The government of Nova Scotia has recently made some limited improvements to the law of products liability1 . Merchant sellers are no longer permitted to contract out of the three basic obligations or "implied warranties" contained in the old Sale of Goods Act: to deliver a merchantable article, 2 fit for the buyer's purpose 3 which corresponds to the description under which it was sold. 4 The reformulation of these old common law obligations which first received statutory recognition in 18935, was done in a somewhat ambiguous and unsatisfactory manner. 6 Of far greater consequence to consumers however, is the fact that the old products liability rule has been left intact: namely, that a consumer who wishes to sue under any of these three "implied" warranties must be in privity of contract with his defendant supplier. 7 This means that the consumer can only sue an out-of-privity defendant in tort. When one considers that the Supreme Court of Canada has recently re-affirmed that there is no action for economic loss in tort 8, it becomes evident that the consumer has no legal remedy whatever against an out-of-privity defendant (typically the manufacturer) who has supplied an unworkable product.
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Nadine Cooper Mont, “Comment on Ontario's Bill 110 "An Act to provide for Warranties in the Sale of Consumer Products"”, Comment, (1977-1978) 4:1 DLJ 201.