MILLER © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. ◆ Doing business today involves risks, both legal and financial. ◆ A tort is a civil injury designed to provide a remedy (damages) for injury to a protected interest. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 2 ◆ Damages Available in Tort Actions.  Compensatory: reimburse plaintiff for actual losses.  Special: quantifiable losses, such as medical expenses, lost wages, and benefits. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 3 ◆ Damages Available in Tort Actions.  General: non-monetary, such as pain and suffering, reputation.  Punitive: punish the wrongdoer. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 4 ◆ Tort Reform.  Types of Reforms. • Limit punitive and general damages. • Capping what attorneys receive in contingency cases. • Losing party pays all expenses.  Federal Reform.  State Reforms. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 5 ◆ Tortfeasor (person committing the tort) must “intend” to commit the act:  He intended the consequences of his act; or  He knew with substantial certainty that certain consequences would result. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 6 ◆ Transferred Intent.  Intent of tortfeasor is transferred when he intends to harm person “A” but unintentionally harms person “B” as well. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 7 and Battery. → ◆ False Imprisonment. → ◆ Infliction of Emotional Distress. → ◆ Defamation. → ◆ Invasion of Privacy. → ◆ Business Torts. → ◆ Assault © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 8 ◆ Assault.  Intentional, unexcused act that: • Creates a reasonable apprehension or fear of, • Immediate harmful or offensive contact. • NO CONTACT NECESSARY. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 9 ◆ Battery is the completion of the Assault: Intentional or Unexcused.  Harmful, Offensive (Reasonable Person Standard) or Unwelcome.  Physical Contact.  ◆ Plaintiff may be compensated for physical and emotional harm. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 10 ◆ False Imprisonment.  Confinement or restraint.  Of another person’s activities.  Without justification. ◆ Merchants may reasonably detain customers if there is probable cause. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 11 ◆ Intentional Infliction of Emotional Distress.  Extreme and outrageous,  Results in severe emotional distress in another. ◆ Most courts require some physical symptom or illness. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 12 ◆ Defamation.  Defamation involves wrongfully hurting a person’s good reputation.  Law imposes duty to refrain from making false statements of fact about others. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 13 ◆ Defamation.  Orally breaching this duty is slander; breaching it in print or media (and internet) is libel. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 14 ◆ Defamation.  Published statement must be a fact. Opinions are protected speech under the First Amendment, and not actionable. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 15 ◆ Defamation.  Publication Requirement: gravamen of defamation is the “publication” of a false statement to a 3rd party that holds an individual up to hatred, contempt or ridicule in the community. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16 ◆ Defamation: Libel.  General Damages are presumed; Plaintiff does not have to prove actual injury. • Include compensation for disgrace, dishonor, humiliation, injury to reputation and emotional distress. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 17 ◆ Defamation: Slander.  General Rule: Proof of “Special damages” (actual economic loss). • Exception: Slander Per Se. No proof of damages is necessary when the statement involves: loathsome disease, business improprieties, serious crime, or that a woman is non-chaste. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 18 ◆ Defamation: Defenses.  Truth is generally an absolute defense.  Privileged (or Immune) Speech. • CASE 6.1 MCKEE V. LAURION (2013).→ © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 19 ◆ Defamation: Defenses.  Public Figures. • To prevail against a public figure, plaintiff must show the statement was made with “actual malice” (made with either knowledge of falsity or reckless disregard for the truth). © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 20 ◆ Invasion of Privacy.  Use of Person’s Name or Likeness.  Intrusion on Individual’s Affairs or Seclusion.  Publication of Information that Places a Person in False Light.  Public Disclosure of Private Facts. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 21 ◆ Invasion of Privacy.  Use of another’s name, likeness or other identifying characteristic for commercial purposes without the owner’s consent. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 22 ◆ Fraudulent Misrepresentation: Misrepresentation of material fact;  Intent to induce another to rely;  Justifiable reliance by innocent party;  Damages as a result of reliance;  Causal connection.  ◆ Fact vs. Opinion (not puffery). © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 23 ◆ Abusive or Frivolous Litigation.  Torts related to abusive or frivolous litigation include: • Malicious prosecution, and • Abuse of process. