England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM DERBY COUNTY COURT
HIS HONOUR JUDGE WAINE
NG307991

		Royal Courts of Justice Strand, London, WC2A 2LL
		17th October 2006

Lord Justice Thomas:

1. On 17 December 1998, the appellant (the claimant), then aged 55, underwent a total hip replacement operation. The operation involved the implantation of a 9 mm JRI Furlong prosthesis (supplied by the respondent defendants to the hospital) into the claimant's right hip. The operation was performed privately by Mr. De Boer at the Purey Cust Nuffield Hospital in York and was apparently successful, as the claimant gained a significant degree of improvement in his mobility.
2. On 5 June 2000 the prosthesis sheared in two beneath the femoral head close to the radial base of the spigot region of the stem. On 22 June 2000 the claimant underwent a further hip replacement operation involving the explantation of the fractured prosthesis and the insertion of another. The second operation resulted in the claimant losing a significant amount of movement and mobility.
3. On 3 June 2003, the claimant brought an action for damages alleging that as the defendants were the producers of the prosthesis, they were strictly liable under the Consumer Protection Act 1987 for the damage caused by a defect in the prosthesis. It was contended that the defect was a point defect on the surface which caused its premature failure. In the alternative the claimant contended that the prosthesis was defective because it was unable to withstand the ordinary forces applied to it when it was implanted.
4. The provisions of the Consumer Protection Act relevant to the claim were:

2. Liability for defective products

(1)   Subject to the following provisions of this Part, where any damage is caused wholly or partly by a defect in a product, every person to whom subsection (2) below applies shall be liable for the damage.

(2) This subsection applies to—

(a) the producer of the product;

3. Meaning of "defect"

(1)   Subject to the following provisions of this section, there is a defect in a product for the purposes of this Part if the safety of the product is not such as persons generally are entitled to expect; and for those purposes "safety", in relation to a product, shall include safety with respect to products comprised in that product and safety in the context of risks of damage to property, as well as in the context of risks of death or personal injury.

(2) In determining for the purposes of subsection (1) above what persons generally are entitled to expect in relation to a product, all the circumstances shall be taken into account, including –

(a) the manner in which, and purposes for which, the product has been marketed…

(b) what might reasonably be expected to be done with or in relation to the product.

4. Defences

(1)   In any civil proceedings by virtue of this Part against any person ("the person proceeded against") in respect of a defect in a product it shall be a defence for him to show—

…..

(d) that the defect did not exist in the product at the relevant time;

5. The broad effect of these provisions as applied to this claim was that the claim would succeed if the claimant proved that the prosthesis was defective and it failed because of the defect, unless the defendant could prove that the defect did not exist "at the relevant time". It was common ground that that time was the time at which the defendants supplied the prosthesis to the hospital for subsequent implantation into the claimant.
6. It was the defendants' case that any defect was not introduced during manufacture and the prosthesis had failed because of damage to it during implantation. There was no express plea to the claimant's alternative case.
7. The action was tried before Judge Waine at Derby County Court. On 30 September 2005 the judge dismissed the claimant's claim and ordered him to pay the defendants' costs. He made an assessment of damages in the sum of £52, 583.93 together with interest, in the event of his primary decision being reversed on appeal. HHJ Waine refused permission to appeal. Permission was granted by this Court.

The issue at the trial

8. By the time of the trial, as a result of expert examination of the prosthesis to which I will refer, it was agreed that the prosthesis fractured as a result of fatigue failure initiating from a defect in the titanium alloy from which it was made.
9. Under the legislative scheme, the defendants were therefore liable unless they could prove that the prosthesis was not defective in that respect at the time they supplied the prosthesis to the hospital.
10. Before the trial judge,

i) It was the defendants' case that their manufacturing and inspection process was such that the prosthesis had no defect when they supplied it to the hospital; it was most likely that the defect occurred when the prosthesis was implanted during surgery.

ii) It was the claimant's case that the defects found on examination of the prosthesis after the fracture were caused during the explantation of the prosthesis. These defects or at least one of them had covered up a pre-existing defect which had initiated the fracture; that defect had been present prior to implantation.

