member States.

Article 15
1. Each Member State may:
(a) by way of derogation from Article 2, provide in its legislation that within the meaning of Article 1 of this Directive ‘product’ also means primary agricultural products and game;
(b) by way of derogation from Article 7(e), maintain or, subject to the procedure set out in paragraph 2 of this Article, provide in this legislation that the producer shall be liable even if he proves that the state of scientific and technical knowledge at the time when he put the product into circulation was not such as to enable the existence of a defect to be discovered.

2. A Member State wishing to introduce the measure specified in paragraph 1(b) shall communicate the text of the proposed measure to the Commission. The Commission shall inform the other Member States thereof.

The Member State concerned shall hold the proposed measure in abeyance for nine months after the Commission is informed and provided that in the meantime the Commission has not submitted to the Council a proposal amending this Directive on the relevant matter. However, if within three months of receiving the said information, the Commission does not advise the Member State concerned that it intends submitting such a proposal to the Council, the Member State may take the proposed measure immediately.

If the Commission does submit to the Council such a proposal amending this Directive within the aforementioned nine months, the Member State concerned shall hold the proposed measure in abeyance for a further period of 18 months from the date on which the proposal is submitted.

3. Ten years after the date of notification of this Directive, the Commission shall submit to the Council a report on the effect that rulings by the courts as to the application of Article 7(e) and of paragraph 1(b) of this Article have on consumer protection and the functioning of the common market. In the light of this report the Council, acting on a proposal from the Commission and pursuant to the terms of Article 100 of the Treaty, shall decide whether to repeat Article 7(e).

Article 16
1. Any Member State may provide that a producer’s total liability for damage resulting from a death or personal injury and caused by identical items with the same defect shall be limited to an amount which may not be less than 70 million ECU.

2. Ten years after the date of notification of this Directive, the Commission shall submit to the Council a report on the effect on consumer protection and the functioning of the common market of the implementation of the financial limit on liability by those Member States which have used the option provided for in paragraph 1. In the light of this report the Council, acting on a proposal from the Commission and pursuant to the terms of Article 100 of the Treaty, shall decide whether to repeal paragraph 1.

Article 17
This Directive shall not apply to products put into circulation before the date on which the provisions referred to in Article 19 enter into force.

Article 18
1. For the purposes of this Directive, the ECU shall be that defined by Regulation (EEC) no. 3180/78, as amended by Regulation (EEC) no. 2626/84. The equivalent in national currency shall initially be calculated at the rate obtaining on the date of adoption of this Directive.

2. Every five years the Council, acting on a proposal from the Commission, shall examine and, if need be, revise the amounts in this Directive, in the light of economic and monetary trends in the Community.

Article 19
1. Member States shall bring into force, not later than three years from the date of notification of this Directive, the laws, regulations and administrative provisions necessary to comply with this Directive. They shall forthwith inform the Commission thereof.

2. The procedure set out in Article 15(2) shall apply from the date of notification of this Directive.

Article 20
Member States shall communicate to the Commission the texts of the main provisions of national law which they subsequently adopt in the field governed by this Directive.

Article 21
Every five years the Commission shall present a report to the Council on the application of this Directive and, if necessary, shall submit appropriate proposals to it.

Article 22
This Directive is addressed to the Member States.(ii) The German Product Liability Act of 15 December 1989

§ 1. Liability
(1) If, as a result of a defect of a product, a human being is killed, is injured or affected in his health, or a thing is damaged, the producer┬┐ is obliged to compensate the person who suffered the damage for the ensuing harm. In the case of damage to property this rule applies only if an object other than the defective product is damaged and if this object is normally intended for private use or consumption and has been used by the injured party primarily for this purpose.

