Product Liability Laws in Thailand

Introduction:
In Thailand, the key pieces of legislation dealing with the issue of product liability are:
1. Liability for Damages Arising from Unsafe Product Act (2008) otherwise known as the Product Liability Act (2008); and
2. The Consumer Cases Act (2008).

The Thai Civil and Commercial Code is also relevant as it supplements the Product Liability Act in relation to compensation to injured persons.

Product Liability Act (2008)

Purpose of the Act
The main purposes behind this legislation were to:
a. Instill greater consumer confidence in products in Thailand and to better protect the public from dangerous or defective products;
b. Simplify the previous legal approach to product liability which was overly complicated and make it easier for injured persons to receive justice and fair compensation.

Scope of the Act
This Act offers consumers considerable protection given that it provides that ‘Business Operators’, as defined therein as:

1. Manufacturers (or hirers for manufacture),
2. Importers,
3. Sellers of products; or
4. Persons who use a name, trademark, trade name, mark or statement that would lead to the belief that they are the manufacturer, hirer for manufacture or importer of the product);

are subject to a legislative regime whereby they can be held jointly liable to affected persons who have suffered ‘damage’ from ‘unsafe products’ which have been ‘sold, distributed to, dispensed or given to’ consumers, regardless of whether the damage was intentionally or negligently caused by the Business Operator(s).

The purpose of making the various Business Operators jointly liable is to make it easier for consumers to seek redress as it is not necessary for them to single out exactly which party in the product chain was responsible for the damage.

Defendant Shopping Issue:
Under section 5 of this Act, any of the ‘Business Operator(s)’ who are in the product chain leading to the injured party are jointly liable despite the fact that the ‘Product’ may have been free of defects at the time it left the possession of a particular supplier or manufacturer.

Hence, this feature of the law could lead consumers to undertake ‘defendant shopping’ in the case of a claim, whereby they search for the wealthiest defendant(s) in the supply chain to sue. This aspect of the law could be highly prejudicial to larger and wealthier Business Operators such as large profitable companies as they will offer a more advantageous target for injured parties given their greater fiscal resources.

Commencement of the Act:
The effective date of the Act (which was 20 February 2009) is also crucially important as section 15 provides that any products sold to consumers before this date are not covered by this legislation, instead they are to be handled by the Civil & Commercial Code.

Definition of ‘Products’:
Section 4 of the Act defines ‘Products’ to mean any kind of movable property manufactured or imported for sale including ‘Agricultural Products’ and electricity, other exclusions are outlined in the Ministerial Regulations (2010) and mainly relate to certain agricultural products that are grown in Thailand such as dried tobacco and de-husked rice.

What Constitutes ‘Damage’ under the Act:
In relation to what constitutes ‘damage’ under this Act, this term is broadly defined given that it encompasses damage to:

In terms of ‘mental damage’ the act defines this to mean: pain, phobia, anxiety, sorrow, shame, or similar types of mental damage.
Note: The scope of damage may be better clarified in future judgments of the Supreme Court when cases involving the interpretation of ‘mental damage’ are clearly addressed by the Court.

Burden of Proof:
In order for Business Operator(s) to be liable under this Act, the injured party must prove that:
1. They sustained the actual damage from the Product of the Business Operator; AND
2. The use and storage of the Product was done in the normal manner.

HOWEVER, the injured party shall not be required to provide evidence that the damage occurred from the action(s) of a particular Business Operator(s).

Application of Strict Liability Doctrine under the Act:
This legislation extends tort law in Thailand by applying the doctrine of strict liability in that each Business Operator is jointly liable to the Injured Party if the injured party can prove that they sustained the actual damage from the Product of the Business Operator.

For instance, the manufacturer of a defective product will be considered liable even if they were not negligent in making the Product defective. However, note section 8 of the Act which provides some exceptions to manufacturer liability.

Defenses Available to Business Operators under the Act:
An injured person should be aware that under section 7 of this Act an Business Operator can avoid liability if they are able to prove one of the following:

a) Their Product is not in fact an unsafe product. Note: This is a question of fact and will likely turn on technical evidence and expert witness testimony to prove that the product is in fact safe;

b) The injured party was already aware that the Product was unsafe before using it;

c) The damage that was sustained by the injured person was due to their incorrect usage or storage of the product. It is worth noting that this last exemption only applies when the Business Operator has clearly and accurately marked on the Product the correct usage, applicable warnings and the correct storage method on the product.

d) Section 8 of the Act provides that a manufacturer of the Product who is producing the Product under the orders of another party authorizing such production will not be liable under this Act if they can provide evidence that:
I. The danger was caused by the design of the party authorizing the production of the Product OR
II. Compliance with the instructions provided by the party authorizing the production of the Product
Where the manufacturer had not and should not have foreseen such danger/ safety issue.

e) The manufacturer of component parts shall not be liable under this Act if they can prove that the danger/ product safety issue was caused by the design, assembly, instructions, storage warning message or Product information provided by the manufacturer of the Product

Agreement between Consumer & Business Operator(s) Limiting Liability:
In relation to whether a preceding agreement between a ‘Consumer’ and the Business Operator (such as purchase terms and conditions) will affect the product liability of the Business Operator, section 9 of this Act provides that the Business Operators’ liability is not able to be exempted or limited by an agreement between the parties which is entered into before the damage occurs.

