Indiana Law Review Book Revieiv Products Liability and the Reasonably Safe Product. By Alvin S. Weinstein,* Aaron D. Twerski,** Henry R. Piehler,*** and William A. Donaher.**** New York Chichester, Brisbane, Toronto: John Wiley & Sons, Inc., 1978. Pp. ix, 314. $15.00. I. Thesis To one uninitiated in the method and logic of the law, products liability may appear to be an area with a simple philosophy — com- pensate the innocent consumer for harm suffered as a result of defective products. The legal analysis, however, is much more in- tricate and less susceptible to facile generalization. To the manufac- turing community, the legal maze of defect, causation, foreseeable harm, and other concepts must seem both frustrating and insidious. Products Liability and the Reasonably Safe Product^ initiates the manufacturing community^ into the mysteries of products liability law and enables the manufacturer to develop a reasoned scheme of design, production, and marketing. A legal primer for the manufac- turer and those involved in the distributive chain, the book discusses the fundamentals of products liability law which should be used as an aid in establishing price and quality control procedures or in making cost and quality tradeoffs in the production process. The book is not intended to address the technical considerations of Professor of Mechanical Engineering and Public Affairs, Carnegie-Mellon University. Adjunct Professor of Law, Duquesne University School of Law. Associate Dean and Professor of Law, Hofstra University School of Law. Associate Professor of Metallurgy, Materials Science and Public Affairs, Carnegie-Mellon University. Adjunct Professor of Law, Duquesne University School of Law. Professor of Law, Duquesne University School of Law. 'A. Weinstein. A. Twerski, H. Piehler & W. Donaher, Products Liability and THE Reasonably Safe Product (1978) [hereinafter cited as Products Liability]. See also Donaher, Piehler, Twerski & Weinstein, The Technological Expert in Products Liability Litigation, 52 Tex. L. Rev. 1303 (1974) (discussing the role of expert witnesses, advocating an increased use); Twerski, Weinstein, Donaher & Piehler, The Use and Abuse of Warnings in Products Liability— Design Defect Litigation Comes of Age, 61 Cornell L. Rev. 495 (1976) (discussing the interplay of warnings and defect standards) [hereinafter cited as Twerski, The Use and Abuse]; Weinstein, Twerski, Piehler & Donaher, Product Liability: An Interaction of Law and Technology, 12 Duquesne L. Rev. 425 (1974) (dealing with the fundamental concepts forming the basis of the reviewed book). ^"Manufacturing community" refers to the engineering, management, and marketing personnel who produce an item that is placed in the stream of commerce. 627 628 INDIANA LAW REVIEW [Vol. 13:627 the practicing bar; instead, it is offered as an overview to those who desire background information. The authors, members of the two disciplines most closely con- cerned with products liability — management and the law,^ pool their resources to "analyz[e] the role of technology and its interface with the law."" Specifically, they seek "to examine whether the practice of products litigation [is] based on established legal principles and . . . technological reality as well."^ With this two-fold purpose in mind, the authors examine the legal responsibilities of the manufacturing community. They conclude that legal practice should complement the decision-making process of engineering and designing products: When it comes to evaluating the design process for safety, .... [t]he designer can plan for the total avoidance of liability. A product will not be declared defective in design merely because it caused an injury. A court will evaluate design safety by testing the reasonableness of the trade-offs that went into making the final design decisions. It is here that the manufacturer must be sensitive to the weight the courts have placed on the various factors in the risk-utility balanc- ing process.^ The authors premise this conclusion on the theory that courts generally apply a risk-benefit calculus in determining liability.^ Although the risk-benefit analysis conforms neatly with marketing policy, the test possesses certain deficiencies in light of courtroom realities. Before discussing the relative strengths and deficiencies of the risk-utility approach, this Review will provide a brief synopsis of the book's contents. ^Professors Weinstein and Piehler teach engineering and public affairs at Carnegie-Mellon University; Professors Donaher and Twerski are Professors of Law at Duquesne and Hofstra Law Schools, respectively. Troducts Liability, supra note 1, at vii. ^/d at viii. 7d at 137 (emphasis added). ''Id. at 51, 137. The authors apply the seven factors recommended by Dean Wade to guide courts in determining liability. See Wade, Strict Liability of Manufacturers, 19 Sw. L.J. 5, 17 (1965). These seven factors are: (1) The usefulness and desirability of the product. (2) The availability of other and safer products to meet the same needs. (3) The likelihood of injury and its probable seriousness. (4) The obviousness of danger. (5) Common knowledge and normal public expectation of the danger. (6) The avoidability of injury by care in use of the product (including the ef- fect of the instructions or warnings). (7) The ability to eliminate the danger without seriously impairing the use- fulness of the product or making it unduly expensive. Products Liability, supra note 1, at 47 (citing Wade, supra, at 17). 