(2) The obligation to pay damages is excluded if:
1. the producer has not put the product into circulation;
2. it is to be assumed, having regard to the circumstances, that the product was not yet defective when it was put into circulation;
3. the producer has neither manufactured the product for sale or for any other form of distribution for a consideration nor has manufactured or distributed it in the course of his occupational activities;
4. the defect is due to the fact that at the time when the producer put the product into circulation it complied with mandatory legal provisions;
5. the defect could not yet be discerned, having regard to the state of art [literally: science and technique] at the time when the producer put the product concerned into circulation.

(3) In addition, the maker of the part of the product is exempt from the obligation to pay compensation if the defect was caused by the construction of the product into which the part was inserted or by the instructions of the maker of the product. Sentence 1 applies mutatis mutandis to a producer of a basic substance (Grundstoff ).

(4) The person who has suffered the harm has the burden of proving the defect and its causal connection with the harm. In a dispute as to whether the obligation to pay compensation is excluded according to sub-paragraphs (2) or (3), the producer bears the burden of proof.

§ 2. Products
Product in the meaning of this Act includes every moveable object, even if it forms part of another moveable or of an immovable as well as electricity. Produce of the soil, of animal husbandry, bee-farming, fishing, and hunting are exempt, unless they have undergone the first stage of processing.

§ 3. Defects
(1) A product is defective if it does not provide that degree of safety which can be justifiably expected, having regard to all the circumstances, in particular
(a) its presentation;
(b) its use which may be reasonably expected;
(c) the time when it was put into circulation.
(2) A product is not defective for the sole reason that later on an improved product was put into circulation.

§ 4. Producer
(1) Producer in the meaning of this Act is the person who has manufactured the final product, a basic substance or a component part of the product. Furthermore, whoever represents himself as a producer by attaching his name, trademark or other distinctive mark is regarded as the producer.
(2) Notwithstanding sub-paragraph 1, a person is also treated as a producer who, within the range of his commercial activity, imports into the area covered by the Treaty for the Establishment of the European Economic Community a product with a view to sale, hire, hire-purchase or any other form of distribution.
(3) If the manufacturer of the product cannot be ascertained, every distributor is treated as its producer, unless he indicates to the injured party within one month of receiving the latter’s relevant request who is the producer or the person who supplied him with the product. The same applies to an imported product in respect of which the person referred to in sub-paragraph (2) cannot be ascertained, even if the name of the producer is known.

§ 5. Several tortfeasors
If several producers are co-liable for the damage, they are jointly and severally liable. Between the debtors themselves, in the absence of provisions to the contrary, the liability to pay compensation and its extent depends upon the circumstances, in particular as to whether the damage has been caused predominantly by one or the other of them; furthermore §§ 421–5, 426 sub-paragraph 1, second sentence and sub-paragraph 2 BGB apply.

§ 6. Reduction of liability
(1) If the injured party is partly to be blamed for having caused the damage, § 254 BGB applies; if an object has been damaged, any blame attached to the person exercising physical control over it is treated as that of the injured party.
(2) If the damage has been caused at the same time by a defect of the product and by the act of a third party, the liability of the producer is not reduced. § 5 second sentence applies.

§ 7. Extent of damages in case of death
(1) In case of death, the expenses incurred in an attempt to restore health must be compensated together with the pecuniary loss suffered by the deceased in consequence of the loss or reduction of his earning capacity or of his increased needs. Damages also include the funeral expenses payable to the person responsible for them.

(2) If at the time of injury the deceased was connected with a third party by a relationship which rendered him, actually or potentially, liable by law to maintain that person, and if the third party lost his right to maintenance in consequence of the death, he is entitled to damages in so far as the deceased during the period of his life expectancy would have been liable to maintain him. This liability arises also if the third party was conceived at the time of death but not yet born.

§ 8. Extent of damages in case of injury to the person
If injury was caused to the body or to health, the expenses incurred in restoring health must be compensated together with the pecuniary loss suffered by the injured party resulting from the temporary or permanent loss or reduction of his earning capacity or from his increased needs.

