The Product Liability Act as statutory limitation of fault liability?

According to the Product Liability Act of 25 February 1991, which implements the Product Liability Directive of 1985, damage caused by defective products can be compensated by the producer (or in some cases the supplier) without the victim having to prove a fault.

In a noteworthy judgment of 14 March 2024 (C.23.0100.N), the Belgian Cour de cassation ruled that the Product Liability Act of 25 February 1991 limits the application of the extra-contractual fault liability (currently articles 1382 and 1383 Old Civil Code, as from 2025 article 6.5 Civil Code).

The Cour de cassation holds that, if the liability is based on the fact that a defective product was put into circulation and caused damage, the producer and supplier can only be held liable and the victim can only obtain compensation within the terms of the Product Liability Act. Their extra-contractual liability based on articles 1382 and 1383 Old Civil Code can therefore only be withheld if the liability is based on a fault other than the putting into circulation of the defective product.

The Court motivates this by referring to the main purpose of the Directive to eliminate, through maximum harmonisation, the differences between national liability systems for damage caused by defective products, for the purpose of achieving the internal market and safeguarding free competition between economic operators.

The court specifies that this exclusion of the non-contractual liability regime applies regardless of whether it could provide a higher level of protection to the victim.

This logically means that, in accordance with the Products Liability Act, the claim is time-barred by the lapse of three years from the day the plaintiff became or should have become aware of the damage, the defect and the identity of the producer. Thus, the plaintiff cannot enjoy the longer limitation period of extra-contractual liability unless he invokes a separate fault by the producer.

What about damages? The Product Liability Act only provides for compensation for well-defined types of damage caused by defective products, namely damage caused to persons and goods for private use or consumption, the latter subject to a deductible of €500. The appeal before the Cour de cassation invoked, among other things, that the Court of Appeal had ruled "without applying the limitations on compensable damage." The rather general wording of the decision of the Cour de cassation might give the impression that, if the fault consists in having put a defective product into circulation, only the Product Liability Act can apply and therefore goods other than private goods are not eligible for compensation.

It is not excluded that this judgment will be used for the purpose of such liability limitation, but that cannot be its intention. Damage to goods other than private goods is not regulated by the Directive or the Product Liability Act and remains untouched.  When the judgment refers to “damage”, it should be understood to mean only damage inflicted on persons or privately used goods.