11. The claimant's alternative case set out in paragraph 3 above was not pursued. When the judge indicated that he was not impressed with the alternative case that case was not pursued further. I shall refer to that alternative case further at paragraphs 32 - 40 .
12. On the issue which was pursued at trial, the judge heard evidence on three subjects – metallurgy, the implantation and the defendants' manufacturing and inspection process.

The metallurgical evidence

13. It was agreed by Dr Cook, a metallurgist called by the claimant, and by Dr Cawley, a metallurgist called by the defendants, in two joint statements that:

i) The fracture was due to the initiation and propagation of a fatigue crack emanating from a surface point defect on the prosthesis.

ii) The surface point defect which caused the fatigue crack must have been present before or at the time of the implantation.

iii) Scanning Electron Microscopy (SEM) examination in August 2004 revealed a number of gouge like defects or point defects on the surface coincident with the initiation of the fatigue crack.

iv) Two defects were shown on the SEM

a) There was a smearing or lipping of material over the fracture face which could only have been caused post fracture, as it imposed surface material on the fracture surface. This defect had occurred after the fracture and probably during the explantation. The fact that this was post fracture prevented either expert from ascertaining any pre-explantation damage at that precise area on the prosthesis.

b) The second defect which was visible on the SEM had a sharp angular appearance with no indication of any lipping; this was referred to as a notch type defect. This defect represented the type of notch that could as a stress raiser cause the initiation of fatigue failure, but it could not be said for certain that it was the actual stress raiser that induced the initiation of the fatigue crack.

v) The defects were at least 200 microns in depth.

14. The two metallurgists gave evidence at the trial.

i) Dr. Cook's evidence was that

a) On the balance of probabilities both defects, the lipping and the notch, probably originated from the same source and therefore were occasioned at the same time. His view was that these had been occasioned on explantation. He accepted that it was possible that the notch like defect could have been present prior to explantation, but on balance he considered that both defects occurred on explantation.

b) There must therefore have been another pre-existing defect covered up by the mechanical damage which had been the initiation point of the fracture. That defect was a surface point defect which must have been present before or at implantation.

ii) Dr. Cawley's evidence was that it was difficult to say that both defects were caused at the same time; he thought that the notch like defect was not caused by explantation and pre-dated this procedure. It probably had initiated the fracture, as it was a classical defect of the kind known to initiate a fatigue failure. It was not associated with the manufacturing process, as it was too large. In an initial report by a colleague which Dr Cawley had countersigned, it was suggested that the notch like defect was characteristic of damage arising during the implanting of the prosthesis; when asked about this observation in his evidence, Dr Cawley made clear he could not say that the damage was characteristic of damage occurring when the prosthesis was implanted.

iii) The subsequent damage to the prosthesis prevented the experts identifying what damage had been caused pre-explantation.

The evidence relating to the implantation

15. No evidence was called from Mr De Boer or any of those present during the implantation. There was a note of the operation which gave no indication of any problems during the operation, but it was extremely brief.
16. The claimant called Mr Julian Chell, a consultant orthopaedic surgeon at Nottingham to give expert evidence. His evidence was that there was nothing in the medical records which indicated that there were any problems with the implantation. This indicated that no undue force was required and therefore problems at implant could be excluded. He would have expected a surgeon who caused or saw a defect to replace the prosthesis.
17. Although he expressed the view in his report that he considered it more likely that the failure related to a defect in manufacture, he accepted in his evidence that he was unable to say whether Mr De Boer had used a gripping instrument and was unable to say whether the defect which had caused the fatigue failure had arisen during the operation or during manufacture.