§ 9. Damages by way of periodical payments
(1) Damage arising in the future as a result of the total or partial loss of earning capacity and of increased needs together with the damages payable to a third party in accordance with § 7 sub-paragraph (2) is to be compensated by periodical payments.
(2) § 843 sub-paragraphs 2–4 BGB apply.

§ 10. Maximum rate of damages
(1) If death or injury to the person has been caused by a product or by products of the same kind affected by the same defect, the liability to pay damages is limited to a maximum of DM 160 million.
(2) If the damages payable to several injured parties exceed the maximum rate set out in sub-paragraph (1), the individual damages are reduced in proportion of their total to the maximum rate allowable.

§ 11. Extent of compensation in case of damage to goods
Where goods are damaged, the person who suffered the damage has to bear the loss up to DM 1125.

§ 12. Limitation of actions
(1) An action according to § 1 shall not be brought after the expiration of three years from the time when the claimant knew or could have known of the damage and of the person liable to pay damages.
(2) Time does not run if negotiations are pending between the persons liable to pay and to receive compensation until the continuation of the negotiations has been abandoned.
(3) Furthermore, the provisions of the BGB relating to limitation of actions apply.

§ 13. Extinction of claims
(1) A claim according to § 1 is extinguished after the expiration of ten years from the date when the producer against whom the claim is made has put the product into circulation. This does not apply where a law suit or summary proceedings are pending.
(2) Sub-paragraph (1), sentence 1 does not apply to a claim which has become res judicata or to a claim covered by another executory title. The same applies to a claim which is the subject-matter of an out-of-court settlement or which has been recognised by a legal act.

§ 14. Mandatory character
The liability of a producer in accordance with the Act cannot be excluded or restricted in advance. Any agreement to the contrary is void.

§ 15. Liability according to other legal provisions
(1) If, due to the application of a pharmaceutical product destined for human use and sold in the area of application of the Pharmaceutical Products Act, a person is killed or his body or health otherwise affected, the provisions of the Product Liability Act will not be applicable.
(2) Liability in accordance with other provisions remains unaffected.

Notes
The Act establishes a parallel regime of liability which can be similar or more extensive to that found in the ‘Common law’ (based on § 823 BGB and described above, ch. 2, section A. 4 (c)). Under the Act, liability depends on the product being ‘defective’, i.e. not meeting the degree of safety normally required from such a product. Whether this will in practice lead to different results than the case law built on § 823 I BGB is a matter of some doubt. (See Kötz/Wagner, Deliktsrecht, no. 461). § 2 of the Act provides a list of situations where liability can be excluded. § 4 is worthy of special attention since it defines the persons likely to be liable; and it may be rendering non-manufacturers more extensively liable than they are under the ‘Common law’ regime. Finally, note that (like all German strict liability statutes) the Act sets limits to the amounts of damages that can be claimed under it. Compensation for pain and suffering (immaterial damages) also presupposes that the claim is based on the tort provisions of the Code so they are not claimable under the Act. For a fuller discussion see references given in ch. 3, section A. 5(b). It is, of course, left to the plaintiff to decide whether he will base his claim on the ‘Common law’ regime and/or that established by the Act.

(iii) The [UK] Consumer Protection Act 1987

I. Product Liability

1 (1) This Part shall have effect for the purpose of making such provision as is necessary in order to comply with the product liability Directive and shall be construed accordingly.

(2) In this part, except in so far as the context otherwise requires
‘agricultural produce’ means any produce of the soil, of stock-farmingor of fisheries;
‘dependant’ and ‘relative’ have the same meaning as theyhave in, respectively, the Fatal Accidents Act 1976 and the Damages (Scotland)Act 1976;
‘producer’, in relation to a product, means
(a) the person who manufactured it;
(b) in the case of a substance which has not been manufactured but has been won or abstracted, the person who won or abstracted it;
(c) in the case of a product which has not been manufactured, won or abstracted but essential characteristics of which are attributable to an industrial or other process having been carried out (for example, in relation to agricultural produce), the person who carried out that process;
‘product’ means any goods or electricity and (subject to subsection(3) below) includes a product which is comprised in another product, whetherby virtue of being a component part or raw material or otherwise; and
‘the product liability Directive’ means the Directive of the Councilof the European Communities, dated 25 July 1985, (no. 85/374/EEC) on the approximationof the laws, regulations and administrative provisions of the member States concerningliability for defective products.

