Legal Analysis: Thermomix Case - Negligence, Consumer Law, and Damages

This report provides a legal analysis of the Thermomix case, focusing on the liability of Thermomix in Australia Pty Ltd as an importer and seller of kitchen appliances manufactured by Vorwerk & Co. KG. The analysis centers on the application of negligence law, the Australian Consumer Law (ACL), and the Wrongs Act 1958 (Victoria). The report examines the duty of care owed by Thermomix to its consumers, the breach of this duty due to defective products leading to injuries, and the resulting damages. It also explores the limitations on damages imposed by the Wrongs Act. Furthermore, the report delves into the consumer guarantees under the ACL, particularly the guarantee of acceptable quality, and how Thermomix's actions violated these guarantees. The report highlights the importance of consumer protection and the legal responsibilities of manufacturers and importers under Australian law. The report provides a comprehensive overview of the legal issues involved, including the application of negligence law, consumer guarantees, and the Wrongs Act.

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Contents
Solution.......................................................................................................................................................2
Introduction.............................................................................................................................................2
Answer 1..................................................................................................................................................2
Answer 2..................................................................................................................................................5
Answer 3..................................................................................................................................................5
Reference Lists............................................................................................................................................8

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Solution
Introduction
An Australian company named Thermomix in Australia Pty Ltd imports kitchen appliances from
a German company named Vorwerk & Co. KG. The German company is the manufacturer of
kitchen appliances and it exports it to Thermomix in Australia Pty Ltd and Thermomix in
Australia Pty Ltd in turn sells their imported goods within Australia through authorized persons
deputed by them for selling the same to trade and retail customers.
Thus, Thermomix in Australia Pty Ltd are the imports and sellers of the goods. Now, as per
section 7 of the Australia Consumer Law, a manufacture is a person who imports goods in
Australia when the manufacture does not have place in Australia, puts goods together, holds
himself to be the manufacture of the goods or puts its name on the goods1.
Now, Vorwerk & Co. KG does not have a place of business in Australia and Thermomix in
Australia Pty Ltd imports goods in Australia, thus, Thermomix in Australia Pty Ltd must be
considered as a manufacture and any action under law of negligence, Civil liability Act or the
Australian Consumer law can be brought against Thermomix in Australia Pty Ltd as it is a deem
manufacture.
The appliances sold by the Thermomix in Australia Pty Ltd are not proper and thus as reported
by Choice there were around 87 incidences which clarifies that the appliances are not proper and
18 persons were injured physically which required medical treatment. Hence due to the above
said facts there is breach of norms of the ACL and Civil Liability Law 2002 etc.
As per the content of the article published
byhttps://www.choice.com.au/home-andliving/kitchen/all-in-one-kitchen-machines/articles/accc-
takes-thermomix-to-federal-court160617, the report had been prepared which analyze the various
laws that had been violated.
Answer 1
As per law of negligence no person should perform the acts in such manner that his acts would
harm any third person. Every defendant has a duty that his acts must be performed in such a
manner so that his acts must not harm anybody.
The law of negligence holds the manufacturer (including retailers) liable when damages are
caused to the actual consumers because of the use of the defective product of the manufacture.
The three ingredients of negligence if established hold the manufacture. The same are2:
1 Paul Latimer. 2011. Australian Consumer Law 2012. CCH Australia Limited.
2 Andy Gibson and Douglas Fraser. 2013. Business Law 2014. Pearson Higher Education AU.

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i. Duty of care on the part of manufacture - The first ingredient to hold a manufacture
negligent is that there must be duty of care imposed upon the manufacture. The duty of
care implies that the manufacture must act in a proper manner so that no injury from his
acts should be caused to any third person who is in proximity to the manufacture and who
can be reasonably foreseeable by the manufacture. In Donoghue v Stevenson3 the duty of
care can be imposed when there are presence of two elements:
a. When the injured consumer is neighbor of the manufacture. The consumer is in
such a position that the acts of the manufacture will affect the consumer. The parties are
in proximity with each other so that the manufacture will have impact the consumer and
is held in Baar v Snowy Mountains Hydro-Electric Authority4.
b. When the consumer is reasonably foreseeable to the manufacture. It is necessary
that the consumer must be reasonably foreseeable. In Haley v London Electricity Board5
it was held that every consumer is reasonably foreseeable by the manufacture of the
product.
In Coregas Pty Limited v Penford Australia Pty Limited (2012) it was rightly held that all
the manufacturer, importer, supplier and seller all owe duty of care towards their
customers and thus must act in such manner so that the duty is not violated in any of the
situations.
ii. Breach of Duty of care – The second step towards the negligence is Breach of duty of
care. A person is said to had breached the duty when he does not take care and thus
performs the acts without even taking the care that he should had adopted. Also even if
the care was taken by him the level of care is to be seen as to whether the care taken by
him was reasonable as per the situation. The level of care can be analyzed by taking into
account the level of care a reasonable prudent person would had taken in the like
situation. If the level of care of manufacturer matches with same then he cannot be said to
have breached the duty of care. The standard of care depends upon the risk involved and
is held in the leading case of Wyong Shire Council v Shirt6.7
iii. Damages because of the breach of duty of care - The third step towards the negligence is
the injury caused to the injured by the act of the manufacture. In case the injury is caused
to the injured due to breach of duty of care on the part of the manufacturer then the
manufacturer is liable, but the injury must be caused due to the breach of duty of care of
the manufacturer. In case the same is not the case then the manufacture cannot be held
3 Donoghue v Stevenson (1932).
4 Baar v Snowy Mountains Hydro-Electric Authority (1970).
5 Haley v London Electricity Board (1965).
6 Wyong Shire Council v Shirt (1980).
7 James Plunkett. 2018. The Duty of Care in Negligence, Bloomsbury Publishing.

