March 2010

In December 2009, the ECJ ruled on a reference from the House of Lords (now replaced by the Supreme Court) on whether it was possible under EU product liability rules to add a party to a claim for a defective product after the end of the limitation period.

Aventis Pasteur SA ("APSA") manufactured an HIB vaccine. In September 1992, APSA sent a consignment of vaccine to its UK subsidiary, Aventis Pasteur MSD ("APMSD"). A unit of the vaccine was administered to Mr. Declan O'Byrne in November 1992. Mr. O'Byrne suffered brain damage and in 2000 sued APMSD under the UK Consumer Protection Act 1987 claiming that the damage was caused to the vaccine being defective.

The UK Consumer Protection Act 1987 (the "Act") implements Directive 85/374/EEC on product liability (the "Directive"). The Directive imposes liability on the 'producer' of a defective product and 'producer' is defined to include the manufacturer of a finished product. The Directive also sets limit for claims of 10 years from when the actual product which caused the damage was put into circulation.

Originally Mr. O'Byrne brought within the 10-year time limit a claim against APMSD which successfully argued that it was not the manufacturer and was therefore not liable under the Act. Therefore, in March 2003 (after the expiry of the 10-year time limit), Mr. O'Byrne applied for a court order that APSA be substituted for APMSD in the proceedings.

The UK Limitation Act 1980 prohibits the substitution of a new party after the expiry of a limitation period, with certain exceptions, including where the name given in the original action was given in mistake.

The House asked the ECJ to decide whether the Directive permitted the laws of a Member State to allow substitution of a new defendant to a claim under that directive after the 10-year period for where the person originally sued was someone fell outside the Directive.

The ECJ decided that in principle the national laws of a Member could not be so applied. However, the ECJ then qualified this by stating that it was open to the English court, after a consideration of the facts, to come to a decision in favour of O'Byrne on two possible grounds:

1) as APMSD was a subsidiary of APSA when the vaccine was supplied, the time limit did not prevent an English court from allowing substitution APSA for APMSD in proceedings started within the 10-year period, should the English court decide on the facts that the putting into circulation of the vaccine (even though it was done by the subsidiary) was actually determined by the parent company that manufactured the product; and

2) APMSD, may be treated as a producer under the provisions of Article 3(3) of the Directive. This states that: "Where the producer of the product cannot be identified, each supplier of the product shall be treated as its producer unless he informs the injured person, within a reasonable time, of the identity of the producer or of the person who supplied him with the product." The ECJ concluded that to avoid being considered the producer, a supplier such as APMSD would have not only need to deny being the producer of the product but also inform the claimant "on its own initiative and promptly" of the identity of the actual producer or its own supplier.

Comment - As the Supreme Court has yet to hear the case subsequent to the ECJ's ruling, it remains to be seen whether the ECJ's guidance will be followed.