TORTS
What is the point of a Tort system?
1) Creates optimal deterrence (from irresponsibility, etc.)
2) Creates insurance in the form of compensation.
3) Corrective Justice
4) Loss Distribution
5) Redress of Social Grievances
(FIRST TWO ARE MOST IMP’T [in Croley’s mind])
Perspectives on Tort Law: Law and Economics
a. Guido Calabresi’s Golden Rule: Min (Ca + Cs): Goal of tort law is to minimize the sum of the costs of accidents plus the costs of safety. We want people to be careful up to the point where it is no longer worth it (where spending $1 on safety will prevent less than $1 in accident costs). Here is how it goes:
i. Specify Deterrence Goal: Determine how much care we want people to take (or, put another way, how much risk we want to encourage).
ii. Leftover Insurance Problems: Even after deterrence goal is reached, still have the costs of unpreventable accidents (accidents we do not want to prevent because the costs of prevention are too high).
iii. How To Allocate Risk for Unpreventable Accidents: Accident costs hurt least when spread thinly, so spread costs of accidents over many, and weight them toward those most able to pay.
b. Tools for Analyzing Tort Issues
i. Analytical: What is the possible ways tort law might respond to an issue?
ii. Descriptive: How does the law in fact treat the issue (black letter law)?
iii. Normative: How do we evaluate the law’s treatment? What goals is it advancing?
Entitlements (See Appendix for further, in-depth discussion)
a. Property Rule: Pay my subjective price for my property. Presumption is that we want to shift entitlements as little as possible for social goals. Used when bargaining is possible, low transaction costs. Shifts to liability rule when transaction costs are high.
b. Liability Rule: Pay the court’s objective price (damages) for my property. Used when transaction costs are high. Paying the damages promotes deterrence goal. Assumes courts are good at assessing damages.
c. Inalienability Rule: For policy reasons right cannot be bought or sold.
Why Torts Rather Than Another System?
a. Why Not Nature?: We could let the chips fall where they may. This saves the cost of running the torts system, but dissolves trust necessary for productive risk-taking.
b. Why Not Informal Networks? We could let informal associations regulate harms (e.g. friendships, neighbors). Here you still have administrative costs, with risk that self-help will get out of hand.
c. Why Not Contracts? As we seem to love contracts, why not let them allocate risks for harm? Contracts works well when transaction costs are low (e.g. parties know one another and have an opportunity to bargain). But the paradigm torts case involves strangers, where transactions costs are high. Torts allows us to overcome some of the difficulties of k formation (e.g. mutual assent, consideration, offer and acceptance). In a way, torts is “contracts on the run,” in that tort laws seek to promote outcomes that reasonable parties would choose if they were able to contract about accident risks. Note that products liability lies on the border between contracts and torts.
d. Why Not Criminal Law? Criminal law is used to prevent conduct that we as a society are not ambivalent about (e.g. we don’t want rape at all). Contrarily, much of the risk-producing behavior in tort is good. Thus we do not want to eradicate all risk; there are some risks we want people to take. Note that intentional torts lie on the border between criminal law and tort law.
e. Why Not Administrative Law? We could also regulate risk through public law bodies such as legislatures or administrative agencies? Must ask ourselves is there anything that torts law can do that admin law cannot?
Defenses in a Tort action
1) Deny P’s assertion of one of the 4 elements (their factual bearing, interpretation, etc.)
2) affirmative defense – D should not face liability because the P’s actions contributed to the final outcome. (contributory negl., comparative negl., consent, etc.)
General Burden of Proof in Torts (aka standard of proof)
“MORE PROBABLE THAN NOT”
4 Elements of a Tort
1) Duty
2) Breach
3) Causation
4) Damages
DUTY
A. Generally no duty other than ordinary care unless there is a special (custodial) relationship, assumption of duty, foreseeable risk, or negligent entrustment.
B. No duty to act unless there’s a special relationship or an assumed duty.
1. owner of business premises generally does have to help people on the premises
2. common carriers have a special duty to protect passengers
3. duty to help starts with undertaking, and perhaps promising to help, but generally only if the victim is left worse off in some way
C. Tarasoff stretched the duty to warn to situations where there is a special relationship, high foreseeability, and policy to prevent future harm.
D. contributory negligence is a complete defense in non-comparative negligence jurisdictions
E. assumed risk
F. Providing alcohol to minors (Reynolds), giving a minor access to a car (Vince), and writing glowing recommendations for an accused child molester (Randi) are three situations where the foreseeable risk and public policy could allow a court to find negligence.
G. Common law landowner status relationships – discuss results under likely status, and mention possibility of court having abandoned the status rules
1. trespasser – generally no duty to trespasser, but one cannot have traps set up to harm them.
a. if owner has knowledge of trespasser’s presence, warnings of specific dangers may be required
b. duty to trespassing children arises with: knowledge that children are likely to trespass, knowledge of unreasonable risk, insignificant benefit of dangerous condition, child is ignorant of risk, lack of reasonable care by owner to abrogate the risk
2. licensee (social guests, probably emergency workers) – duty to warn of known risks, avoid willful & wanton injuries
3. invitee (business purpose or public on land opened to them) – duty to inspect for dangers
a. owner must only ask reasonably, so random crime without pattern doesn’t create liability
b. anyone who gives owner economic benefit is probably invitee
c. No general duty to protect customers from crime (Williams), or to comply with hostage taking robber (Boyd), but if burden is especially low, certain measures may be required (Taco Bell)
4. Rowland, (Cal. 1968) abandoned the common law status relationships in favor of a list of policies including foreseeability, degree of certainty, closeness of connection of conduct to injury, preventing future harm, burden of care, etc. Now jury gets to weigh policies rather than judge decide which relationship.
