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FOUNDATIONAL THEORIES OF TORTS

A tort is a civil wrong not arising out of a contract. Holmes: Conduct which every one may fairly expect and demand from every other, whether that other has agreed to it or not. It can mainly be divided into two separate categories: accident law: cases imposing strict liability or negligence liability for damage to a person’s body or property; and intentional torts: liability is not imposed for negligence, but only upon proof of the defendant’s intention to invade the legally protected interest of another.

Torts vs. Contracts:

Contracts—A voluntary relationship regarding how people organize their liveso Have the ability to bargain and negotiateo Allocation of risks and responsibilities through direct negotiations

Torts—Allocation of risks and responsibilities among strangerso Products liability does not necessarily mean you are a stranger, but are still tortso Medical malpractice is a tort even though you are not a strangero Epstein: we would do better to keep torts between strangers and put all the rest in

contracts

Main theories regarding the function of tort law: Corrective Justice/Civil Redress Optimal Deterrence Loss Distribution Compensation

CORRECTIVE JUSTICE/CIVIL REDRESS: (Coleman: law and philosophy) Based upon the idea that when one party wrongs another, the correction of the wrong may help to restore the moral balance between them. Liability is imposed for monetary compensation to correct the wrong that have been done to that individual. As the connection between the injured and the cause becomes less direct, it becomes less relevant

Core Notion: Envisions an individual injurer who directly compensates an individual victim, with the injurer’s own money. Among two innocents, the one who acts compensates. Compensation is owed because a victim’s rights have been invaded, not because the injurer has been negligent or otherwise at fault.

Civil Redress: Not as ensuring that as insuring that injustice is corrected, but as providing redress for civil wrongs. The is a moral duty to correct the wrong, not a necessary goal of correcting future injustice

o 1) Someone infringed upon an individual right, 2) there is thus a moral imbalance, and 3) tort suit is to be used to rectify that suit (Works well with intentional torts and when torts were connected to criminal liability

Fault: Is essential to the institution of tort law and the ultimate moral defensibility

OPTIMAL DETERRENCE: (Calabresi: “Cost of Accidents”) Goal of preventing future tortious actions by threatening potential wrongdoers with liability if the cause actionable harm (e.g. deter excessively risky activity so that only those losses worth avoiding are avoided). Some personal injuries are not worth avoiding. If damages aren’t foreseeable/predictable, actors might not be able to take into account potential liability

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Minimizing harms and costs of harms: One must take into account the cost of preventing harm and the cost of administering the tort system. Compensation is not the goal, only a mechanism that is used to deter and provide redress for harms that do not serve the ultimate good of society.

o Criticism: 1) individuals do not act rationally to minimize costs, 2) they do not have perfect information that would allow them to make correct decisions.

Optimal Number: There is an optimal number of accidents and that number is not necessarily zero. Socially optimal solution: where the marginal costs of further accident prevention measures equal the marginal benefits in terms of lives saved or injuries and harms forgone

LOSS DISTRIBUTION: The cost of the loss suffered by the plaintiff is not simply transferred to the defendant, but is distributed through the defendant to a larger number of individuals. Having a large number of individuals share a small loss is better than having a small number of defendants share a large loss. Place liability on the person who is in the best position to spread the loss (cheapest cost avoider).

Risk distribution: 1) the broadest possible spreading of losses, both over people and time, 2) placing of losses on those classes of people or activities that are best able to pay, 3) placing losses on those activities that, in some undefined sense, engender them

COMPENSATION: The principle function of tort law is to promote the compensation of those who have suffered injury. The goal is to restore the injured party, to the extent possible, to the position that would have been occupies had the wrong not occurred. Compensation can also be used not to compensate the victim, but to promote the other goals of tort law (deterrence, corrective justice).

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INTENTIONAL TORTS

Intentional torts share the requirement that the defendant intentionally commit the elements that define the tort. Most contemporary courts adhere to the Restatement definition, which defines intent to mean either that the defendant desires or is substantially certain the elements of the tort will occur.

Moral Hazard problem and Insurance: you do not want to incentivize someone to act upon an event that would provided them with insurance or that is wrong

Intentional Torts: Intent to Act Act Causation Damages

Physical Harms:

Battery (Defenses—Consent, Insanity, Self-Defense and Defense of Others) Trespass to Land (Use of Deadly force, Defense of Privilage)

Emotional Harms

Assault Offensive Battery False Imprisonment (Defense of Probable Cause) Intentional Infliction of Emotional Distress (I.I.E.D)

BATTERY (TRESPASS TO PERSON): 1) Defendant acted voluntarily; 2) Defendant acted with requisite intent. 3) Harmful and/or offensive contact. 4) Plaintiff did not consent to contact

RTT: § 1Intent: A person acts with the intent to produce a consequence if:

a) acts with purpose of producing that consequence; orb) the person acts knowing that the consequence is substantially certain to result

RST: § 13

Battery: Harmful Contact:a) intending to cause a harmful or offensive contact with the person or third person, or an imminent apprehension of such a contact, and,b) a harmful contact with the person directly or indirectly results

Elements of Battery:o Acted voluntary: Cannot be an involuntary act, spasm or use of your hand to hit someone

o Acted with Intent: A person need not intend to cause harm or appreciate that his contact will cause harm so long as he intends to make a contact, and that contact is harmful. Need not intend to cause a certain harm nor have malicious intent.

i) Substantial certainty – knowing with substantial certainty that tortious act will occur is enough to determine intent.

ii) Transferred intent – if A, meaning to shoot B, hits C instead, intent element is still satisfied.

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o Contact: Contact must violate prevailing social standards of acceptable touching. “Offends a reasonable sense of personal dignity.” You do not need foreseeability of harms.

i) Egg-Shell Skull Rule—You take the defendant as they are. The damages you cause do not need to be foreseeable.

o No Consent

Vosburg v. Putney(WI 1891)

In cases of assault and battery, “the plaintiff must show either that the intention was unlawful, or that the defendant is in fault. If the intended act is unlawful, the intention to commit it must be necessarily unlawful.”

“the wrong-doer is liable for all injuries resulting directly from the wrongful act, whether they could or could not have been foreseen by him.”

Putney delivered a kick to Vosburg’s leg just above the knee. This was delivered in the classroom.

Garratt v. Dailey(Wash. 1956)

The mere absence of an intent would not absolve one from liability if the act is wrongful

Substantial Certainty: need not know any specific injury, but only that consequences will follow

Child pulls out chair from old woman

White v. University of Idaho(Idaho 1990)

A person need not intend to cause harm or appreciate that his contact will cause harm so long as he intends to make a contact, and that contact is harmful

Piano teacher approaches student from behind and she is injured

Defenses to Battery:o Consent: Consent is an absolute defense to intentional tort liability. If the asserted victim

gives permission, what would otherwise be tortious is instead privileged.i) Express: Use of contract to provide consent to an action (Consent to Operations)ii) Implied: Consent inferred from conduct (O’Brien, held out arm for small pox vac.).iii) Scope of Consent: In some case may extend to natural elements and otherwise

might be constrained to specific areasiv) Emergency Rule: It is necessary to act before consent can be obtained. Based upon

the notion that the plaintiff would have consented to the operation if they had been asked.

v) Fraud/Nondisclosure: Consent cannot be established through these means

Mohr v. Williams(MN 1905)

Without consent, and with no circumstances to justify acting without it, an act is wrongful; and if it was wrongful, it was unlawful.

“Any unlawful or unauthorized touching of the person of another, except it be in spirit of pleasantry, constitutes an assault and battery.” Harmful intent must not be shown.

After patient had been put under, performed a skillful and successful surgery on the left ear, not the agreed upon ear.

o Insanity: Where an insane person by his act does intentional damage to the person or property of another he is liable for that damage in the same circumstances in which a normal person would be liable.

i) One idea is that if the insane person is held liable, then the caretakers (i.e. the parents, etc.) will take greater care restraining the insane person.

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ii) Rational choice is not required, just the intent to act

McGuire v Almy(Mass 1937)

“Where an insane person by his act does intentional damage to the person or property of another he is liable for that damage in the same circumstances in which a normal person would be liable.”

Must have been capable of entertaining intent and must have entertained that intent

Almy, was insane and was locked in his room when the caretaker was not in the room supervising. The defendant had previous episodes of violence.

o Self-Defense: This is a complete defense, you are not responsible for what happens. Trigger is that you have to actually believe that there is an imminent threat of injury. (objectivity of the threat). You are also allowed to use self-defense when acting on behalf of a third person (same test applies).

i) Reasonableness is key: Circumstances would lead a reasonable man to believe that his life was in danger, or that he was in danger of receiving great bodily harm

Courvoisier v. Raymond (CO 1896)

Self-Defense: Circumstances would lead a reasonable man to believe that his life was in danger, or that he was in danger of receiving great bodily harm

Courvoisier was awaken in the night by a group trying to enter his jewelry shop. He shot at them, but shot a police officer instead, who was approaching him

TRESPASS TO LAND: Every unauthorized and therefore unlawful entry in to the land of another is trespass. This is based upon the strong property interest of the common law (Dougherty v. Stepp). In both self defense and defense of property there is a consideration of how and how much force can be used.

Use of Deadly Force in Protection of Property: In both self defense and defense of property there is a consideration of how and how much force can be used.

RST: § 85 Use of Mechanical Device:You are not liable for injuries that you would be justified causing if you were actually there.

Judge Posner (Reaction to Bird): “The proper accommodation of two legitimate activities: the raising of tulips and the keeping of peacocks.” This is a law and economic take on it. You don’t think of it as one person wronging another. It’s just two legitimate entitlements that are clashing. The court comes up with an ingenious solution is the posting of the notice.

Bird v. Holbrook(England 1825)

In defense of property, no man can do indirectly that which he is forbidden to do directly.

Holbrook rented and occupied a walled garden. To protect this garden, he installed a spring gun.

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Necessity: Necessity is either a defense or a privilege. Absent that privilege, it is a trespass. This is an extraordinary privilege, and right only exists as far as the necessity arises. If you are resisting someone’s necessity privilege, the other person can use force (You can’t actively resist). It only goes as far as self-help as there is no duty to rescue. Necessity is heightened in cases of protection of life.

o Complete privilege v. incomplete privilege

o This is an incomplete privilege: have to pay for damages for any use of that propertyo Reasons why it is incomplete:

i) Incentivize not making the place more restrictive to be a safe havenii) Fortification would be the only other option

Ploof v. Putnam(VT 1908)

“Necessity, and an inability to control movements inaugurated in the proper exercise of a strict right, will justify entries upon land and interference with personal property that would otherwise have been trespasses.”

Because of a violent tempest, Ploof must dock his ship at Putnam’s dock to prevent injury to fam.

Vincent v. Lake Erie Transportation Co.(MN 1910)

The defendant “prudently and advisedly availed itself of the plaintiff’s property for the purpose of preserving its own more valuable property, and the plaintiffs are entitled to compensation for the injury done.”

Unjust enrichment: would require the boat owner to compensate the dock owner for the benefit that he received from the use of the dock

While boat was docked, a storm developed. The boat stayed docked, resulting in damages of $500

EMOTIONAL AND DIGNITARY HARMS: These were originally parasitic to actual physical injuries, but have received more relevance as emotional health takes on greater status in society. In the so-called hierarchy torts, this is last (Physical, property, emotional).

