How To Write A Bulletproof Product Liability Waiver
Product defects and malfunctions may not seem to grace the headlines like before, but they still happen. Whether it’s defective car parts or contaminated food stations, the products we use daily can go bad, and no business is immune to this. With that said, consumers can file claims against a company even when the business (or product) is not at fault for a buyer’s injury or illness. And without proper liability terms, the business can be in the wrong even if they’re not at fault. This post will look at how business owners can write an all-encompassing product liability waiver that offers protection against litigation.
Understand 3 Types Of Product Liability Claims & Plan To Address Them
What is product liability? Product liability is what determines who is responsible for any product defects. When it comes to product defects, there are three main categories—design, manufacturing, and marketing. Mistakes happen, but that doesn’t mean that these mistakes can’t cause massive consequences. It’s crucial that when you own a business that sells physical items, to get set up with a proper product liability waiver form in place.
A design defect is a problem with how a product is made and meant to function. A design defect will exist before the product gets manufactured. A design defect could affect a product early on in its life or down the road. This can be pretty dangerous because the fault will eventually make itself known no matter how carefully a customer uses the product.
For example, the Tiny Love Wind Chime toy from Tiny Love was recalled in 2010 for a design defect. This toy was meant to hang over a baby’s car seat or crib and be something that they could play with. Due to a design defect, the baby could pull the toy apart, revealing shard metal parts.
A manufacturing defect is when nothing is wrong with the design of a product, but something went wrong during the production process. A manufacturing defect can be caused by human error or something more significant, affecting the entire line of products. As a business owner, it’s important to know that it doesn’t matter how the product became defective. The company is almost always held strictly liable either way.
An example of a manufacturing defect would be if a bottle of cough medicine became contaminated during manufacturing. This could have been from contact with a human or something accidentally getting into the batch of medicine and affecting thousands of bottles. The minute one of these infected items leaves the warehouse strictly liable.
A marketing defect can be when a company fails to disclose a potential side effect or potential risk using the product. It is the companies responsibility to discover the risks that come with their products and ensure that consumers are aware of all risks. This is why we see products now with so many warning labels and lists of potential side effects. This is the result of both a company trying to protect their customers and cover their bases in case of a lawsuit.
A great example of this was in 2002 when a woman filed charges against Philip Morris. She sued them for failing to provide proper labels on their products, warning her that tobacco products could lead to tobacco addiction and illness. Philip Moris was ordered to pay $28 million in punitive damages.
Understand What Makes A Liability Waiver Ineffective To Write A Stronger One
In order to protect the livelihood of your business, it’s essential to cover all of your bases. While we hope you never have to deal with any lawsuit, things happen. Ensure that you are protecting your business from expensive product liability lawsuits and write a clear product liability waiver form. Here are some tips on what to do and what not to do:
Unclear And Ambiguous language
Do Not: use unclear and ambiguous language. If a waiver is too complex or challenging for the average consumer to read and understand, you risk your product liability waiver form getting thrown out of court.
Do: When putting your product liability waiver template together, make sure all the language used is clear, concise, and to the point.
Location Of Critical Language
Do Not: Hide important information and clauses in areas of a waiver that they do not belong. If the court believes you were trying to hide something or mislead the consumer, your product liability waiver form could be useless in court.
Do: Make each clause obvious of its intent. For your waiver to hold weight in court, it must be easy to understand, with every potential risk written clearly and not disguised in any way.
Product Liability Waiver Form
Check out these 5 steps for creating a product liability waiver. Waiver Forever can help you get started and make sure that your waiver can protect your business if you have to deal with a product liability lawsuit in the future.
In addition to product liability waiver templates, we have a large template library that can help you create all different waivers and liability forms, including COVID-19 waivers, event waivers, and more!