The trial judge's conclusion on that part of the evidence

18. The judge in his judgment first considered the metallurgical evidence and the evidence in relation to the implantation and concluded that:

i) Both experts were highly qualified. They were agreed that the lipping obscured in one area whatever might have been present on the surface of the prosthesis at an earlier stage.

ii) As to the notch like defect, he said that by common consent, it pre-dated the fracture. This, it was accepted before us was an error; it is evident from the further findings of the judge that this was a slip in expression as he went onto refer to the evidence of Dr Cook as being to the effect that both defects had been occasioned at the same time and that time was at explantation. The slip made by the judge was therefore not material.

iii) He considered that both experts had gone beyond what they had said in their joint statement and Dr Cook had gone further than what he had said in his report.

iv) The judge therefore turned to consider whether the defendants could exclude the defect prior to delivery to the hospital.

v) He could not accept the views of Mr Chell; the note of the operation was sparse even by the standards of 1998 and it was not possible to deduce what force may have been required to insert the prosthesis; the mere fact that there were no difficulties did not exclude some use of force to obtain the tight fit required. He thought that Mr Chell should have been more cautious. No clear deductions could be drawn from the note.

vi) He concluded:

"On balance, I do not consider it possible to say on the experts' evidence or the other relevant evidence precisely when the damage was caused. It was capable of being present at the time of delivery or being caused at implantation or explantation. My view on the evidence and given that the two areas of damage were caused at the same time, the more likely time would have been at explantation rather than at implantation, but overall the experts' evidence is not sufficiently clear one way or the other."

19. The trial judge considered the real issue was whether the defendants could exclude a defect prior to the delivery to the hospital and he turned to consider the manufacturing process.

The evidence on the manufacturing process

20. Evidence was called as to the manufacturing process by the defendants who had a market share of about 7% of the hip replacement market. The prosthesis implanted in the claimant had been designed in 1985, though it had been updated. Over 80,000 of this type of prosthesis had been implanted prior to the time of the claimant's second operation in 2000. By 2002, there had been only 9 problem reports, 5 of which related to that part of the prosthesis which had fractured in the case of the claimant.
21. Mr Jones (the managing director), Mr Jackson (the group technical director) and Mr Thornton (the quality supervisor) gave evidence on behalf of the defendants that:

i) The defendants received batches of forgings which their process had to convert into a prosthesis capable of lasting the life time of the recipient through a total of 30 processes, including work to the stem, inspection and packaging.

ii) The process of shaping involved grinding and abrasion, most of it to the stem; at the time this had been done manually, but by the time of the trial it was computer controlled. The shaping and grinding were those parts of the process most likely to cause some sort of defect on the surface of the product.

iii) During the manufacture, the prosthesis underwent a process by which the matt finish was replaced by a highly polished surface; at that stage it was inspected twice. The polished surface enabled an inspector to see much more clearly any surface imperfections.

iv) Mr Jones, the managing director, said that a defect measuring 35 microns could be seen with a human eye; if there were any concerns, the inspector would use a magnifier which magnified any defect by 5 times. The highly polished surface made any mark stand out; it was therefore not necessary to inspect each product under a magnifying glass.

v) A defect of 200 microns would simply not have got through the process.

vi) 2 out of a typical batch of 30 would be rejected during these inspections; these would be re-worked, but if there was any doubt they would be finally rejected.

vii) There were similar further inspections when the product was despatched for packaging and a further inspection prior to final dispatch.

The Judge's findings on the manufacturing process and his overall conclusion

22. The Judge considered the manufacturing and inspection process in some detail. He found the defendants' employees who had given evidence were experienced, conscientious in their approach to their work and impressive in giving evidence. He concluded:

"I have absolutely no doubt that this product was subject to vigorous and meticulous process of work and inspection of the highest quality. I appreciate that with human error or even pure negligence nobody can pretend that a mistake could not be made, but if a defect of such significance had slipped through the net it would have required, in my view, mistakes or negligence by a number of individuals. On this evidence I am simply not prepared to accept that such a mistake was made with the product. An ultimate failure rate of 5 in some 80, 000 supports this point."