Assault: Either intend to cause apprehension, or intend to contact. Applicability of transferred intent and other such doctrine follows rules for battery. Threat to a third person is not actionable.

o Either a successful attempt at battery or simply a threat.i) The plaintiff must perceive the threat.ii) The threat must be immediate.

RST: § 21

Assaulta) he acts intending to cause a harmful or offensive contact with the person or third person, or an imminent apprehension of such contact; andb) the other is thereby put in such imminent apprehension

Note: It is enough that he believes that the act is capable of immediately inflicting the contact upon him unless something further occurs

o Distinguishes between fear and apprehensioni) Fear arises when you don’t know if you can repel the attacker.

Apprehension is when you think you can repel the attacker.ii) Even if I know I can repel an attack, I’ll be in a worse position than if I had

never been attacked at all.

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I. de S. and Wife v. W. de S

He made an assault upon the woman and from an assault one shall recover damages

Man swung hatchet at a woman and missed. No physical harm was done.

Tuberville v. Savage

Because his declaration is that he has no intention, there is no assault. An assault is the intention as well as the act. If you swing and miss, that is an assault

Man puts hand on sword, and says if not for judges in town, I would not take language from you

Offensive Battery: The damage isn’t the physical injury. It’s the damage to my dignity. It’s someone showing that they value themselves more than me – corrective justice. Contact is necessary. Courts stress the mental aspect, malice in intent.

RST: §18

Battery: Offensive Contacta) he acts intending to cause a harmful or offensive contact with the person or third person, or an imminent apprehension of such contact; andb) an offensive contact the person directly or indirectly results

Alcorn v. Mitchell(IL 1872)

This is the greatest indignity. It is customary to instruct juries that they may give vindictive damages where there are circumstances of malice, willfulness, wantonness, outrage, and indignity attending the wrong complained of

Alcorn deliberately spat in the face of Mitchell in a courtroom, in the presence of a large number of persons.

False Imprisonment: Three walls do not make a prison. You must show effective confinement, not a simple restriction on movement. This area may be large and need not be stationary. The defendant must intend to confine the plaintiff.

o The test for reasonable grounds is OBJECTIVE, not subjective.

i) Subjective – the person detaining thinks its reasonable.ii) Objective – whether an ordinary, reasonable decision maker would find it

reasonable

Bird v. Jones(England 1845)

To constitute imprisonment, a person must be prevented from leaving the place.

Otherwise, we are saying that mere loss of freedom is imprisonment.

It would turn every obstruction of a right of way into imprisonment

Man was obstructed from a public way because of stands that had been placed there to watch a boat race.

Coblyn v Kennedy’s, Inc. (Mass 1971)

“Any demonstration of physical power which, to all appearances, can be avoided only by submission, operates as effectually to constitute an imprisonment.”

When man left store, an employee physically grabbed him, and asked him to return to the store. He compiled, but had health problems.

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Intentional Infliction of Emotional Distress (IIED): IIED wants to recognize a standalone tort to compensate for emotional injury. It did not have to be connected to a threat of assault, there did not have to be contact, etc

RST: §46

Outrageous Conduct Causing Severe Emotional Distress1) One who by extreme and outrageous conduct intentionally or recklessly causes severe emotional distress2) to anyone else present, if distress results in bodily harm

Wilkinson v. Downton (Q.B. 1897)

A person is responsible for emotional damages if:o There is an intention to produce a harmful effecto The effect was not too remote to be regarded as a

consequence of the act. Parasitic Damages: may result naturally, necessarily,

directly, and proximately in consequence of his wrong

told her that her husband was smashed up, and way lying in a hospital with both legs broken. This was not true. She suffered a violent shock

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NEGLIGENCE

Holmes view of negligence: If the intervening events are of such a kind that no foresight could have been expected to look out for them, the defendant is not to blame for having failed to do so. An innocent actor should not have to bare the costs of the loss just because they acted.

Consequences that a reasonable man would be bound to contemplate and would thus have a chance to guard against (ordinary human care)

Must be an objective standard: the average man of ordinary intelligence and prudenceo When a man has a distinct defect, he will not be answerable to this standard

o Infants will be judged by a difference standard (what would a similar child do)

Negligence Elements: Duty: Did the defendant out the plaintiff a duty to conform his conduct to a standard necessary

to avoid an unreasonable risk of harm to others Breach: Did the defendant’s conduct fall below the applicable standard of care Causation: Was the breach causation in fact and/or proximate cause Damages: Did the plaintiff suffer harm

DUTY: REASONABLE PERSON: Standard of conduct to which person must conform to avoid being negligent is that of a reasonable man under like circumstances. Person exercising those qualities of attention, knowledge, intelligence, and judgment which society requires of its members for the protection of their own interests and the interests of others.

Foreseeability: You want to base the standard on what people will actually be able to foresee. People can alter their actions based on what they know. There is an incentive based. You want to give the right incentive to the actor to take reasonable action. You want the actor to think about the risks entailing in the action.

Infancy: Unless engaging in an adult activity, children will be held to the same standard of a person the same age, intelligence, and experience. RTT.

Roberts v. Ring (1919):

Facts: A seven year old was hit by an older man in a car driving 5 mph Holding: A boy of seven is not held to the same standard of care in self-protection. On

the other hand, “when one, by acts or omissions causes injury to others, his negligence is to be judged by the standard of care usually exercised by the ordinarily prudent normal man.”

Daniels v. Evans (1966):

Facts: A 19-year-old was killed when his motorcycle collided with the defendant’s automobile.

Holding: When a child engages in activities normally undertaken by adults, his conduct will be measured by an adult standard.o A minor assumes adult responsibility for the operation of so potentially dangerous

instrument as an automobile. People on the road have the right to expect that others, regardless of age and experience, will, obey the traffic laws and thus exercise the adult standard of ordinary care.

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Temporary Insanity: Generally held to the same standard of a reasonable person. Policy reasons for doing so:

o As between two innocents, place blame on the one who actso To induce those interested in the estate of the insane person to restrain and control o The fear an insanity defense would lead to false claims of insanity to avoid liabilityo You are likely to have precursors and notice of your disease

Breunig v. American Family Insurance Co. (1970):

Facts: Plaintiff brings suit to recover damages when her car was struck by a person having a mental delusion.

Holding: The mental illness “must be such as to affect the person’s ability to understand and appreciate the duty which rests upon him to drive his car with ordinary care, or if the insanity does not affect such understanding and appreciation, it must affect his ability to control his car in a ordinarily prudent manner…must be an absence of notice or forewarning.”

o It is unjust to hold a man responsible for his conduct which he is incapable of avoiding and which incapability was unknown to him prior to the accident.

Reasonable Woman: Should there be a different standard? Would women find different forms of sexual harassment?

Daniels v. Clegg (1873):

Facts: The daughter was driving a carriage and was driven off the road by a man driving a carriage. It was claimed that she was just as negligent for the act, because she should have assumed to have the same skill

Holding: A woman should not be held to the same standard: persons more or less incompetent shall be held to a duty no higher that must be required of such person than we have a right to expect.

Eichhorn v. Missouri (1895):

Facts: Eichhorn fell and received severe injuries when she was trying to board a train at a temporary location (which did not have a temporary platform for the 3 foot climb). The R.R. claimed negligence on her part. In their instructions to the jury, they emphasized “neglect to exercise such care, caution, and foresight as a woman of ordinary care..” They objected to the use of man of ordinary care used in another portion of the instructions.

Holding: The jury must understand that men is generic and embraced women.

Tucker v. Henniker (1860):

Facts: A carriage accident happened. The woman wanted to be held to a standard of women.

Holding: Women are of the same skill and prudence and therefore should be judged to the same standard which person of common prudence, or mankind in general, are held.

Asbury v. Charlotte Rail (1899):

Facts: Woman was exiting train, claimed it was negligently started, she got injured. They claimed negligence on her part. The standard of “an ordinarily prudent man” was applied. The RR appeal to get the woman standard applied: “as the care to be exercised by a woman, when she is placed in a dangerous situation, would be greater…and the law requires a greater degree of care to be exercised in avoiding it.”

Holding: No

HAND FORMULA / CALCULATION OF RISK: The law and economics movement has placed an enormous amount of weight on this: the internalization of costs. We want actors to be considering this on an ex ante basis. If I subject people to unreasonable risk, that is unacceptable. Postulates that the definition of reasonable is inherent in the balancing of costs and benefits.

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Hand Formula: Hand Formula: (1) The probability that she will break away; (2) the gravity of the resulting injury, (3) the burden of adequate precautions (Carroll Towing

o Negligence = B<PL: Probability of injury is P, the cost of injury is L, and cost of prevention B

Calculation of Risk: PL without the B (Stone)o What would be a reasonable foreseeable risk?o Court ruled that even if it drove cricket playing to zero that’s okay.o Appeal said Substantial Risk.

RTT: § 3

NegligenceRequires that you look at the foreseeable likelihood that the person’s conduct will result in harm, the foreseeable severity of any harm that may ensue, and the burden of precaution to eliminate or reduce the risk of harm

Eckert v. Long Island R.R. (1871):

Facts: A man was attempting to save a child from an approaching train. He was hit and killed. The relative brings suit claiming that the speed of the train was negligent for such a densely populated area. The R.R. claims that he was contributory negligent in putting himself in the danger.

Holding: He was not negligent, because he had an obligation to the child and that act is therefore justified and an act that is not wrong cannot be negligent.

o Dissent: No one can maintain an action for a wrong, when he consents or contributes to the act which occasions it.

United States v. Carroll Towing Co. (2nd Cir. 1947):

Facts: A barge sunk after running into a larger ship’s propeller. The U.S. sues the barge transporter to recover for lost flour. There are “collision damages” and “sinking damages.” The sinking damages could have been prevented if they had properly been aboard and take precautions (hence, negligence).

Holding: Hand Formula: (1) The probability that she will break away; (2) the gravity of the resulting injury, (3) the burden of adequate precautions

o Negligence = B<PL: Probability of injury is P, the cost of injury is L, and cost of prevention B

o When the cost of accidents is less than the cost of prevention, a rational profit-maximizing enterprise will pay out in torts.

Stone v. Bolton (England 1950):

Facts: Stone (P) was struck in the head by a ball that flew out of a cricket field across the street from her home. Stone sued Bolton (D), the owner of the cricket field for public nuisance and common law negligence on the grounds that the field did not have a fence high enough to prevent balls from flying out of the field. Bolton claimed that only 6-10 balls had escaped the field in the previous 30 years and it was therefore an unforeseeable risk.

Holding:o First holding: There was a reasonably foreseeable risk of injury and it is always

possible in the last resort to stop using that ground for cricketo Second Holding: A person is not negligent when the risk of damage to a person

on the road was so small that a reasonable man in the position of the appellants, considering the matter from the point of view of safety, would have thought it right to refrain from taking steps to prevent the danger.

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Andrews v. United Airlines (9th Cir. 1994):

Facts: Upon arrival of a United Airlines (D) flight at the gate, a briefcase fell from the overhead compartment seriously injuring Andrews (P). Passengers were warned on arrival that items stored in overhead bins may have shifted and that passengers should use caution.

Holding: Common Carrier Rule: “owe both a duty of utmost care and the vigilance of a very cautious person towards its passengers.”

CUSTOM: This is an external matrix for look at negligence, use of society standards not jury/court evaluation of the facts (as opposed to reasonable person and hand formula). Custom is not necessarily a depository measure, but can be evidence of some negligence. “Reasonably safe” means safe according to the usages, habits, and ordinary risks of business.

