Court:

Court of Appeal of Liège, 11th division, JLMB 2005/05 p. 212 Cour d'Appel de Liège, 11ème Chambre Parties : C. vs. S.A. K.B.C. Assurances and others Date : 7 November 2005

Topics:

Liability of manufacturers and importers on the basis of Product Liability Act of 1991.

Liability of manufacturers and importers on the basis of general tort law

Liability of retailers unaware of latent defect of a product for the consequences of the accident caused by the defect

Claim on the basis of tort law between retailer and purchaser

Articles:

PLA of February 25, 1991.

1382 C.C.

1644-1645 C.C.

1382 C.C.

Facts:

A motorcycle manufactured in Italy by Cagavi is imported in Belgium by W.M. and sold by retailer C to S.L. Three months after the sale; S.L. loses control and falls against a parked car. He is injured and the motorcycle damaged. The accident is caused by the rupture of the motorcycle's fork. A series of motorcycles was affected by a latent defect; an insufficient tightening of the screw fasteners between the bases and the stems of the fork. The defect was known to the manufacturer. He indeed had, three weeks prior to the sale to S.L., instructed the importers to recall the motorcycles and to carry out the necessary repairs. The importer W.M., however, did not inform the retailer, or S.L., yet invoiced the manufacturer for the cost of repair. Prior to the sale, the retailer was unaware of any problems with the motorcycles. S.L. claims from the retailer, the importer (bankrupt in the mean time) and the manufacturer, compensation for physical injury and for the portion of the damages to the motorcycle not compensated by his casualty insurer. The casualty insurer and social insurer having compensated S.L. claim on the basis of subrogation. Defendants invoke a prior accident with the motorcycle and its improper use as cause of the accident.

Legal Questions:

Are the manufacturer and the retailer liable on the basis of tort law if they neglect to inform the buyer of a defect of the product bought by him of which they are aware? Is the retailer liable for a defective product liable under common law if he was not aware of the defect?

Decision:

A prior accident and the alleged improper use of the motorcycle are rejected as cause of the accident, which is found in the defect in the motorcycle.

The manufacturer and the importer are held jointly and severally liable on the basis of the PLA of February 25, 1991. The motorcycle was affected by a defect, as it did not offer the safety which buyers were entitled to expect when making a normal use of the motorcycle. The existence of the defect was established on the basis of the declarations of witness of the accident and of the claimant himself which were not contradicted by expert testimony; it was recognised by the manufacturer in his instructions sent to the importers to recall the defective series of motorcycles.

The manufacturer and the importer are also held liable on the basis of general tort law. (art. 1382 C.C.) for the negligence of not having taken all necessary measures to inform the buyers of the motorcycle of the defect. The manufacturer and the importer thus are to provide full compensation to claimant.

The action against the retailer is rejected. It can only be based on the sales contract and not on general tort law. As the retailer was totally unaware of the defects of the motorcycle, he is not liable for the damages suffered by the buyer who can only claim restitution of the price of the motorcycle or for part thereof.

Comments:

The decision is interesting in that it seems to be the only recently published decision on the basis of the Product Liability Act of 1991 involving an accident with a motor vehicle. Interesting is also the leniency with which the retailer is treated under common law. A professional seller is presumed to have known the latent defects of the goods sold, unless it was totally impossible for him to discover the defect. In evaluating this impossibility, courts generally are substantially more tolerant for retailers than for importers, distributors and manufacturers. In this decision, however, the court does not require evidence of the impossibility to discover the defect and rejects liability on the only basis of the absence of actual knowledge of the defect. In doing so, the court in fact sets aside the presumption of knowledge. In doing so, it reaches, with respect to the liability of retailers in a case where the importer or manufacturer of the defective product are known, the same result as under art. 3 of the Product Liability Directive and the Belgian PLA.

For the original decision (in French), please click here