Can a Cause of Action Exist Regarding a Working Product? By David I. Marr & Gregory L. Juliano Canadian Litigation Counsel Product Liability Seminar, Toronto, Ontario September 14, 2000 INTRODUCTION On first impression, the topic question may seem somewhat confusing. One might think it absurd that there could be a claim involving a product which is functioning normally for its intended purpose. However, what if there was a chance that the product might fail at some unknown time in the future? Could a cause of action exist in these circumstances? In the case of most products, the customer could simply stop using the product if he fears a future malfunction. In these circumstances, the damages of the customer would be fairly limited; perhaps being no more than the cost of replacing the suspect product. But is a customer entitled to replace a product which continues to function normally for its intended purpose? If so, when would a customer be entitled to take this step? Statistically, how big of a chance of failure would give rise to such a cause of action? A more serious question arises when a customer is unable to stop using the product. In the field of product liability, this question has become particularly important with regard to medical products. What if a consumer has been implanted with, for example, an artificial joint, a pacemaker, or an artificial heart valve which has a chance of failure? What if the consumer has been on a certain drug for a number of years, which is later discovered to have the possibility of causing serious side effects which may develop sometime in the future? There is no doubt that the risk of the product failing or causing serious side effects could cause stress on the part of the consumer. But, if the product does not actually fail, or does not actually cause side effects, can the consumer seek compensation for such stress? If so, what statistical chance of failure must the product have in order to entitle the consumer to compensation? Even if a cause of action exists in these circumstances, a plaintiff would also have to show that he has suffered a type of damage recognizable at law. In this regard, the question becomes: what degree of stress must the consumer suffer in order to be entitled to compensation at law? CASE STUDY - THE FACTS Perhaps the best way to study a question of law is to apply it to a particular factual situation; a case study. Our firm recently had an opportunity to become involved in a case which dealt with the interesting questions raised above. The plaintiff in our case, when a man of 42 years of age, began experiencing chest pains and cold sensations in 1980. By 1982, he was diagnosed with a severe aortic insufficiency. A congenital malformation of his aortic heart valve was actually causing blood to flow backwards through the heart. He urgently required heart valve replacement surgery, without which he would certainly deteriorate and die. The plaintiff's doctor performed implantation surgery in 1982, using a heart valve produced by our client, the manufacturer. The operation was a complete success. The plaintiff was able to resume a normal lifestyle, and the valve continues to function normally to the present day. However, our plaintiff claimed to have suffered emotional distress upon hearing rumour and media reports of a disproportionately high number of incidents of failure in the valve with which he was implanted. In 1991 and 1992, he read a number of newspaper articles regarding an unusually high rate of strut fracture in the valve. In early 1992, he received an informational letter from our client, the manufacturer, recommending that he consult his doctor. He did not do so, but rather continued become increasingly stressed from continuing media reports. Later in 1992 he viewed a CBC Marketplace program on television concerning the valves, which added to his anxiety. It seems this may have prompted him to retain a lawyer. The lawyer obtained more information through court documents in a number of American lawsuits. Finally, a Statement of Claim was issued at the end of 1994. The plaintiff claimed that his anxiety and stress continued to increase, but he never consulted a medical practitioner regarding his emotional difficulties or the condition of his artificial heart valve. Of course, every artificial heart valve has some chance of failing, and the plaintiff was aware of this fact. Unfortunately, due to the nature of the product, any failure is likely to have catastrophic results; probably death. Although this remote possibility is worrisome, the only alternative to valve replacement for the plaintiff in our present case was almost certain death from his congenital condition. In many ways, his post-transplant situation was not as bad as he perceived. A number of cases regarding artificial heart valves have been heard in the United States, including a large class-action in Ohio1 , which resulted in an out-of-court settlement. As part of that settlement, an expert medical panel created a formula for predicting the risk of product failure, and guidelines for elective replacement of certain valves. According to the panel's formula, the particular valve implanted in our plaintiff had an estimated risk of fracture of 0.0547 percent per annum (5 in 10,000). The panel's guidelines would not recommend replacement surgery in these circumstances. In comparison to other risks to which the plaintiff had been subjected, the risk of strut fracture seemed relatively low. For example, the risk of death for the plaintiff during his 1982 implantation surgery itself was between 5 and 10 percent; an event almost 100 times more likely than strut fracture. In the early stages of recovery, the plaintiff continued to be at serious risk of blood clots, stroke, hemorrhaging, or infection; also in the range of 5 to 10 percent. Further, a male citizen of the plaintiff's age (62 years old) had a 1.3417 