Pros: It can be used as a floor (“sword”). Provides you with greater uniformity as different courts will be looking at the same rule. It is allowing industry to set their own standards: if it is custom, it is probably custom for a reason. It is an external standard.

Cons: When used as a ceiling, it can underdeter people from taking proper care (“shield”). It is also static and does not necessarily progress as much as it should. The whole industry may lag behind and can hide behind regressive standards.

Titus v. Bradford (Pa 1890):

Reasonably safe means safe according to the usages, habits, and ordinary risks of business.

All the cases agree that the master is not bound to use the newest and best appliances.” Juries must necessarily determine the responsibility of individual conduct, but they

cannot be allowed to set up a standard which shall, in effect, dictate the customs or control the business of the community.

Mayhew v. Sullivan Mining Co. (Me 1884):

Facts: Plaintiff working on a platform that had a hole and then the plaintiff created another ladder hole and the plaintiff fell in.

Holding: Custom and average have no place in the definition of ordinary care.

T.J. Hooper (S.D.N.Y. 1931):

Facts: The plaintiffs were shipping two barges full of cargo when the ships encountered a storm. T he barges sank and the cargo was lost. The defendants owned the two tugboats that accompanied the barges. The plaintiffs sued the defendants, claiming that the tugs were not seaworthy because they were not equipped with effective radio sets capable of receiving warning of the storm. At the time, a statute had been enacted that required passenger steamers to carry such radios.

1st Holding: Custom is not based merely on old standards. It also must be based on adapting to new technology.

o The standard changes with advancing knowledge, experience, and the changed appliances of navigation. The use of the radio was shown to be so extensive as to amount almost to a universal practice in the navigation of coast wise tugs along the coast

Second: Custom is never its measure; a whole calling may have unduly lagged in the adoption of new and available devices. Courts must in the end say what is required; there are precautions so imperative that even their universal disregard will not excuse their omission.

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Lucy Webb Hayes National Training School v. Perotti (D.C. Cir. 1969):

The hospital fell short of its own internal standard. The hospital’s failure to observe the standards it had itself established represented negligence

RTT: Defendant may have relied upon their standard in choosing where to go

Medical Malpractice: Custom is extremely important in this context. It is given more weight in these cases than in other cases. As custom declines in use, medical malpractice goes up. Malpractice is a balance of ensuring patient safety, compensating medical malpractice victims, and keeping health care costs affordable, while operating within a complex regulatory scheme.

o Special Relationship: Similar to the common carrier relationship, doctors need to take extra care because of their special relationship.

o Individual Autonomy: The idea is that every human being has the right to determine what happens with his own body. And as such, they deserve to have all the options and the risks associated with all of those options available to them so they can make an informed decision.

o Hyman: You want to force doctors to internalize the costs of their negligence, but you also need to ensure that patients are informed of their condition before and after (especially in cases where something has gone wrong). Use caps on non-economic damages to encourage reporting.

T. Lama v. Borras (1st Cir. 1994):

Facts: Lama (P) scheduled surgery with Dr. Borras (D), a neurosurgeon, to correct a herniated disk. Borras neither prescribed nor enforced a regime of absolute bed rest prior to surgery. Because Lama was a heavy smoker, Borras instructed Lama to enter the hospital one week prior to surgery to clean out his lungs. P was not subjected to conservative treatment. The operation was not successful and D operated again five weeks later and did not order pre or post operative antibiotics.

Holding: Custom in medical malpractice: (1) basic norms of knowledge and medical care, (2) failed to follow norms, (3) this failure was the cause of injury

o The standard of care is a national standard of careo Heightened duty of care because of the special relationship (similar to the

heightened duty of a common carrier). Fiduciary duty to act on the patients behalf

Informed Consent: Consent must be informed or knowledgeable in some meaningful sense if we are to accord it legal significance. As long as one who suffers harm consents to bear the risk that leads to it, the injurer is not under a duty to protect the victim and is not at fault if an injury occurs. Based upon the express assumption of risk: expressly agreed to release a potential injurer from tort liability for all injuries that might incur. (Schuck Article)

o Idealist: expansive conception to disclose and elicit information about risks and alternatives.

i) Contract of adhesion: The doctor is in a better position to know

o Realists: Based upon custom. Too much information would discourage someone from the treatment they need.

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o Tort Claim: They must be injury causation—the undisclosed risk must have caused the patient’s harm, and decision causation—had the patient been properly informed, she would have made a different decision

o Exceptions to consent: Emergency, Inability to consent (and no other person available), Harm to person (welfare of the patient)

o Theoretical ideas:i) Individual Autonomy:

(1) With managed care, it is become more of a product such as product liability(2) Within in pure contract situations, you would want full autonomy, but

within a system of insurance, you may not want pure autonomy any longer (cost of care is externalized)

(3) Need to reign in full autonomy(4) If everything goes well, you cannot bring an action when your autonomy

interest is violatedii) Relational continuity:

(1) You are not going to have the family physician and thus do not have the full trust that you could expect from other relationships

iii) Utility:(1) Does it actually lead to better decision making

iv) Conflict of Interest:(1) Different ways that a person may be paid (more or less medical care)(2) Defensive medical procedures(3) Might have other interests in mind that would not lead that physician to

make the best decision for the client

T. Lama v. Borras (1st Cir. 1994):

Facts: P sued D on the grounds that D did not inform him of the potential risks of the surgery. P also sued the hospital for not equipping his bed with a bed rail and for not having a nurse present to assist him at the time of his fall. The court ordered a directed verdict in favor of D on the grounds that P had failed to produce any evidence of negligence.

Holding: A prudent person in the patient’s position would have decided if suitably informed of all perils bearing significance. If adequate disclosure could reasonably be expected to have caused that person to decline the treatment because of the revelation of the kind of risk or danger that resulted in harm, causation is shown, but otherwise not.

o Disclosure is to protect the patient against consequences which, if known, he would have avoided by foregoing treatment

o Individual autonomy: requires enough information to enable an intelligent choice, all risks potentially affecting the decision must be unmasked

ESTABLISHING NEGLIGENCE THROUGH STATUTE/ADMIN REGS: This is both an external standard and a bounded standard. Failing to abide-by a statute can either be “evidence” of negligence or dispositive, “negligence per se.” Statutes and regulations will often have a private right of action attached to them.

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RST: § 286

Standard of conduct defined by legislation or regulation will be adopteda) Protects the class of personsb) Protects the particular interest which is invadedc) Protects that interest against the king of harm that has resultedd) Protect that interest again the particular hazard from which the harm results

RT: § 14

Statutory Violations as Negligence Per seAn actor is negligent if, without reason, the actor violates a statute that is designed to protect against the type of accident the actor’s conduct causes, and if the accident victim is within the class of persons the statute is designed to protect.

Thayer, Public Wrong and Private Action (1924):o An ordinary prudent man, knowing the ordinance—for upon familiar principles he can claim

no benefit from his ignorance of the law—would have chosen to break it, “reasonably” believing that damage would not result from his action.

o Ordinance is not “negligence per se,” but only “evidence of negligence.”o Exception (would have to prove necessity): One who has assumed to place his own foresight

above that of the legislature in respect of the very danger which it was legislating to prevent.

Osborne v. Mc. Masters (Minn. 1889):

Facts: The company sold to an individual a deadly poison that they did not label “Poison,” as require by statute. The person died and suit was brought on their behalf.

Holding: Where a statue or municipal ordinance imposes upon any person a specific duty for the protection or benefit of others, if he neglects to perform that duty he is liable to those for whose protection or benefit it was imposed for any injuries of the character which the statute or ordinance was designed to prevent, and which were proximately produced by such neglect.

Gorris v. Scott (1874):

Facts: Disease control statute state lambs needed to be in pens on ships. Lambs were not in pens and fell off ship, not a harm that was to be protected by the statute

Holding: The harm must be within the legislative intent to prevent: was the plaintiff (even though foreseeably injured) in the category the statute meant to protect and was the harm that occurred (again, even if foreseeable), the ‘mischief’ the statute sought to avoid.

Martin v. Herzog (NY 1920):

Facts: Killed in a collision in which both parties did not have lights on, a direct violation of NY statute.

Holding: By the very terms of the hypothesis, to omit, willfully or heedlessly, the safeguards prescribed by law for the benefit of another that he may be preserved in life or limb, is to fall short of the standard of diligence to which those who live in organized society are under a duty to conform:

o Omission of the statutory signals is more than some evidence of negligence.o You are only at fault when it causes damages or is a factor of contributory

negligence

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Uhr v. East Greenbush Cent. Sch. Dist. (NY 1999):

Facts: The NY statute required that all kids get tested for scoliosis each year. The girl was not tested one year and her condition became so severe that surgery was required. The statute had a provision indicating that the City could not be held liable for the enforcement of the provision.

Holding: A statute does not necessarily carry with it a right of private enforcement by means of tort litigation. It must be examined under the following

o Whether the plaintiff was one of the class who was to benefito Would the recognition of the private right promote the legislative purposeo Would creation of such a right be consistent with the legislative scheme

This would not be consistent with the legislative scheme: there was an enforcement provision and a statutory immunity provision

AFFIRMATIVE DUTIES: Unless there is a special relationship, there is very rarely a duty to rescue. You can be held liable for misfeasance, but very rarely for nonfeasance. Under corrective justice, an individual who stands idly by while a victim suffers preventable harm has clearly done “wrong to another and should be held liable. Under the L&E, burden of rescue is less than the probability of harm times the severity of harm, the socially optimal outcome is achieved through rescue.

Misfeasance (misdeeds): Positive acts of injury or creating dangerous conditions that result in harm. Basic duty is for all individuals to abstain from hurting other persons, both strangers and persons of a special relationship.

Nonfeasance (failure to act): Failure to render material aid or support to other persons

Weinrib: When there is an emergency that the rescuer can alleviate with no inconvenience to himself, the general duty of beneficence that is suspended over society like a floating charge is temporarily revealed to identify a particular obligor and oblige, and to define obligations that are specific enough for judicial enforcement.

o There is an individual obligation to act on behalf of another individual. o You can’t trade off one life for the greater good. This is the anti- law and economics

perspective.

Duties of Owners and Occupiers: There is generally no duty to those persons who trespass on your property, except for no willful and wanton conduct. Traditionally, there was a difference in the classes of persons/invitees who entered property, but that was changed by Rowland.

RST: § 332

Invitees Defined(1) Public or a business visitor(2) A public invitee is a person who is invited to enter or remain on land as a member of the public for a purpose for which the land is held open to the public(3) A business visitor is a person who is invited to enter or remain on land for a purpose directly or indirectly connect with business dealing with the possessor of the land

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Robert Addie & Sons v. Dumbreck (Eng. 1929):

Facts: The owner operated a haulage system that had an exposed wheel on their property. The owner had put up signs and specifically told individuals (especially children) not to trespass on their property. Nonetheless, many individuals used the property as a shortcut and many children played on the wheel. A child was killed on the wheel, even after being warned not to go on the property.

Holding: With regards to trespassers, the landlord does not own a duty of care expect not to commit willful and wanton conduct against those individuals. There are three classifications of visitors, each with different duties:

o Business Invitees: By invitation, express or implied of the occupier, mutually beneficial relationship (joint interest of their presence on that property).

Duty: Highest duty and must provide reasonable care to ensure premises are safe.

o Licensee (“social guest”): With the leave and license of the occupier, or ambivalence of the occupier (no joint interest of the person being there).

