Deck 12: Product and Service Liability Law

Question 1

George met with an accident while skiing. He brings a negligence suit against Joe, who rented the skis to George. Which of the following statements is true of this scenario?

A) If Joe is 40 percent responsible, George would be able to recover 40 percent of the damages in a state that has adopted modified comparative negligence.
B) If Joe is 40 percent responsible, George would be able to recover 40 percent of the damages in a state that has adopted pure comparative negligence.
C) George can recover damages even if Joe proves contributory negligence.
D) George can recover damages if misuse of the product is proved.

Answer 1

B

Question 2

Which of the following statements is true of the privity limitation?

A) The privity limitation allowed negligence suits against the manufacturer only if the owner of the product was using it when it failed.
B) The court indicated that it is unfair to impose liability on the manufacturer and seller even if they earn profits from a defectively made product.
C) Eradication of the privity requirement led to a shift in social policy toward placing responsibility for injuries on the victims.
D) It did not allow the plaintiff to recover damages unless the plaintiff purchased the defective goods directly from the manufacturer.

Answer 2

D

Question 3

Plaintiffs in product liability cases have traditionally used .

A) theories of warranty
B) theories of negligence
C) the strict product liability theory
D) the market share theory

Answer 3

B

Question 4

Which of the following is an effect of the growing acceptance of strict liability?

A) Negligence has become less important as a theory of liability.
B) Negligence has become more important as a theory of liability.
C) The doctrine of negligence per se is used more frequently.
D) The doctrine of res ipsa loquitur is used more frequently.

Question 5

Which of the following statements is true of the statute of limitations?

A) It limits the time within which all types of civil actions may be brought.
B) It limits the types of civil actions that may be brought to court.
C) In most states, it permits lawsuits only when intentional torts have been committed.
D) If the injured party is a minor, it permits the parent or guardian to bring a civil action suit.

Question 6

Which of the following best describes a statute of repose?

A) It is a statute that bars actions arising more than a specified number of years after the cause of the action arises.
B) It is a statute that limits recoverable damages based on the percentage of harm caused by the defendant.
C) It is a statute that limits recoverable damages to less than $1,000,000.
D) It is a statute that bars actions arising more than a specified number of years after the product was purchased.

Question 7

Elimination of the privity requirement led to .

A) an increase in the liability of producers
B) an increase in the liability of consumers
C) a decrease in the liability of manufacturers
D) a decrease in the liability of sellers

Question 8

Which of the following doctrines helps a plaintiff to recover damages when a manufacturer fails to meet the standards imposed by a statute?

A) res ipsa loquitur
B) breach-of-warranty doctrine
C) disclaimer doctrine
D) negligence per se

Question 9

Which of the following is not an essential element in a product liability case based on negligence?

A) The defendant manufacturer owed a duty of care to the plaintiff.
B) The defendant breached the duty of care.
C) The plaintiff suffered actual, compensable injury.
D) The defendant intended to cause the plaintiff harm.

Question 10

Which of the following describes the condition in which courts impose liability based on negligent design?

A) when the materials used by the manufacturer satisfy most of the standards acceptable in the trade
B) when the risk of harm outweighs the utility of the product
C) when the manufacturer fails to include a warning about obvious dangers
D) when the manufacturer warns only the original purchaser and not the user

Question 11

A statute of _ bars actions arising more than a specified number of years after the cause of action arises, while a statute of _ bars actions arising more than a specified number of years after the product was purchased.

A) repose; limitations
B) limitations; repose
C) frauds; repose
D) frauds; limitations

Question 12

Which of the following is not a common negligent action leading to product liability case?

A) negligent failure to warn
B) negligent intent to harm
C) negligent provision of an inadequate warning
D) negligent design

Question 13

In bringing an action for negligence in design, a plaintiff may prove all but which of the following?

A) The product design is inherently dangerous.
B) The product design contains insufficient safety designs.
C) The product design does not contain the most recent consumer preferences.
D) The product design consists of materials that do not satisfy standards acceptable in the trade.