1980] BOOK REVIEW 629 II. Synopsis The authors begin their consideration of the value of applying legal principles to the design process with a brief discussion of the three basic theories of products liability: negligence, turning on the conduct of the defendant; strict liability and implied warranty, turn- ing on product quality and contractual expectations; and express warranty and misrepresentation, turning on product performance vis-a-vis explicit representations.** Discussing the elements of a tort action, the authors observe that each theory of liability requires proof that the product was defective at the time it left the defendant's hands and that the defect caused the harm. In discussing the basic elements of a products liability claim, the issue of duty is explored and described as a shorthand determination of whether a manufac- turer should be held responsible for his product's design. The authors conclude that the questions raised by a court in deciding whether a duty exists should be raised by the manufacturers during the design stage.^ Building upon this foundation, the authors discuss the meaning of product defectiveness by contrasting production defects with design flaws. ^° A production defect occurs when a particular product fails to conform with the manufacturer's standard product." Defining a design defect is not so simple; generally, American courts have employed two tests in defining design defectiveness: (1) the con- sumer expectancy test, and (2) the unreasonably dangerous test.^^ In ^Products Liability, supra note 1, at 5-16. 'Id. at 27. '7d at 28-32. "M at 31. See Caterpillar Tractor Co. v. Beck, 593 P.2d 871, 880 (Alaska 1979). 'Troducts Liability, supra note 1, at 45-51. Because the book is addressed to the manufacturing community, the debate about which test, consumer expectancy or risk-benefit, is preferable only receives brief attention. To illustrate the debate, con- sider the divergent views of Professors Calabresi and Hubbard. Calabresi contends that strict liability should focus on who has the incentive to make a cost-benefit analysis of accident costs and prevention costs. Minimizing these two concepts is refer- red to as "optimal deterrence." Calabresi, Optimal Deterrence and Accidents, 84 Yale L.J. 656 (1975). Calabresi's conception of strict liability has, in his opinion, two advan- tages: (1) Because the incentives to reduce costs fall on the parties, as opposed to the "regulator," strict liability can cope with situations where the optimal deterrence is achieved through mutual balancing by producer and consumer, and (2) Because the incen- tives are on the parties, any error by the "regulator" is presumed not to be the fault of the parties, so no one bears more than a theoretical 50 percent chance of having an error saddled on him. Id. at 669-70. In contradistinction is Professor Hubbard's theory that defects should be defined according to consumer expectations. Hubbard, Reasonable Human Expectations: A Normative Model for Imposing Strict Liability for Defective Products, 29 Mercer L. Rev. 465, 465 (1978). Due to the vagueness of such concepts as "efficiency," "cost," and "benefit," Hubbard contends that human expectations should prevail over efficiency. Id. at 468-70. According to Hubbard, a product is defective only when it violates those 630 INDIANA LAW REVIEW [Vol. 13:627 applying a consumer expectancy test, a manufacturer is liable whenever consumer expectations are frustrated.'^ Expressing a prefer- ence for the risk-benefit analysis, the authors explain some of the limitations of the expectancy approach. First, the expectancy test prevents liability when the danger is obvious to the user, regardless of whether the product's risks exceed its utility.'" By focusing on consumer expectations, courts often overlook the feasibility of alter- native designs which have a bearing on the defectiveness of a design.'^ Additionally, the expectancy standard is an unsound method of determining liability when the person injured by the pro- duct is not the buyer or user.'*' For example, an injured bystander may not have any expectation about the safety of a product purchased or used by another person.'