Duty: No duty to ensure premise is safe, but must ensure that there is no trap or concealed danger that is not apparent or known to the visitor

o Trespassers: No invitation Duty: No duty to take reasonable care nor to protect against

concealed danger

Rowland v. Christian (Cal. 1968):

Facts: Mr. Rowland was invited to Ms. Christian’s apartment. When he was using the restroom, the porcelain handle on one of the water faucets broke, severing the nerves and tendons of his right hand. Christian has know about this problem and had not warned him of the dangerous condition of the handle. She claimed there was an assumption of risk and contributory negligence.

Holding: The status of an individual is not determinative of the duty that they should be given by the occupier (though it can influence that duty), except in cases where other factors should provide immunity. The duty of the occupier should be determined on the basis of ordinary principles of negligence. Immunity factors:

o Foreseeability of harmo Degree of certainty that the plaintiff suffered harmo Closeness of the connection between the injury and the defendant’s conducto The moral blame attached to the defendant’s conducto The policy of preventing future harmo The prevalence and availability of insurance

Specific Holding: Where the occupier of land is aware of a concealed condition involving tin the absence of precautions an unreasonable risk of harm to those coming in contact with it and is aware that a person on the premises is about to come in contact with it, the trier of face c can reasonably conclude that a failure to warn or to repair the condition constitutes negligence.

Special Relationships: This has only been upheld to cases in which the special relationship person knew of the specific person who was at risk. The duty tends to be most powerful in three situations:

o Potential target has been identified (Tarasoff)

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o Psychiatrist somehow facilitated the commission of the crime (Lundgren: helped to get guns back)

o Psychiatrist or institution has breached some explicit promise to the future victim (Long: Promised to inform wife when abusive husband would be released)

Tarasoff v. Regents of University of Cal. (Cal. 1976):

Facts: Poddar, a student, killed Tarasoff. He had confined his intentions to kill her to a University psychologist and had been designated as paranoid schizophrenic. No one warned Tatiana of his intentions.

o The family sues stating that the failure to warn and the failure to bring about confinement broke state law. Defendants argued they owed no duty of reasonable care

Holding: In instances of “special relationships,” there are affirmative duties to exercise reasonable care to protect third parties against dangers discovered or emanating from that relationship. Other factors determine whether a duty exists:

o Foreseeability of harmo Degree of certainty that plaintiff will suffer injuryo Closeness of connection between defendant’s conduct and injury sufferedo Moral blame attached to defendant’s conducto Policy of preventing future harm

Special Relationship: Does not have to be between the defendant and the plaintiff, but could exist through the third party. In the case of psychiatrist, they must exercise the reasonable degree of skill, knowledge, and care ordinarily possessed and exercised by members of that profession in similar circumstances. Their protect privilege ends where the public peril begins.

JUDGE VS. JURY: Judges fear that the jury might abuse its unlimited power by deciding cases contrary to established principles of law. The goal should be distributive justice—like cases should be treated alike, no matter what substantive principles apply.

o Role of judge: needs to ensure that juries do not decide cases contrary to established principles and that cases reach similar judgments when the substantive issues are similar

Have the duty to determine the law and rule to be applied Guard against irrational decisions (need to correct this because there is a link

between predictability and deterrence)

o Jury has the duty to find the facts to which it then applies the defined law. Norm creation, Conscience of the community, Jury is incredibly costly Hindsight bias: you want to go back to the point in time when that person was

deciding. If the accident has already occurred, then people would see as inevitable

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CAUSATION:

CAUSE-IN-FACT: The empirical substrate of the claim – is the action of the defendant appropriately link to the cause. Often the but-for cause. Without such action or event, the future consequences would not have resulted . Most cases will revolve around scientific uncertainty This can also include the substantial factor test.

RTT: § 26Factual Cause

Tortious conduct must be a factual cause of physical harm for liability to be imposed. Conduct is a factual cause of harm when the harm would not have occurred absent the conduct

RTT: § 27Multiple Acts:

If multiple acts exist, each of which alone would have been a factual cause under 26 of the physical harm at the same time, each act is regarded as a factual cause of the harm.

NY Central RR v. Grimstad (1920)

Facts: Man drowned when he fell of the ship. There were no life-preservers on the ship. He did not know how to swim

Holding: The court found that the man not being able to swim was the cause of his death. The other causes were too speculative.

PROXIMATE CAUSE: There are several standards starting with the ordinary and natural result of defendant’s negligence.

In re Polemis

Facts: Ship has boom material. Mast falls on boom materials. BOOM!

Holding: Reject-- Negligence is the consequence may reasonably be expected to result from a particular act. Would a reasonable person foreseen that the act would cause damage.

Foreseeability is important under duty and breach, but it has no bearing in damages. Directness test: foresight does not come in.

Directness Rule:o Looks backwards in time and looks to see if there are any intervening circumstances that

break the chain of causationo Foreseeability is very relevant to the determination of duty and breach, but not to

causationo Was there a superseding cause that broke the chain of events?

Foresight test:o Look forward to see what are the reasonably foreseeable risks and see if the harm is

within those foreseeable risks.o Can be both a risks test as well as a consequences test.

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Wagon Mound I Facts: Ship has boom material. Mast falls on boom materials. BOOM!

Holding: It is the foresight of the reasonable man which alone can determine responsibility.

Causation Limited by Foreseeable Duty: The risk reasonably to be perceived defines the duty to be obeyed, and risk imports relation; it is risk to another or to other within the range of apprehension.

RTT: § 29Limitations on liability for Tortious Conduct (Cardozo)

Limited to those physical harms that result from the risks that made the actor’s conduct tortious.

RST: § 431

What Constitutes Legal Cause (Andrews)a) is a substantial factor in bringing about the harm, and (Lead a reasonable man to believe)b) no rule of law relieving the actor from liability because of the manner in which his negligence has resulted in the harm

Palsgraf v. Long Island R. CO

Facts: Plaintiff, Helen Palsgraf, was standing on a platform when a guard attempted to push a passenger onto an exiting train. During the attempt, the passenger dropped a package covered in newspaper, later found to be fireworks, and an explosion followed.

Holding: The effects and consequences of the negligence could not be foreseen by a reasonable person:

o “there was nothing in the situation to suggest to the most cautious mind that the parcel wrapped in newspaper would spread wreckage through the station.”

o “If the harm was not willful, he must show that the act as to him had possibilities of danger so many and apparent as to entitle him to be protected.”

o Orbit of duty Dissent: “substantial factor” test. Andrews says it’s all a matter of judgment, it’s like a

stream. At certain points you can tell when a tributary joins the stream, but it all gets mixed in.

Emotional Distress: When mental shock or emotional distress can flow from wrongful conduct.o Physical Injury Rule: The emotional shock has to be parasitic to an actual injury

(Mitchell miscarriage)o Zone of Danger: You must be within the area where the act occurred. The care almost

hit you. (Dulieu v. White: Horses pass near)o Dillon Test (negligence is limited to case that result in physical injury to some person):

Located near the scene Distress resulted directly from the observance of the circumstances Close relationship between victim and person

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RTT: § 47Negligent Infliction of Emotional Disturbance resulting from bodily harm to third person

a) perceives the event contemporaneously, andb) is a close family member of the person suffering the bodily injury

Dillion v. Legg (1968)

Facts: The driver struck and killed child while she was crossing the street. The mother sued for nervous shock and serious mental and physical pain. She was in close proximity.

Holding: Liability deals directly with the foreseeability of the risk:o Whether plaintiff near the sceneo Whether shock resulted from direct emotional impact upon plaintiff from the

observanceo Whether they were closely related.

Engler v. Illinois Farmers (2005)

NIED only when 1. In zone of danger, 2. Reasonable fear, 3. Manifest physical harm, 4. Close relationship

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TORT LAW UNDER UNCERTAINTY

RES IPSA LOQUITUR: (The thing speaks for itself) The conditions traditionally required for the application of res ipsa loquitur are: “an accident that normally does not happen without negligence; exclusive control of the instrumentality by the defendant; and absence of voluntary action or contribution by the plaintiff.” In order for the plaintiff to have the benefit of res ipsa loquitur, she must convince the jury that each of these factors more likely than not exists.

Prosser1) The event must be of a kind which does not occur w/o negligence2) Instrumentality must be in the exclusive control3) no contributory action

RST: § 328

Res Ipsa LoquiturCan be inferred if:

a) ordinarily does not occur w/o neg.b) other responsible causes have been sufficiently eliminatedc) the negligence is within the scope of defendant’s duty to plaintiff

Judge decides if inference can be drawn, jury decide which inference to draw.

RTT: § 17Res Ipsa Loquitur

Type of accident that ordinarily happens as a result of the negligence of a class of actors of which the defendant is a relevant member. (Jury is only able to make a permissive inference)

Burden Shifting: Put the burden on the defendant to prove that there was no negligence. It is still only circumstantial evidence, but provides a huge help to the plaintiff. “Burden of Explanation” not a burden of proof. A narrow reading of Res Ipsa Loquitur would be narrow circumstantial evidence, a broad reading would shift the burden of proof entirely.o Justification: There are certain circumstances where the plaintiff does not have proper

access to information.

Colmenares v. Sun Alliance Insurance Co. (1986)

Facts: Person is hurt by the Port Authority’s escalator

Holding: Application of the Prosser test. Maintenance of an escalator was a non-delegable task

Ybarra v. Spangard

Facts: in with appendicitis, out with shoulder problems due to "trauma or injury by pressure or strain"

Holding: The control of the agency or instrumentality that harmed P was in the hands of the D's => Ds have burden of initial explanation. Similarly it is enough that P can show an injury resulting from an external force applied while he lay unconscious in the hospital without identifying the instrumentality.

COLLECTIVE LIABILITY: Joint tortfeasors are two or more individuals who either (1) act in concert to commit a tort, (2) act independently but cause a single indivisible tortious injury, or (3) share responsibility for a tort because of vicarious liability. Under traditional common law, each joint

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tortfeasor is “jointly and severally” liable for the plaintiff's total damages. This means that each individual is fully liable to the plaintiff for the entire damage award. If the plaintiff is unable to collect a co-tortfeasor's portion of the liability, the tortfeasor(s) from whom the plaintiff can collect are responsible for the other tortfeasor's (s') share.

Joint: Plaintiff can hold the defendants jointly responsible. The plaintiff could go after D1 for 100% or D2 for 100% or both for 50% each.

Several: If a defendant is only responsible for 40% of the harm, he only pays 40%. It can be separated out by either by the percentage fault or percentage of the causal contribution to the harm.

Joint and Several: Theoretically you can decide Defendant 1 is 2/3 and Defendant is 1/3 responsible. But then plaintiff can go over Defendant 1 for the entirety and then it’s up to Defendant 1 to sue Defendant 2 for his contribution.

Kingston v. Chicago & N.W. Ry. (WIS 1927):

Facts: A fire was started by a spark from the company’s locomotive. The fire merged with another fire, the cause of which is unknown, before destroying the D’s property. Both fires were deemed proximate causes of the house’s destruction (e.g. the house destruction “would not have happened but for” the fire).