(3) For the purposes of this Part a person who supplies any product in which products are comprised, whether by virtue of being component parts or raw materials or otherwise, shall not be treated by reason only of his supply of that product as supplying any of the products so comprised.

2 (1) Subject to the following provisions of this Part, where any damage is caused wholly or partly by a defect in a product, every person to whom subsection (2) below applies shall be liable for the damage.

(2) This subsection applies to
(a) the producer of the product;
(b) any person who, by putting his name on the product or using a trade mark or other distinguishing mark in relation to the product, has held himself out to be the producer of the product;
(c) any person who has imported the product into a member State from a place outside the member States in order, in the course of any business of his, to supply it to another.

(3) Subject as aforesaid, where any damage is caused wholly or partly by a defect in a product, any person who supplied the product (whether to the person who suffered the damage, to the producer of any product in which the product in question is comprised or to any other person) shall be liable for the damage if—
(a) the person who suffered the damage requests the supplier to identify one or more of the persons (whether still in existence or not) to whom subsection (2) above applies in relation to the product;
(b) that request is made within a reasonable period after the damage occurs and at a time when it is not reasonably practicable for the person making the request to identify all those persons; and
(c) the supplier fails, within a reasonable period after receiving the request, either to comply with the request or to identify the person who supplied the product to him.

(4) Neither subsection (2) nor subsection (3) above shall apply to a person in respect of any defect in any game or agricultural produce if the only supply of the game or produce by that person to another was at a time when it had not undergone an industrial process.

(5) Where two or more persons are liable by virtue of this Part for the same damage, their liability shall be joint and several.

(6) This section shall be without prejudice to any liability arising otherwise than by virtue of this Part.

3 (1) Subject to the following provisions of this section, there is a defect in a product for the purposes of this Part if the safety of the product is not such as persons generally are entitled to expect; and for those purposes ‘safety’, in relation to a product, shall include safety with respect to products comprised in that product and safety in the context of risks of damage to property, as well as in the context of risks of death or personal injury.

(2) In determining for the purposes of subsection (1) above what persons generally are entitled to expect in relation to a product all the circumstances shall be taken into account, including

(a) the manner in which, and purposes for which, the product has been marketed, its get-up, the use of any mark in relation to the product and any instructions for, or warnings with respect to, doing or refraining from doing anything with or in relation to the product;

(b) what might reasonably be expected to be done with or in relation to the product; and

(c) the time when the product was supplied by its producer to another;

and nothing in this section shall require a defect to be inferred from the fact alone that the safety of a product which is supplied after that time is greater than the safety of the product in question.

4 (1) In any civil proceedings by virtue of this Part against any person (‘the person proceeded against’) in respect of a defect in a product it shall be a defence for him to show

(a) that the defect is attributable to compliance with any requirement imposed by or under any enactment or with any Community obligation; or

(b) that the person proceeded against did not at any time supply the product to another; or

(c) that the following conditions are satisfied, that is to say
(i) that the only supply of the product to another by the person proceeded against was otherwise than in the course of a business of that person’s; and
(ii) that section 2(2) above does not apply to that person or applies to him by virtue only of things done otherwise than with a view to profit; or

(d) that the defect did not exist in the product at the relevant time; or

(e) that the state of scientific and technical knowledge at the relevant time was not such that a producer of products of the same description as the product in question might be expected to have discovered the defect if it had existed in his products while they were under his control; or

(f) that the defect
(i) constituted a defect in a product (‘the subsequent product’) in which the product in question had been comprised; and
(ii) was wholly attributable to the design of the subsequent product or to compliance by the producer of the product in question with instructions given by the producer of the subsequent product.