Question 14

Which of the following statements is true of negligent failure to warn?

A) The manufacturers must provide warnings about obvious dangers.
B) The manufacturers have to include warnings only for the original purchaser of the product, but not the user.
C) The manufacturers need not include warnings about dangers from unforeseeable misuses of the product.
D) The manufacturers of prescription drugs need not provide warnings to physicians of any chance of serious adverse reactions.

Question 15

Which of the following statements is true of defenses to a negligence-based product liability action?

A) For misuse of a product to constitute a valid defense, the misuse must be unreasonable or unforeseeable.
B) An employee using an unsafe machine at work is presumed to have assumed the risk.
C) If contributory negligence is proved, the plaintiff can recover for only that portion of the harm attributable to the defendant's negligence.
D) If pure comparative negligence is proved, the plaintiff is barred from recovery.

Question 16

In most states, the statute of limitations for tort actions is .

A) 30 days from the date of injury
B) 45 days to 11 months from the date of injury
C) 2 to 4 years from the date of injury
D) 4 to 7 years from the date of injury

Question 17

Elimination of the privity requirement reflected a shift in .

A) purchases toward only those products that were produced with proper care in design, manufacture, and labeling
B) social policy toward placing responsibility for injuries on those who market a product that could foreseeably cause harm if proper care were not taken in the manufacturing process
C) social policy toward placing responsibility for injuries on those who purchase a product that has a foreseeable risk
D) packaging strategies employed by manufacturers to begin including warnings about the potential danger of the product

Question 18

In early product liability cases, the privity limitation meant that the plaintiff was required to demonstrate that .

A) he or she purchased the defective product directly from the manufacturer
B) the seller owed a duty of care to the consumer
C) the manufacturer breached a duty of care
D) the damages are actual as opposed to punitive

Question 19

Which of the following is not a common negligent action leading to product liability case?

A) negligent manufacture
B) negligent testing or failure to test
C) negligent advertising
D) negligent infliction of emotional distress

Question 20

Which of the following refers to a scenario in which courts will impose liability due to negligent design?

A) A reasonable person concluding that the warning labels were simply inadequate.
B) A reasonable person concluding that despite any warnings given with the product, the risk of harm outweighed the utility of the product as designed.
C) A reasonable person concluding that the utility of the product as designed outweighed the risk of harm.
D) A reasonable person concluding that the product's design violated statutory duties.

Question 21

In a state that follows modified contributory negligence, in which of the following scenarios could the plaintiff recover the percentage of harm caused by the defendant?

A) The jury finds that the plaintiff's negligence was responsible for 55 percent of the harm.
B) The jury finds that the plaintiff's negligence was responsible for 75 percent of the harm.
C) The jury finds that the plaintiff's negligence was responsible for 65 percent of the harm.
D) The jury finds that the plaintiff's negligence was responsible for 45 percent of the harm.

Question 22

A(n) is a disavowal of liability for breach of warranty by the manufacturer or seller of a good in advance of the sale of the good.

A) disclaimer
B) express warranty
C) implied warranty of fitness
D) tort

Question 23

Katherine purchased a pair of earphones from Simon. She realizes that they are defective and brings a strict liability action against Simon. Which of the following statements is true of this scenario?

A) Simon is not liable as he has not entered into any contractual relation with Katherine.
B) If Simon has exercised all possible care in sale of the product, he is not liable.
C) If Simon is not engaged in the business of selling electronic goods, he is not liable.
D) Simon is not liable as he is not the manufacturer of the product.

Question 24

Which of the following statements is true about strict liability in tort?

A) Product liability actions based on strict liability in tort focus on the producer or manufacturer.
B) To succeed in a strict liability action, the plaintiff must prove that the defendant did not exercise the degree of care that is reasonably expected under those circumstances.
C) A failure by the manufacturer or seller to adequately warn of a risk or hazard associated with the product can be used by the plaintiff to establish that the product is defective.
D) To be successful in a strict liability action, the plaintiff must prove that the product developed a defect before it was sold.

