Consumer Protection and Product Liability
This section covers consumer protection and product liability. The exam tests cooling-off rights, unfair contract terms, misleading representations, and strict liability for defective products.
Core rules
- The Consumer Contract Act protects consumers against unfair solicitation and clauses. Specified commercial transactions may give an eight-day cooling-off period, with exceptions. Misleading or coercive solicitation can give rescission rights. Clauses that improperly restrict consumer rights or shift risk can be void.
- The Product Liability Act imposes strict liability on manufacturers for damage caused by a defect in a product. The claimant must prove defect, damage, and causation; fault is not required. Liability covers injury, death, and property damage, but generally not pure economic loss.
- Defenses and time limits matter. A product is defective if it lacks the safety ordinarily expected considering its characteristics.
Worked example
A consumer buys a heater that catches fire because of a wiring defect and damages a room. The manufacturer may be strictly liable under the Product Liability Act even without negligence. The consumer must show the defect, fire, and damage. The seller may also face consumer contract claims if it misrepresented safety.
Traps
Do not apply cooling-off to every purchase; it is transaction-specific. Do not confuse strict product liability with breach of contract. Do not overlook property damage limits or limitation periods. Do not assume a warning always eliminates defect risk.