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Design Error (Design Defect or Design Fault), Design Developed-Fault* and

Product Liability

Francisco de Assis Braga

Economist, Insurance Consultant, member of APTS

I suppose that the reader, familiar with the term “design error”, may be a little surprised
at the term “design developed-fault”. I will try to explain the difference between the two
concepts.
A design error happens at the time of product conception, when some principle,
criterion or rule of the prevailing state of the art of science and technology at that time is
broken or not complied with by the product designer. A design developed-fault is a
design problem which can only be known as such sometime later when new facts or
research reveal that some principle, criteria or rule of the prevailing state of art of
science and technology at the time of the product construction led to a defect in the
product or to a hazardous feature of it which could not be known at that time. It follows
from there that both the design error and the design developed-fault result in faulty
designs and these faulty designs create defective products that may cause injury or
damage, which in turn may result in claims under a liability insurance policy. The
difference is that the design developed-fault does not result from negligence or non-
compliance with any principle, rule or criteria of the state of art of technology at the
time the product was launched.
Herman Vasconcelos defines the design developed-fault “as the risk (of causing injury
or damage) that cannot be scientifically known at the moment the product is launched in
the market, but it is found after certain time of using the product.”1
Thus, we have that both design error and design developed-fault are conception errors,
but they differ as to in the latter the conception of the product was in conformity with
the prevailing state of the art of science and technology at that particular time.
A design error, by itself, does not prevent the insured from liability (art. 12 of the
Brazilian Consumers Code), although it exempts the insurer, as it is generally a risk not
covered by the Brazilian insurance policy.
If there were no design error, but a design developed-fault, would it be proper to
question the liability of the company that manufactured the product?
The commentators of the Brazilian Consumers Code do not entirely agree that the
design developed-fault is a defense against liability. The issue is a complex one and is
about establishing whether only the manufacturers of the product or the manufacturers
and the community should bear the costs of development fault.
Two of the three authors consulted agree that the design developed-fault is not a defense
against the liability of the manufacturer.2
For example, Norris, for various reasons a respectful author, summarizes his
argumentation in the following way:
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“In casu, various are the reasons why it is understood that the design developed-fault
does not constitute a defense against liability.” Thus, we took the liberty to transcribe
some, which seemed to us to be the more important ones:
• “There is no fundament based on the hypothesis of special liability (so well outlined
by the Project of Civil Code, in its art. 963) for the excluding cause that is now under
examination, considering those who perform hazardous activities;
• as it is a very controversial exclusion clause, in order that it could be accepted, it
should have been specially included as one of the possibilities listed on the art. 12, §
3º of the Consumers Code;
• an exclusion based on the risk of a design developed-fault would reintroduce many
of the not wanted elements of the system based on fault” (highlighted by me).

In fact, the question is controversial, and not only among us in Brazil, as the European
Union let its member countries freely adopt either position in their respective laws.3
As it is a polemic issue, my opinion would only be another one among many; even so, I
understand, and agree with Norris, that an exemption of liability, to be practically
enforceable, must be explicitly expressed in the law, and our Consumers Code, on its
art. 12, § 3º, did not list the design developed-fault as an exempting condition of
liability, reason why the manufacturer cannot invoke it as a defense for not paying.
In addition, if we, hypothetically, admit that the Consumers Code exempts the
manufacturer of liability on cases of design developed-fault, we would be, as
emphasized by Norris, reintroducing many of the elements of liability based on fault,
and this is not in accordance with the general approach taken by the Consumers Code
that has reaffirmed the principle of absolute or strict liability (which was clearly the
intention of the authors of its draft project).
But, would the insurance policy of product liability leave the manufacturer/insured
without protection? I suggest that the reader make a thoughtful analysis of the question,
as it is clearly relevant for the adjustment of product liability claims.

* - Free translation of the Brazilian-Portuguese term “erro de desenvolvimento”.

1
See Vasconcelos, Antonio Herman, Comentários ao Código de Proteção ao Consumidor, São Paulo, 1991, p. 67.
2
Marins, J. Responsabilidade da Empresa pelo Fato do Produto, São Paulo, Ed. Revista dos Tribunais, 1993; Norris, R.
Responsabilidade Civil do Fabricante pelo Fato do Produto. São Paulo, Ed. Forense, 1996; e Rocha S L F,
Responsabilidade Civil do Fornecedor pelo Fato do Produto no Direito Brasileiro. Ed. Revista dos Tribunais, 1992.
3
See Marins, J Responsabilidade da Empresa pelo Fato do Produto São Paulo: Ed. Revista dos Tribunais, 1993, p. 130.