BREACH
LIABILITY STANDARDS
Some General Points:
1) Choice in torts law goes between negligence liability and strict liability.
2) When figuring out liability, groups much larger than the parties in question are at stake. Tort law serves to determine how those groups interact, take care, and make decisions on a daily/weekly/yearly/lifetime basis.
3) ***Reducing activity levels is achieved by putting the cost of unpreventable accidents on the actor you want to deter. (This is a big Croley point)
The Liability Rules Cube
Axis 1: Liability Rules
[numbers in parentheses show how many actors we have to consider the actions of]
1) APL (Absolute Plaintiff Liability) (0) – P always pays.
2) Negligence with Contributory Negligence (2) – P always pays unless D negligent, unless P contributorily negligent. Need only when 1 party has more info than another.
3) Negligence (1) – P always pays unless D negligent.
4) Strict Liability with Contributory Negligence (1) – D always pays unless P was contributorily negligent.
5) Strict Liability with Contributory Negligence with Last Clear Chance (2) –D always pays unless P was contributorily negligent, unless D has last clear chance to prevent harm. Invented so D cannot take advantage of negligent P when D has ability to prevent harm.
6) ADL (Absolute Defendant Liability) (0) – aka strict liability; D always pays.
-The last two are the only ones in which the Defendant pays for unpreventable accidents. Everything else is left up to the P to just deal with.
Axis 2: Mutability Rules
a. Mutability Default: Liability rules can be contracted around. Favorable to D.
b. Immutability: Liability rules cannot be changed. Favorable to P.
Axis 3: Damages
a. Economic
b. Economic + Non-economic
c. Economic + Non-economic + Punitive
ORGANIZATION TOOLS
Unilateral Care
a. Concerned with care D gives a certain activity. Focused on preventable accidents.
b. Unilateral Care Cases
i. All categories except APL increase D’s care level.
ii. Helps to increase the D’s level of care.
iii. ADL has same effect on the conduct of the D as N, no more, no less.
Bilateral Care
a. Concerned with both D’s and P’s care levels. Focused on preventable accidents.
b. Bilateral Care Cases
i. Four middle rules increase both parties’ care levels.
ii. Negligence Test (P pays unles
Custom is “relevant but not decisive.”
2. Industry Practice
i. Usually formal.
ii. Relied upon in medical field more than the community standard.
iii. A residual of the locality rule remains w/ respect to hardware. Asks how much and what type a community has? (If very little, tend to be a little more forgiving)
3. Relevant community standards
4. Statutes and Regulations (Crim., Licensing, General, etc.) – Purpose of statute or regulation is very important in determining whether it is used in analysis.
i. Licenses: courts view behavior regardless of license possession, and then the license statute violation to a lesser extent. (Helling v. Carey) (This is done because many cases of no license are b/c professional just let the license lapse. Also, licenses are often brought about b/c of professional societies trying to bar entry to profession, and courts recognize one can be professional level w/o license.)
ii. Preemption – common law may no longer be valid b/c of legislation. Courts decide new standards by interpreting.
iii. Regulatory non-compliance – If you don’t coincide with regulation, you are negligent.
iv. Alcohol (special case) – can hold alcohol sellers liable in some states for selling to obviously drunk patron. Exceptions for “barhoppers” and “unnoticeably drunk.”
Rationale:
1) force commercial sellers to obtain adequate insurance to cover social costs of drinking
2) alternative is for injured parties insurance companies to foot the bill – not fair
3) SL makes ∆ the insurer of unpredictable accidents
4) more efficient for bar owners insurance policy to cover it
5) Two considerations
a) Fairness – on distributive justice side, who should bear cost
b) Efficiency – who can write insurance contracts that are most sensitive to the activity levels of people
v. Sovereign Immunity
b. Federal Torts Claims Act
1) US consent to be sued in tort for damages if conduct of any agents would have given rise to tort liability if they were ordinary private parties
a) Exceptions
a. If agent of government is exercising a discretionary function cannot sue
b. If agent of government is performing statutory duty, then cannot sue.
5. Agencies
i. If we are confident about agency determinations of negl., then use them in conjunction w/ tort sanctions to enforce. (e.g. Is the market working fairly, thus making custom a viable rule to follow?)
ii. Legislature can preempt suit or define standard at any time.
iii. Rules are articulated in advance (predictable but rigid)
iv. Standard defined after the fact (flexible but unpredictable)
d. Coase Theorem
i. Where transaction costs are low, and parties are rational, parties will bargain around inefficient rules to the efficient solution.
ii. Liability Rules Still Matter: Though in the above circumstances liability rules don’t affect outcomes, still matter for the distribution of wealth.
iii. Where transaction costs are high, legal system must allocate liability burdens correctly or create waste.
e. Restatements
i. 291
