FIDGET SPINNERS – ARE THEY SPINNING OUT OF CONTROL?
This is according to Simon Colman, Executive Head at SHA Specialist Underwriters, says who says over the past two months, there has been a number of cases reported in Australia and the US of injuries caused by fidget spinners, ranging from fingers getting stuck in the spinners to parts of the spinners being swallowed. “The major question that has arisen from these incidents is whether the manufacturer or the retailer should be held liable for the damages that were caused.”
In South Africa, these types of liability claims can find themselves in court or at the very least, in front of the National Consumer Commission, even if the matter involves an international supplier, says Colman. “Section 61 of the Consumer Protection Act (CPA) imposes joint and several liabilities upon all of the members of the product supply chain. Therefore, not only can the manufacturer be held liable for injuries caused, but also the retailer or any other party that assisted in getting the product to the marketplace, giving the consumer several parties that they can seek recourse from.”
Colman says the fidget spinner cases serve as a reminder to all South African businesses, to be aware of the importance of understanding the consumer protection framework. Particularly in terms of product liability and product safety issues.
He explains that when Section 61 of the Consumer Protection Act came into full effect in April 2011, it was quite contentious because of the impact on suppliers of products. “Prior to 2011, the common law (of Delict) was applied to cases where a consumer was injured by the use of a product. This meant that the injured party had to prove that the negligent actions of the supplier had caused the injury. If the consumer could not prove negligence of the supplier their claim against the supplier would not have succeeded. Section 61 really turned this on its head because it imposes a form of "strict liability" where it is not necessary for the victim to establish negligence on the part of the supplier.”
However, the CPA does provide some limited defences where retailers may escape liability if it can be proven that the defect that caused the injury only occurred after the product was sold, or if it would be unreasonable to assume that the retailer could have discovered the unsafe properties of the product, says Colman. “A retailer of foodstuff, for instance, cannot conceivably open and test every tin of beans it sells.”
All members of the product supply chain should protect against financial losses related to product liability by ensuring that they have an adequate liability insurance policy in place, he says. “These issues are best discussed with the guidance of an insurance broker who can make sure that they have the widest possible cover that will respond to CPA related actions.”
It is also a very good idea that retailers consult with their attorneys to make sure they have adequate indemnities with the other members of the supply chain, he adds. “Whilst the retailer cannot contract out of liability with the consumer, they can ensure that the manufacturer indemnifies them for losses.”
‘’Retailers and distributors should not make the mistake of thinking that the product liability exposure rests only with the manufacturer, the Joint and Several liability provisions Act found in Section 61 of the CPA places them in the direct firing line,” concludes Colman.