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Action against the manufacturer

Sometimes an action may be taken against the manufacturer instead of, or as well as against the supplier. For example, the contract might not give the injured person the necessary legal rights or the manufacturer may be better able to meet large claims because it is adequately insured. There are statutory rights against manufacturers under the Australian Consumer Law, which is contained in schedule 2 of the Competition and Consumer Act 2010 (Cth).

Manufacturers are usually sued for breach of the guarantees contained in the Australian Consumer Law [see in particular schedule 2, ss 54-56], for breach of other provisions of the Australian Consumer Law [see in particular shcedule 2, ss 106 and 138] or for negligence at common law.

The extent to which negligence, or carelessness, must be proved varies from case to case. It commonly involves satisfying the court that it was more probable than not that the plaintiff's injury was caused by the negligence of the manufacturer.

If a number of people have been injured by the same product it is now easier to take a class action (make a claim as a group) [see Competition and Consumer Act 2010 (Cth) sch 2, s 149 and the Federal Court Rules 2011 (Cth)].

Liability may be found if the drug or device was not properly tested, if sterilisation and safety control measures were inadequate, or if the company failed to warn users of adverse reactions.

The manufacturer is also liable for the negligent acts of individual employees.

The court will consider the extent to which consumers were warned of adverse reactions or potential hazards by information attached to the product.

In the case of therapeutic products, much of the relevant information will be given to the consumer by the doctor. It is unclear whether or to what extent a warning provided by the manufacturer but not passed on to the consumer allows the manufacturer to escape liability.

In a claim of negligence, the manufacturer may argue that a plaintiff voluntarily accepted the risks associated with the durg or device or was careless in using it. A further difficulty confronting a plaintiff receiving a drug or device at a health service is in proving that the damage or harm complained of has been caused by the product and not by the health service. In other words, fault may lie with those administering treatment rather than with the product itself. When the faulty product is not the sole cause of the damage, difficulties and complexities arise which can have an impact not only on the amount which may be recovered, but also on the result of the case. These difficulties may be not only legal but also practical, such as the difficulty of obtaining evidence needed for success in the case.

To defend a claim, the manufacturer must usually show both that the consumer was aware of and understood a particular risk, and that he or she consciously decided to take the risk, or was reckless about whether or not a harmful result might occur.

What if the manufacturer cannot be identified?

If a consumer wishes to take action against a manufacturer for defective goods but does not know or cannot identify the manufacturer, they may request, by written notice, that the supplier provide details to identify the manufacturer [see Competition and Consumer Act 2010 (Cth) sch 2, s 147].

If no information is provided to identify the manufacturer within 30 days then the supplier to whom the request was made can be taken to be the manufacturer for the purposes of any action to be pursued.

Action against the manufacturer  :  Last Revised: Fri Apr 12th 2013
The content of the Law Handbook is made available as a public service for information purposes only and should not be relied upon as a substitute for legal advice. See Disclaimer for details. For free and confidential legal advice in South Australia call 1300 366 424.