23. As a consequence the trial judge found that the product left the defendants' factory without defect; the defendant had therefore established the statutory defence under s.4.
24. In refusing leave to appeal, the judge said:

"Defendants on facts had first rate system of inspection and manufacturing. No evidence of defect before prosthesis supplied to hospital. So statutory defence under section 4. In any event more likely defect occurred when prosthesis implanted".

The judge in these reasons went further than in his judgment, as he made no finding in his judgment that it was more likely that the defect occurred on implantation.

The claimant's case on appeal

25. The case advanced before us on appeal on behalf of the claimant by Mr Maskrey (who did not appear below) can be summarised:

i) The judge had been in error as to thinking that the notch like gouge identified on the SEM was the defect which the claimant said was introduced during manufacture; the defect identified on the SEM was measured as 200 microns. The claimant's case was that there had been a point defect which had been obscured as a result of the gouges found on the SEM which had been made during explantation; this was not visible on the SEM and was much smaller than 200 microns.

ii) When the judge concluded that the defect would therefore have been visible and picked out in the process of the inspections, he had wrongly identified the defect for which the claimant contended and by wrongly concluding that the defect which initiated the fatigue fracture was at least 200 microns, he had reached a false conclusion on its visibility on inspection. If he had correctly identified that the surface point defect which had initiated the fracture was a point defect and was much smaller, he would not have concluded that the defect would not have been seen in the manufacturing process by visual inspection without a magnifying glass and as the defendants did not use a magnifying glass on each inspection, he could not conclude that it would have been identified on inspection.

iii) The fracture had occurred beneath the femoral head close to the radial base of the spigot region of the stem; whilst the femoral head was highly polished, this was not the case with the stem and it would therefore not be as easy to detect a defect on that surface

iv) The judge was therefore in error (a) in failing to determine whether the notch like gouge had occurred at implantation (as was the defendant's case) or at the same time as the other gouge – explantation- (as was the claimant's case) and (b) in determining that the notch like gouge revealed on the SEM which neither expert contended had been caused during manufacture would have been detected during manufacture.

v) As the judge considered it more probable that the two types of defect had been caused during explantation, he should therefore have held that on the balance of probabilities that the defects had been caused then.

vi) Having reached that conclusion he should have asked himself when the surface point defect that initiated the fatigue crack arose and on the evidence concluded that it must have been present during manufacture and not detected, in view of its small size, during the inspection process. He should have reached that conclusion unless the defendants could show (a) that a surface point defect of less than 35 microns (which would not have been visible on inspection) could not have initiated the fatigue failure and (b) that a surface point defect of 35 -200 microns would have been detected and (c) that it was likely that a surface point defect capable of initiating the fatigue failure would have been introduced on implantation.

vii) Even if he had not so concluded, then the defendants had failed to show that the damage had been caused during implantation on a balance of probabilities

26. It was common ground that the judge had made a mistake in his judgement when he stated that it was common ground that the notch like defect pre-dated the fracture. As is apparent from what I have set out at paragraph 18.ii), that was not the case, but this was a mere slip as the judge clearly appreciated that that the claimant's case was that the defect had been caused on explantation.
27. In the light of the judge's conclusion that the defects which were seen on the SEM examination were more likely than not to have been occasioned by explantation, the evidence pointed to the fact that the notch like defect was not the defect that initiated the failure and the fracture had been caused by a surface point defect that could not been seen on the SEM examination.
28. In these circumstances, it is not necessary for me to consider the criticisms made of the judge's treatment of Dr Cook and Dr Cawley's evidence. It is right to point out that Dr Cawley could not and did not give evidence as to when that surface point defect had come into existence. The judge in his judgment made no finding as to whether the defect was occasioned on implantation. His decision on the claim in favour of the defendants was based solely on his determination that (on an analysis of the evidence of the manufacturing process in the light of the expert evidence as to the cause of the fatigue failure being a surface point defect) the prosthesis was not defective at the time it was delivered to the hospital. His judgment did not go beyond that determination.
29. The issue before us was therefore whether the judge's analysis of the evidence in reaching that determination based on the evidence as to the surface point defect and the manufacturing process was right:

