A recent Court of Appeal decision, North v Bayerische Motoren Werke, has closed the door on a class action against BMW. The court confirmed that there is no legal right to keep using a product indefinitely, and the cost of repairs cannot be recovered just because a product breaks — even if it was negligently made. The court's decision is a significant one for manufacturers and consumers alike.
Key takeaways
- a product owner cannot recover from a manufacturer simply because a product breaks
- there is no right to keep using a product forever
- repair costs are only recoverable if owners spent the money to prevent real danger, not just to keep their car working
- if the faulty part is an "integral component" of the product, the owner cannot claim for damage to the product itself, and it cannot be artificially separated from the product to claim that "other property" was damaged
What drove the lawsuit?
The plaintiffs alleged that BMW sold vehicles with a defective timing chain module. They claimed this defect could cause catastrophic engine failure. The class action sought to recover the cost of repairing or replacing the timing chain and any resulting engine damage.
The lower court certified the case as a class action, allowing BMW owners to pursue claims for:
- the cost of repairing or replacing the timing chain module and
- the cost of repairing engine damage caused by the defect
BMW appealed, arguing that these claims were not legally viable.
Where the Court of Appeal parked
- the appellate court found these were claims for "pure economic loss" (i.e., loss that is not a direct result of physical harm or property damage) which is not usually recoverable in negligence
- the court held that costs to fix a damaged product are only recoverable if they are incurred to avert a real and substantial danger to people or other property. If they are only incurred to make the product usable again, there is no basis for recovery,
- the court allowed BMW's appeal and overturned the orig inal decision
In short, the Court of Appeal set a clear limit: buyers cannot use class actions to recover the cost of fixing products — including cars — unless they spent the money to prevent real danger. If they just want to fix their product, then they alone are in the driver's seat.
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