Consumer Protection Act 1987 recent cases on causation

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1 Consumer Protection Act 1987 recent cases on causation There have been several recent judgments in relation to cases pursued under the Consumer Protection Act 1987 ( CPA ) which provide helpful guidance in relation to the factors which should be taken into account when considering causation, and the burden of proof which each party must discharge. The court has treated the starting point in determining causation to be Lord Brandon s judgment in The Popi M (1985) (relating to a tortious claim, albeit a claim which predated the CPA). This case involved a ship which sunk in mysterious circumstances (the claimant contended that the cause was a submerged submarine, the defendant contended that the cause was wear and tear). In this case, Lord Brandon (considering the claim on appeal) criticised the approach taken at first instance which resulted in Bingham J allowing the claimant s claim to succeed, notwithstanding the fact that he had concluded that the claimant s theory was extremely improbable. Lord Brandon stated that he considered that Bingham J may have based his judgment on the famous dictum of Sherlock Holmes: when you have eliminated the impossible, whatever remains, however improbable, must be the truth. In overturning this decision, Lord Brandon stated that the court was not bound to make a finding in relation to the cause of the incident and could simply find that the claimant had failed to discharge the burden of proof. The following three recent cases are further examples of this principle. McGlinchey v General Motor (2012) CSOH 206 The claimant had parked her car on a road with a gradient of 4%. She got out of her car, went around to the boot to let her dog out and the car rolled backwards towards her. The claimant alleged that the handbrake was defective, and pursued a claim against the manufacturer of the vehicle under the Consumer Protection Act 1987 in relation to the injury that she sustained. The claimant referred to various defects throughout the litigation, but was never able to identify the precise nature of the defect which she alleged had caused the handbrake to fail. At the point of trial, the defect relied upon involved the slipping of the handbrake grip. The claimant s expert carried out experiments in which he attempted to recreate the alleged failure of the handbrake. He successfully recreated the failure on 2 or 3 occasions, albeit only under laboratory conditions and in circumstances where he had deliberately set out to recreate the failure (for an entire afternoon). The court at first instance accepted, as a matter of fact, that the claimant had correctly applied the handbrake prior to exiting the vehicle, but did not accept that the claimant had demonstrated, on the balance of probabilities, that the handbrake had failed as a result of a defect. It therefore rejected the claimant s claim. The claimant appealed the first instance decision. The Inner House (it being a Scottish claim) reviewed the basis on which the first instance court had reached its decision. It noted the apparent conflict between the court s (albeit implicit) finding that the handbrake had been properly applied, with the court s finding that the claimant had not demonstrated a defect. This left the cause of the accident as, in the words of the Inner House, an unexplained and perhaps inexplicable mystery. 1

2 The question which the Inner House was grappling with was whether it was acceptable for the court to decide cases purely on the basis of a failure to overcome the onus of proving that the car rolled backwards because of a defect, in the face of evidence that a defect may possibly have existed, in circumstances where the other logical alternative cause (ie, a failure on the part of the claimant to apply the handbrake properly) had already been eliminated. The court reviewed judgments given in cases such as Popi M and Ide v ATB Sales Ltd, and considered once again whether an admittedly improbable cause can, on the balance of probabilities, be consider to be the cause. The Inner House concluded that there will be cases in which the simple failure of the product to act in a particular way will inevitably lead to the inference that a defect of some sort must have existed (such was the finding in Ide v ATB Sales Ltd). However, if, as in the present case, there are a variety, albeit a limited variety of reasons [for failure] which do not involve a defect, the claimant may be required to prove the precise mechanism of failure. As such, the Inner House upheld the first instance decision and concluded that the court was entitled to dismiss the claimant s claim on the basis that she had not proved her claim on the balance of probabilities. If the court is faced with an improbable alleged cause, in a factual matrix with a (limited) variety of alternative causes, it may reasonably reject the claim even if it to do so results in the accident being an inexplicable mystery. Love v Halfords Ltd (2014) EWHC 1057 The claimant purchased a mountain bike from the defendant, along with a three year care maintenance plan. He returned it 3 months following purchase for a routine after-sales service, which did not identify any problems with the bike. 6 months after this service, the claimant was riding his bike when he lost control of it and fell, sustaining serious injuries. The claimant alleged he lost control of the bike because the steerer tube in the mechanism of the bicycle fractured. He denied ever having modified or altered the bike. The claimant pursued a claim under the CPA, Sale of Goods Act 1979 and Supply of Goods and Services Act It was said by the court that the claim was put forward principally in relation to the CPA, and that his contractual claims would be bound to fail if his CPA claim failed. The claimant denied that the bike had been involved in a previous accident, denied lending it to friends and denied that it could have been used by another person without his knowledge. The claimant argued that the steerer tube fractured, causing him to lose control. The defendant argued that the steerer tube was bent in some prior accident, had been incompetently repaired and thus weakened or, alternatively, that the steerer tube was simply fractured as a result of the accident and did not play a part in causing the accident. The court stated that the claimant had the burden of proving, on the balance of probabilities, that the fracture of the steerer tube caused the accident. Once proved, the burden then rested with the defendant to prove (if appropriate) that the defect had arisen post supply, and thus avail himself of a defence under s4 of the CPA. Conflicting expert evidence was presented by the parties. In the light of evidence given by a sole joint expert fractographer, the court concluded that there must have been an event prior to the accident which caused damage to the steerer tube by bending, and then an attempted repair which damaged the tube further. As a result, the defendant had successfully demonstrated that the tube was not, on the balance of probabilities, defective at the time of supply. Finally, the court concluded that the cause of the final 2