Question 25

Which of the following statements describes a circumstance in which the manufacturer or distributor is liable for selling a defective product according to strict liability in tort?

A) The seller is not engaged in the business of selling the type of product that was found to be defective.
B) The product developed by the manufacturer is expected to reach the consumer or user after undergoing substantial change.
C) The product develops a defect four years after it was purchased by the consumer.
D) The user or consumer has not bought the defective product from or entered into any contractual relation with the seller.

Question 26

Which of the following statements is true of implied warranty of merchantability?

A) It states that the product being sold is the safest one that can be produced with the scientific knowledge available.
B) To meet the standard of merchantability, the product must be adequately contained, packaged, and labeled as the agreement may require.
C) This warranty is made even if the seller does not regularly sell that type of good.
D) The Uniform Commercial Code considers contracts related to consumer goods that limit damages for injuries to a person as valid.

Question 27

Which of the following statements is true about disclaimers used to limit consequential damages for injury caused by consumer goods?

A) These disclaimers are considered unconscionable under the Uniform Commercial Code, and will not be enforced.
B) These disclaimers are enforceable only if the contract is in writing.
C) These disclaimers are enforceable whether or not the contract is in writing.
D) These disclaimers are not considered unconscionable, and are, therefore, not enforced.

Question 28

Which of the following refers to a scenario in which the plaintiff is said to have assumed the risk?

A) when the plaintiff voluntarily and unreasonably encounters a known danger
B) when the plaintiff encounters an unknown danger
C) when the plaintiff does not consider the dangers of a product
D) when the plaintiff does not read all of the provided warnings and instructions to prevent danger

Question 29

A(n) warranty is one clearly stated by the seller or manufacturer.

A) express
B) implied
C) liquidated
D) impact

Question 30

According to the American Law Institute's Restatement (Third) of Torts: Product Liability, .

A) the liability is strict when there is a manufacturing defect
B) the liability is strict when there is a defective warning
C) a manufacturing defect is said to exist if the consumer uses it for its original purpose
D) the seller's liability is determined by the percentage of fault apportioned by the court

Question 31

Tom purchases a new set of tires for his vehicle. He informs Richard, the vendor who specializes in such goods, that he intends to use it in snowy conditions. The tires do not provide sufficient grip in snow, and his vehicle meets with an accident. Which of the following statements is true of this scenario?

A) Richard cannot be held liable as Tom voluntarily assumed the risk of driving in snowy conditions.
B) Richard cannot be held liable if an express warranty was not issued with the product.
C) Richard is liable on the basis of negligent design.
D) Richard is liable as he breached an implied warranty of fitness for a particular purpose.

Question 32

A defendant raising the defense is claiming that the harm was not caused by the defendant's negligence.

A) res ipsa loquitur
B) contributory negligence
C) product misuse
D) comparative negligence

Question 33

A(n) warranty is one that automatically arises out of a transaction.

A) express
B) implied
C) limited
D) impact

Question 34

Which of the following is true about the standard adopted by the Restatement (Third) of Torts for design defects?

A) It is based on strict liability.
B) It is based on reasonableness.
C) It is a negligence-based test on the duty to warn.
D) It is based on the defendant's intent.

Question 35

Which of the following statements is true of breach of warranty actions?

A) Most courts do not require that the purchaser provide the manufacturer a notice within a reasonable time of becoming aware of the breach of warranty if the two parties have not dealt with each other.
B) According to the Uniform Commercial Code, the cause of action arises the day the product malfunctions.
C) Most courts allow a manufacturer to relieve itself of liability for breach of warranty by using disclaimers even if the disclaimers are not stated on an integral part of the product or package.
D) The Uniform Commercial Code contains a provision stating that disclaimers on products cannot be considered as unconscionable.

Question 36

In terms of product liability, a strict liability in tort standard is applied when there is a .

A) misrepresentation in an advertisement
B) false statement made by the seller
C) product that was defective when it was sold
D) substandard degree of care exercised by the manufacturer

Question 37

Which of the following statements is true of the state-of-the-art defense?