i) I accept, as was contended on behalf of the claimant, that the machining and polishing process did cause some surface imperfections which did on occasion escape notice during the manufacturing process; however, it is clear from the evidence given, in particular that of Mr Thornton, that such imperfections were then identified in the ordinary operation of the system at or before the final inspection process.

ii) It was also clear that the inspection system was based on visual inspection by the naked eye of each forging; it was only if something was identified by the naked eye that a magnifying glass was used. The naked eye could not, however, detect a surface defect of less than 35 microns.

iii) The evidence taken as a whole clearly established that the area within which there could have been a surface point defect which could have initiated fatigue failure was on a highly polished surface; the report relied on by the claimant to show that the surface was not polished was insufficiently clear in contradistinction to the very clear evidence of the defendants' witnesses on this point. The Judge was, in my view, entitled to find that the relevant area was polished.

iv) During the course of his cross-examination, Dr Cook accepted that the kind of surface point defect from which the fatigue failure originated would have been visible on a polished surface; he accepted that a defect down to 35 microns would have been visible and that the defect capable of initiating the fatigue failure was well within what one would see on visual inspection.

v) The only evidence as to the size of the surface point defect which initiated the fatigue failure (on the assumption that it was not one of the defects visible on the SEM examination) was that it could have been smaller than the defects visible on the SEM examination – that is to say smaller than 200 microns. There was no evidence called before the judge to suggest that it was smaller than 35 microns. On the contrary the assumption that seems to have been made by both experts was that the defect may have been in the order of about 200 microns.

vi) As there was therefore no evidence to suggest that the surface point defect that initiated the fatigue failure was smaller than 35 microns, the system was capable of detecting the defect, as Dr Cook accepted.

vii) Those who carried out the inspection were found by the judge to be highly experienced and conscientious.

viii) As the system was capable of detecting the only type of surface point defect capable of initiating the fatigue failure, given the view taken of those operating the system, it could be inferred that any such defect would have been detected had it been present prior to delivery to the hospital and that in the case of the prosthesis implanted into the claimant that the inspection system had not failed.

30. It seems to me that on an analysis of the evidence before the judge and on the way the case was presented to him, the judge was therefore correct in making the finding of fact made by him that the prosthesis was not defective at the time it was supplied to the hospital. The statutory defence was therefore established. It was not therefore necessary for the judge to find how or when the surface point defect which initiated the fatigue failure arose.
31. In the circumstances, it is not necessary to consider the additional ground on which the defendants sought to support the judgment namely that the defect which caused the fatigue failure was probably in any event occasioned at implantation.

The claimant's alternative case

32. It was also contended by the claimant that, as it was a necessary inference from the judge's determination that the defect was not present at the time of delivery to the hospital, the defect must have been introduced during implantation. As there was no evidence that the implantation had been carried out negligently or that excessive force had been used by Mr De Boer in implanting the prosthesis, it was contended that the judge should therefore have considered the claimant's alternative case that the prosthesis was defective as the defendants had produced a prosthesis which on delivery to the hospital was defective in that a surface point defect (capable of initiating fatigue failure) could be caused during the ordinary course of implantation.
33. Counsel for the claimant relied upon the fact the defendants had subsequently strengthened the neck area of the femoral stem by increasing the cross-sectional diameter so that the prosthesis was stronger and more robust, as Mr Jones had accepted in his cross-examination. The defendants had also changed their manufacturing process so that this area of the prosthesis was machine lathed instead of being hand glazed. In 2002 the Medical Devices Agency had carried out a full review of fractured stems and had written to the defendants on 19 March 2002:

"The summary report illustrates that there is no significant correlation between stem diameter and fracture location. We understand that the neck geometry is the same for all stem diameters, so neck failures would not be influenced by stem diameter

You have said in your letter .. that you have undertaken some design modifications to improve the fatigue resistance of this product. These included the use of increased neck diameter, CNC finishing and the use of a finished forging. …

We are concerned at the persistent nature of these failures. However we consider that, based on the spread of stem sizes and fracture sites (neck or mid stem), there is not, at present, a case for further corrective action…"

34. S.3 makes it clear that there is a defect in the product if the safety of the product is not such as a person is reasonably entitled to expect; in determining what persons are generally entitled to expect, the court must take into account what might reasonably be expected to be done with or in relation to the product. In the ordinary course of things, it would be expected that a prosthesis would be subject to procedures and forces on implantation which it had to withstand. It would follow that a person was plainly entitled to expect a prosthesis to be so designed and manufactured as to withstand the procedures and forces ordinarily used on implantation. If it was not so designed and manufactured, then it would be defective at the time it was supplied to the hospital.
35. Once it was concluded that it was more likely than not that the gouges visible on the SEM occurred on explantation and that therefore the defect must have been introduced on manufacture or implantation, the issue as to whether the design and manufacture of the prosthesis was such that it could withstand what was to be expected on implantation could have remained an issue in the case. In that event, the burden would have remained on the defendants to show not merely that there was no surface point defect on delivery but that the design and manufacture was such that the prosthesis could withstand the ordinary forces to which the prosthesis would inevitably have been subject during implantation so that a surface point defect of a size capable of initiating a fracture would not have arisen during ordinary procedures used on implantation.
36. However, although such a case was raised in the pleadings, it was not pursued by the claimant for the reasons set out at paragraph 11. The judge did not therefore deal with this issue or make any finding in relation to it in the judgment.
37. It was contended that this did not matter, as the burden was on the defendants to prove that there was no defect in the prosthesis and they had not disproved this. As the defect had arisen either during or before implantation, the defendants had to prove (a) that no defect had arisen during manufacture and (b), if they could prove that, then the defect which must have arisen during implantation, resulted from implantation with such force or in such a manner which could not ordinarily have been expected.
38. I cannot accept that contention. When a case comes before the court, the parties must identify the issues. It matters not that the case arises under the Consumer Protection Act which places on the defendant the burden to which I have referred; the issues to which the evidence is to be directed and in relation to which the trial is to be conducted must be identified. In the present case, the claimant initially pleaded this alternative case. He properly identified it as an issue as the Civil Procedure Rules require. Identification in this way is essential, as otherwise if everything that might possibly be in issue has to be investigated, a trial would become unfocussed and of disproportionate length and expense. For example, on the alternative case, it would have been necessary to have evidence on the procedures ordinarily used on implantation and the procedures used by the surgeon, Mr De Boer when he implanted the prosthesis. That would have considerably escalated the cost and the length of the trial; it was not proportionate for that to be undertaken when the claimant ceased to pursue the alternative case. The points raised in the alternative case were not then in issue and the defendants did not have to deal with them as part of discharging the legal burden placed on them by the Act.
39. Thus, once the claimant did not pursue the alternative case, it was not incumbent on the defendants to deal with that case, although if it had remained in issue, the burden would have been on them.
40. In my view, in these circumstances, the issues raised in the alternative case are not issues with which this court can deal on appeal.
41. For these reasons, I would dismiss the appeal.

Cross Appeal

42. There was a further issue raised by a respondent's notice that in the event of the appeal succeeding, the defendants cross appealed on damages by seeking to set aside part of that part award of the judge's assessment of damages relating to loss of earnings.

In the light of my conclusion that the appeal fails, it is not necessary to consider the issues that arise on the cross-appeal.

Lord Justice Mummery:

43. I agree.

Lord Justice Maurice Kay:

44. I also agree.