3 fracture of the steerer tube was a second accident, involving considerable speed and force. Thus, the court concluded, the steerer tube failed as a result of the index accident, and was not the cause of it. We understand that this case is being appealed. Hufford v Samsung Electronics (UK) Ltd (2014) EWHC 2956 The claimant pursued a claim against the defendant in respect of a fire which occurred at his home, in the course of which a fridge freezer, manufactured by the defendant, caught fire. The claimant purchased the fridge freezer in 2007 and had his kitchen refurbished in December 2009, during which time the fridge freezer was temporarily moved to the hall before being back into the kitchen following the works. The claimant alleged that the fire originated inside the fridge freezer as a result of an unspecified electrical fault. The defendant argued that the fire originated outside the appliance. The court held that it was necessary to have regard to all of the circumstances of the case. In reliance on Ide v ATB Sales Ltd, the court stated that it is not necessary for a claimant to specify or identify a precise defect within the product, it is sufficient for a claimant to prove the existence of a defect in broad or general terms. The defendant highlighted the practical difficulty which it faced in running a defence under s4 of the CPA if the claimant failed to identify a specific defect: unless the claimant proved the alleged defect with specificity, the defendant would be unable to establish that the specific defect did not exist in the product at the point of supply. The court dismissed this argument and held that, in the event that the defendant wished to run a defence of this nature, it would be for the defendant to identify the relevant defect and then show that it did not exist at the point of manufacture. Notwithstanding this, the court highlighted that the burden of proof remains on the claimant to prove the existence of a defect (unspecified or otherwise) which caused a fire. On this point, the court quoted Thomas LJ s judgment from Ide v ATB Sales Ltd, which stated the task of the court is simply to determine whether the loss was caused by the defect and not by another cause, in other words: the court should simply determine whether the claimant had proved his case. If it found that the claimant had not, the court was not required to making a finding in relation to an alternative cause. As such, it is not necessary for the defendant to prove an alternative cause of the accident in order to successfully defend the claim. In relation to arguments regarding improbable causes, the court held that it must not find that one party s contention in respect of causation has been proved on the balance of probabilities simply because it is the more probable (or the least improbable) of the theories presented. It is open to the court to simply state that the claimant has not proved his claim on the balance of probabilities. Based on the expert evidence put forward by the parties, the court concluded that the claimant had failed to prove his claim. Howmet Ltd v (1) Economy Devices Ltd (2) Electrochemical Supplies Ltd (3) MJD Supplies Ltd [2014] EWHC 3933 (TCC) On 12 February 2007, there was a fire at the claimant s factory in Exeter, causing losses in excess of 20m. The claimant claimed that the fire was caused by the failure of a thermolevel probe that was supposed to detect a loss of liquid in a hot water tank. The heater to the tank was switched on at a time when the tank was virtually empty. The probe should have detected that the tank was virtually empty and should have 3

4 operated to switch the heater unit off. It did not do so, the heaters overheated and set fire to the tank, and the fire spread to the rest of the factory. The second defendant was engaged by the claimant to design and supply what is termed a new grain etch line, which included the tank involved in the fire. The third defendant was sub-contracted by the second defendant to install the probe. The second defendant had settled with the claimant, and the third defendant had no money and no insurance, so the C s claim proceeded only against the first defendant, who was the manufacturer of the probe. The claimant claimed that the probe had been negligently designed which meant that it was unreliable, and was not a failsafe device. It also complained that information about the probe contained in the defendant s brochure was misleading as to the qualities and safety of the probe. The defendant denied liability, arguing that the losses sustained by the claimant were not within the scope of any duty which it owed to the claimant, that there was nothing wrong with what was a simple and relatively low grade product and that that the actual cause of the fire was far from self-evident. There had been problems with the probe prior to the fire, including a previous fire, following which the claimant had added float switches to the tanks, as an additional safety measure. The judge found that the probes produced by the defendant were both unreliable and unpredictable, and not acceptable as a safety device. In relation to the defendant s contention that it should not be liable on the basis that it never claimed that it was a fail safe device, the judge noted that whilst the brochure did not claim that the product was failsafe, there was also no warning in the brochure that the probe should not be used as the only safety device, or that it might not always fail safely, A purchaser would understand from the literature that the product was a safety device designed to switch off the heater when the liquid fell below a certain level. He went on to comment that: It lies ill in the mouth of a manufacturer who has supplied a defective safety device to say that he should be under no liability because the buyer should have been alert to deficiencies in the literature supplied with the product and should have made further enquiries which would or might have revealed that the device in question was defective. He also found that it should have been well within the contemplation of the defendant that the device might be used as the sole safety device. Further, he also found that the design and manufacture of the probes was deficient, that the defendant failed to implement any form of satisfactory testing regime of its products, and that its failure to do so amounted to a want of proper care, and further that the instructions provided with the product were manifestly unsatisfactory. The judgment is generally critical of the product produced by the defendant. However, the judge then turned to causation, for the purposes of the claim in negligence. He identified from the evidence four potential reasons why the thermolevel probe did not operate to switch off the heater in the tank and prevent it from overheating: 1. The sensitivity control in the control unit may have been incorrectly set; 2. Component failure or defect within the thermolevel itself; 3. A broken or poor electrical connection in the probe cable; 4