Holding: Each cause or fire is attributable to the reason for the destruction and is responsible. The burden shifts to the defendant to prove that their particular event was not the proximate cause of the injury.

o They are responsible for damages as a part of the whole as it is impossible to tell what damages are attributable to each individual actor

o To do otherwise would allow the defendants to plead the wrong of the other as a defense to his own wrongdoing

Alternative Liability: Shift the burden of proof to the defendants, requiring each to prove that he was not the cause of the plaintiff’s injury. If neither defendants could provide such proof, each would be jointly liable for the plaintiff’s injury.o This theory shifts the burden on the plaintiff from proving that this actually caused the

damage to it may have caused the damage. Reduces proof need for causation

Summers v. Tice (Cal. 1928):

Facts: One went up a hill, a bird popped out, and they shot at the bird. They hit the man instead, causing injury to his eye and his upper lip. There was no contributory negligence.

Holding: When it can be proven by the P that multiple Ds were negligent and cannot tell which one caused the harm, the burden of justice shifts and is the burden to each of the defendants to absolve him if he can.

o To do otherwise would be to exonerate both form liability, although each was negligent, and the injury resulted from such negligence.

o Both are liable for the injury suffered by the third person, even though the negligence of only one of them could have cause the injury.

o Places the burden of proof of causation upon tortious defendants in certain circumstances

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Evidential Group (Geistfeld): The plaintiff needs to prove that a certain group was responsible for the tort and that the defendant is a part of the group. The defendant can then prove that it was not.o The plaintiff still has a burden to prove that this group is responsible for the tort

o Real definition: (1) each defendant may have tortiously caused the harm, (2) one did actually cause the harm, (3) each defendant would be subjected to liability for having actually caused or contributed to the harm, then no defendant can avoid liability by relying upon the tortious conduct of the other defendants, when that form of exculpatory causal proof would enable all of the defendants to avoid liability.

Market-Share Liability: When it can be proven by the P that multiple Ds were negligent and cannot tell which one caused the harm, you can measure the likelihood that any of the defendants supplied the product which injured the P by the percentage of the market the D had in the specific instance.

Sindell v. Abbott (Cal. 1980):

Facts: The drug DES, when taken by pregnant women, would cause forms of cancer in their children at about 10 years of age. In was officially banned in the 1971 for use by pregnant women. Because of the time delay in injuries, plaintiffs could not know for sure what company made the drug they ingested (over 200 companies making a version of it).

Holding: When it can be proven by the P that multiple Ds were negligent and cannot tell which one caused the harm, you can measure the likelihood that any of the defendants supplied the product which injured the P by the percentage of the market the D had in the specific instance.

o Exception: Can exculpate, defendant is able to prove that there product could not have been the proximate cause of the injury.

o As between an innocent plaintiff and negligent defendants, the latter should bear the cost of the injury

o This is a modification of the Summers rule or “alternative liability rule”: Places the burden of proof of causation upon tortious defendants in certain circumstances

o This liability will be only assessed to the defendants named in the suit (plaintiff might not get 100%)

Hymowitz v. Eli Lilly and Company (NY 1989):

Facts: Same as other.

Holding: When it can be proven by the P that multiple Ds were negligent and cannot tell which one caused the harm, you can measure the likelihood that any of the defendants supplied the product which injured the P by the percentage of the NATIONAL market the D had in the specific instance. (No exceptions or exculpate)

o Each defendant is liable in proportion to the amount of risk createdo No exculpating: it is just a windfall for a producer to escape liability solely

because it manufactured a more identifiable pill, or sold only to certain drug stores. They are still culpable

Dissent: You must be able to exculpate: the traditional burden of proof of causation is on the plaintiff. A plaintiff may not recover for his or her injuries form a defendant who could not have cause those injuries.

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SCIENTIFIC UNCERTAINTY : Harmful contact that is most likely to fail under the preponderance of evidence rule. Dealing with situations where the burden of proof is going to be very high. If you keep it on the plaintiff, the plaintiff is more likely than not going to be able to prove the link. Preponderance v. probabilistic cause.

Recurring Miss: Situations where a person has committed negligence that lead to damages, but there is not enough information to hold them liable

Lost Chance Recovery: Recovery for a lost percentage of surviving

Haft v. Lone Palm Hotel

Facts: Father and son drown in hotel pool. Statute requires lifeguard or sign. Neither present.

Holding: roof of causation shifts to D when D's negligence is responsible for absence of evidence.

Zuchowicz v. U.S.

Facts: Prescribed an overdose of Danocrine; contracts fatal PPH; dies Holding: If negligent act is wrongful b/c it increases likelihood of a certain injury, and

that injury occurs, then fact-finder may infer causation. Burden on D to prove that negligence (here, the OVERDOSE) was not a but-for cause.

"Strong causal link" is sufficient grounds for presumption of causation (burden-shifting) in cases of scientific uncertainty. FDA violation ~ negligence per se analysis.

Herskovits v. Group Health Cooperative

Facts: Hospital misses diagnosis of cancer; likelihood of survival drops from 39% to 25% (a 36% decrease).

Holding: P's 36% "lost chance" of survival is sufficient to allow jury to consider whether malpractice proximately caused death. Otherwise patients with <50% chance of survival would always lose. Should only recover damages directly caused by premature death.

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PLAINTIFF’S CONDUCT & DEFENSES

CONTRIBUTORY NEGLIGENCE: Conduct on the part of the plaintiff which falls below the standard to which he should conform for his own protection and which is a legally contributing cause co-operating the negligence of the defendant in bringing about the plaintiff’s harm. Belief that the “plaintiff must come in with clean hands.”

“Last Clear Chance”: The contributory negligence of the party injured will not defeat the action if it is shown that the defendant might by the exercise of reasonable care and prudence have avoided the consequence of the injured part’s negligence.

RTT: § 17

Causal Relation between harm and plaintiff’s negligence:1) It is a substantial factor in bringing about his harm and there is no rule restricting his responsibility for it2) )Same rules as used to prove defendant’s conduct

RST: § 479

Last Clear Chance:a) plaintiff is unable to avoid it by the exercise of reasonable vigilance and care, andb) defendant is negligent in failing to utilize with reasonable care and competence hi then existing opportunity to avoid harmc) knows the situation and has reason to realize the peril

Gyerman v. United State Lines Co. (Cal. 1972):

Facts: Longshoreman was injured while unloading fishmeal stacks. There is a common procedure for stacking the fishmeal and it was not followed in this circumstance. There was a claim of contributory negligence because the worker continued to work after he recognized the danger of proceeding.

Holding: Contributory negligence is conduct on the part of the plaintiff which falls below the standard to which he should conform for his own protection and which is a legally contributing cause co-operating with the negligence of the defendant in bringing about the plaintiff’s harm.

o The burden of proving contributory negligence is on the defendanto Although custom does not fix the standard of care, evidence of custom is

ordinarily admissible for its bearing upon contributory negligence

Raimondo v. Harding:

a person face with an emergency and who acts, without opportunity for deliberation, to avoid an accident may not be charged with contributory negligence if he acts as a reasonably prudent person would act under the same emergency circumstances.

LeRoy Fibre Co. v. Chicago, Milwaukee & St. Paul Ry. (SCOTUS 1914):

Facts: Farmer places his flax about 70 feet away from a train track. The train operator negligently operated the chu chu at a speed that emits sparks. The sparks set fire to the flax and burned all the rest of the flax. The lower court found the farmer as contributory negligent.

Holding: That one’s use of his property may be subject to the servitude of the wrongful use by another of his property seems an anomaly. The rights of one man in the use of his property cannot be limited by the wrongs of another.

o A person may suffer inconvenience and be subject to risks by the legitimate use of nearby property, but not the risk from wrongful operation.

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Fuller v. Illinois Central R.R. (Miss. 1911):

Facts: A man was attempting to cross a RR track in his wagon. He had his head down and did not look up to the oncoming train. The train had the ability to stop or to blow the whistle to warn the person of the train coming. It did not do so.

Holding: “Last Clear Chance”: The contributory negligence of the party injured will not defeat the action if it is shown that the defendant might by the exercise of reasonable care and prudence have avoided the consequence of the injured part’s negligence.

o The part who last has a clear opportunity of avoiding the accident, notwithstanding the negligence of his opponent, is considered solely responsible for it.

ASSUMPTION OF RISK: There are thus three basic elements to the assumption of risk. The plaintiff must (1)know a particular risk and (2) voluntarily (3) assume it.

Primary: Defendant was not negligent, either owed no duty or did not breach the duty owed (Murphy)

Secondary: assumption of the risk is an affirmative defense to an established breach of duty. (Meistrich: skater who knew the rink was not right, but continued anyway)

Spectators: All spectators share the common knowledge of injury from attending these events

Lamson v. American Axe. & Tool Co. (Cal. 1972):

Facts: They changed the axe racks. The new racks had a tendency to drop the axes. Man told boss, boss said that you can use the racks or leave. One fell on him.

Holding: Assumption of risks: appreciated the danger and understood what was likely to happen. He stayed and took the risk.

Murphy v. Steeplechase Amusement Co. (N.Y. 1929):

Facts: Man got injured on the “Flopper.”

Holding: One who takes part in such a sport accepts the dangers that inhere in it so far as they are obvious and necessary.

o This hazard was invited and foreseen.

Meistrich v. Casino Arena Attractions, Inc

Facts: The ice was not prepared correctly, he knew this, remained on the ice, and fell.

Holding: Secondary AOR: D did breach duty, but if reasonable P would have avoided injury, then apply AOR and D not liable. (Primary AOR defense is no duty or no breach.)

COMPARATIVE NEGLIGENCE: A part is not barred from recovering damages in a tort action. In some states, it can be barred if it exceeds or equals the comparative negligence of another party in the action.

Li v. Yellow Cab Co. of CA

Facts: Plaintiff had attempted to cross three lanes of oncoming traffic in order to enter a service station. Defendant was speeding through a yellow light.

Holding: Adopt pure form of comparative liability in direct proportion to fault in all cases. As opposed to Up to the point, which proportions fault up until the point at which the plaintiff’s negligence is equal to or greater than that of the defendant.

Knight v. Jewett

Facts: They were playing football. She says not to be so rough and threatened to quit. He fell on her and she broke her little finger.

Holding: Ruled that this was primary assumption of risks, which bars against negligence, so primarily still applies in a comparative neg. environment.

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MULTIPLE DEFENDANTS

JOINT AND SEVERAL LIABILITY: Joint tortfeasors are two or more individuals who either (1) act in concert to commit a tort, (2) act independently but cause a single indivisible tortious injury, or (3) share responsibility for a tort because of vicarious liability. Under traditional common law, each joint tortfeasor is “jointly and severally” liable for the plaintiff's total damages. This means that each individual is fully liable to the plaintiff for the entire damage award. If the plaintiff is unable to collect a co-tortfeasor's portion of the liability, the tortfeasor(s) from whom the plaintiff can collect are responsible for the other tortfeasor's (s') share.

No Contribution: The Plaintiff is able to recover 100% from one defendant, but that defendant is not able to sue the other defendant for their portion of the damages. This is similar to contributory negligence’s “clean hands” rule.

Merryweather v. Nixan:

“If A recover in tort against two defendants, and levy the whole damages on one, that one cannot recover a moiety against the other for his contribution.”

