Part A

Shine Inc. is a commercials exterior and interior cleaning company. The company has no products of its own and purchases them from Glow Inc. For ten years, the company has been buying the products from the said company, and there has never been a case of a legal claim. The company has operated profitably for the ten years. The products purchased from Glow Inc. are all chemical free and thus not harmful.

However, for six months, three of the companies under contract with Shine Inc. have been complaining of effects such as headaches, rashes, and nausea after the cleaning. This is a clear indication that there is a problem with the cleaning products. Shine only concluded that other issue other than their products caused the problems. This was a failure on their part. They should have tested to see if the products from Glow Inc. were safe after complaints started coming in. Instead, the company just continued using them. This is a case of negligence. First, both the companies owed a duty of care to National Office Services Inc. Shine Inc. had to make sure that the products they used were safe, and Glow Inc. had to manufacture products that were safe.

From the case, it is clear that the goods from Glow Inc. were not safe, and Shine Inc continued to use them thus bringing side effects to the employees. This is because the symptoms only started after the cleaning. Employees did not feel the symptoms before the cleanup. Additionally, it affected many employees from different companies. Though Shine Inc. did not manufacture the products, they should have tested to see if the products were safe. Glow Inc, on the other hand, should have included a warning on the products against allergies and other symptoms. The premise would have ensured that Shine Inc. used the products appropriately.

Shine Inc. argued that it was protected by an exculpatory clause in its contract with National Office Services. An exculpatory clause covers for damages in the course of fulfilling the contract (Lau & Johnson, n.d. p 285). However, in this case, the symptoms appeared after cleaning the offices. The direct cause of the symptoms was the products used and not the method of use. The exculpatory clause in this case cannot cover for negligence. This is a case of product liability. In line with this argument, I agree with the court ruling where National Office Services received damages.

Part B

The exculpatory clause in the Shine Inc. contract with National Office Services should not affect the outcome of the lawsuit. An exculpatory clause is a provision in a contract that frequently relieves one party off a liability in case of damages in the course of contract execution. National Office Services sued Shine Inc. under the strict product liability for negligent and defective manufacture of the goods used in cleaning. Under the strict product liability, a manufacturer or distributor of a defective product is liable to an injured person regardless of whether the defendant had taken necessary measures to avoid the injury (Mayer, Warner & Siedel, 2012 p 165). The types of defects considered here include design defects, inadequate warnings, and manufacturing defect.

The manufacturer, distributor, or the retailer can be sued under strict product liability. In line with this, National Office Services was right in suing both the manufacturer and the retailer. Shine Inc acts as the retailer since they used the products to clean offices. The policy behind this rule is that consumers should lack compensation simply because it is hard to determine who was responsible for the injury in the distribution chain. Glow Inc. manufactured defective products, and they sold them to Shine Inc. Shine then used the products to clean offices in National Office Services. This makes shine retailers of Glow Inc products. Under the strict product liability, both the manufacturer and the retailer are liable for injury caused by defective products (Carper, McKinsey & West, 2008 p 350). Shine Inc had received complaints from National Office Services for many months, and they did not take any steps to ensure that the products were safe. This makes the company liable for negligence.

The exculpatory clause covers for damages during the execution of the contract. However, the case is not about damage but negligence, defective manufacture and lack of adequate warnings on the products. Therefore, the case becomes an issue of neglect. It is imperative to note that the exculpatory clause does not cover negligence. In addition, given that sued for strict product liability both of the sued companies were liable under this provision. It is not for the court to determine who was responsible for the defective product. It is the defendant who should prove who in the supply chain is in charge of the defect (Lasker, Klein & Barago, 2015 p 300). In this case, the exculpatory clause would have made no changes to the outcome. Under the circumstance presented, Shine Inc. was liable for the injury. The company should sue Glow Inc. to recover the damages incurred in the case.

Under strict liability, the plaintiff proves that the product was defective and not that the defendant was negligent. The exculpatory clause thus will not apply when the product is defective. This will be a question of whether the products used were defective or not. It will be upon Shine Inc. to prove it was not negligent and sue for damages from Glow Inc. as far as National Office Services is concerned, it is suing Shine Inc for using being negligent by using a  defective product.

Part C

Product liability law is very significant in the society. In the current economic and business systems, manufacturers use distributors to supply their products. Merchants, on the other hand, use retailers to get the product to the consumers. Thus, it becomes hard to determine who is liable for any defect in a product. A good example would be a television set.  One cannot prove that the distributor or retailer did not make any changes to the product. In such a case, the injured consumer might not get compensation (Lau & Johnson, n.d. p 304). In addition, manufacturers often claim that they followed necessary standards while manufacturing products making it hard for plaintiffs to win cases involving defective products.

