Part Two (out of 25 points)

Case Scenario:

You as President of Green Machine Inc. recently received a disturbing phone call from a lawyer who represents a person named Barry Fonder. According to the lawyer, Barry was accidentally injured by one of Green Machine's products. It seems that Barry purchased one of Green Machine's electric teapot heater/warmer devices; a product called the "Warmer 3000" and brought it home for use. When using it for the first time at home Barry plugged the Warmer 3000 into a electrical outlet on a countertop in his kitchen and used it to keep a recently made pot of tea warm while he studied throughout the day for his upcoming final exam in Legal Aspects. About an hour later Barry left his house in order to pick up some materials that he needed from the library. When he returned to his house approximately one hour later, he found his house on fire and the fire being extinguished by the local Fire Department. Upon further investigation the Fire Department made the assessment that the likely cause of the fire was the Warmer 3000 device which the Fire department believe had exploded and was likely the source of the Fire as the explosion had likely ignited flames that traveled to his window curtains that were draped near the Counter and the electrical outlet into which the Warmer 3000 had been plugged into. Barry's House was destroyed as a result of the Fire and in the process most of the contents in his house were lost. Amongst some of the valuable contents of his house lost in the fire was an original one-of-a-kind painting by Picasso that Barry kept stored in his bathroom linen closet and his mint condition 1927 Babe Ruth baseball card that he kept in a cookie jar in his Kitchen. As a result of the significant emotional pain and trauma that Barry indicates he has suffered as a result of this event he is receiving therapy/counselling, has withdrawn from his school program and to this date remains unemployed. It appears that for reasons undisclosed Barry's Home insurance company is also denying coverage for the house fire and so Barry is now looking to commence a lawsuit against Green Machine Inc. to recover all losses and damages suffered as a result of the "Warmer 3000 Fire".

Important Note: Facts may be added to the scenario in later questions. Facts added in later questions should not be taken into consideration in answering earlier questions. For example, new facts are presented in question 3; these facts should not be used in considering your response to question 2. Answer each question in the order in which it is asked with the facts presented up until that point.

5. Assuming Green Machine Inc. is found to be liable in this case for product liability are there facts in this case that could help Green Machine reduce their liability or the amount of the award for damages claimed by Barry? Explain. (5 marks)