Tragedy of the Commons: Tragedy = each man is locked into a system that compels him to increase his heard w/o limit – in a world that is limited; 2 assumptions à actors will always be selfish and try to maximize gain
· W/ a common resource that everyone has access to, no one is going to exercise self-restraint
o Legal system is needed to step in and regulate use so resource can last longer
· Pollution = tragedy of commons in reverse
o Putting something IN to the commons b/c rational actor finds that his share of the cost of waste he discharges is less than the cost of purifying his waste before releasing it
§ Esp. true when, as is the case w/pollution, source is not clearly visible or traceable and thus, generators will not easily be called to account
· Solution: make it cheaper for polluter to treat his pollutants before releasing them rather than discharge them untreated
o KEY ISSUE: Force actors to internalize their externalities by regulating pollution (externality) release (permits, limits, prohibition, etc.)
· Ask yourself: How do the statutes we cover address externality/tragedy of commons?
o Require notice/info given to public regarding externality release?
· Why care? Inter-generational equity/posterity, environmental justice, morality/warm fuzzies, if we let externalities build the clean up costs will be astronomical
· Potential Responses to Externalities:
o No response
§ Costs typically incurred on poor/minorities
§ **Question three on exam potentiallyàwhy is doing nothing the best response to a particular problem?
§ Fair to say that the law has failed to respond to greenhouse gas emissions
o Law banning an externality – ESA
§ Exampleàgiving kids asthma and cancer, dumping toxins, not banned
§ Killing or hurting an endangered animal is actually banned. You will go to jail.
o Limit harm imposed on other people – WQBEL, NAAQS (max harms), tech forcing CWA
§ Catalytic converter is example of effort to limit harm. Actually reduces air pollution by about 90%. Engineers are pretty good at pollution control technology
· Usually comes at a cost to a company
§ Power plants need scrubbers
§ Wastewater must be filtered
o Incentivize individual behavior (market trading/SO2)
§ Carpool lanes
§ Economic and social incentives
§ Social incentives are tremendously effective (shame, praise, etc.)
§ Incentivizing good behavior is typically called a market approach
§ Market Mechanism: Tax to make him incur the cost and see if he still drives. Forces cost internalization (don’t necessarily have to give the benefit to people that observed the externality) – maybe a subsidy could effectively do the same thing.
§ Proactive regulation: Regulates the commons, so government takes ownership right and does something to preserve it. Emissions standards and speed limits. Regulating behavior to minimize externality. Telling John he can’t drive a certain speed to minimize externality. Both regulations make it less great of a deal to drive. HE’s internalizing costs. Regulations don’t eliminate the externality, it aims to minimize it relative to the benefits. Good regulations force cost internalization.
o Polluter pays (CERCLA, RCRA)
§ Forced liability
§ Works because polluter internalizes the externality
§ Right around 50 cents per gallon tax for gas
§ Imposing retroactive liability: polluter pay principle (or causing someone harm, compensate them, tort system).
§ Torts are a system of cost internalization
Risk and CBA
Many meanings of “Risk”
Uncertainty, Scientific Complexity, and Risk
Human nature and attempts to internalize social costs
Politics; administrative process
Race to the bottom (attract industry by lowering regulatory standards)
Stewardship; inter-generational equity; sustainability
Remedy and enforcement choices
§ Polluter pays principle (strict liability)
· The Common Law
· CL offer things statutes don’t. Damages for injury and property. Ability to select forum for state court vs. federal court. Not as effective than statutes, however. Causation, cause in fact, j and s liability, and discretion for the judge to award damages or injunctive relief. Discretion for the judge. Nuisance is usually relieved through injunctive relief. Judges can award damages instead, though damages aren’t as satisfying. Judge might say they can keep doing what they’re doing, but they just have to pay you. Need to argue that injunctive relief is necessary if you’re an environmental lawyer. Trend towards damages. Companies now just buyout properties instead of going through the pain of going through lawsuits.
Nuisance = the use of property by one party so as to substantially interfere with the reasonable use, enjoyment, or value of another’s property – ALWAYS MENTION THIS ON THE EXAM
P suffered substantial unreasonable interference with their use of their property
That interference was caused by D’s use of D’s land
Public nuisance: substantial interference w/use of a public place
Nuisance inquiry into “unreasonableness” should focus on the degree of interference suffered by the victim, NOT be a balance of D’s negligence/tolerability of D’s conduct
Balance test: if social utility of D’s conduct outweighs harm suffered by P, relief is denied altogether (instead of at least provide P with compensation)
Nuisance v. trespass: trespass requires physical interference; nuisance = interference by any means
MI does not recognize trespass via pollution or dust; can ONLY be pled as nuisance.
Typical remedy: Injunction
Simply awarding damages will not stop the polluting activity; more litigation could result
o Land/property is unique and cannot be replaced by money
· Private Nuisance
Boomer v. Atlantic Cement Co. – P seeks injunction and damages from D, cement plant, under nuisance theory for substantial interference from dirt, smoke, vibrations
HELD: D will be enjoined from operating the cement plant unless and until it pays P permanent damages that compensate P for the total economic loss to its property (present and future) caused by the operation of D’s plant.
Even though there IS a nuisance, the large disparity in economic consequences of the nuisance and of an injunction is the basis for the court ultimately deciding (in essence) to “deny” the injunction.
In so holding, majority overturns an old rule of law that grants an injunction even when there is a marked economic disparity
This was a balancing test and a decision that D’s conduct was tolerable b/c the court did not deny P relief altogether – it granted compensation
Policy: the risk of paying permanent damages to property owners should provide an incentive for cement plant operators to minimize nuisance
Also, simply granting an injunction worth at most a couple hundred thousand dollars to P (value of his property) creates an incentive for P to go to D and say – give me 1M and I’ll ignore the injunction, keep polluting.
o Dissent: majority is licensing a continued wrong à Even community benefits (jobs are kept) and P is made whole, the pollution damages env. beyond this specific town
o If you want damages, YOU HAVE TO GO THROUGH CL SYSTEM.
