Business Law Note

10-27-2011

Proximate Cause (scope of liability) tort law does not impose liability on a defendant for all harm factually caused by the defendant's negligent conduct.

1. Cause in Fact

2. Foreseeable Facts (legal limitation)

Foreseeability the liability of a negligent defendant for unforeseeable consequences has proved to be troublesome and controversial.

Intervening injury

1. Foreseeable unforeseeable

2. Unforeseeable foreseeable

3. Unforeseeable unforeseeable

Contributory negligence: is defined as conduct on the part of the plaintiff that falls below the standard to which he should conform for his own protection and that is legal cause of the plaintiff's harm.

Comparative Negligence: damages are divided between the parties in proportion to the degree of fault or negligence found against them.

(Modified comparative negligence) the plaintiff recovers as in pure comparative negligence was equal to or grater than that of the defendant, in which case the plaintiff recovers nothing.

Assumption of Risk: a plaintiff who has voluntarily and knowingly the risk of harm arising from the negligence or reckless conduct of the defendant cannot recover for such harm.

1. Express assumption of risk is the plaintiff expressly agrees to assume the risk of harm from the defendant's conduct. Such an agreement is by contract.

2. Implied assumption of the risk is the plaintiff voluntarily proceeds to encounter a known danger.

Product Liability:

The manufacturer

The wholesaler

Retailer

Buyer (family member or any foreseeable user)

The liability of manufacturers and sellers of goods for defective products, or for its failure to perform adequately, may be based on one or more of the following

1. negligence

2. misrepresentation

3. warranty

4. Strict liability on tort.

Warranties: creates a duty on the part of the seller to ensure that the goods he sells will conform to certain qualities, characteristics, or conditions. The seller is not required to warrant the goods, and he may, by appropriate words, disclaim (exclude) or modify a particular warranty or even all warranties.

Types of Warranties:

1. Warranty of Title: Under the Uniform Commercial Code (UCC) warranty of title, the seller implicitly warrants

a. that the title conveyed is good and its transfer rightful

b. That the good are subject to no security interest or other lien (a claim on the property by another fro payment of debt).

2. Express Warranties: is an explicit undertaking by the seller with respect to the quality, description, condition, or performability of the goods.

a. Consist of an affirmation of facts

b. A promise that relates to the goods

c. A description of the goods

d. A sample or model of the goods

3. Implied Warranties: arises out of the circumstance under which the parties enter into their contract and depends on factors such as the type of contract or sales entered into, the seller's merchant or no merchant status, the conduct of the parties, and the applicability of others statutes.

a. Merchantability: under the code, a merchant seller makes an implied warranty of the merchantability of goods that are of the kind in which he deals. The implied warranty of merchantability provides that the goods are reasonably fit for the ordinary purposes for which they are used.

b. Fitness for particular Purpose: unlike the warranty of merchantability, implies warranty of fitness for particular purpose applies to any seller, whether a merchant or not. The implied warranty of fitness for a particular purpose does not require any specific statement by the seller. It requires only that the seller know that the buyer, in selecting a product for a specific purpose is relying on the seller's expertise.

c. To exclude or to modify an implied warranty of fitness for the particular purpose of the buyer the declaimer must be in writing and conspicuous. All implied warranties, unless the circumstance indicates otherwise are excluded by expression like "as is" or "with all faults"

Strict Liability in Tort: Section 402a imposes strict liability in tort on merchant sellers both for personal injuries and for property damages that result from selling a product in a defective condition, unreasonably dangerous to the user or consumer.

Requirement or elements of strict liability tort:

1. Seller is a merchant - the defendant was engaged in the business of selling a product such as the defective one

2. Sales product in defective condition - the defendant sold the product in a defective condition.

3. Unreasonable danger - the defective condition made the product unreasonably dangerous to the user or the consumer or to his property.

4. Reach user in an unaltered condition- the defect in the product existed when it is left the defendant's hands

5. Causes injury - the plaintiff sustained physical harm or property damage by using or consuming the product

6. The defective condition was the proximate cause of the injury or damage.

Defects:

1. Manufacturing defect - occurs when the product