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liable and in case the injury caused is too remote then also the manufacturer is not liable
for the injury caused to the inured.
When all these three steps are satisfied then only the manufacturer can be held liable under the
law of negligence.
As per the facts of the case the company
Thermomix in Australia Pty Ltd was under the duty of care to sell those goods to customers
which should not harm them in any way. As an importer it was his duty to sell the proper
products. The duty is towards all the customers as they are the neighbor of the consumer as
rightly held in Donoghue v Stevenson. The injury can be caused to the customers as they are in
proximity with the company and thus the damage caused to them by using the product is
reasonably foreseeable and not too remote.
The duty of care had been breached by the Thermomix in Australia Pty Ltd as the products
supplied by it in the market lead to injury to its consumers. The company also did not
followed the statutory provision as per which the company was to notify the defect in
product within 48 hours of defect being coming to knowledge of the company.
As the consumers are affected by the use of product of the Thermomix in Australia Pty Ltd so
they can claim the damage or loss suffered by them from the Thermomix in Australia Pty Ltd for
the Thermomix in Australia Pty Ltd to be negligent under the law of negligence.
Hence the Thermomix in Australia Pty Ltd will have to pay the customers for the loss as per the
law of negligence.
The Wrongs Act 1958, Victoria also applies the law of negligence.
The duty of care is imposed upon the manufacturer as he must comply with all the norms in
order to evade liability as per law under the Wrongs Act 1958.
The part which is associated with the concept of duty of care to be adopted by a manufacturer is
Part X of the Wrongs Act 1958. As per Section 48 of the wrongs Act 1958, each manufacturer is
duty bound to provide safe and proper goods to its customer and must protect the consumers who
are in proximity with the company from all reasonably foreseeable risks that might follow. The
duty of care can only be imposed upon the manufacturer when the reasonable care as per the
prudent person had not been taken by the manufacturer which the prudent person would had
taken in the like situation. The level of care varies with the circumstances and situation.8
8 ue Carter DeLaune, Patricia K. Ladner, Lauren McTier, Joanne Tollefson , Joanne Lawrence. 2016. Fundamentals of Nursing:
Australia & NZ Edition – Revised. Cengage AU.

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As per Section 49 of the Wrongs Act 1958 the liability upon the manufacturer can only be
imposed if the loss caused to the customer is due to the act of the manufacturer. In case no injury
or loss is caused or loss is caused due to some other reason than the manufacturer cannot be held
liable under the Wrongs Act 1958.9
Thermomix in Australia Pty Ltd being an importer was aware that if the product was not proper
then it may be harmful for the consumers. So as per section 50, the Thermomix in Australia Pty
Ltd did not bought into the notice of the consumers that the product is not proper and thus had
breached the duty of care which was on their part. As the Thermomix in Australia Pty Ltd there
is breach section 48-50 as the injury had been caused due to the usage of goods of the
Thermomix in Australia Pty Ltd to the consumers.
Answer 2
The Wrongs Act 1958 limits the damages to be paid to the injured by putting cap on the amount
of damages to be paid to the injured. As in case the injured is to be paid under the negligence act
for the injury suffered then this act will limit the amount to be awarded to the injured. The
Wrongs Act 1958 limits the damages to the injured who face injury. The Wrongs Act 1958
applies to the injury caused due to negligence, breach of contract and breach of provisions of
statues. The limit of awarding damages to injured is that the same is calculated as per section 281
of the Act, a) a discount rate of the percentage prescribed by the regulations; or (b) if no percentage is
so prescribed—a discount rate of 5%. The above said limit is the maximum limit up to which the
damages can be awarded under Act. The damages can be claimed under the head loss of earning
capacity or loss of desire of financial support, but the amount can also be limited to the above
said calculation.10
The cap that had been restricted will only be beneficial for the persons coming under the high
income group as the same will affect the lower income persons as the cap only grants the average
of three times of weekly earnings. The 1958 Act provides advantage to the wrongdoers as the
liability to be paid by them is thus limited by this Act.
Answer 3
Australian Consumer Law had been enacted for the benefit of the consumers in the society. Part
3-5 provides various rights to the consumers under the Australian Consumer Law. The rights can
be availed by the consumers when the consumer guarantees as granted to them under part 3-2 are
violated by the manufacturer of the product. The guarantees provided to a consumer cannot be
limited under the act and no exclusion clause or limit clause can save the manufacturer in the
Australian Consumer Law. In case exclusion clause is inserted by the manufacturer which puts
limit on the consumer guarantees then same is considered to be void.11
9 Katy Barnett and Sirko Harder. 2014. Remedies in Australian Private Law. Cambridge University Press.
10 Paul Latimer. N1.
11 Stephen Corones. 2012. The Australian Consumer Law. Lawbook Company.