(2) In this section ‘the relevant time’, in relation to electricity, means the time at which it was generated, being a time before it was transmitted or distributed, and in relation to any other product, means
(a) if the person proceeded against is a person to whom subsection (2) of section 2 above applies in relation to the product, the time when he supplied the product to another;
(b) if that subsection does not apply to that person in relation to the product, the time when the product was last supplied by a person to whom that subsection does apply in relation to the product.

5 (1) Subject to the following provisions of this section, in this Part ‘damage’ means death or personal injury or any loss of or damage to any property (including land).

(2) A person shall not be liable under section 2 above in respect of any defect in a product for the loss of or any damage to the product itself or for the loss of or any damage to the whole or any part of any product which has been supplied with the product in question comprised in it.

(3) A person shall not be liable under section 2 above for any loss of or damage to any property which, at the time it is lost or damaged, is not
(a) of a description of property ordinarily intended for private use, occupation or consumption; and
(b) intended by the person suffering the loss or damage mainly for his own private use, occupation or consumption.

(4) No damages shall be awarded to any person by virtue of this Part in respect of any loss of or damage to any property if the amount which would fall to be so awarded to that person, apart from this subsection and any liability for interest, does not exceed £275.

(5) In determining for the purposes of this Part who has suffered any loss of or damage to property and when any such loss or damage occurred, the loss or damage shall be regarded as having occurred at the earliest time at which a person with an interest in the property had knowledge of the material facts about the loss or damage.

(6) For the purposes of subsection (5) above the material facts about any loss of or damage to any property are such facts about the loss or damage as would lead a reasonable person with an interest in the property to consider the loss or damage sufficiently serious to justify his instituting proceedings for damages against a defendant who did not dispute liability and was able to satisfy a judgment.

(7) For the purposes of subsection (5) above a person’s knowledge includes knowledge which he might reasonably have been expected to acquire
(a) from facts observable or ascertainable by him; or
(b) from facts ascertainable by him with the help of appropriate expert advice which it is reasonable for him to seek;
but a person shall not be taken by virtue of this subsection to have knowledge of a fact ascertainable by him only with the help of expert advice unless he has failed to take all reasonable steps to obtain (and, where appropriate, to act on) that advice.

(8) Subsections (5) to (7) above shall not extend to Scotland.

6 (1) Any damage for which a person is liable under section 2 above shall be deemed to have been caused
(a) for the purposes of the Fatal Accidents Act 1976, by that person’s wrongful act, neglect or default;
(b) for the purposes of section 3 of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1940 (contribution among joint wrongdoers), by that person’s wrongful act or negligent act or omission;
(c) for the purposes of section 1 of the Damages (Scotland) Act 1976 (rights of relatives of a deceased), by that person’s act or omission; and
(d) for the purposes of Part II of the Administration of Justice Act 1982 (damages for personal injuries, etc., Scotland), by an act or omission giving rise to liability in that person to pay damages.

(2) Where
(a) a person’s death is caused wholly or partly by a defect in a product, or a person dies after suffering damage which has been so caused;
(b) a request such as mentioned in paragraph (a) of subsection (3) of section 2 above is made to a supplier of the product by that person’s personal representatives or, in the case of a person whose death is caused wholly or partly by the defect, by any dependant or relative of that person; and
(c) the conditions specified in paragraphs (b) and (c) of that subsection are satisfied in relation to that request,
this Part shall have effect for the purposes of the Law Reform (Miscellaneous Provisions) Act 1934, the Fatal Accidents Act 1976 and the Damages (Scotland) Act 1976 as if liability of the supplier to that person under that subsection did not depend on that person having requested the supplier to identify certain persons or on the said conditions having been satisfied in relation to a request made by that person.

