09 Nov 2016

CU LAB: Are Australia's product liability laws ready for driverless cars?

Greg Williams sets out the main product liability issues with driverless cars, and how our laws will respond.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.


A lot of the main product liability issues with driverless cars are going to be the same issues that we encounter with cars these days. It's essentially what happens when there's a malfunction, and what happens when there's an accident, especially if the malfunction or the accident results in someone being injured.

However I think that one of the exciting things about this technology is also that it is new technology and we don't quite yet know what the driverless car of the future is going to look like. So as a result it's inevitably going to throw up some new legal issues, some new product liability issues, that we just haven't thought about yet.

Australia already has a very sophisticated product liability regime, probably one of the best in the world. So there's not a lot that actually needs to change about our laws in order to make those laws applicable to driverless cars. We still have a system that says that if a product has a defect, a consumer who suffers an injury as a result of that defect can recover. And that's the principle that's going to apply in the world of driverless cars.

The more complicated issue we're going to have to confront is who's ultimately responsible. One of the interesting things about driverless cars is that it's a technology that has the potential to fundamentally change the way in which transportation services are bought and sold in this country. So will we still have a concept of private ownership of cars, once there are driverless cars?

We don't know exactly at the moment who are going to be all the people who are involved in the supply chain for a driverless car. We don't know what additional services might be required in order to make a driverless car work. For example, will the driverless car depend upon information that is transmitted to the car wirelessly by entirely new service providers who don't even exist yet?

So the issue that we're going to have to confront from a product liability perspective as this technology evolves is: as these new roles in the supply of transportation services evolve, what level of responsibility to the new players have when things go wrong?