Dis­tri­bu­tors with the sta­tus of manu­fac­tu­r­ers from the view­point of pro­duct lia­bi­li­ty law

Fede­ral Supre­me Court ruling on clas­si­fi­ca­ti­on as a manu­fac­tu­rer and dis­tri­bu­tors’ duties to safe­guard traffic

By Judgment of 21 March 2023 (Case No: VI ZR 1369/20), Germany’s Fede­ral Supre­me Court gran­ted an appeal by a far­mer who had brought an action see­king dama­ges against a was­te dis­po­sal com­pa­ny. The court’s ruling essen­ti­al­ly dealt with the ques­ti­on of whe­ther the defen­dant qua­li­fies as a manu­fac­tu­rer and the duties of a dis­tri­bu­tor to safe­guard traf­fic within the con­text of producer’s lia­bi­li­ty in accordance with § 823(1) of the Civil Code.

Facts of the case

The start­ing point of the case was an action filed by a far­mer against a was­te dis­po­sal com­pa­ny (the defen­dant). In the cour­se of its com­mer­cial acti­vi­ties, the defen­dant had acqui­red a phosphate- and potassium-based flu­id which was con­ta­mi­na­ted with her­bici­des from a third par­ty  as “was­te,” which it then ren­a­med “EC fer­ti­li­zer for far­ming,” pre­pa­ring asso­cia­ted pro­duct infor­ma­ti­on which iden­ti­fied the flu­id as fer­ti­li­zer. It then sold the flu­id as fer­ti­li­zer to a dis­tri­bu­tor, through which it ulti­m­ate­ly rea­ched the far­mer. Use of this con­ta­mi­na­ted flu­id, which was label­led as fer­ti­li­zer, cau­sed dama­ges to the farmer’s rape plants. The plain­ti­ff asser­ted claims against the defen­dant see­king com­pen­sa­ti­on for assess­ment and rec­ti­fi­ca­ti­on of the damages.

Duties of distributors

The decisi­ve ques­ti­on in terms of producer’s lia­bi­li­ty in tort law in accordance with § 823(1) of the Civil Code, which is the form of lia­bi­li­ty which comes into con­side­ra­ti­on in the pre­sent case, is whe­ther a per­son enga­ged in the manu­fac­tu­re or dis­tri­bu­ti­on of a pro­duct brea­ched its duties to safe­guard traf­fic. Whe­ther such a per­son had duties to safe­guard traf­fic, and if so which ones, depends on the capa­ci­ty in which that per­son acted. Pro­duct manu­fac­tu­r­ers are natu­ral­ly sub­ject to the most exten­si­ve duties to safe­guard traf­fic (e.g. duties rela­ting to design and fabri­ca­ti­on). Dis­tri­bu­tors, on the other hand, have only limi­t­ed duties to safe­guard traf­fic; in par­ti­cu­lar, they have no duties with respect to design and fabri­ca­ti­on. As a result, dis­tri­bu­tors are gene­ral­ly excluded from producer’s lia­bi­li­ty for design and fabri­ca­ti­on defects.

Dis­tri­bu­tors with the sta­tus of manufacturers

But in cer­tain cases, in the cour­se of their acti­vi­ties, dis­tri­bu­tors may be con­side­red as manu­fac­tu­r­ers in terms of § 823(1) of the Civil Code, a sta­tus which comes with more exten­si­ve duties to safe­guard traf­fic. This may be the case, for exam­p­le, if the dis­tri­bu­tor makes chan­ges to the product.

In the pre­sent case, the Hig­her Regio­nal Court of Koblenz ruled that the defen­dant did not qua­li­fy as a manu­fac­tu­rer becau­se it did not make any chan­ges to the flu­id. But the Fede­ral Supre­me Court found that it did qua­li­fy as a manu­fac­tu­rer after all. As ground for this fin­ding, the Fede­ral Supre­me Court cited the fact that defen­dant its­elf acqui­red the flu­id as “was­te” and then resold it as “EC fer­ti­li­zer for far­ming,” with pro­duct infor­ma­ti­on to match. In so doing, the court found that the defen­dant had crea­ted an enti­re­ly new pro­duct, despi­te the fact that it made no chan­ges to the flu­id its­elf. As a result, the court found that the defen­dant should be clas­si­fied as the manu­fac­tu­rer, and is the­r­e­fo­re requi­red to com­ply with more exten­si­ve duties to safe­guard traffic.

Whe­ther and to what ext­ent ascer­tai­ning that the flu­id was con­ta­mi­na­ted (and con­se­quent­ly avo­i­ding its use) was part of the defendant’s more exten­si­ve duties to safe­guard traf­fic must now be deter­mi­ned by the appel­la­te court (Hig­her Regio­nal Court of Koblenz), which is now requi­red to retry the case in light of the Fede­ral Supre­me Court’s judgment and issue a new ruling. It is clear, howe­ver,  that a stric­ter stan­dard must be appli­ed with regard to the defendant’s duties of due care, con­tra­ry to the pre­vious ruling by the appel­la­te court.


The judgment will have a prac­ti­cal impact, in that dis­tri­bu­tors should be awa­re of the fact that they may be clas­si­fied as manu­fac­tu­r­ers in terms of pro­duct lia­bi­li­ty law even if they make no actu­al chan­ges to the pro­duct, if the other cir­cum­s­tances of the case jus­ti­fy such an assump­ti­on. This may occur, as e.g. in the pre­sent case, if the pur­po­se of the pro­duct is alte­red, resul­ting in the crea­ti­on of an enti­re­ly new product.

Even if they do not qua­li­fy as manu­fac­tu­r­ers, dis­tri­bu­tors should keep in mind that they may have duties of inspec­tion with respect to the pro­ducts they dis­tri­bu­te. Exami­na­ti­on of the pro­ducts by the dis­tri­bu­tor may be requi­red if the­re is spe­ci­fic cau­se for an inspec­tion, e.g. if dama­ges from use of the pro­duct have alre­a­dy been repor­ted or if the cir­cum­s­tances of the indi­vi­du­al case sug­gest the need for review (cf. e.g. Fede­ral Supre­me Court, Judgment of 11 Decem­ber 1979 –Case No.  VI ZR 141/78, NJW 1980, 1219).


Stay up-to-date

We use your email address exclusively for sending our newsletter. You have the right to revoke your consent at any time with effect for the future. For further information, please refer to our privacy policy.