A) It is a product liability defense based on adherence to existing economically feasible methods when the product was manufactured.
B) If proven, the defendant cannot be held liable for the defective product.
C) It bars actions arising more than a specified number of years after the product was purchased.
D) It is a valid defense in a negligence case because the focus is on the reasonableness of the defendant's conduct.

Question 38

The implied warranty of fitness for a particular purpose refers to .

A) a warranty that allows the purchaser to recover the full purchase price if there is any dissatisfaction with the product
B) a warranty that is clearly stated by the seller or manufacturer
C) a warranty that arises when the seller tells the consumer that a product is fit for a specific use
D) a warranty that a product is reasonably fit for ordinary use

Question 39

Which of the following refers to unconscionability under the Uniform Commercial Code?

A) The seller was not aware of the defect at the time of purchase.
B) The plaintiff is a minor.
C) The contract clause is grossly unfair.
D) The lawsuit was brought after the expiration date of the statute of repose.

Question 40

Which of the following refers to the state-of-the-art defense?

A) The defendant proves that a warning on the product would not have helped.
B) The defendant proves that there was insufficient scientific knowledge to make a safer product at the time it was manufactured.
C) The defendant proves that the plaintiff had insufficient knowledge to purchase the product.
D) The defendant proves that the warning could have been understood by any reasonable person.

Question 41

Which of the following is true of adopting the Restatement (Third) of Torts: Product Liability?

A) The seller's liability differed depending on whether the defect was a manufacturing defect, a design defect, or a defective warning.
B) The seller's liability differed depending on whether the plaintiff was a merchant, a consumer, or a minor.
C) The privity limitation was reinstated as a defense to product liability lawsuits.
D) The state-of-the-art defense is permitted by courts in most strict liability cases.

Question 42

According to the Uniform Commercial Code, to meet the standard of merchantability, the goods must pass without objection in the trade under the contract description.

Question 43

The risk-utility test is used to determine whether a product has met the standards that would be expected by a reasonable consumer.

Question 44

Which of the following statements is true of the market share theory?

A) It is used when various manufacturers have produced different parts of the product.
B) It is used when the allegedly harmful products differ based on the manufacturer who has produced them.
C) It apportions liability among the defendants on the basis of the market share they held at the time the product was produced.
D) It apportions liability among the defendants on the basis of the market share they hold when the lawsuit is filed in court.

Question 45

Most courts recognize that the concept of voluntariness is an illusion in the workplace.

Question 46

Printing claims about products on their packaging creates an implied warranty of fitness for a particular purpose.

Question 47

In most cases, an employee using an unsafe machine at work is not presumed to have assumed the risk.

Question 48

Statutes of repose are usually much shorter than statutes of limitations.

Question 49

The feasible alternatives test, set out in the Restatement (Second) of Torts, is the consumer- expectations test.

Question 50

Product liability and tort law are unrelated.

Question 51

Why did some courts conclude that compliance with the Clean Air Act does not preclude oil companies from liability?

Question 52

Section 402A of the Restatement (Second) of Torts is generally considered to be the foundation of modern product liability law.

Question 53

State-of-the-art defense is valid in a negligence case because the focus is on the reasonableness of the defendant's conduct.

Question 54

In terms of the strict liability in tort theory of product liability, the focus is on the producer or seller, not the product.

Question 55

Abolition of the privity limitation opened the door for negligence as a theory of liability when people were injured because of a product manufacturer's or seller's lack of care.

Question 56

Which of the following statements is true of defenses to a strict product liability action?

A) Product misuse is available as a defense to a strict product liability action.
B) Assumption of the risk is not permitted as a defense to a strict product liability action.
C) The state-of-the-art defense is generally allowed in a strict product liability action.
D) The state-of-the-art defense in a strict liability action requires testimony from an expert witness.

Question 57

Producers are generally required to warn customers of obvious dangers associated with a product.

Question 58

With reference to cosmetics and over-the-counter drugs, what should the plaintiff prove for the court to conclude that the defendant is guilty of negligent failure to warn?

