PRODUCT AND SERVICE LIABILITY

(Ronald Arvin C. Cusi)

The chapter tackles the liability of manufacturers and sellers as to

damages resulting from their defective product whether the basis may be the
following; fraud, warranty, negligence and strict liability.

There are two governing code in determining the liability under the
product and service liabilities, the New Civil Code and the Consumer Act.

Fraud under Article 33 of the New Civil Code, “In cases of

defamation, fraud, and physical injuries, a civil action for damages, entirely
separate and distinct from the criminal action, may be brought by the injured
party. Such civil action shall proceed independently of the criminal
prosecution, and shall require only a preponderance of evidence;” while
Fraud as governed by the Consumers Act states that the prohibited deceptive
sales acts and practices are provided for in Article 50 while the unfair or
unconscionable sales acts and practices are enumerated in Article 52.

As to the warranties, the provisions on warranties are found in the

New Civil Code – Articles 1547, 1561, 1562, 1563 to 1571, which surmises
any affirmative of fact or any promise by the seller relating to the thing, the
necessary tendency of which is to induce the buyer to purchase the same,
and the buyer purchases the thing relying thereon. On the other hand, the
warranties as provided for by the Consumers Act contains provisions
imposing warranty obligations on the manufactures and sellers; recognizes
that the provisions of the Civil Code on conditions and warranties shall
govern all contracts of sale with conditions and warranties; and, other
provisions of the Consumer Act added certain rules that govern warranties in
sale of consumer products.
 In cases of negligence, if a manufacturer or service provider is proven
as to failed to exercise the required diligence in maintaining their services or
products, then the plaintiff is entitled to be compensated or indemnified
through damages.

The doctrine of strict liability could also govern the indemnification of

the plaintiff or the offended party. Under Article 2187 of the New Civil
Code, Manufacturers and processors of foodstuffs, drinks, toilet articles and
similar goods shall be liable for death of injuries caused by any noxious or
harmful substances used, although no contractual relation exists between
them and the consumers. Likewise, under the Consumers Act, Article 97 –
provides for liability for defective products ‘independently of fault’ while
Article 99 – strict liability even extends to services. Services under this
article means, ‘with respect to repair and service firms, services supplied in
connection with a contact for construction, maintenance, repair, processing,
treatment or cleaning of goods or of fixtures on land, or distribution of
goods, or transportation of goods.