percent chance of dying2 simply as a result of the risks of everyday life (134 in 10,000). CAUSE OF ACTION The first question for the court to address was whether a cause of action could exist for a normally functioning product. Unfortunately, the case law in Canada on this subject is very scarce. All previous Canadian cases regarding medical products (or any type of product) have involved an actual failure of the product. For example, the Supreme Court of Canada dealt with the issue of breast implants in 19953 ; but the plaintiffs in this case actually had their implants rupture. In a further example, a 1986 Ontario case4 involved oral contraceptives, but the plaintiff actually suffered a stroke as a result of taking the drug. Courts in the United States, however, have directly addressed this issue. The vast majority5 seem to have decided that there is no cause of action regarding a normally functioning product. For example, a Texas judge concluded: There is no cause of action under Texas law where a plaintiff's product is and has been functioning without incident. Texas law does not recognize a claim seeking to recover for alleged concern or anxiety that a functioning product might fail at some future unknown time.6 This conclusion is based upon sound policy concerns. If the courts were to allow a cause of action in these circumstances, it might open a "floodgate" for claims. This could have unpredictable adverse consequences on the cost and availability of medical care. The United States Court of Appeals commented: ... instead of spreading a concentrated loss over a large group, each patient would cover his own probable fear recovery (plus the costs of litigation by paying a higher price for the heart valve in the first instance. Because no loss-spreading occurs, the money flows in a circle, from each patient (in the form of a higher price) to the company back to the same patient (in the form of a fear recovery), with a substantial portion of the higher price skimmed off for attorneys' fees. In addition, the higher price will place the product beyond the economic reach of at least some of the patients, forcing them to turn to the next best (affordable) alternative. We see little reason to adopt such a system.7 The problem with this approach is that, if there is no cause of action regarding a working product, there is no chance of recovery for emotional distress, no matter how likely the product is to fail. The plaintiff would be forced to wait for a failure, which in the case of a heart valve, could be catastrophic. This would hardly seem a just result if a product had, for example, a 90 percent chance of failure. However, if a cause of action is allowed to exist in these circumstances the courts would have a difficult time in deciding what degree of statistical certainty is required. There must be a limit in order to prevent a deluge of claims. Should it be 10 percent, 50 percent, or 90 percent chance of failure? Should these percentages be fixed, or vary according to the severity of the consequences of a product failure? For example, a 25 percent risk of failure may be acceptable for an artificial knee joint, but be wholly unacceptable with regard to a heart valve transplant, such as that in our case study. There have not yet been any cases in Canada to follow this approach; that is, allowing a cause of action to exist, but limiting claims based up the likelihood of failure and/or severity of consequences. However, there are indications that the courts may be headed in this direction. In 1995, the Ontario Court (General Division) dealt with a case8 involving cardiac pacemakers which had a significant chance of malfunction. There was a 16 to 25 percent chance that the wire leads might fracture, causing the jagged end to cut through the heart with disastrous results. This case has still not gone to trial. The only court hearing so far was an application to certify a class of people for this class-action lawsuit. In certifying the class and allowing the case to go forward, the judge decided that the plaintiffs' allegations were not "patently ridiculous and incapable of proof".9 In other words, the court determined that the plaintiffs should at least have an opportunity to go to trial and argue that a cause of action exists in these circumstances. In arriving at his decision, it seems that the judge focused on the high chance of failure of this product and the severe consequences of such a failure. It is not unusual for a court to try and find a remedy when it perceives an injustice is being done. Since this was not a full trial, there was no in-depth discussion regarding in what circumstances a cause of action might exist, and in what circumstances it would not. The court did, however, make an interesting comparison to the situation of heart valves, such as that implanted in the plaintiff in our case study. The judge, referring to the Ohio class-action, described the claim involving heart valves as "extremely speculative", with a failure rate of "less than 1 percent".10 He concluded: The implanted persons here are not like the recipients of... [the] heart valve... who would simply carry on in their normal lives, hoping they would not be the one or two hundred whose valves would suddenly fracture.11 Thus, it appears that Canadian courts are at least willing to entertain the idea that there might be a cause of action regarding a product which is functioning normally for its intended purpose. Despite the relatively low chance of failure of the heart valve in our case study, this possibility encouraged our plaintiff to push forward with his claim. DAMAGES Of course, in order to be entitled to any form of compensation, our plaintiff also had to show that he has suffered a type of damage recognizable at law. There are essentially two types of damages which might occur as a result of a normally functioning product which has a possibility