5 4. The thermolevel voltage may have drifted over time so that it was no longer capable of accurate measurement; With reference to the expert evidence available the judge first eliminated entirely the last of these 4 potential causes. He found that the second of the potential causes, (failure or defect of a component within the probe) was an unlikely cause of the fire, albeit one that could not be excluded altogether, and that the third of these potential causes (a poor or broken electrical connection in the probe cable), was an unlikely cause of the fire. The judge then returned to the first of these four potential causes of the fire that he had identified, and said that incorrect setting of the sensitivity control seems to me to be the least unlikely. Having ruled out potential causes 2, 3 and 4, and found that potential cause 1 was the least unlikely, the judge then went on to find that: Whilst I am satisfied that the fire was the result of a failure of the thermolevel to operate properly, on the evidence as it stands I am not able to reach a conclusion as to the probable mechanism by which that came about and, therefore, as to precisely what led to the overheating of the heater in the hot water tank. He then referred to the Court of Appeal s decision in Nulty v Milton Keynes Borough Council [2013] BLR 134 when it held that the civil balance of probability test meant no less and no more than that the court had to be satisfied on rational and objective grounds that the case for believing that the suggested means of causation occurred was stronger than the case for not so believing it is not enough for the court to choose between, say, three causes each of which taken by itself is an unlikely cause and then, as a matter of logic, to conclude that the least unlikely must be the probable cause of the loss. Applying this, Mr Justice Edwards-Stuart found that he was unable to conclude that incorrect setting of the [sensitivity control] was more likely than not the reason why the thermolevel did not cause the heater to cut out it may well have been but on the balance of probability I cannot say that it was. Accordingly the claimant s claim in negligence must fail for want of proof of causation. Therefore, whilst the judge found that (a) defendant s design and testing of its product was unsatisfactory, (b) the literature supplied with it was unsatisfactory, and (c) the product was not suitable as a safety device; and whilst of the four potential causes of the fire he identified, three were directly in relation to the defects with the product, the fourth potential cause was the setting of the sensitivity control by the claimant. The judge found this the least unlikely cause, but could not say that it was the cause on the balance of probabilities. Therefore, because there was a potential non-negligent (by the defendant at least) cause of the fire, which was at least less unlikely than the other potential causes, the judge could not find in favour of the claimant. This seems perhaps particularly harsh given that the judge also commented on the lack of emphasis in the product literature on the necessity of the sensitivity control being correctly set. The court emphasised again that the burden is on the claimant to prove that the defendant s breach has caused the loss. In fire cases such as this one, where the fire is likely itself to have destroyed key forensic evidence that might assist in showing the cause of the fire, there might be a number of possible causes, only one (or some) of which would lead to the defendant being liable. 5

6 The court found that even if one possible cause can be shown to have been more likely than the others, that will not necessarily be the cause in law. It is necessary to show independently that it was the cause on the balance of probabilities. There were four possible causes here. The court found one cause to be the most likely, but nevertheless not to have been the cause on the balance of probabilities. This seems instinctively odd, but is logically correct. Comment It is clear from these cases that the claimant is not required to prove the precise nature of the alleged defect in order to succeed with a claim under the CPA. However, the claimant must prove on the balance of probabilities that a defect was present which caused the alleged injury or damage and, in seeking to refute this claim, the defendant need not present a more likely or probable competing cause. The court s starting point should be a consideration of whether the claimant has, on the balance of probabilities, proved his claim. In the event that the claimant succeeded on this point, the onus would then shift to the defendant if he wished to assert a defence under section 4 of the CPA (for example, that the defect was not present at the point of supply). The court has acknowledged the difficulty that the defendant may face in proving this in circumstances whereby the claimant is not required to prove the nature of defect alleged. These principles are undoubtedly helpful to practitioners in this area. However, it is always worth bearing in mind all of the circumstances of the case. More than one of the above judgments referred (with approval) to Lord Reid s judgment in McWilliams v Sir William Arrol & Co [1962], in which he was stated In the end when all of the evidence has been brought out it rarely matters where the onus originally lay: The question is which way the balance of probability has come to rest. The court will inevitably look at the entire picture of competing causes when determining whether the claimant has proved his claim.