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 24 NAME OF TORT DESCRIPTiON Assault and Battery Any unexcused and intentional act that causes another person to be apprehensive of immediate harm is an assault. An assault resulting in physical contact is a battery. False imprisonment An intentional confinement or restraint of another person's movement without justification. Intentional Infliction of Emotional Distress An intentional act that amounts to extreme and outrageous conduct resulting in severe emotional distress to another. Defamation (Libel or Slander) A false statement of fact, not made under privilege, that is communicated to a third person and that causes damage to a person's reputation. For public figures, the plaintiff must also prove that the statement was made with actual malice. Invasion of privacy Publishing or otherwise making known or using information relating to a person's private life and affairs, with which the public has no legitimate concern, without that person's permission or approval. Fraudulent Misrepresentation (Fraud) Abusive or Frivolous Litigation A false representation made by one party, through misstatement of facts or through conduct, with the intention of deceiving another and on which the other reasonably relies to his or her detriment. The filing of a lawsuit without legitimate grounds and with malice. Alternatively, the use of a legal process in an improper manner. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 25 ◆ Wrongful Interference With a Contractual Relationship occurs when:  Defendant knows about contract between A and B;  Intentionally induces either A or B to breach the contract; and  Defendant benefits from breach. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 26 ◆ Wrongful Interference With a Business Relationship occurs when:  Established business relationship;  The defendant uses predatory methods to cause the relationship to end; and  Plaintiff suffers damages. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 27 ◆ Defenses to Wrongful Interference:  Interference with justified or permissible.  Bona fide competitive behavior is a permissible interference even if it results in the breaking of a contract. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 28 ◆ Trespass to Land.  Occurs when a person, without permission: • Physically enters onto, above or below the surface, of another’s land; or • Causes anything to enter onto the land; or, • Remains, or permits anything to remain, on the land. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 29 ◆ Trespass to Land.  Defenses to Trespass to Land: • Trespass is warranted (necessary), or • Trespasser is a licensee. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 30 ◆ Trespass to Personal Property.  Intentional interference with another’s use or enjoyment of personal property without consent or privilege. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 31 ◆ Conversion.  Wrongful possession or use of property without permission. ◆ Disparagement of Property.  Slander of Quality: publication of false information about another’s product (trade libel). → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 32 ◆ Disparagement of Property.  Slander of Title: publication falsely denies or casts doubt on another’s legal ownership of property, resulting in financial loss. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 33 CONCEPT SUMMARY 6.2 Intentional Torts against Property NAME OF TORT Trespass to Land DESCRIPTION The invasion of another's real property without consent or privilege. Once a person is expressly or impliedly established as a trespasser, the property owner has specific rights, which may include the right to detain or remove the trespasser. Trespass to Personal Property The intentional interference with an owner's right to use, possess, or enjoy his or her personal property without the owner's consent. Conversion The wrongful possession or use of another person's personal property without just cause. Disparagement of Property Any economically injurious falsehood that is made about another's product or property; an inclusive term for the torts of slander of quality and slander of title. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 34 ◆ Tortfeasor does not intend the consequences of the act or believes they will occur. ◆ Actor’s conduct merely creates a foreseeable risk of injury. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 35 ◆ Analysis:  Duty: Defendant owed Plaintiff a duty of care;  Breach: Defendant breached that duty;  Causation: Defendant’s breach caused the injury;  Damages: Plaintiff suffered legal injury. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 36 ◆ Duty of Care and Breach.  Defendant owes duty to protect Plaintiff from foreseeable risks that Defendant knew or should have known about. • A foreseeable risk is one in which the reasonable person would anticipate and guard against it. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 37 ◆ Duty of Care and Breach.  Duty of Landowners. • Duty to warn invitees, exercise reasonable care. • Landlords owe duty of reasonable care to tenants and guests for common areas such as stairs and laundry rooms. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 38 ◆ Duty of Care and Breach.  Duty of Landowners. • Duty to Warn Business Invitees of Foreseeable Risks (knew or should have known). • EXCEPTION: Obvious Risks. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 39 ◆ Duty of Care and Breach.  Duty of Professionals. • Professionals may owe higher duty of care based on special education, skill or intelligence. • Breach of duty is called professional malpractice. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 40 ◆ Causation.  