More clarity for product manufacturers in relation to strict liability claims by consumers

12 Dec 2019

Wilson v Beko PLC [2019] EWHC 3362 (QB)

The judgment in Wilson v Beko [2019] handed down on 10 December 2019 considers some interesting issues as to when a consumer can rely on s 41(1) of the Consumer Protection Act 1987 (the Act)  in bringing a  strict liability claim for damages arising from the breach of a Safety Regulation under Part II.  In this tragic case Mr Wilson died in a house fire in 2016 (and members of his family were seriously injured) which was caused by a defect in a Beko fridge-freezer.

A claim under Part I of the Act has to be brought within 10 years beginning with the date that the product was put into circulation. The fridge-freezer had been purchased in 2005 (and would have been supplied before that) so any claim under Part I was time barred as the 10 year long stop applied.

Part II of the Act imposes Safety Regulations in respect of products. The claimants brought a claim under s 41(1) of Part V of the Act based on a breach of the Safety Regulations imposed by Part II in an attempt to circumvent the limitation period. They alleged that Beko were in breach of the Electrical Equipment (Safety) Regulations 1994 and as such were in breach of s 41(1) of the Act which provides that ‘(1) an obligation imposed by Safety Regulations shall be a duty owed to any person who may be affected by a contravention of the obligation and, subject to any provision to the contrary in the Regulations and to the defences and other incidents applying to actions for breach of statutory duty, contravention of any such obligations should be actionable accordingly.’

The court was asked to determine as a preliminary issue the following:

"Are, on the true construction, section 41(1) of the Consumer Protection Act 1987 (‘the 1987 Act’) and/or the Electrical Equipment (Safety) Regulations 1994 applicable in this case (on the basis of the matters pleaded in the Amended Particulars of Claim), and taking into account insofar as relevant Products Directive (No 85/374/EEC) and EU law, and if so to what extent and on what basis?"

The legal framework

The defendant maintained that Part I of the Act was enacted to make such provision as to ensure that the UK complied with the Directive of the Council of the European Communities (No 85/374/EEC) (the Directive).  The Directive makes producers strictly liable for damage caused by defective products; proof of negligence or other fault is not required. 

The Directive provides that consumers are protected so that if a product causes personal injury or material damage above EUR 500, to an item of property, mainly for private use or consumption, producers are liable regardless of whether or not they are at fault (see the Report from the Commission to the European Parliament, the Council and the European Economic and Social Committee on the Application of the Directive, COM (2018) 246 (7 May 2018) pages 2-3).

The recitals to the Directive provide amongst other things that the consumer requires compensation for death and personal injury as well as compensation for damage to property; “…whereas the latter should nevertheless be limited to goods for private use or consumption…”

The defendant argued that the claimants could not bring a claim under s 41(1) of Part V of the Act for breach of the Safety Regulations imposed by Part II in circumstances where the subject matter of the claim would fall within the scope of Part I of the Act.  The claimants were claiming for compensation for personal injury and for damage to property of a personal nature and hence such action was clearly capable of being brought within the scope of the Directive and hence Part I of the Act.   The defendant argued that interpretation of National Law has to be by reference to the scope of the Directive (including the provisions for time limits and defences) and if the claimants could bring a claim under s 41(1) of the Act it would mean that the Directive would not be adhered to and would plainly be wrong.

That is to say that the Directive clearly sets out a framework where a consumer can claim compensation for personal injury or damage to property (for private use or consumption) which has been ratified by Part I of the Act.  To allow a separate claim under s.41(1) would mean that parts of the Directive as enacted would not be followed, including the long stop limitation period contained in the Directive.

The judgment

The court found that in circumstances where a claim fell within the scope of the Directive and Part I of the Act (as in the Wilson case) it was not possible to bring a claim under s 41(1) of Part V of the Act.

“Section 41(1) operates by making a breach of the obligations imposed by safety regulations actionable.  In my judgment, in order to conform with what I have held to be the correct interpretation of the Directive, breaches of obligation imposed by safety regulations made under Part II of the 1987 Act are not actionable under s41(1) if and to the extent the breach of duty in question would fall within Part I of the 1987 Act as relating to a defective product that caused actionable damage.”

Given the above the claimants failed on the preliminary issue which ultimately meant the claim under the Act was time barred under the 10 year long stop. The claimants however still have their remaining claim in negligence against the defendant – it is the enhanced strict liability claim under the Act that is unavailable.

What this means for you

Wilson is concerned with a claim by a consumer – such claims have to be bought by reference to Part I of the Act. This therefore leaves an interesting question as to whether losses sustained to business property can be recovered under s 41(1) of the Act.  Whilst the judge made reference to commercial property falling outside the Directive the question of whether this would have been recoverable was not explicitly dealt with in the judgment and appears to have been left open for now. 

Looking forward the judgment suggests that any claim for compensation for personal injury and/or property damage (of personal nature) will need to be brought under Part I of the Act, regardless of whether that loss arose from a breach of a Safety Regulation imposed by Part II.  However a similar claim causing damage to commercial property will be brought under Part V of the Act, and although not yet tested in a court of law it could give a peculiar advantage to commercial entities over individuals of potentially providing a longer limitation period and one which is not necessarily caught by the 10 year long stop.

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Disclaimer: This document does not present a complete or comprehensive statement of the law, nor does it constitute legal advice. It is intended only to highlight issues that may be of interest to customers of BLM. Specialist legal advice should always be sought in any particular case.

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