Product Liability
Olaniwun Ajayi LP / Nigeria
A brief overview of the situation regarding product liability in Nigerian Pharma. Prepared in association with Olaniwun Ajayi LP, a leading law firm in Nigeria, this is an extract from The Pharma Legal Handbook: Nigeria, available to purchase here for USD 99.
1. What types of liability are recognized in your jurisdiction?
In Nigeria, liability may arise from a breach of an obligation implied in law, from a breach of contract in which case a contractual liability will be imposed and from liability in Tort.
Some obligations are imposed by law on manufacturers, suppliers or vendors of products and liability may arise where such persons or organisations breach any of such implied obligations. Such obligation may include an implied warranty of merchantability of the product manufactured or sold. Thus where the product sold turns out to be is defective or unfit for purpose, the manufacturer will automatically become liable to the purchaser or consumer notwithstanding that parties did not enter into an express agreement regarding the merchantability of the product; this is because the law implies and imputes this obligation on the manufacturer or vendor of the product in this regard.
As a corollary to the above, where there is an agreement between the manufacturer, supplier or the consumer as to the quality, efficacy or otherwise of the product either in the form of a representation or by way of a contractual warranty, any of which turns out to be false, untrue or misleading; the manufacturer or such other person may be liable per the terms of such contract, whether such contract is oral or written.
The frontiers of product liability under Torts are not streamlined and liability under this head may be far reaching. Typically, a manufacturer, supplier or vendor may be liable in tort where the receiving party can show that the product purchased was defective or that a damage was caused to the purchaser or consumer whether in terms of personal injury or pecuniary loss.
2. How do these types of liabilities apply to the manufacturers of medicines and devices?
There is currently no law expressly imposing liability on manufacturers of medicines and Medical devices. The Federal Competition and Consumer Protection Act, 2018 (FCCPA) however imposes liabilities on manufacturers, who supply defective or hazardous products or goods to consumers. In this regard, where a manufacturer of medicines or medical devices produces defective or hazardous products which are used by the consumer, such manufacturer may become liable under the FCCPA.
Product liability cannot be restricted or excluded by any contract, either with a supplier, intermediary or the consumer. This liability exists whether or not the consumer bought the goods directly from the manufacturer or entered into any form of contract with the manufacturer of such medical products or devices. Manufacturers would also come under liability where they misrepresent facts which lead to pecuniary loss or health hazards on the part of the consumers. A manufacturer may not restrict or exclude any form of liability which he may be subject to.
3. Does potential liability extend to the manufacturer only or could claims extend to corporate executives, employees, and representatives?
Under FCCPA, contravention of consumer rights attracts criminal liability, both on the part of the manufacturing company and on the part of the Director. The punishment for contravention on a Director of a company found liable is a term of imprisonment not exceeding five (5) years or to a fine of Ten Million Naira (N10,000,000) or a combination of both. Suppliers of the product if found liable are also subject to the same punishment.
4. How can a liability claim be brought?
Aggrieved consumers seeking to enforce any of the rights under the FCCPA may refer the matter to the business/undertaking or to the applicable industry sector; file a complaint directly with the Federal Competition and Consumer Protection Commission or directly approach a court of competent jurisdiction. Notably, consumers aggrieved by a breach of their rights under the Act may have recourse to Civil Society Groups who are also empowered to grant redress to victims of defective goods and/or services.
Where a consumer or such other person do not hinge their claim on the FCCPA, recourse will only be had to the Court.
5. What defences are available?
The nature of defence which may be available to a defendant in an action or claim arising from a product is unique to the product liability action. Prominently, a manufacturer, producer or any person against whom an action is brought may plead in his defence that the injury to the Claimant was not caused by the product; or that there was contributory negligence on the part of the Claimant (where a claim under Tort is brought). A defence of contributory negligence will however not totally absolve the manufacturer or supplier of complete liability on the claim.
A defence that the action is caught by the Statute of Limitation can also be available where being an action founded in simple contract, it is instituted after six (6) years from the date the cause of action arose or in the case of damages arising from negligence [where damages consist of or include personal injury] is instituted after three years of the date the cause of action accrued.
