Effem Foods Ltd v Nicholls

Reported Decision: (2004) ATPR 42-034

Court of Appeal

CITATION:	Effem Foods Ltd v Nicholls [2004] NSWCA 332
HEARING DATE(S):	9 July 2004
JUDGMENT DATE:	17 September 2004
JUDGMENT OF:	Handley JA at 1; Tobias JA at 31; Palmer J at 32
DECISION:	1. Leave to appeal granted.; 2. Appellant to file a notice of appeal within 14 days if not already filed.; 3. Appeal dismissed with costs.
CATCHWORDS:	TRADE PRACTICES - consumer protection - product liability - statutory defences - manufacturer failed to prove that defect occurred after goods left its control - ND
LEGISLATION CITED:	Trade Practices Act 1974
CASES CITED:	Briginshaw v Briginshaw (1938) 60 CLR 336 Cavalier Marketing (Australia) Pty Ltd v Rasell (1990) 96 ALR 375 Cheong v Wong (2001) 34 MVR 359 Malec v J C Hutton Pty Ltd (1990) 169 CLR 638 Medtel v Courtney (2003) 198 ALR 630 Stegenga v J Corp Pty Ltd (1999) ATPR 41-695 The Popi M [1985] 1 WLR 948
PARTIES :	Effem Foods Ltd (Claimant) Pamela Nicholls (Opponent)
FILE NUMBER(S):	CA 40790/03
COUNSEL:	C Hoeben SC (Claimant) P G Mahony (Opponent)
SOLICITORS:	Wotton & Kearney (Claimant) Konstan Lawyers (Opponent)

LOWER COURTJURISDICTION:	District Court
LOWER COURT FILE NUMBER(S):	DC 14495/01
LOWER COURT JUDICIAL OFFICER :	Phegan DCJ

CA 40790/03

HANDLEY JA
TOBIAS JA
PALMER J

17 SEPTEMBER 2004

EFFEM FOODS LTD v PAMELA NICHOLLS

CATCHWORDS

TRADE PRACTICES – consumer protection – product liability – statutory defences – manufacturer failed to prove that defect occurred after goods left its control

FACTS

The claimant (the manufacturer) manufactured a chocolate-coated confectionary item sold under the name of Snickers bar (the bar). The opponent purchased one of these bars in a shop but when she attempted to eat it she bit into a concealed safety pin and was injured. She brought proceedings in the District Court against the manufacturer for breach of its obligations under ss 74D and 75AD of the Trade Practices Act 1974 to supply goods which were of merchantable quality and free from defects. The trial Judge overruled statutory defences under s 74D(2)(a)(i) and s 75AK(1)(a) that the defect occurred after the bar had left its control and did not exist when it was supplied by the manufacturer. The Judge found that the chances of a safety pin accidentally entering the product line, surviving and then passing the metal detector at the end were very remote but such a result was not impossible. He also found that the safety pin could have been deliberately inserted in the bar while it was in the retail shop. The Judge awarded the opponent damages and the manufacturer sought leave to appeal. It claimed that proof of the possibility of sabotage in the shop was enough to discharge its onus of proving the statutory defences. HELD: (1) Under the statutory defences the manufacturer had to establish on the civil onus that the defect occurred after the bar had left its control and did not exist when it was supplied by the…