Product Liability 2009 - Arnold & Porter LLP

Korea
206
Lee & Ko Korea
In case of breach of contract claims, the claimant would bear the
burden of proving that the manufacturer had breached the contract
due to its supply of products not conforming to the terms of the
contract, and as a result, the claimant had suffered damages.
2.2 What test is applied for proof of causation? Is it enough
for the claimant to show that the defendant wrongly
exposed the claimant to an increased risk of a type of
injury known to be associated with the product, even if it
cannot be proved by the claimant that the injury would
not have arisen without such exposure?
The standard of causation is not specifically provided for under the
PLA. However, the recent trend by the Korean courts is to shift the
burden of proof to the defendants regarding the existence of defect and
causation. For instance, the consumer would only need to prove that
the accident were to happen within the realm of manufacturer’s
control and the accident would generally not happen without
someone’s fault. If the consumer proves such facts, then the court
would presume that the product was defective and the damage was
caused by such defect to alleviate the burden of consumers. Further,
the wrongful exposure of a claimant to an increased risk of injury that
is known to be associated with the product alone would not make the
manufacturer liable for damages, unless some sort of injury such as
physical or mental injury is proved by the claimant.
2.3 What is the legal position if it cannot be established which
of several possible producers manufactured the defective
product? Does any form of market-share liability apply?
Market-share liability is not recognised under Korean law. In order
to impose product liability, the manufacturer of the defective
product would need to be identified. In case the manufacturer
cannot be identified, the supplier or lesser might be liable under
certain requirements (please see question 1.3).
2.4 Does a failure to warn give rise to liability and, if so, in
what circumstances? What information, advice and
warnings are taken into account: only information provided
directly to the injured party, or also information supplied to
an intermediary in the chain of supply between the
manufacturer and consumer? Does it make any difference
to the answer if the product can only be obtained through
the intermediary who owes a separate obligation to assess
the suitability of the product for the particular consumer,
e.g. a surgeon using a temporary or permanent medical
device, a doctor prescribing a medicine or a pharmacist
recommending a medicine? Is there any principle of
“learned intermediary” under your law pursuant to which
the supply of information to the learned intermediary
discharges the duty owed by the manufacturer to the
ultimate consumer to make available appropriate product
information?
As abovementioned in question 2.2, the PLA requires reasonable
explanation, instruction, warning, and other indications regarding
the product directly for the consumer. The learned intermediary
defence would not be recognised by Korean courts.
3 Defences and Estoppel
3.1 What defences, if any, are available?
Affirmative defences may be proved by manufacturers in product
liability suits to be exempted from liability:
(1) the claim was brought beyond the 3- or 10-year statute of
limitation;
(2) the manufacturer did not supply the product;
(3) the state of scientific or technical knowledge at the time
when the manufacturer supplied the product was not such as
to enable the existence of the defect to be discovered;
(4) the defect in the product is due to compliance with applicable
laws at the time when the manufacturer supplied it; or
(5) (in case of subcontractor) the components or raw materials
claimed to be the cause of the defect were supplied pursuant
to the specifications and instructions given by the final
manufacturer.
However, where, in spite of the fact that the manufacturer knows or
should have known the existence of any defect in the product after
it has been supplied, the manufacturer fails to take appropriate
measures to prevent the damage caused by the defect from
occurring, then the manufacturer shall not enjoy from exemptions
#3 and #5 above (Article 4 of the PLA).
Further, if the negligent actions of the claimant contributed to the
overall damage, then the amount of damage compensation
attributable to such negligence of the claimant may be deducted
(please see question 3.6).
3.2 Is there a state of the art/development risk defence? Is
there a defence if the fault/defect in the product was not
discoverable given the state of scientific and technical
knowledge at the time of supply? If there is such a
defence, is it for the claimant to prove that the fault/defect
was discoverable or is it for the manufacturer to prove that
it was not?
As abovementioned in question 3.1(3), a “state of scientific or
technical knowledge” defence is recognised under the PLA. The
manufacturer would have the burden of proving that the state of
scientific or technical knowledge at the time when the manufacturer
supplied the product was not such as to enable the existence of the
defect to be discovered.
3.3 Is it a defence for the manufacturer to show that he
complied with regulatory and/or statutory requirements
relating to the development, manufacture, licensing,
marketing and supply of the product?
As abovementioned in question 3.1(4), in case the defect in the
product is due to compliance with applicable laws at the time when
the manufacturer supplied it, and the manufacturer asserts this
affirmative defence, liability may be avoided. However, this
affirmative defence may only be applied in case where the
government has mandated certain regulatory standard onto the
manufacturer and the manufacturer had no other choice but to
comply with such regulatory standard. Meaning, a mere showing
of the manufacturer’s compliance with minimum regulatory
standards does not provide for this defence under the PLA.
3.4 Can claimants re-litigate issues of fault, defect or the
capability of a product to cause a certain type of damage,
provided they arise in separate proceedings brought by a
different claimant, or does some form of issue estoppel
prevent this?
A claim for damages due to a defective product can be re-litigated
even if the issues have been contested and finally resolved in
different cases, because the effectiveness of final judgement covers
only the parties to the litigation under Korean law. However, in
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