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Consumer Product Failure Causing Personal Injury Under the No-Fault Accident Compensation Scheme in New Zealand—a Let-off for Manufacturers?

Author

Listed:
  • Trish O’Sullivan

    (Massey University)

  • Kate Tokeley

    (Victoria University)

Abstract

This article examines how the no-fault accident compensation system in New Zealand operates to relieve manufacturers from liability to consumers for product failures which cause personal injury or death. The state-run accident compensation scheme pays compensation to persons who suffer “personal injury by accident” and bars claims for compensation from the party at fault. The advantage for consumers is that they are entitled to compensation from the accident compensation scheme as of right and do not need to make claims against manufacturers of products which cause injury or death. The article outlines some limited circumstances when consumers may claim compensation from manufacturers and identifies other avenues for holding manufacturers responsible for injury or death caused by faulty products. The paper makes three recommendations to increase manufacturer responsibility: (1) allow the regulatory body which administers the Accident Compensation system to claim compensation, by way of subrogation, from manufacturers in limited circumstances; (2) require manufacturers to pay an additional “product liability” levy to the accident compensation scheme; and (3) amend the Health and Safety at Work Act 2015 to cover non-workplace accidents exposing manufacturers of unsafe products to Worksafe investigation and possible criminal liability. The article argues that imposing additional responsibility on manufacturers for product failures which cause personal injury or death is justified on the grounds of fairness. Arguments based on corrective fairness and distributive fairness can both be relevant in cases of personal injury caused to consumers by manufacturers.

Suggested Citation

  • Trish O’Sullivan & Kate Tokeley, 2018. "Consumer Product Failure Causing Personal Injury Under the No-Fault Accident Compensation Scheme in New Zealand—a Let-off for Manufacturers?," Journal of Consumer Policy, Springer, vol. 41(3), pages 211-227, September.
    • Handle: RePEc:kap:jcopol:v:41:y:2018:i:3:d:10.1007_s10603-018-9383-2
    DOI: 10.1007/s10603-018-9383-2
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    References listed on IDEAS

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    1. repec:reg:rpubli:575 is not listed on IDEAS
    2. Ian Mcewin, R., 1989. "No-fault and road accidents: Some Australasian evidence," International Review of Law and Economics, Elsevier, vol. 9(1), pages 13-24, June.
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