(3) Section 1 of the Congenital Disabilities (Civil Liability) Act 1976 shall have effect for the purposes of this Part as if
(a) a person were answerable to a child in respect of an occurrence caused wholly or partly by a defect in a product if he is or has been liable under section 2 above in respect of any effect of the occurrence on a parent of the child, or would be so liable if the occurrence caused a parent of the child to suffer damage;
(b) the provisions of this Part relating to liability under section 2 above applied in relation to liability by virtue of paragraph (a) above under the said section 1; and
(c) subsection (6) of the said section 1 (exclusion of liability) were omitted.

(4) Where any damage is caused partly by a defect in a product and partly by the fault of the person suffering the damage, the Law Reform (Contributory Negligence) Act 1945 and section 5 of the Fatal Accidents Act 1976 (contributory negligence) shall have effect as if the defect were the fault of every person liable by virtue of this Part for the damage caused by the defect.

(5) In subsection (4) above ‘fault’ has the same meaning as in the said Act of 1945.

(6) Schedule 1 to this Act shall have effect for the purpose of amending the Limitation Act 1980 and the Prescription and Limitation (Scotland) Act 1973 in their application in relation to the bringing of actions by virtue of this Part.

(7) It is hereby declared that liability by virtue of this Part is to be treated as liability in tort for the purposes of any enactment conferring jurisdiction on any court with respect to any matter.

(8) Nothing in this Part shall prejudice the operation of section 12 of the Nuclear Installations Act 1965 (rights to compensation for certain breaches of duties confined to rights under that Act).

7 The liability of a person by virtue of this Part to a person who has suffered damage caused wholly or partly by a defect in a product, or to a dependant or relative of such a person, shall not be limited or excluded by any contract term, by any notice or by any other provision.

8 (1) Her Majesty may by Order in Council make such modifications of this Part and of any other enactment (including an enactment contained in the following Parts of this Act, or in an Act passed after this Act) as appear to Her Majesty in Council to be necessary or expedient in consequence of any modification of the product liability Directive which is made at any time after the passing of this Act.

(2) An Order in Council under subsection (1) above shall not be submitted to Her Majesty in Council unless a draft of the Order has been laid before, and approved by a resolution of, each House of Parliament.

9 (1) Subject to subsection (2) below, this Part shall bind the Crown.

(2) The Crown shall not, as regards the Crown’s liability by virtue of this Part, be bound by this Part further than the Crown is made liable in tort or in reparation under the Crown Proceedings Act 1947, as that Act has effect from time to time.

(iv) Notes on the consumer protection enactments

Here are some:
(a) Liability is now strict in theory as well as in practice (except for development risks in non-pharmaceutical products). All that the victim will have to show is that the product was defective and the defect caused his injury. This is not to say that all will be plain sailing since (a) causation (despite presumptions) may be difficult to prove and (b) the Directive (and the national laws) retain quite an array of defences. For details see the texts.
(b) When is a product defective? Note again the different national formulations as well as the Directive’s emphasis on ‘user expectations’. Can American case law help in this respect?
(c) In the many happy hours of reading that will be necessary to understand the emerging law, the following articles in English may help (detailed references to the German literature are given in Ch. 2, section A.4(c) above): Borrie, ‘Product Liability in the EEC’ 9 Dublin U. L. J. 82 (1987); Dielmann, ‘The European Economic Community’s Council Directive on Product Liability’ 20 The Int’l Law 1391 (1986); Lord Griffiths, De Val, and Dormer, ‘Development in English Product Liability Law: A Comparison with the American System’ 62 Tul. L. Rev. 353 (1988); Newdick, ‘The Future of Negligence in Product Liability’ 103 (1987) LQR 288; Stapleton, ‘Product Liability Reform—Real or Illusory?’ (1985); Whittaker, ‘The EEC Directive on Product Liability’ Y. B. of Eur. L. 233 (1985); Whittaker, ‘European Product Liability and Intellectual Products’ 105 (1989) LQR 125.

This page last updated Thursday, 01-Dec-2005 11:04:43 CST. Copyright 2007. All rights reserved.