of failure; the cost of replacement, and emotional distress. The first type of damage is widely recognized in common law. If a plaintiff must replace the suspect product, he would normally be entitled to claim compensation for the cost of replacement. In the case of a medical product, the plaintiff might even be able to claim for pain and suffering due to having to endure a second operation. There are many cases confirming that a plaintiff is entitled to compensation for replacement when a product fails, but there are no Canadian examples of a situation where the product might fail at some unknown time in the future. Again, the courts must be careful about opening up a "floodgate" for claims. There is no case law indicating at what statistical probability of failure a plaintiff should replace a suspect product. In our case study, there was no evidence that it would be medically prudent to have the heart valve implanted in the plaintiff replaced with a different model. The risks of surgery were simply too high; particularly with the plaintiff being 62 years old. The second type of damage is even more problematic. There is no doubt that our plaintiff suffered some upset and distress as a result of worrying about the potential failure of his heart valve. However, not every type of emotional distress is compensable as a form of damage recognized at law. In fact, the general rule in Canada has been that a plaintiff is not entitled to compensation for emotional distress which does not amount to nervous shock. In a 1986 case, the British Columbia Supreme Court explained: Sorrow, grief or emotional distress are not in themselves compensable. There must be some recognizable psychiatric or psychosomatic condition attributable to the defendant's breach of duty of care owed to the plaintiff.12 More recently, the Ontario Court of Appeal came to the same conclusion, saying "the courts to date have declined to award damages for mental distress arising from negligence, except where the distress stems from a recognizable psychiatric illness".13 In our case study the plaintiff did not plead or provide evidence that he was suffering from such nervous shock. Yet, there is some sympathy in the courts for plaintiffs who have suffered emotional distress which does not go so far as to result in a recognized psychiatric illness. Many judges would like to open the "floodgates" to more claims regarding emotional distress. In a 1997 case, a trial level judge of the Ontario High Court of Justice mused: I cannot see any reason to deny compensation for the emotional pain of a person who, although suffering, does not degenerate emotionally to the point of actual psychiatric illness. Surely emotional distress is a more foreseeable result from a negligent act than is a psychiatric illness.14 Yet, this statement is really only obiter, since the judge went on to find that there was evidence that the plaintiffs had suffered a psychiatric illness, as they had been prescribed medication to calm their nerves. However, with the right set of facts and a sympathetic judge, a court may be willing to award damages where a plaintiff has suffered something less than nervous shock. There is also a question of how a plaintiff must prove that he is suffering from a recognizable psychiatric illness. In our case study, the plaintiff provided no expert reports or evidence that he was suffering from a recognizable psychiatric illness. Despite describing himself as living in "fear" and "terror", the plaintiff never consulted any medical practitioner regarding his mental state. Indeed, the plaintiff never even consulted a medical practitioner as to the condition of his artificial heart valve or the likelihood of it failing. Despite common practice, it may not be necessary to provide this type of expert medical evidence. So long as the court has enough evidence of another kind to conclude that the plaintiff suffers from a recognizable psychiatric illness, he may be entitled to damages. The Saskatchewan Court of Appeal has said: Counsel for the hospital argued that to find nervous shock the court must be presented with medical evidence. We do not agree with this contention.15 In this case, the court felt that the trial judge was entitled to rely on the oral testimony of the plaintiff as to his emotional state. The court essentially took judicial notice that the symptoms reported by the plaintiff would amount to a recognizable psychiatric illness. So it appears that courts are occasionally willing to bend the rules with regard to the type of emotional damage suffered by the plaintiff in our case study. However, it is clear that, for the plaintiff to have a strong case, he must provide medical evidence that he is suffering from a recognized psychiatric illness. The plaintiff in our case study simply did not have this type of evidence. CONCLUSIONS I am sure you are all wondering what the judge decided, and how our case study actually turned out. Unfortunately, the judge dismissed the plaintiff's case on other grounds, a limitation argument, and did not rule on the issues which are the subject of this paper. As a result, the law in Canada continues to be unclear. While currently there may not be a cause of action recognized in Canada for a normally functioning product, this type of recognition could be on the not too distant horizon. The courts may also be moving towards a more generous definition of the type of emotional distress for which a plaintiff can seek compensation. If, at sometime in the future, the courts choose to allow this type of claim to proceed, they must be very careful not to open the door to a deluge of similar cases. Manufacturers, and their insurers, should be aware that an incremental change in the law may be on the horizon, which could expose them to liability for a perfectly functioning product which has the potential to fail at sometime in the future.

 

Back To Top