^ Even if the injured party is the con- expectations. Hubbard concedes that efficiency should resolve the issue of defec- tiveness when both or neither the buyer and seller have reasonable expectations. Id. at 477-78. See notes 35-39 infra and accompanying text. The distinction between the consumer expectation theory of defectiveness and the unreasonably dangerous approach, however, may be insignificant. Recent commen- taries demonstrate that these tests serve some of the same policies. For example, Pro- fessor Fischer, a proponent of the risk-benefit test, proposes a multiple factor test that considers consumer expectations as well as those of the manufacturer. Fischer, Pro- ducts Liability— The Meaning of Defect, 39 Mo. L. Rev. 339, 359 (1974). By the same token, factor six of Professor Wade's seven factors deals with the product user's anticipation of danger. Wade, supra note 7, at 17. Similarly, proponents of the reasonable consumer expectation theory incorporate elements of the unreasonably dangerous test. Advocating a consumer expectancy test. Professor Shapo has compiled a list of thirteen considerations which include such risk-benefit factors as "implications of the proposed decision for public health and safety generally," "cost to the producer and other sellers of acquiring the relevant information," and "the likely effects on prices and quantities of goods sold." Shapo, A Representational Theory of Consumer Protection: Doctrine, Function and Legal Liability for Product Disappointment, 60 Va. L. Rev. 1109, 1370-71 (1974). A unified view and the one most likely to represent the actual decision-making process is that consumer expectations are incorporated in a risk-balancing test. Some commentators like Professor Hubbard, however, would disavow any unification of the tests. For an instructive discussion about the consumer expectancy and risk-utility stan- dards, see Caterpillar Tractor Co. v. Beck, 593 P2d 871 (Alaska 1979) (adopting both standards). ''E.g., Muller & Co. v. Corley, 570 S.W.2d 140 (Tex. Civ. App. 1978); Vincer v. Esther Williams All-Aluminum Swimming Pool Co., 69 Wis. 2d 326, 230 N.W.2d 794 (1975). See generally Fischer, supra note 12, at 348-52; Montgomery & Owen, Reflec- tions of the Theory and Administration of Strict Tort Liability for Defective Pro- ducts, 27 S.C.L. Rev. 803 (1976). '*See Products Liability, supra note 1, at 45-46. See also Keeton, Product Liability and the Meaning of Defect, 5 St. Marys L.J. 30, 35 (1973); Montgomery & Owen, supra note 13, at 823. 'Products Liability, supra note 1, at 46-47. "Fischer, supra note 13, at 351; Montgomery & Owen, supra note 13, at 823. '^Montgomery & Owen, supra note 13, at 823 n.67. Use of the consumer expecta- 1980] BOOK REVIEW 631 sumer, he may be unable to recover because he is an expert aware of the product's defectiveness/® Consequently, consumer expecta- tions may vary on the basis of a consumer's particular knowledge about a product. The unreasonably dangerous test overcomes the doctrinal defi- ciencies of the consumer expectation test by examining whether on balance the benefits of a particular design are greater than its risks. ^^ Typically, courts applying this test consider the availability and feasibility of alternative designs, as well as the product's use, environment, and risks.^^ The authors, in fact, conclude that reasonable consumer expectations are usually determined by balanc- ing risk and utility .^^ Realistically, a consumer expects that a pro- duct will be reasonably safe in terms of relative advantages and dis- advantages. The application of a risk-benefit test demonstrates the com- plementary relationship between warnings and design in producing a reasonably safe product. Obviously, warnings are an inexpensive means of eliminating certain risks because the burden of adding a warning is almost always less than the probability and gravity of harm for failing to warn of the danger.^^ Although warnings are a cheap alternative to product safety, the authors observe that a con- sumer cannot be expected to understand multiple and complex warnings, the effectiveness of which decreases inversely to in- creases in multiplicity and complexity .^^ Moreover, the authors discuss the impact that design modifications have on the desirability of warnings: A warning may or may not be sufficient, depending on the probability of reducing the risk and the feasibility of the design alternatives that would eliminate the risk or substan- tially diminish it. Courts sensitive to the very real limita- tions that affect warnings have indicated their concern that in some instances even the best of warnings may not shield the manufacturer from liability. The vehicle for this instruc- tion to manufacturers has been the design issue. tion test in this instance would require the fiction of imputing an expectation to the bystander. '^Fischer, supra note 12, at 349-50. ^^See Fischer, supra note 12, at 348-52; Montgomery & Owen, supra note 13, at 815-18. See also Products Liability, supra note 1, at 45-51. '"See Phillips v. Kimwood Machine Co., 269 Or. 485, 525 P.2d 1033 (1974); Wade, supra note 7, at 17. "Products Liability, supra note 1, at 51. ^I