Question 59

If a product is to be used by someone other than the original purchaser, the manufacturer is generally required to put some sort of warning on the product itself.

Question 60

Privity means that one is a party to a contract.

Question 61

Market share theory is used by courts when .

A) a defendant is not engaged in the business of selling the type of product that caused harm to the plaintiff
B) a defendant manufactures many different variations of the same type of product
C) many manufacturers produced the same product that caused harm to the plaintiff
D) the entire market share of a product belongs to one manufacturer

Question 62

Market share liability theory attempts to balance the interests of the plaintiffs in recovering for injuries caused by defective products against the manufacturers' interests in not being held liable for injuries caused by a product they did not produce.

Question 63

According to , only the party who contracted for the accountant's work may sue.

A) the Ultramares Doctrine
B) Section 552 of the Restatement (Second) of Torts
C) the reasonably foreseeable user rule
D) market share theory

Question 64

Explain the implied warranty of fitness for a particular purpose.

Question 65

With theory, courts attempt to balance the interests of the plaintiffs in recovering for injuries caused by defective products against the manufacturers' interests in not being held liable for injuries caused by a product they did not produce.

A) free market
B) market share
C) strict liability
D) comparative negligence

Question 66

Explain the theory of market share liability.

Question 67

Which court created market share theory in the 1980 case Sindell v. Abbott Laboratories?

A) the U.S. Court of Appeals for the Ninth Circuit
B) the U.S. Supreme Court
C) the North Carolina Court of Appeals
D) the California Supreme Court

Question 68

According to , the accountant is liable only to those in a privity-of-contract relationship.

A) the Ultramares Doctrine
B) Section 552 of the Restatement (Second) of Torts
C) the reasonably foreseeable user rule
D) market share theory

Question 69

According to , the accountant owes a duty to the client and any class of persons the accountant knows is going to be receiving a copy of his or her work.

A) the Ultramares Doctrine
B) Section 552 of the Restatement (Second) of Torts
C) the reasonably foreseeable user rule
D) market share theory

Question 70

Which of the following is not a factor generally necessary for applying market share theory?

A) All defendants intended to cause the plaintiff harm.
B) All defendants are tortfeasors.
C) The allegedly harmful products are identical and share the same defective qualities.
D) The plaintiff is unable, through no fault of his or her own, to identify which defendant caused his or her injury.

Question 71

Provide arguments for and against allowing the state-of-the-art defense in strict product liability actions.

Question 72

What are the arguments for and against the statutes of repose?

Question 73

Which of the following statements is true about malpractice actions?

A) They are no longer permitted under the Restatement (Third) of Torts.
B) They generally apply the strict liability standard.
C) The number of malpractice actions against professionals is rising at a rapid rate.
D) The number of malpractice actions against manufacturers is rising at a rapid rate.

Question 74

Discuss the consequences of eliminating the privity requirement.

Question 75

How did the 1916 case of MacPherson v. Buick Motor Co. lead to the elimination of the privity requirement?

Question 76

Explain the implied warranty of merchantability.

Question 77

Which of the following is not a common legal theory that serves as a basis for a malpractice suit?

A) negligence
B) breach of contract
C) strict liability
D) fraud

Question 78

Which of the following is an incorrect statement regarding service liability?

A) Strict liability has been frequently applied to services.
B) Most service liability cases involve services provided by professionals, such as doctors and lawyers.
C) Along with the growth in lawsuits for defective products, there has also been an increase in the number of lawsuits brought for defective services.
D) Lawsuits for defective services are generally brought when someone or someone's property is harmed as a result of an inadequately performed service.

Question 79

Attempts to extend the application of market share liability theory to products other than drugs have not met with much success.

Question 80

Which of the following statements is true about malpractice suits?

A) They are service liability suits brought against professionals.
B) They are service liability suits brought against manufacturers.
C) Strict liability is usually applied to malpractice suits.
D) Strict liability is generally not applied if the defendant has provided both a good and a service.