Even though a Tortfeasor owes a duty of care and breaches the duty of care, the act must have caused the Plaintiff’s injuries. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 41 ◆ Causation.  Courts ask two questions: • Was the defendant’s action the causation in fact of plaintiff’s injury, and → • Was it the proximate cause of plaintiff’s injury →. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 42 ◆ Causation in Fact. →  Did the injury occur because of the Defendant’s act, or would the injury have occurred anyway?  Usually determined by the “but for” test, i.e., but for the Defendant’s act the injury would not have occurred. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 43 ◆ Proximate Cause.  When the causal connection between the act and injury is strong enough to impose liability.  CASE 6.2 PALSGRAF V. LONG ISLAND RAILROAD CO. (1928). © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 44 ◆ The Injury Requirement and Damages.  To recover, Plaintiff must show legally recognizable injury.  Compensatory Damages are designed to reimburse Plaintiff for actual losses. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 45 ◆ The Injury Requirement and Damages.  Punitive Damages are designed to punish the tortfeasor and deter others from wrongdoing. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 46 ◆ Negligence Per Se occurs when defendant violates a statute designed to protect plaintiff: Statute sets out standard of care.  Plaintiff is member of class intended to be protected by statute.  Statute designed to prevent Plaintiff’s injury.  © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 47 ◆ Good Samaritan Statutes.  Protects someone who renders aid to an injured person from being sued for negligence. ◆ Dram Shop Acts.  Liability for injuries may be imposed upon bartender and bar owner. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 48 of Risk. → ◆ Superseding Intervening Cause→. ◆ Contributory or Comparative Negligence.→ ◆ Assumption © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 49 ◆ Assumption of Risk. Plaintiff has knowledge of the risk, and voluntarily engages in the act anyway.  Defense can be used by participants, as well as spectators and bystanders. →  © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 50 ◆ Assumption of Risk. Can be implied by plaintiff’s knowledge of risks and subsequent conduct.  CASE 3.3 TAYLOR V. BASEBALL CLUB OF SEATTLE, LP (2006).  © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 51 ◆ Superseding Cause.  A unforeseeable, intervening act that breaks the causal link between Defendant’s act and Plaintiff’s injury, relieving Defendant of liability. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 52 ◆ Contributory Negligence.  Under common law doctrine of contributory negligence, if plaintiff in any way caused his injury, he was barred from recovery.  Not very common.→ © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 53 ◆ Comparative Negligence.  Most states have replaced contributory negligence with the doctrine of comparative negligence.→ © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 54 ◆ Comparative Negligence.  Comparative negligence computes liability of Plaintiff and Defendant and apportions damages.  Pure Comparative Negligence States: allows Plaintiff to recover even if his liability is greater than that of Defendant. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 55 ◆ Comparative Negligence.  Modified Comparative Negligence States: percent of damages Plaintiff causes herself are subtracted from the total award. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 56 ◆ Comparative Negligence.  50 Percent Rule: Plaintiff recovers only if liability is less than 50%.  51 Percent Rule: Plaintiff recovers nothing if liability is greater than 50%. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 57 MILLER © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. ◆ Development of Strict Liability.  Theory of strict liability started with Rylands v. Fletcher (1868 England).  Defendant’s liability for strict liability is without regard to: Fault, Foreseeability, Standard of Care or Causation. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 2 ◆ Development of Strict Liability.  Strict liability based on abnormally dangerous activities is one application. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 3 ◆ Abnormally Dangerous Activities.  Ultrahazardous or abnormally dangerous activities: • Involve serious potential harm; • Involve high degree of risk that cannot be made safe; and • Are not commonly performed in the community or area. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 4 ◆ Other Applications.  Wild Animals: • Owners keeping wild animals are strictly liable for injuries. • Persons who keep domestic animals are liable if the owner knew or should have known that animal was dangerous. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 5 ◆ Other Applications.  Product Liability. • Manufacturers and sellers can be strictly liable because they can bear the cost by spreading throughout the manufacturing and distribution chain.  Certain Types of Bailments. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 6 ◆ Product Liability can be based on: →  Misrepresentation; →  Strict Liability; →  Warranty Theory. →  Negligence; © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 7 ◆ Negligence.  Claim based on a manufacturer’s breach of the reasonable standard of care.  Due Care Must Be Exercised in: • Design, materials, production process, assembling and testing, adequate warnings, inspection, and testing. