Recently the Ministry of Commerce published an extremely useful handbook on business
and investment in Cambodia entitled Cambodia: The Re-emergence of New Opportunities.
Included in the book are a number of current laws affecting investment and also draft
laws which are in the process of being completed.
One of these is the draft product liability law which will address an area of jurisprudence
which, until now, has had very little coverage in Cambodia.
Very simply put, "product liability" is the generic phrase used to describe
the liability of a supplier of a product to one injured by the product.
It is an area of tort law that also has applications in contractual transactions.
The scope of the draft law published by the Ministry of Commerce is said to cover
the liability of manufacturers, wholesalers, retailers, dealers, sellers and other
distributors of products for injuries caused by such products within the Kingdom
of Cambodia.
Each of these parties has different standards by which they may be found liable for
damages caused by defective products and different defenses to actions taken against
them.
Manufacturers are generally prima facie liable for damages caused by products which
they have created if that product is deemed defective.
A defective product is one containing a manufacturing defect, design defect or a
defect in the packaging, instruction or warnings that could have been avoided if
the manufacturer had exercised reasonable care.
A product will also be considered defective if its manufacture failed to meet the
standard set by the Royal Government for such products and such failure was the cause
of the damage to the user.
Sellers of a defective product (including manufacturers, wholesalers, dealers and
retailers and others who, for payment, transfers ownership of a product to another
for resale, consumption or use) will be liable for injuries caused by that product
if they are aware of the defect, or should have been aware of the defect, at the
time that they sold the product.
Other distributors of defective products (including lessors, carriers and others
not considered to be sellers) will only be liable for injuries caused if they have
been guilty of gross negligence or willful misconduct.
Under the draft law, damages caused by gifts or other products obtained free of charge
will not be recoverable from anyone other than the manufacturer.
Suppliers will not be found liable for defective products if the defect has been
caused by unauthorized modifications to the product after it has passed out of the
supplier's control.
In such cases the injured party must seek relief from the person who made the unauthorized
modification.
Under the draft law, victims of defective products which cause damage to person or
property may recover monetary compensation from the supplier in an amount sufficient
to restore them and their property to the condition that they would have been in
had the product not been defective.
They may also seek to recover compensation for any direct economic or physical damage
caused by the product and their costs in pursuing legal action against the supplier.
If by their use of the defective product the injured party has aggravated the damages
caused or could have reasonably avoided the resulting damage, the compensation available
to the injured party will be adjusted to account for their degree of fault.
Similarly, if more than one party is found to be responsible for the cause of the
injury, the responsibility for compensating the injured party will be divided among
the parties in accordance with their degree of fault.
Actions for product liability will have to be brought within one year from the date
of any injury caused by the defective product, or within one year from when the injury
was or should reasonably have been discovered, if the damage was not immediately
apparent.
Actions against manufacturers and sellers are absolutely barred if more than ten
years have passed from the date of manufacture or sale respectively, and are barred
against other distributors if more than five years have passed.
With the increasing level of local product manufacturing that Cambodia is now experiencing,
this law, should it pass the National Assembly in its current draft form, will be
extremely valuable in addressing the needs of parties injured because of the faulty
workmanship or unsafe design of consumer goods.
(This article was written by Michael Popkin, of the law firm Flipse Driksen Doran
and Le).