Union Stock Yards v. Chicago, Burlington, & Quincy R.R. (1905):

Facts: A train had a faulty nut that caused eventual injury to an employee. This was due to the negligence of both companies in failing to inspect the train. The Union Stock Yards paid the employee and sued Chicago for recovery of their share of responsibility

Holding: General Rule: one of the several wrongdoers cannot recover against another wrongdoer, although he may have been compelled to pay for all the damages for the wrong done. Both are equally particeps criminis.

o Exception: When someone is exposed to the liability, but does not join the act. The wrong must go to who is primarily responsible for the injury sustained

Primary responsibility vs. Secondary responsibilityo This is not an exception: both are equally at fault

With Contribution: The Plaintiff is able to recover 100% from one defendant, but that defendant is able to sue the other defendant for their portion of the damages.

American Motorcycle Association v. Superior Court (Cal. 1978):

Facts: A kid was injured in an event that he claims was negligently organized. AMA claims that the parents are negligent as well.

Holding: Proper Apportionment of Liability: (1) Joint and several not abolished by comparative neg.; (2) Doctrine of partial equitable indemnity exists: (3) Also comparative indemnity exists

o A concurrent tortfeasor is liable for the whole of an indivisible injury whenever his negligence is a proximate cause of that injury

o Goal of plaintiff obtaining full recovery: The wrongdoers should be left to work out between themselves any apportionment (Summers v. Tice)

Guilty parties are permitted to obtain indemnity from other concurrent torfeasors on a comparative fault basis

o For a settling party, that has entered into a “good faith” settlement, they are discharged from any claim for partial or comparative indemnity that may be pressed by a concurrent torfeasor

The amount in “good faith” is subtracted from the remaining damages

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Settling in a Comparative Negligence World: How a settlement is factored into a final decision can effect whether a defendant gets off and whether the plaintiff gets full or more recovery.

o Pro Tanto

i) % Remaining Liability (Trial damages – settlement), but the non-settled defendants can sue to enforce proper shares

ii) % Remaining Liability (Trial damages – settlement), but there can be no more suitso Proportionate Share:

i) % Liability * Trail damages, irrespective of settlement and no more suits allowedii) Promotion of settlementiii) Judicial economyiv) Fairness to the parties

Damages = $100 Pro Tanto w/contr. Pro Tanto w/o contr. Proportionate

A (25%)—Settles $10 $10 ($25 in the end) $10 $10

B (50%) $60 (Can sue A for $10) $60 $50

C (25%) $30 (Can sue A for $5) $30 $25

Plaintiff $100 $100 $85

McDermott, Inc. v. AmClyde and River Don Casting, Ltd. (1994):

Facts: McDermott settled with three defendants for a million. The two others did not. The jury said damages were $2.1 million and liability was 32% AmClyde ($672,000) and 38% River Don ($798,000). The defendants would recover more than the damages awarded if: settlement is added to these proportions. Court of Appeals said damage total was: (2.1 mil – 30% liability Mc & other def.) – settlement = 470,000. They also dismissed AmClyde’s liability because of contract negotiations.

Holding: Damages must be assessed on the basis of proportionate fault, no matter the settlement totals of other parties.

o Three different rules could be applied: Amount of damages to be proportioned is % Remaining Liability (Trial

damages – settlement), but the non-settled defendants can sue to enforce proper shares

Amount of damages to be proportioned is % Remaining Liability (Trial damages – settlement), but there can be no more suits

Amount of damages is % Liability * Trail damages, irrespective of settlement and no more suits allowed

o Mary Carter Agreement: Defendant makes a secret settlement, but stays in the case to attempt to put more liability on the other defendant as a part of the agreement.

VICARIOUS LIABILITY: The imposition of liability upon on party for a wrong committed by another party.

Scope of Employment Rule: Restricts vicarious liability to tortious conduct that should be considered as one of the normal risks to be borne by the business there by excluding an employee’s personal torts

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o Motive Test: purpose to serve the masteri) Works well when it is done for the benefit of the employerii) “Frolic and Detours” fall outside the scope of employment (Bushey type cases)

o Foresight Testi) Serves as an almost all purpose test for what can be foreseen

o Location of Wrongi) Not an entirely viable test as it is a bit too large

Efficiency/Deterrence: minimizing costs of accidentso Employers are in the best position to prevent future accidents Need to define this

right to certain areas where they are able to actually deter (Need to define what is within the scope of employment in order to actually define what they are able to create incentives for).

i) Standard of careii) Observationiii) Screeningiv) Trainingv) Promotion/Demotion/Termination

Loss-Spreading Rationale: upon whom should we spread these losseso Employers have better access to insurance marketso Better risk-spreading mechanisms: onto the product, wages, or other parts of the

businesso Gets around the insolvency problems of victim going uncompensated

Deep Pockets (Compensation):o Where do you place the moral responsibilityo Also, ensuring the ability to actually effect the incentives of different employeeso Seeing the employer as a third-party insurer

Ira Bushey v. United States (2nd 1968):

Facts: Drunk sailor in the Gowanus causes damages to a ship while coming back to the boat.

Holding: There are many different test for scope of employment. The risk of people coming and going is enough is enough to make it fair that the enterprise bear the loss

o Motive testo Foresight testo Location test

Petrovich v. Share Health Plan of IL

Facts: The doctor made a mistake and they go after the HMO as the true employer of the HMO doctor.

Holding: As a general rule, no vicarious liability exists for the actions of independent contractors. It can be established from apparent or implied authority:

o Apparent Authority: the principal will be bound not only by the authority that is actually gives to another, but also by the authority that it appears to give. The HMO 1) held itself out as the provider, 2) patient justifiably relied upon the conduct of the HMO to provide services

o Implied Authority: Has sufficient control over the individual. Control over 1) the right to make prospective decisions, 2) the right to refuse to pay

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STRICT LIABILITY

STRICT LIABILITY VS. NEGLIGENCE: A defendant under a negligence rule has an incentive to take the appropriate level of precaution, because that ultimately determines his or her liability. In contrast, because a defendant under a strict liability rule is held liable for all accidents, assuming that the frequency of accident is directly related to the frequency of activity, there is an incentive to reduce the overall level of activity.

Economic Efficiency: We choose the set of entitlements which would lead to that allocation of resources which could not be improved in the sense that a further change would not so improve the condition of those who gained by it that they could compensate those who lost from it and still be better off than before.

Kaldor-Hicks Efficiency: winners actually compensate the losers so that at least some one is better off and no one is worse off than before.

Calabresi (Cost of Accidents): 1) economic efficiency governs whatever we pick; 2) the cost should be put on the party or activity that is best located to make such a cost-benefit analysis; 3) should be put on the part which can most cheaply avoid them; 4) party with lowest transaction costs

Hammontree v. Jenner (1971):

Facts: Man driving a car, who had a history of epilepsy, crashes into a bike store after losing control and having a seizure. The jury did not find negligence and the plaintiff wanted instead to have the jury find the case on the theory of absolute liability: legally liable for all injuries and property damage which an innocent person may suffer as a proximate result of the defendant’s inability to so control or operate his motor vehicle.

Holding: The principles of negligence apply to the liability of a driver for injuries resulting from an accident that occurred during the time in which the driver was suddenly stricken by an illness rendering him unconscious.

o Only a driver who is aware of that conditional can anticipate the hazards and foresee the dangers. Innocent people would be held liable.

o Manufacture liability: a manufacturer is strictly liable in tort when an article he places on the market, knowing that it is to be used without inspection for defects, proves to have a defect that causes injury.

Notes: You can relate this to activity level. If you would impose strict liability to these situations then it would dampen activity. You don’t want to say that anyone who has ever had an epileptic seizure can never drive again.

COASE THEOREM: If there are zero transaction costs, the efficient outcome will occur regardless of the choice of legal rules. The choice of legal rules is rather a choice of how to redistribute income. If there are positive transaction costs, the efficient outcome may not occur under every legal rule. In these circumstances, the preferred legal rule is the rule that minimizes the effects of transaction costs.

In accident situations, both strict liability and negligence are efficient, provided that liability equals actual damages if strict liability is used and that that the standard of care corresponds to the efficient outcome if negligence is used.

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Drive D’s benefit P’s cost Benefit-CostFast 120 100 20Moderate 80 40 40Slow 50 30 30

In accident situations in which the problem is to induce both the injurer and the victim to take appropriate care, a rule of strict liability with a defense of contributory negligence or a rule of negligence is efficient.

Drive D’s benefit Pl’s cost (pedestrian) Benefit – costFast $120 $100 (walks)

$110 (runs)$20 (walks)$10 (runs)

Moderate $80 $40 (Walks)$50 (Runs)

$40 (walks)$30 (runs)

Slow $50 $20 (walks)$30 (runs)

$30 (walks)$20 (runs)

In accident situations in which the problem is to induce the injurer both to take appropriate care and to participate in the activity at an appropriate level, strict liability is efficient. Negligence also is efficient if the standard of care encompasses both the injurer’s care and his level of participation in the activity.

Criticisms: Coase theorem is based upon the idea that tort liability rules are the only things that are driving a person’s actions. Tort liability rules are not the only thing that effects economic considerations

o People consider the Risk to selfo Moral considerations weigh on people’s decisionso Market constraints: product manufacturer might take more care than the optimal

level of car in order to protect their reputationo There are other areas of liability (fines, penalties, crimes, regulatory agencies)o Our ability to correctly foresee our cost-benefits is very rare and complicated

ULTRAHAZARDOUS (ABNORMALLY DANGEROUS) ACTIVITIES: This along with nuisance is one of the traditional bases of strict liability. This does not bar assumption of risk. It also does not let a plaintiff recover if they were abnormally sensitive to the activity.

RST: § 519General Principal:

Strict liability for abnormally dangerous activities although he has exercised the utmost care to prevent the harm

RST: § 520

Activities that are Ultrahaz.:A) High degree of riskB) Likelihood that great harm will resultC) Inability to eliminate riskD) Not a matter of common usageE) InappropriatenessF) Value to the community

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RTT: § 20

Actor is subject to strict liability for carrying out an abnormally dangerous activity:1) Creates a foreseeable and highly significant risk or physical harm even when reasonable care is exercised by all actors2) Not of common usage

Restatement: 519 v. 20o The first three factors of 519 are much like the Hand Formula

o If there is great societal value, you would want to be able to keep it

o Difference between restatements, no longer has the value to the community

Fletcher (Reciprocity): a victim has a right to recover for injuries caused by a risk greater in degree and different in order from those created by the victim and imposed on the defendant—in short, for injuries resulting from nonreciprocal risks.

o If the defendant creates a risk that exceeds those to which he is reciprocally subject, it seems fair to hold him liable for the results of his aberrant indulgence.

Indiana Harbor Belt R.R. v. American Cyanamid Co. (1990):

Facts: Defendant manufacturer of chemicals was sued by plaintiff switching line for cost of decontamination measures that resulted from railroad tank car leak. Plaintiff based its counts on theories of negligence and strict liability arising from an abnormally dangerous activity

Holding: court reasoned that accidents that are due to a lack of care can be prevented by taking care, and when a lack of care can be shown in court, such accidents are adequately deterred by the threat of liability for negligence.

o A paradigmatic case of strict liability is found where (a) the risk (probability) of harm is great; (b) the harm that would ensue if the risk materialized is great; (c) yet, such an accident cannot be prevented by the exercise of due care; (d) the activity is not a matter of common usage; (e) the activity is inappropriate to the place in which it takes place; and (f) the value to the community of the activity does not appear to be great enough to offset its unavoidable risks.

o Ultrahazardousness or abnormal dangerousness is a property not of substances, but of activities.

o Manufacturer of a product is not considered to be engaged in an abnormally dangerous activity merely because the product becomes dangerous when it is handled or used in some way after it leaves his premises, even if the danger is foreseeable

Madsen v. East Jordan Irrigation:

Blasting lead to minks killing each other because of the noise. These damages were too remote. For damages, the events have to be in the realm of anticipation.