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 8 ◆ Negligence.  Privity of Contract Not Required. • No privity of contract required between plaintiff and manufacturer. • Liability extends to any person’s injuries caused by a negligently made (defective) product. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 9 ◆ Misrepresentation.  Occurs when fraud committed against consumer or user of product.  Fraud must have been made knowingly or with reckless disregard for safety.  Plaintiff does not have to show product was defective. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 10 ◆ Strict Liability holds people liable for results of their acts, regardless of their intentions or exercise of reasonable care. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 11 ◆ Strict Liability and Public Policy.  Consumers should be protected from unsafe products;  Manufacturers and distributors should be liable to any user of the product; → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 12 ◆ Strict Liability and Public Policy.  Manufacturers, sellers and distributors can bear the costs of injuries.  CASE 7.1 BRUESEWITZ V. WYETH, LLC (2011). © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 13 ◆ Requirements for Strict Liability: 1. Product must be in defective condition when sold. 2. Defendant is in the business of selling the product. 3. Product must be unreasonably dangerous. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 14 ◆ Requirements for Strict Liability: 4.Plaintiff must be physically harmed 5.Defective condition must be proximate cause of injury. 6. Goods are in substantially same condition. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 15 ◆ Requirements for Strict Liability.  Proving a Defective Condition. • Plaintiff does not need to show what manner the product become defective. • But plaintiff must show, at purchase, product was defective and “unreasonably dangerous”. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16 ◆ Requirements for Strict Liability.  “Unreasonably Dangerous” Products: • The product was dangerous beyond the expectation of the ordinary consumer. OR → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 17 ◆ Requirements for Strict Liability.  “Unreasonably Dangerous” Products: • A less dangerous alternative was economically feasible for the manufacturer, but the manufacturer failed to produce it. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 18 Defects (Restatement 3rd of Torts): ◆ Product • Manufacturing Defects. → • Design Defects. → • Warning Defects. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 19 ◆ Product Defects:  Manufacturing Defects. • Occurs when a product “departs from its intended design even though all possible care was exercised in the preparation and marketing of the product.” © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 20 ◆ Product Defects:  Design Defects. • Product is manufactured correctly. • Test: plaintiff must show defendant’s failure to use a reasonable alternative design rendered the product not reasonably safe. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 21 ◆ Product Defects:  Design Defects. • Risk-Utility Analysis. • Consumer Expectation Test. • CASE 7.2 WILSON SPORTING GOODS CO. V. HICKOX (2013). © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 22 ◆ Product Defects:  Inadequate Warnings. • Content of Warnings: product is defective based on inadequate warnings or instructions. → • CASE 7.3 JOHNSON V. MEDTRONIC, INC. (2012). © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 23 ◆ Product Defects:  Inadequate Warnings. • Liability based on foreseeability that proper instructions/labels would have made the product safe to use. • Obvious Risks. • Foreseeable Misuses. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 24 ◆ Market-Share Liability.  Liability when multiple defendants contributed to manufacture of same defective product.  Each defendant is proportionately liable based on its market share. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 25 ◆ Other Applications of Strict Liability.  Virtually all courts extend strict liability to injured bystanders.  Strict liability also applies to suppliers of component parts. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 26 ◆ Preemption.  Government regulations preempt claims for product liability. ◆ Assumption of Risk.  Some courts do not allow AR to be used in strict product liability claims. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 27 ◆ Product Misuse.  Plaintiff does not know the product is dangerous for a particular use. ◆ Comparative Negligence (Fault).  Defendants may be able to limit damages by apportioning fault. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 28 ◆ Commonly Known Dangers (e.g., matches, sharp knives). ◆ Knowledgeable User (e.g., electricians). ◆ Statutes of Limitation and Repose. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 29 MILLER © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. ◆A warranty is an assurance or guarantee by the seller or lessor of certain facts concerning the goods being sold or leased. ◆ If seller breaches a warranty, buyer can recover damages, or rescind the contract. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 2 ◆ Warranties automatically arise in most commercial sales transactions. ◆ Normally warranties can be disclaimed or modified with specific language in the contract. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 3 ◆ UCC-312 can creates three express warranties at sale:  Good Title.  