The product liability law sought to replace the standard negligence laws. The product liability law does not recognize the fact that the manufacturer or the retailer had met the set standards. It is hard to prove that one has behaved below standards or that the cause of the defect was something else. This is why the product liability allows a plaintiff to sue the manufacturer, distributor, or the retailer for an injury caused by a defective product.  It is not for the plaintiff to prove that the sued party was liable (Lau & Johnson, n.d. p 368). Once a plaintiff has sued the manufacturer and the distributor, it is then up to the defendant to prove who was responsible for the defect. This protects the innocent consumers injured by defective products.

Without the product liability laws, it is hard to determine who is the cause of a defect. This is so because the supply chain is large and the blame will be passed on to the next person in the supply chain. In addition, it is hard to determine who caused the defect in the supply chain. The product liability laws come in to save consumers from uncaring manufacturers and distributors. The focus of the law is to make sure that injured consumers receive compensation from everybody in the supply chain. It is then upon those in the supply chain to determine the cause of the defect and sue those responsible to recover their dues.

In most of the court cases, the burden lies with the plaintiff to prove that the defendant in liable. Under product liability law, a doctrine shifts the burden to the defendant. If is clear that the product defect would not exist unless someone was negligent. Then the burden shifts to the defendant to prove it was negligent (Lasker, Klein & Barago, 2015 p 301). In addition, the strict liability clause is also very helpful to the plaintiffs. If the clause applies, the plaintiff has no business proving that the manufacturer was negligent. The plaintiff just needs to prove that the product was defective. In the case under study, National Office Services is just proving that the products used by Shine Inc. were defective and not that Shine Inc. and Grow Inc were negligent.

Part D

The product liability laws make sure that manufacturers, as well as distributors and retailers, handle products with care. However, in my view, standardization of product liability laws should occur all over the world. Different countries have different rules, but manufacturers are now global meaning a defective product can instill injury on a consumer in a different state than the state of manufacture. A good example is the case of the Geier v. American Honda Motor, Inc. the plaintiff was claiming that the automobile manufacturer was liable for failing to equip the car with driver’s seat airbag (Barney, 2004 p 950).

The court ruled for the defendant since putting an airbag on the driver’s side was against the Department of Transportation standards. In this case, the local laws preempted the product liability law. Standardization of the product liability law is necessary to avoid preemption. There should be no limits to litigation based on conflictions between the local laws and the product liability laws. The fact that business had become global demonstrates the need to have comprehensive product liability laws to ensure that consumers all over the world are safe from manufacturers and marketers looking out for their interests.

The product liability lawsuits should be limited to situations where the defective manufacture or negligence is the cause of the injury. If left open, consumers can take advantage and sue when they misuse products and are injured. If a consumer misuses a product leading to injury, then this is negligence on the part of the consumer. A good example is the Liebeck v. McDonald case of 1994. Liebeck accidentally poured coffee on her lower body after being served at McDonald. She sustained burns on her thighs and buttocks. She sued under product liability and argued that McDonald served coffee at 180 degree of temperature as compared to other served, which served at 140 degrees (Cain, 2007 p14). It is agreeable that McDonald was not liable for the burns since the plaintiff poured the tea on herself and not an employee of McDonald. However, the jury verdict awarded her $ 2.7 million in damages and $ 160,000 for medical expenses.

Litigation in product liability should be limited to negligence on the part of those in the supply chain. If a consumer improperly or accidentally injures himself/herself with the product, then the negligence is on the consumers’ part and not on the manufacturer. Just like in the above mentioned case. A consumer can easily pour the hot coffee on oneself and then sue for damages.

References

Barney, M. A. (2004). Not as Bas as We Thought-The Legacy of Geier v. American Honda Motor Company in Product Liability Preemption. Brook. L. Rev., 70, 949.

Cain, K. G. (2007). The McDonald’s Coffee Lawsuit. Journal of Consumer & Commercial Law, 11(1), 14-19

Carper, D. L., McKinsey, J. A., & West, B. W. (2008). Understanding the law (5th ed.). Mason, OH: Thomson/West.

Lasker, E. G., Klein, S. A., & Barago, T. F. (2015). Taking the Product out of Product Liability: Litigation Risks and Business Implications of Innovator and Co-Promoter Liability. Def. Counsel J., 82, 295.

Lau, T., & Johnson, L. C. (n.d.). Legal and Ethical Environment of Business. Washington: Flat World Knowledge.

Mayer, D., Warner, D., & Siedel, G. (2012). Business Law and the Legal Environment. Business Law and the Legal Environment.

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