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CONVERSION: Intentional exercise of dominion and control over a chattel which so seriously interferes with the right of another to control it. If you purchase stolen property, there is conversion among the seller and the purchaser.

Requires a distinct act of dominion over another person’s property. You have to intend to assert dominion or ownership over something. The consequences that result from that are strict. I’ve committed conversion even if I’m mistaken. If I think the book is mine and I take it, it’s still conversion.

INTENT to steal is not necessary. It’s INTENT to act, not INTENT to commit a wrong. Acting in a way that is inconsistent with the title or the rights of someone else’s property.

Moore v. Regents of U of Cal.

Facts: THAT'S MY SPLEEN: Man with hairy leukemia is being treated and his spleen, blood, and other disposed parts are used to discover very profitable cell-line

Holding: For conversion: plaintiff must establish an actual interference with his ownership or right of possession. If P neither has title to the property alleged to be converted, nor possession, he cannot maintain conversion. A patient's right can be protected by other forms other than strict liability and adapting this tort to the medical field is better left for the legislature.

Kremen v. Cohen

Facts: Cohen steals sex.com by sending letter to Network Solutions

Holding: Property includes intangible items. Conversion traditionally only applied to tangible goods, hence the need to have some tangible written document. Conversion can be applied to these intangible items and does not necessarily require a written document. The common law cannot stand idle while people give away property. The legislature can make changes if they like.

Factors to consider when applying a old tort to a new issue:o Precedent

i) Moore: no court has ever in a reported decision imposed conversion liability for the use of human cells in medical research. This raises a flag of caution. The court has been asked to take this tort of conversion (originally about stealing horses) and extend it.

ii) Kremen: We have not created new tort duties. (they cite Moore v. Regents). We have only applied settled notions of conversion law.

o Legislature v. Court

i) Moore: This is a decision for the legislature.ii) Kremen: The legislature is free to change the court’s rulings. “The common law

does not stand idle while people take the property of others.” We’ll make this decision for now and the legislature can overturn if they decide to.

o Fairness

i) Moore: Worried that if they were to apply strict liability it might not be fair. Need to protect innocent parties, namely the end users of the cell line. They would be held strictly liability even though they haven’t done anything. It would impose liability onto all those to whom the liability comes.

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ii) Kremen: Cohen is the one who actually profited off of the domain name. Network Solutions was careless, so maybe our fairness considerations wither away. But we have to consider the fact that we would be holding Network Solutions STRICTLY LIABLE even if they were not at fault. The Kremen court says that’s fine. If someone gives away property that isn’t theirs, they should be held responsible.

o Incentives/Activity levels

i) Moore: We don’t want to threaten with disabling civil liability innocent parties who are engaged in social useful activities, such as researchers. This could dull the incentives for medical innovation. There’s an aversion to applying strict liability because it would have an activity level effect that would dampen medical research.

ii) Kremen: The district court was worried about stifling the registration system. But the Court of Appeals says that maybe we need more regulations. People want to be able to protect their claim to the sites.

TRESPASS TO CHATTELS: The intentional interference with the right of the possession of personal property. This is intentional damage to the chattel or to deprive the individual of the use of the chattel for a substantial time or some other legally protected interest of the possessor is affected.

Intel Corp. v. Hamidi

Facts: Hamidi, a former employee of D sent a series of mass emails libeling Intel. Intel seeks an injunction for trespass to chattels/land.

Holding: In CA law, trespass to chattels does not and should not encompass an electronic communication that neither damages the recipient computer system nor impairs its functioning. They may be accepted as a nuisance, but are not a trespass.

eBay v. Bidder's Edge

Facts: WHERE'S MY RAID: eBay sued for trespass to chattels. BE was crawling eBay's online database to give its customers the ability to compare bids for similar items across websites

Holding: Court granted eBay's request for an injunction holding that BE's "repeated searches amounted to trespass to chattels, capable of impairing the operation of its site b/c the use of BE's webcrawlers exceeded the scope of any such consent when they began acting like robots by making repeated queries"

NUISANCE: CA rule definition: anything that is injurious to health, including but not limited to, the illegal sale of controlled substances, or is indecent or offensive to the senses, or an obstruction to the free use of property, so as to interfere with the comfortable enjoyment of life or property, or unlawfully obstructs the free passage or use of something.

RST: § 20

Unreasonableness of Intentional Invasion:a) gravity of the harm outweighs the utility of the actor’s conductb) harm caused by the conduct is serious and the financial burden of compensating for this and similar harm to others would not make the continuation of the conduct not feasible

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Coase theorem: if zero transaction costs, doesn’t matter whether court gives entitlement to party A or B, and doesn’t matter whether injunctive or damage relief. Reality, however, is rife with transaction costs.

o Where you place the entitlement will be extremely important

Live and Let Live (Bramwell): There should be exceptions to nuisance (non-wanton activity): ordinary use of a person’s land. There is a reciprocal relationship that would require each to let certain things go.

Locality Rule: If one lives in the city he must expect to suffer the dirt smoke, noisome odors… Some activities may be a reasonable use in a certain locality.

Protection/Nuisance Nuisance No nuisance

Injunctive (property rule)

I: Factory owner can’t pollute unless homeowner allows it.Ensign

III: Factory can pollute at will (of course can stop if homeowner pays off).Fontainebleau; Rogers

Damages(liability rule)

II: Factory owner can pollute but must compensate homeowner.Boomer

IV: “Purchased injunction.” Homeowner can stop factory from polluting but must compensate. [rare, a bit spurious/problematic for theorists]Spur Industries

Michalson v. Nutting

Facts: Defendant let the roots of his tree grow under his property to the plaintiffs, and they fucked up the sewer and the foundations of his house.

Holding: The owner of the land is free to grow trees and roots extending is a natural consequence that will happen. But the plaintiff does have a right to self help to chop off the roots.

Fontainebleu Hotel Corp. v. Forty-Five Twenty-Five, Inc.

Facts: One cannot use his property to injure the lawful RIGHTS of another, but no landowner has a legal right to the free flow of light and air across the land of his neighbor. Even if the structure is erected largely for spite and even though it causes injury to another by cutting off light and air and interfering with the view, if it serves a useful purpose, it does not give rise to a cause of action.

Holding: One cannot use his property to injure the lawful RIGHTS of another, but no landowner has a legla right to the free flow of light and air across the land of his neighbor. Even if the structure is erected largely for spite and even though it causes injury to another by cutting off light and air and interfering with the view, if it serves a useful purpose, it does not give rise to a cause of action.

Rogers v. Elliott Ordinary person standard: the right to make noise must be balanced against the

annoyance which others can reasonably submit to. This should be determined by people generally and not those particularly sensitive.

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Ensign v. Walls

Dogs: No categorical "coming to the nuisance" defense. One's trade may be non-nuisance for many years, but as neighborhood changes, it can become a nuisance. Can take into account her investment, but that does not preclude finding nuisance. Especially when it will only get worse w/gentrification.

Boomer v. Atlantic Cement Co.

Upends tradition that finding a nuisance --> injunction. If the economic value of the nuisance is much greater than the harm of the nuisance, can award "permanent" (past and future) money damages and preclude any future recovery.

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PRODUCTS LIABILITY

There are three main areas within Products Liability: Manufacturer Defect Design Defect Failure to Warn

Contracts vs. Torts: Torts: role is to protect society’s interest in being free from harm, and the cost of protecting

society from harm is borne by society in general. It is determined by the duty owed to a party. Contract: Guard and determine performance of promise. Disappointed interests are properly

determined within contracts. If it is not in the contract, it is a failure to bargain for adequate contract remedies. Does not apply to personal injury.

Reasons for Imposing Strict Liability: Loss minimization: Place the burden on the person in the best position to minimize the losses

that arise out of the general use of its producto They are in charge of the information that is given about their products (Can warn)

o They can test their products and ensure that they are safe: they have enormous information on the product and are best able to make decision about safety

Loss Spreading: The manufacture is best able to spread the costs of the loss among the public at large

No need for RIL: It switches the residual risk of unavoidable accidents from the plaintiff to the defendant

Corrective Justice: The loss should be placed on the person that created it, not the party that suffered from it.

MANUFACTURE DEFECT: Manufactures incur an absolute liability when an article that he has placed on the market, knowing that it is to be used without inspection, proves to have a defect that causes injury to human beings. Must be defined in terms of the safety of the product in normal and proper use, and should not extend to injuries that cannot be traced to the product as it reached the market. (Escola).

RST: § 402A

A person is liable if defective product reaches ultimate user if:a) Is in the business of selling that productb) No substantial change occurs since it was soldc) Amount of care does not affect this nor does it matter if the person had a contractual relationship

Comments from 402: There is a special responsibility of someone who enters the business of creating products to

be sold to the general public Injured party must prove that the product was defective Products that are know by the general public to be dangerous do not apply, but that

company must warn the general public Does not matter if there was a contract Secondary Assumption of Risk still applies

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RTT: § 1 One who sells or distributes a defective product is subject to liability for harm to person or property caused by the defect

RTT: § 2

Categories (RST 2): Manufacturing defect, defective in design, or inadequate instructions:1) Departs from intended design2) A foreseeable alternative design prevented the risks of harm of the defective design4) Reasonable instructions could have prevented the risk of harm

UCC

UCC: Third Party Beneficiaries of Warranties Express or Implied:A seller’s warranty whether express or implied extends to any natural person who may reasonably be expected to use, consume or be affected by the goods and who is injured in person by breach of warranty. A seller may not exclude or limit the operation of this section.

MacPherson v. Buick Motor Co. (1916):

Facts: Defendant was an automobile manufacturer who obtained wheels for its automobiles from a separate manufacturer. Defendant sold its vehicles to automobile retailers. Plaintiff purchased one of defendant's vehicles from a dealer. Plaintiff was riding in the vehicle when it collapsed and plaintiff was injured. Plaintiff sued defendant for negligence.

Holding: Manufactures can be held liable for negligently making and not inspecting their products. They are liable for negligence in relation to dangers that are foreseeable, dangers that are probable, not merely possible.

o If the nature of a thing is such that it is reasonably certain to place life and limb in peril when negligently made, it is a thing of danger.

o One who invites another to make use of an appliance is bound to the exercise of reasonable care. The more probable the danger, the greater the need for caution

o Exception: It is well know that the purchaser will further perform inspections or alterations to the product

Escola v. Coca Cola bottling Co. of Fresno (1944):

Facts: Plaintiff waitress brought an action against defendant bottling company to recover for personal injuries resulting from a defective, exploding bottle of carbonated beverage.

Holding: Manufactures incur an absolute liability when an article that he has placed on the market, knowing that it is to be used without inspection, proves to have a defect that causes injury to human beings. Must be defined in terms of the safety of the product in normal and proper use, and should not extend to injuries that cannot be traced to the product as it reached the market.

o Policy Argument: responsibility should be fixed wherever it will most effectively reduce the hazards to life and health inherent in defective products that reach the market.

