Manufacturer's Duty to Warn: A Canadian Perspective[dagger], The

FDCC Quarterly, Fall 2004 by Churchill-Smith, Bruce

I.

INTRODUCTION

The onset of the twentieth century witnessed the mass production and consumption of goods. Instances of personal injury and property damage have steadily increased with our increased reliance on manufactured products. Consumer protection was initiated through government regulation of the production and handling of consumer goods. Despite increases in legislative controls, consumers continue to suffer personal injury, property damage, and economic loss from the use of both ordinary, everyday products and products that are recognized as hazardous. When such loss occurs, consumers have two general avenues for compensation: contract law and tort law. This area of the law is referred to as "products liability."1 The mass production and consumption of consumer goods presented a new challenge to tort law in particular, and has resulted in a considerable expansion of the duty of care in negligence actions. The following is a summary of the state of products liability law in Canada, with particular emphasis on the manufacturer's duty to warn in negligence actions.

II.

LIABILITY IN CONTRACT

If a contractual relationship exists between plaintiff and defendant, the plaintiff may pursue its action in contract. This cause of action is most commonly advanced against the supplier or distributor of the product, as privity of contract often does not exist between a consumer and manufacturer. A consumer that has purchased a defective product may have a remedy based on the seller's breach of express or implied terms of the purchase contract. Implied warranties of reasonable fitness and of merchantable quality have been developed at common law to protect consumers from defective products. In addition to the common law, each province has legislation that implies certain conditions in contracts for the sale of goods.2 A condition of reasonable fitness is implied when a consumer expressly or impliedly makes known to the seller the purpose for which the goods are to be used and the consumer substantially relies on the seller's skill or judgment. The implied condition that the goods are of merchantable quality is somewhat wider in scope. There must be a sale by description for the condition to be implied. Once a breach of the implied warranty is found, the consumer will succeed without proof of negligence.

If there is no contractual relationship between the parties, the law of tort is the only avenue of recovery for the consumer who has suffered loss.

III.

LIABILITY IN TORT

In a products liability action, the plaintiff must prove the following elements: the defendant owed a legal duty of care to the plaintiff; the product was defective or flawed; the defendant failed to meet the requisite standard of care; and the defect or flaw caused the plaintiff's harm. In contrast to a contract action, a tort action merely requires a relationship of sufficient proximity between the two parties that it can reasonably be said that one owed a duty of care to the other.3 Products liability law has generally recognized three categories of negligence, for which a manufacturer may be liable for loss suffered by a consumer: (1) design; (2) manufacture; and (3) warnings. The first category involves products with a feature, which is known, or is later discovered, to be inherently flawed or dangerous. The second category involves defects in the production process itself. The third category involves products that require warnings with respect to their inherent dangers or instructions as to their safe and proper use. A product may be designed and manufactured with appropriate care, but if it contains inadequate warnings with respect to foreseeable dangers, the manufacturer may nonetheless be liable.

IV.

THE DUTY TO WARN

The duty to warn may arise in cases involving both defectively manufactured or designed products as well as reasonably manufactured products that function in the manner intended, yet have resulted in harm to the consumer. As such, the duty to warn is a flexible and comprehensive concept. A manufacturer is required to warn of all foreseeable risks associated with the use of its product to a wide range of individuals including, but not limited to, the actual purchaser of the goods. The scope of this categoiy of negligence has led to a fear that this duty may result in strict liability for harm suffered by consumers and that manufacturers are effectively being placed in the role of insurers for their products.

The duty to warn seeks to equalize the knowledge imbalance between the manufacturer and the consumer. It promotes personal autonomy in the marketplace and assists in accident prevention. A manufacturer may provide information concerning known defects or non-obvious risks associated with the product, directions for its safe use, as well as instructions for treatment in the event of an accident. These warnings have the potential to avoid accidents altogether or to reduce the extent of the harm if an accident does occur. The duty to warn provides consumers with the knowledge to make informed choices in the marketplace and to appropriately manage the risks associated with an advanced consumer society.4