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The consumer guarantee is the guarantee that is applied to the manufacturer and the supplier or
seller is duty bound to provide the details of the manufacturer to the consumer for the consumer
to take action against the manufacturer. The consumer guarantees is applicable against the
manufacture and if the information regarding the manufacture cannot be found then the supplier
is the rightful person to approach. Section 7 includes a imported as manufacture when the
manufacture has no place of business in Australia.
The guarantees includes:
The product sold to the customer must be of the acceptable quality. In case the same are not of
the acceptance quality then the same is in violation of Section 54 of the Australian
Consumer Law. The product provide to the customer must be durable, safe to use and fit
for the purpose for which they are bought by the consumer and is held in McWilliams
Wines Ltd v Liaweena (NSW) Pty Ltd12.
In case the buyer tells the seller the purpose for which he is buying the goods then the goods
provided by the seller must be as in accordance with the purpose of the buyer if the same
is not same then it is abuse of Section 55 of the Australian Consumer Law and not valid
as per Australian Consumer Law.
The goods sold must be as per the description provided by the seller to the buyer if the same is
not followed by the seller then he is in violation of section 56 of the Australian Consumer
Law and is held in Varley v Whipp13.
As the Thermomix in Australia Pty Ltd is in breach of the consumer guarantees as by putting
exclusion clause the said Thermomix in Australia Pty Ltd cannot get away with the
liability on their part. As the Thermomix in Australia Pty Ltd is the importer and the
products are being manufactured in Germany by a German company so the Thermomix
in Australia Pty Ltd will have to comply with the provisions of the Australian Consumer
Law.
In case the guarantees that are not be violated as per part 3-2 of the Australian Consumer Law
are being violated then in such case the consumer can approach the forum under the
Australian Consumer Law under part 3-5 of the Australian Consumer Law for claiming
under the said act.
In case the goods sold by the seller are faulty then he must replace or repair them in case if he
denied same then he is in violation of the Australian Consumer Law, it is a consumer
guarantee which is with the buyer of the product when he buys the product.
12 McWilliams Wines Ltd v Liaweena (NSW) Pty Ltd (1988).
13 Varley v Whipp (1900).

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The goods sold by Thermomix are not of proper and acceptable quality and hence there is
violation of section 56 of the Australian Consumer Law. Moreover the goods are also not
safe to use and dies not also fit the purpose for which they had been bought hence the
sections and provisions of the Australian Consumer Law had been breached.
Also the Thermomix has not provided for any replacement or return procedure so that is also a
breach as per the Australian Consumer Law.
The consumer guarantees had been breached by the German Company who is the manufacturer
of the goods hence the consumers can claim from Germany Company being the
manufacturer under the Australian Consumer Law.
In case of injury the consumer can move the forum for the losses suffered by him as per the
Australian Consumer Law and the supplier or the manufacturer as the case may be liable
for the fault to the consumer for the loss suffered by the consumer.
The manufacturer can protect himself by taking plea that the product was not faulty when the
same was sold and thus became faulty afterwards. Also he can take plea that the
technology had advanced and the defect which exist in the product could not be traced
with such technology as due to change of technology the same is visible and there is no
fault on the end of the manufacturer.
As due to various violations by Thermomix the ACCC had initiated legal action against it.
ACCC can impose costs, penalties and seek declaration and injunction against the
Thermomix. Court ruled in favor of ACCC and Thermomix and $4.6 million was
imposed upon the Thermomix in April 2018 for deceptive conduct of company against
the customers.

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Reference Lists
Books/.Articles/Journals
Barnett, K and Harder, S. 2014. Remedies in Australian Private Law. Cambridge University
Press.
Corones, S. 2012. The Australian Consumer Law. Lawbook Company.
DeLaune, C; Ladner, P; McTier, L; Tollefson, J; Lawrence, J. 2016. Fundamentals of Nursing:
Australia & NZ Edition – Revised. Cengage AU.
Gibson, A and Fraser, D. 2013. Business Law 2014. Pearson Higher Education AU.
Latimer, P. 2011. Australian Consumer Law 2012. CCH Australia Limited.
Plunkett, J. 2018. The Duty of Care in Negligence, Bloomsbury Publishing.
Case Laws
Baar v Snowy Mountains Hydro-Electric Authority (1970).
Donoghue v Stevenson (1932).
Haley v London Electricity Board (1965).
McWilliams Wines Ltd v Liaweena (NSW) Pty Ltd (1988).
Wyong Shire Council v Shirt (1980).
Varley v Whipp (1900).