A recent decision of the Argentine National Commercial Court of Appeals provides another illustration of the legal risks faced by manufacturers of consumer products where quality control failures result in unsafe goods reaching the market.
The case involved a consumer who became ill after drinking a soft drink containing a sandy substance. The claimant also retained an unopened bottle from the same batch, within which a foreign solid object was subsequently identified.
A court-appointed chemical expert confirmed that the product was defective and unfit for human consumption.
The Court upheld the manufacturer’s liability and increased the award for non-pecuniary damages. It also confirmed punitive damages under Argentina’s Consumer Protection Act, emphasising the seriousness of placing defective food or beverage products into the stream of commerce.
The judgment contains another noteworthy aspect. The Court recognised that, under the terms of the applicable insurance policy, punitive damages were excluded from coverage, leaving the manufacturer directly exposed to that portion of the award.
For manufacturers operating in Argentina, the decision highlights the importance of robust quality assurance systems, effective production controls, product traceability and post-market risk management. Defective products may expose companies not only to compensatory damages but also to punitive sanctions that cannot always be transferred to insurers.
The ruling reflects the increasingly demanding standards applied by Argentine courts in matters involving consumer safety and product liability.