No Liens.  No Infringements. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 4 ◆ Statements That Create:  Quality, condition, description, or performance potential of goods.  Can be created by: • Any Affirmation or Promise. • Any Description. • Any Sample or Model. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 5 ◆ Basis of the Bargain.  Seller does not have to use the words “guarantee” or “warranty.”  Buyer must rely on warranty when he enters into contract. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 6 ◆ Statements of Opinion and Value.  Only statements of fact create express warranties. Puffery versus Express Warranties.  Exception for Statements of Opinion by Experts.  Reasonable Reliance. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 7 ◆ Inferred at law based on the circumstances or nature of the transaction. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 8 ◆ Merchantability.  Automatically arises from merchants.  Merchantable Goods: • Goods are of average, fair, or medium-grade. • Adequately packaged and labeled. • Conform to promises on label. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 9 ◆ Merchantability.  Merchantable Goods: • Warranty can be breached even if merchant did not know product was defective. → • CASE 23.1 SHOOP V. DAIMLERCHRYSLER CORP. (2007). © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 10 ◆ Merchantability.  Merchantable Food: • Serving of food or drinks in a public establishment also has an implied warranty of merchantability. • CASE 23.2 WEBSTER V. BLUE SHIP TEA ROOM, INC. (1964). © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 11 ◆ Fitness for a Particular Purpose.  Particular vs. Ordinary Purpose: Differs from ordinary purpose of merchantability. Goods can be merchantable but unfit for a particular purpose.→ © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 12 ◆ Fitness for a Particular Purpose.  Knowledge and Reliance Requirements: seller must have reason to know purpose, and buyer must have relied on the recommendation. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 13 ◆ Prior Dealings or Custom.  Arises when both parties to a contract have knowledge of a wellrecognized trade custom. Courts infer that both meant this custom to apply to their transaction. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 14 ◆ Lemon Laws.  Defective automobiles that repeatedly fail to meet standards of quality or performance.  Seller has had opportunity to fix.  Arbitration often required. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 15 ◆ Magnuson-Moss Warranty Act.  Modifies UCC for consumer sales.  Only applies when written warranties are made by Seller. • If goods > $10 label “full” or “limited.” • If goods > $15 Seller must make additional disclosures. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16 ◆ Magnuson-Moss Warranty Act.  Full Warranty: Seller must repair or replace.  Limited Warranty must be conspicuous. • If limit of time only must say, e.g., “full twelve-month warranty.” → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 17 ◆ Magnuson-Moss Warranty Act.  UCC Implied Warranties: • May not be disclaimed, but can be limited, but must correspond with time of express warranty. • Requires document of all warranties in “readily understood language.” © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 18 ◆ Occurs when two or more warranties are made in a single transaction:  Consistent Warranties are construed as cumulative. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 19 ◆ Inconsistent Warranties:  Express warranties displace inconsistent implied warranties – except fitness for a particular purpose. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 20 ◆ Inconsistent Warranties:  Samples take precedence over inconsistent descriptions.  Exact or technical specifications displace inconsistent samples or descriptions. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 21 ◆ Express Warranties disclaimed:  If they were never made (evidentiary matter).  If a clear written disclaimer in contract with specific, unambiguous language and called to Buyer’s attention (BOLD CAPS UNDERLINED). © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 22 ◆ Implied Warranties.  Unless circumstances indicate otherwise, warranties of fitness and merchantability can be disclaimed with the words “As Is,” “With All Faults.” → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 23 ◆ Implied Warranties. • CASE 23.3 ROBERTS V. LANIGAN AUTO SALES (2013).  Disclaimer of the Implied Warranty of Merchantability: must use the word merchantability.→ © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 24 ◆ Implied Warranties.  Disclaimer of the Implied Warranty of Fitness: must be in writing and conspicuous. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 25 ◆ Buyer or Lessee’s Examination or Refusal to Inspect.  Warranties are disclaimed as to defects that could reasonably be found on examination. → © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 26 ◆ Warranty Disclaimers and Unconscionability.  Factors include ‘take-it-or-leave-it’ provision or unequal bargaining power.→ © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 27 ◆ Statutes of Limitation.  Action for Breach of Warranty must commence within four (4) years after the action accrues (breach).  Begins to toll at tender, but buyer must notify Seller within a reasonable time. © 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 28
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