· Public Nuisance
· If you move into a neighborhood that already has a nuisance – tough luck – buyer beware.
New York v. Schenectady Chemical Company: In 50s and 60s, D disposed of its wastes by hiring an independent contractor who disposed of the material by dumping it into lagoons and burying it on his property. 20% of the total waste dumped at this contractor’s site can be traced to D.
P claims: The toxic waste has infiltrated the groundwater and constitutes a public nuisance; D hired an incompetent contractor; D should have advised its contractor of the dangerous nature of what he was being hired to dump.
SOL on nuisance expires in 3 yrs and this happened 15-30 yrs ago
P lacks standing
Failure to join necessary parties
We were just doing what everyone else was doing at the time
We are not liable for an independent contractor’s wrongdoing
RULE: The right to maintain an action for nuisance continues as long as the nuisance exists (each day is new injury; no SOL problem.)
P has standing b/c public waters were polluted
RULE: Parties contributing to a nuisance are jointly and severally liable
No dismissal for failure to join parties – D has right of contribution
RULE: Liability standard for nuisance is strict liability NOT negligence. Thus, D’s conduct is not at issue; the fact that D caused harm is enough
The inquiry is whether the condition created is causing injury. NOT whether the conduct creating the condition is causing injury
RULE: D is liable for the acts of an independent contractor if D was
(1) Negligent in hiring him, or
(2) If the work was inherently dangerous (non-delegable duty), or
(3) The hiring party (D) cooperated in a wrongful act
If it knowingly failed to prevent an unlawful act
OR if the work involved the creation of a nuisance
B/c all who contribute to a nuisance are j/s liable
Permit defense?: since facility is operating in compliance w/all regulatory requirements, it cannot be subject to tort liability for any resulting pollution?
Usually DOES NOT WORK unless statute provides for this defense
RULE: There is no permit defense to nuisance actions
· SLAPPS (strategic lawsuits against public participation): respond to citizen suit by counter-suing for defamation, libel, slander, etc.
· Cutting Edge Uses of Public Nuisance
Comer v. Murphy Oil USA: P has standing to bring their claims and the claims do not present a non-justiciable political question. Claim was that GHGs caused Katrina.
Standing requires: injury in fact (we have that here), causation (general factual allegations suffice at pleading stage) and redressabili
EALLY hard to calculate the damages.
o R 2nd Torts § 929: For past harm to land: damages include compensation for the difference btw the value of the land before the harm and the value after the harm OR, at P’s election and in an appropriate case, the cost of restoration that has been or may be reasonably incurred.
o Permit is not an excuse. Doesn’t matter they weren’t negligent – it’s strict liability.
§ Follow automatically upon finding of defendant’s liability
§ Elements of damages in typical personal injury suit:
· Compensation for monetary losses such as lost wages, medical expenses, and auto repair costs
· Intangibles, especially pain and suffering, but also anxiety and emotional trauma
§ See Boomer calculations on page 118
· Looks at property value depreciation
§ The real outcome of the denial of an injunction and the awarding of permanent damages is a judge-made right to pollute. The plant is not shut down, and the polluter continues its harmful activities.
Imposed when there is egregious misconduct on behalf of D; conduct is willful/wanton/malicious
Terry v. Zions Coop: Malice does not consist of hate or ill will but rather refers to a state of mind, which is reckless of the law and of the legal rights of another.
Not about compensation but about punishment and deterrence
§ In environmental cases, punitive damages may serve as a means of capturing and internalizing some of the un-recovered intangible costs (damage to persons downwind; ecological injury)
RULE: Punitive damages awards may be struck down as violating DP if they are excessive.
Pacific Mutual Life Ins. v. Haslip: Consider following factors:
Reasonable relationship btw amt. awarded and harm caused
Reprehensibility, duration, frequency, consciousness of D’s conduct
D’s financial position
Costs of litigation
Whether criminal sanctions were imposed (mitigate punitive award)
D’s payment of other civil awards
State Farm Mutual Auto Ins. v. Campbell: Few awards exceeding 1:1 ratio (compensatory: punitive) will survive constitutional DP muster
Phillip Morris USA v. Williams: DP forbids use of punitive damages to punish a D for injury that it inflicts on non-parties (although scope of harm is relevant to reprehensibility consideration)
Exxon Shipping Co. v. Baker: Alaskans and commercial fishermen sue P for oil spill and resulting damage when P’s captain got drunk and ran into a barrier reef. Lower court awards 2.5B in punitive damages, 507.5M in compensatory damages
SC reduces punitive damages to 1:1 ratio, (507.5M). This will protect against the possibility of awards that are unpredictable and unnecessary for deterrence or retribution.
Under federal maritime law, median ratio is around 1:1 so SC makes it 1:1 & call it a day
This will not punish a company like Exxon or deter similarly situated companies as 507.5M represents 12 hours of Exxon revenue
SC knows this but they want to keep Exxon in business
o When compensatory damages are inaccurate to begin with (in environmental cases they are b/c much of the damage are to intangibles), is it appropriate to impose a 1:1 ratio?
· Toxic Torts
· Science and the Law
Law and Science have contrasting ways of determining truth
Geographic variability v. universality (In law, rules vary by jx)
Different conceptions of causation
Science: statistical evidence serves as proof (95%)
Law: requires particularized proof of causation (D’s cigs. caused P’s cancer)
Courts will accept statistical evidence but only where Ps also produce individualized evidence of causation
Standard is more likely than not: preponderance of evidence, not 95%.