Reference no: EM133282768

Kitchen Magician is a company that manufactures and sells kitchen appliances that have become very popular with the Australian public. The company's current and most popular model is the KM55, which is able to chop food, blend food and cook food, among other features. Kitchen Magician has sold 100,000 KM55 appliances to both household and commercial users in Australia. Most KM55 appliances work exactly as they should, but a small number of customers have had very bad experiences. In a small number of the appliances, the vibrations produced as the KM55 chops and blends food cause the lid to come off the appliance during operation. As a result, hot food sprays out - this has damaged other property in the homes of KM55 owners, and has also caused burns to people who were near the malfunctioning appliances. About 200 KM55 machines, out of the 100,000 sold in Australia, have been affected. The impacts on customers have ranged from minor (minor property damage) to major (extremely severe burns). Kitchen Magician's investigations have shown that the issue arises due to a very small fault in production, appearing in only a small number of appliances. During the product development phase, Kitchen Magician had arranged for full testing of a sample of the KM55 appliances before releasing the KM55 for sale to the public and no faults were detected. However, if a larger number of appliances had been tested, the fault would have been identified. More extensive testing would have increased Kitchen Magician's costs significantly and delayed the release of the product into the market. Advise Kitchen Magician whether it is liable, in the tort of negligence, for the property damage and physical injury caused by the faulty KM55 appliances? (Source: Turner, C., Trone, J., & Gamble, R. (Eds.). (2020). Concise Australian Commercial Law (6th ed.). Thomson Reuters)