Prescription Period:
Section 12 provides that a claim for damages caused by an unsafe Products under the Act must be filed within three (3) years from the day when the damage and the person bound to make compensation became known to the injured person OR within ten (10) years from when the Product was purchased.

HOWEVER, if an injured person’s body, health or hygiene suffers damage that is caused by an accumulation of chemicals in their body or in the event that a period of time must pass before symptoms appear, the injured person has three (3) years counting from the date that they became aware of the damage and the identity of the Business Operator(s) responsible but such period must not exceed ten (10) years from the date that the injured person became aware of the damage. It is worth noting that this prescription period is also in line with section 13 of the Consumer Cases Act (2008).

If there are negotiations between an injured person/ or their representative (consumer protection board) and an Business Operator(s) then the prescription period will be suspended until either party terminates the negotiations It is worth noting that this prescription period is also in line with section 14 of the Consumer Cases Act (2008).

Compensation for Injured Parties:
In terms of product liability compensation for injured parties, there are a number of important issues to consider including:

i. Punitive damages awarded by Thai Courts are relatively small in comparison to those issued by courts in Western jurisdictions especially those awarded in the United States of America. Indeed, section 11(2) of the Product Liability Act only permits the Court to award punitive damages in certain limited circumstances (see below) and these are capped at no more than double the actual damages;
ii. Punitive Damages may be awarded by the Court to an injured person if it is found that the Business Operator has manufactured, imported or sold a Product where:
a) it is aware that such product is unsafe, OR
b) is unaware of such danger due to their gross negligence; OR
c) does not proceed with any appropriate action to prevent such damage after becoming aware that the Product was unsafe.
iii. Could be difficult to put a monetary figure on mental damage;
iv. If an injured person has died then that person’s husband/wife, children or the inheritors under their estate shall have rights to compensation for mental damage such as sorrow, pain, anxiety etc.

Thai Civil and Commercial Code
The Civil Code supplements the Product Liability Act in relation to compensation (see section 11 of the Act).

Compensation for Injured Parties:
Section 438 Civil & Commercial Code is important in terms of compensation for a Wrongful Act as it states that the Court shall determine the manner and the extent of compensation according to the circumstances and gravity of the Wrongful Act. Compensation may include damages for any injury caused.

Injured Party Contributing to Damage Sustained:
If the fault of the injured party has contributed to the damage they have suffered then section 442 of the Code provides that the obligation to compensate them and the extent of such compensation will depend on the particular circumstances, especially which party was mainly responsible for the damage sustained.

Compensation in the case of Death of Injured Person:
In the case of death, section 443 provides that compensation from the responsible party shall include funeral and other necessary expenses. Moreover, if a person dies due to damage from a product then any person who is deprived of their legal support is also entitled to claim for compensation.

Consumer Cases Act (2008):

Application:
This legislation applies to all cases arising from the consumption of goods and services and includes all cases under the Product Liability Act (2008).

Purpose of the Act
The main purpose behind this legislation was to give consumers access to cheaper, simpler and swifter legal proceedings.

Parties to a Product Liability Case:
According to section 19 of the Consumer Cases Act (2008), the Consumer Protection Board (Sor Kor Bor) is entitled to file a law suit for damages on behalf of an injured party. If the Board takes up a case, the cost of litigation is borne by the Board and as such this option is more advantageous for persons of limited financial means. However, the public should however be aware that the Board’s effectiveness is limited due to its finite resources.

Filing a Case:
According to section 20 an injured consumer of a product is able to file their case verbally or in writing. If the injured person files their complaint verbally then a case officer shall arrange the recording of the details of their complaint and shall arrange for them to sign it.

The Court will require that the facts of their case and the relief that they require are expressed clearly in the filing documents otherwise it may require them to amend the documents to improve clarity.

Courts:
Depending on the amount of compensation claimed, product liability cases are filed in the following courts;

Length of Cases:
These cases are significantly faster than ordinary civil law cases, most cases in the court of first instance are finalized within one year. If a decision is contested on a question of law it can then be appealed to the Consumer Case Section of the Appeal Court or the Regional Appeal Court.

But if the Supreme Court gives leave to appeal the case (permission must be sought first & if involving a question of fact then the claim must be for at least 200,000 THB – section 51) then the appeal can take up to 2 or 3+ years to be finalized given the Supreme Courts’ heavy workload.

Mediation Stage:
If a product liability case goes to a court hearing then people should also be aware that it will first be subject to mediation between the parties which shall be conducted by a case officer or a person duly appointed by the Court or a party which is mutually appointed by the parties.

Penalty re Court Fees for Unreasonable Cases:
If the Court feels that an injured person or their legal representative has filed a lawsuit on unreasonable grounds, claimed excessive damages or unnecessarily delayed the proceedings of their case then section 18 of the Consumer Cases Act (2008) permits the Court to order the injured person to pay the court fees in whole or in part and if they are not paid then the Court has the power to strike the lawsuit from its list.

Flexibility re Compensation Awards:
Under section 40 of the Consumer Cases Act the Court may state in its judgment or order that it reserves the right to revise such judgment or order, but not for more than 10 years from the date that the judgment is issued.

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