Product Liability: A Little Knowledge Can Be a Dangerous Thing
Tuesday, 13th September 2016
On 12 February 2007, a fire broke out at Howmet's factory, causing over £20 million worth of damage. Before the fire, the Claimant had installed a "thermolevel" made by Economy Devices Ltd ("EDL") that was designed to switch off the heater in the tank in which the fire had started. It was agreed that, had the device worked properly, the fire would not have occurred.
Unfortunately, the thermolevel was defective. Indeed, prior to 12 February, there had been two incidents where the device had failed to switch off the heater. On both occasions, a fire had resulted which Howmet's employees had managed to put out. Yet, instead of notifying the manufacturer and getting the device repaired, Howmet put its own system in place to stop the tank catching fire.
Following the fire on 12 February, Howmet issued a claim against EDL for negligence. At first instance, Edwards-Stuart J dismissed the claim. The judge found that, although the thermolevel was defective, Howmet had knowledge of the defect and had not been relying on the device at the date of the fire. Therefore, Howmet was unable to prove that the fire had been caused by EDL's negligence. Howmet appealed.
The Court of Appeal unanimously dismissed Howmet's appeal. Howmet had been aware that the thermolevel was defective and that there was a risk of fire. Therefore, the effective cause of the fire was not the defective device, but the failure of the system Howmet had put in place. Alternatively the Court found that, given that Howmet had discovered the defect before the damage took place, EDL did not owe Howmet a continuing duty in respect of the safety of the device.
This decision is significant because it makes clear that, if a company's employees become aware of a defect in a product and continue to use it, the manufacturer may not be liable for damage that later results. Although it might be tempting for an end-user to develop a convenient "workaround", by failing to notify the manufacturer and continuing to use the defective product, they may be releasing the manufacturer from its duty of care towards them.