Questioning the Social Desirability of Product Liability Claims

Abstract

ABSTRACT Questioning the Social Desirability of Product Liability Claims This thesis seeks to answer the primary question as to whether Product Liability Claims are socially desirable by reference to three Product Liability case studies and a survey of 132 archived Product Liability claims. These constitute a representative random sample of Product Liability cases handled by the Author’s Legal Practice. This practice has provided a window through which serious failings are identified in (i) the strict liability based Product Liability Directive; (ii) tort itself as a mechanism for compensating injured persons; and (iii) the procedural infrastructure in which claims are made, as recently reformed in accordance with Lord Justice Jackson’s recommendations. This thesis tests Product Liability claims against the objectives of tort: deterrence; corrective justice; retribution and vindication; distributive justice and compensation. It is found that Product Liability claims fail to meet the defined standard of social desirability. There is nothing special about products to necessitate or justify a bespoke system of liability. Product Liability claims for damages represent in microcosm the broader picture of personal injury claims as a whole. This thesis highlights the failings of a system which relies heavily on gambling upon outcomes; perpetuates a ‘have a go’ culture; rewards the lucky few; builds in an unacceptable element of moral hazard and tolerates and generates the costs of a high volume of claims which serve no practical or legal purpose. It is concluded that 1. The Product Liability Directive was introduced as an emotive response to the Thalidomide tragedy but it would fail to provide a remedy in a similar disaster. Instead it treats sufferers of minor mishaps as victims and contributes to a litigation industry that inculcates in society a false and unnecessary sense of entitlement. 2. The Product Liability Directive should be repealed as a flawed and misconceived piece of legislation that fails to achieve its key goal of protecting consumers and harmonising the law. 3. Support is found in this practical research for much of what Atiyah advocated in his seminal work The Damages Lottery. The possibility of an all-embracing no-fault liability system should be reconsidered subject to strict controls, including thresholds, to ensure that it compensates and rehabilitates only those with genuine needs. 4. A first party insurance market would have to develop to fill the gaps.