Masonry Magazine October 1986 Page. 42
LIABILITY INSURANCE CRUNCH
continued from page 16
In today's manufacturing market almost every product has the potential to enter the stream of commerce and to be distributed in a national market. A manufacturer in Illinois, for example, may have designed a product which suits local needs and fully complies with local safety standards. The Illinois courts may well have determined that virtually identical products are safely marketable and local tort law is satisfied.
Nevertheless, the individual manufacturer or seller cannot control the nationwide movement of their product once sold. A patchwork of 50 different state laws on product liability confronts the manufacturer, whose lawyer quickly recognizes that a product safe enough for Illinois may not be safe enough for California.
Faced with the threat of a suit in every state in the union once their product enters the stream of commerce, the manufacturer's attorney begins reading up on recent product liability decisions rendered by the California Supreme Court. This is to ensure that his client will not be caught off guard by his failure to provide some novel warning or instruction booklet which the California Supreme Court now considers to be dispositive.
Suddenly, the California Supreme Court has become the author and creator of a national liability standard which extends far beyond its sovereign authority. California has managed to establish national tort law, and any manufacturer who hopes to market his product nationwide has become obligated to design and market his product in conformity with California standards. California has become a Super State Supreme Court and federalism has gone down the drain.
Indeed, the tragic irony is that the state with the most onerous standard of liability, in effect, sets the national standard. At times, we seem to have a competition among state supreme courts to create the most novel and far-reaching theories of liability.
The simple fact is that a manufacturer in any given State cannot be protected by his own state legislature or judiciary from the debilitating impact of out-of-state product liability judgments. Although state legislatures may want to bring product liability judgments back into manageable dimensions, they do not have the capacity to legislate effective reforms. A uniform Federal response is the only solution to the problem of nationwide market liability. The states, despite good intention, are simply not capable of adequately righting the wrong.
The Administration's product liability proposal would implement several key reforms in the civil justice system. It would codify negligence standards and establish liability limits with respect to suits based upon the design, manufacture or distribution of a product, whether brought in Federal or state court.
Except where defendants are shown to have been genuinely "acting in concert," joint and several liability simply would not apply. Instead, comparative negligence would become the universal standard-so that a defendant manufacturer, distributor, or retailer could only be liable for that portion of the damages directly attributable to their pro rata share of the fault. Strict liability could be imposed only where it can be proven that the product was defective and that defect rendered the product unreasonably dangerous.
Under the bill's language, adequate warnings would be
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40 MASONRY-SEPTEMBER/OCTOBER, 1986