What Lawyers, Manufacturers And Sellers Need To Know About Product Liability Laws In The Province Of Québec

• Published date: 22 September 2020
• Subject Matter: Consumer Protection, Product Liability & Safety, Dodd-Frank, Consumer Protection Act
• Law Firm: Fasken
• Author: Mr Noah Boudreau and Nicolas-Karl Perrault

Introduction

The significant differences between product liability laws in Québec, which is a civil law jurisdiction, and the laws that apply in other common law jurisdictions such as the US, often come as a shocking surprise for lawyers, manufacturers or sellers faced with product liability issues or claims in Québec. These differences can impact the assessment of the risk associated with product liability claims instituted in Québec and, in some cases, even the outcome of the case. Being aware of and understanding the applicable product liability laws In Québec is all the more important since the laws are especially favourable to purchasers and consumers, which means that manufacturers and distributors (including any wholesaler, importer or supplier of the product) face an increased risk of litigation and what is often a more complex and difficult defence of such claims when compared to other jurisdictions.

This bulletin provides important information and clarity on the applicable statutory warranties of quality and the legal presumptions applicable in cases of an alleged product defect in the Province of Québec. It sets out some of the key and unique features of Québec's product liability law and provides practical advice to lawyers, manufacturers and sellers in order to assist in assessing and minimizing the risks of litigation and defending such claims in Québec.

Statutory Warranties of Quality

The legal principles applicable to the liability of manufacturers and distributors in relation to goods sold in Québec are set out in certain specific provisions of the Civil Code of Québec, CQLR, ch. CCQ-1991 (the "CCQ"), of the Consumer Protection Act, CQLR, ch. P-40.1 (the "CPA") and the Regulation respecting the application of the Consumer Protection Act, CQLR, ch. P-40.1, r. 3 (the "Regulation").

Pursuant to article 1726 CCQ, the seller is bound to warrant the buyer that the property and its accessories are, at the time of the sale, free of latent defects. If the seller was aware or could not have been unaware of the latent defect, he is bound not only to restore the price, but also to make reparation for the injury suffered by the buyer,¹ which includes all direct damages caused to the buyer, including loss of profits.² In cases where the product defect caused bodily injury and where the seller's conduct is considered an intentional or gross fault, the seller could be ordered to pay punitive damages.³

With respect to goods sold to consumers within the meaning of the CPA⁴, its provisions provide for a warranty of quality against latent defects,⁵ a warranty of use⁶ and a warranty of durability considering the price, contract and normal conditions of use of the product, in addition to prohibitions respecting false representations in the contract or in advertisements.⁷

The breach of a statutory warranty under the CPA may entitle the consumer to pursue the following recourses:

• The cancellation of the contract of sale or contract of lease;
• The reduction of the consumer's obligations (price reduction);
• The forced execution of the obligation stated in the contract or the authorization to have such obligation executed at the merchant's or manufacturer's expense;
• Payment of compensatory damages; and
• Payment of punitive damages.

It should be noted that the statutory warranties provided by the CCQ and the CPA may be exercised by the purchaser as well as the subsequent purchaser of the goods directly against any actor involved in the chain of distribution of a good, including the manufacturer, merchant/seller and any distributor of the good (including any importer and wholesaler).⁸

Can Statutory Warranties be Limited or Excluded?

The statutory warranties provided under the CPA cannot be excluded or...