An injured person is not in any position to refute evidence or identify the cause of a defect

In the changing economy, the consumer no longer has the ability to investigate for himself the soundness of a product

Manufacturer would guarantee the safety of his product even when there is no negligence

o Risk of injury can be insured by the manufacturer and distributed among the public as a cost of doing business.

o This applies to consumers, a third party beneficiary of the manufacturer’s contract with the dealer

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Casa Clara Condominium Association, Inc. v. Charley Toppino & Sons (1993):

Facts: The trial court held that petitioner homeowners could not recover for purely economic losses from respondent concrete supplier under a negligence theory. Petitioners owned homes built with, and allegedly damaged by, respondent's concrete. Some of petitioners' claims against respondent were based on a theory of negligence. The appellate court held that because no person was injured and no other property was damaged, petitioners had no cause of action against respondent in tort.

Holding: Application of the Economic Loss Theory: prohibits tort recovery when a product damages itself, causing economic loss, but does not cause personal injury or damage to any property other than itself. This is further defined as damages for inadequate value, costs of repair and replacement of the defective product, or consequent loss of profits—without any claim of personal injury or damage to other property

o The bought a house, not a sum of all its parts (this in not convincing)o You cannot sue for future damage: the degree of risk is indeterminate, with no

guarantee that damages will be reasonably related to the risk of injury, and with no possibility for the producer of a product to structure its business behavior to cover the risk.

Economic Loss Theory: prohibits tort recovery when a product damages itself, causing economic loss, but does not cause personal injury or damage to any property other than itself. This is further defined as damages for inadequate value, costs of repair and replacement of the defective product, or consequent loss of profits—without any claim of personal injury or damage to other property

Consumer expectations: if the product has failed to perform as safely as an ordinary consumer would expect when used in an intended or reasonably foreseeable manner

o Very close to the UCC warranty theory of contractso The majority of the cases are under this ruleo Reason to move away: consumers are not heterogeneous, consumers may not know

what are the reasonable expectationso For a normal case, it is an objective standard

Risk/Utility: in light of certain factors, the benefits of the design do not outweigh the risk of danger inherent in such design

o There are certain classes of products where reasonable people would not have an idea of what to expect

o Idea is going to take into consideration all the risks and benefits with all other information known at the time of analysis

i) Focusing on the product and not on the actions of the manufacturerii) Negligence inflicted strict liability standard

Burden of Proof: Plaintiff:

o Has show that the product is defective or does not meet consumer expectationso In some districts, must demonstrate an alternative design, though most districts

only make this a “may” demonstrate alt. designs Defendant:

o Must prove that benefits of a product outweigh the costs

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In drug related cases, a drug is defectively designed only when it provides no net benefit to any class of patients

Barker v. Lull Engineering Co. (Cal. 1978):

Facts: Appellant was injured while he was operating a high-lift loader manufactured by respondent. At trial, the jury returned a verdict in favor of respondents. Appellant contended that the trial court erred in instructing the jury that strict liability for a defect in design of a product was based on a finding that the product was unreasonably dangerous for its intended use.

Holding: A product is defective in design either (1) if the product has failed to perform as safely as an ordinary consumer would expect when used in an intended or reasonably foreseeable manner, or (2) if, in light of certain factors, the benefits of the design do not outweigh the risk of danger inherent in such design.

o This relies upon the manufacturer’s design, not conducto The failure of performance is measure by a foreseeable manner test.o Hindsight can be used to determine if the benefits outweigh the costs of an

alternative designo Risk/utility analysis consists of: gravity of danger, likelihood of danger,

mechanical feasibility of a safer design, cost of alt. design, and adverse consequences to product

o Burden of proof: In the risk-benefit analysis, the burden of proof is place upon the

defendant The plaintiff is responsible for showing that the product had a

defective design

Castro v. QVC Network (1998):

Facts: Woman buys pan on QVC that claimed it could hold a 25 lbs turkey, but the handles were not big enough for the task and she spilled all the grease on her, suffering burns. The district court instructed the jury together on the two different versions of design defect: (1) UCC—Consumer expectations, (2) Risk/utility Calculus.

Holding: The jury should be instructed on the two different charges. The fact that a product’s overall benefits might outweigh its overall risks does not preclude the possibility that consumers may have been misled into using the product in a context in which it was dangerously unsafe

o Risk/Utility Theory: focuses on whether the benefits of a product outweigh the dangers of its design

Takes into account what is known or ought to be know at the time the defendant acted and all subsequent information that is relevant (Hand formula only takes into account the first part)

o Consumer Expectations: focuses on what a buyer/user of a product would properly expect that the product would be suited for.

UCC: the product was not minimally safe for its expected purpose (this asks whether the manufacturer or the user is in the best position to decide about safety

o Modified Consumer Expectation Test: incorporates risk/utility factors into the consumer expectation analysis

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FAILURE TO WARN: A warning need only be one that is reasonable under the circumstances and the manufacturer need not warn of every mishap or source of injury that the mind can imagine flowing from the product. (Hood)

Hood v. Ryobi America Corp. (1999):

Facts: Man buys saw. Saw had many warnings not to remove guards. Man removes guards, saw chops him up. He sues saying the warnings were insufficiently specific and inadequate to alert him of dangers.

Holding: A warning need only be one that is reasonable under the circumstances and the manufacturer need not warn of every mishap or source of injury that the mind can imagine flowing from the product.

Liriano v. Hobart Co. (1998-99):

Facts: New immigrant to the United States is grinding meat at an Associated in the Bronx. The grinder’s guard had been removed. His hand and arm are made into meat.

Certification question of NY State Court: Can manufacturer liability exist under a failure to warn theory in cases in which the substantial modification defense would preclude liability under a design defect theory?

NY State Holding: Manufacturer liability for failure to warn may exist in cases where the substantial modification defense would preclude liability on a design defect theory.

o A manufacturer who places a defective product on the market that causes injury may be liable for the ensuing injuries

Manufacturer not liable for injuries caused by substantial alterationso A product may be defective when it contains a manufacturing flaw, is

defectively designed, or fails to provide adequate warnings for the use of the product

o A manufacturer has the duty to warn of the danger of latent dangers resulting from foreseeable uses of it product and unintended uses of a product provided these uses are reasonably foreseeable

Manufacturer may be liable for failing to warn against the dangers of foreseeable misuse of its product

This is an ongoing duty to warn of dangers that are revealed by user operation and are brought to the attention of the manufacturer

This is a fact-specific inquiry.o A safety devise is often the most effective way to communicate a warningo There is a limited class of hazards that do not need warnings:

Patently dangerous or pose open and obvious risks Readily apparent as a matter of common sense Fact-specific inquiry

Holding: A jury could find that (a) it is feasible to reduce the risk with safety guards, (b) such guards are made available with the grinders, and (c) that the grinders should be used only with the guards.

o Clarity of Danger Question: is when a danger is so obvious that a court can determine, as a matter of law, that no additional warning is required

The Holmes view is not followed, it must be a fact specific inquiry (Wirth dissent)

o Causation: whether or not the defendant’s negligence was the cause-in-fact of a plaintiff’s actual injury from the general fact that negligence like the defendant’s tends to cause injuries like the plaintiff’s

If negligence exists, the very causal tendency of that negligence to cause injury is enough to establish a prima facie case of cause-in-fact

The law presumes normality and requires that the defendant to adduce evidence that the case is an exception

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Macdonald v Ortho Pharmaceutical Corp

The manufacturer has a duty to provide the consumer written warnings conveying reasonable notice of the nature, gravity, and likelihood of known or knowable side effects, and advising the consumer to seek fuller explanation from the prescribing physician or other doctor of any such information of concern to consumer.

Just because the warning was adequate under FDA labeling requirements doesn't necessary mean it achieved the reasonable duty to warn which is controlled by state law. That is a question for the jury

Learned Intermediary: Prescription drug is not reasonably safe due to inadequate instructions or warnings regarding foreseeable risks of harm are not provided to (a) prescribing and other health care providers in a position to warn; or (b) patient when manufacturer knows or has reason to know providers will not be in position to reduce risks of harm in accordance with warnings.

Liability vs. Regulation (Chavell article): When you think about doing things by regulation or liability, it’s like you have two different tools and you can use one or the other

o Difference in knowledge about risky activities.i) Private parties have an inherent advantage of knowledge so that falls under

liability.ii) This could tip the other way though, for instance we might want the FDA to

regulate.o Private parties might be incapable of paying for the full magnitude of harm done.

i) This leads to regulation.ii) If an individual is facing liability, but has limited assets, then I might be

exposed to liability beyond my assets, so there is no point to insuring larger liabilities. I can get away with more while being asset proof.

o Parties would not face the threat of suit for harm done.i) Regulationii) The whole mechanism of tort liability is only going to work if individuals

come forward and sue.iii) When there is an identifiable victim and wrongdoer (tree overhang, running

for the bus) it’s good.iv) But where the harm is very diffuse and there is some difficulty in getting

everyone together. o Administrative costs incurred by private parties and the public.

i) Torts and liability.ii) The tort system is ex post is only going to be paying the costs in the

instances of injury, which are fewer. iii) With regulation you have to regulate everyone, even those not causing

harm.

PREEMPTION: When the rule of law for which petitioners contend would stand as an obstacle to the accomplishment and execution of the important means-related federal objectives, it is pre-empted. (Geier).

Express: say exactly that there should be no further standards beyond the federal standard, could enact national standards

o Could have a preemption clause and a savings clause

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Impliedo Field: Congress has intervened and created a robust system that they dominate the field

If savings clause exists, probably not going to analyze this, instead with move onto conflict

Historically, there is a presumption against preemption, hence this is not really analyzed in tort law

o Conflict: Issues where the federal scheme inherently clashes with the state scheme Impossibility: Compliance with the fed law, makes it impossible to adhere to

another regulator (legal, erectable)

Geier v. American Honda Motor Co. (2000):

Facts: Petitioner driver collided with a tree and was seriously injured. Petitioners sued respondent car manufacturer, claiming that respondent had designed its car negligently and defectively because it lacked a driver's side airbag. Claim preemption because of National Traffic and Motor Vehicle Safety Act of 1966.

Holding: It was pre-empt by Federal Motor Vehicle Safety Standard (FMVSS) 208. FMVSS 208 sought a gradually developing mix of alternative passive restraint devices for safety-related reasons. The rule of state tort law for which petitioners argued would have stood as an obstacle to the accomplishment of that objective, and the statute foresaw the application of ordinary principles of preemption in cases of actual conflict.

o The court has repeatedly declined to give broad effect to saving clauses where doing so would upset the careful regulatory scheme established by federal law

o When the rule of law for which petitioners contend would stand as an obstacle to the accomplishment and execution of the important means-related federal objectives, it is pre-empted

o While pre-emption fundamentally is a question of congressional intent, the court traditionally distinguishes between express and implied pre-emptive intent, and treats conflict pre-emption as an instance of the latter. And though the court has looked for a specific statement of pre-emptive intent where it is claimed that the mere volume and complexity of agency regulations demonstrate an implicit intent to displace all state law in a particular area, so-called field pre-emption, the court has never before required a specific, formal agency statement identifying conflict in order to conclude that such a conflict in fact exists

Schwartz: Ideal would be to return to the contracts norm. People could come to the forum and make tradeoffs to what insurances they would actually enjoy.

o Because perfect information does not exist, it has moved to tort lawo Rather than interrogate product quality, the court should focus on the disclosure:

people should receive more information about each of their productso Does not believe in risk-utility because courts and juries are not competent to do this

type of analysis (he would take risk-utility over consumer expectations) Consumer expectations is too vague, that juries would be able to interpret it

however they see fito Courts should apply strict liability with a component of contributory negligence and

assumption of the risk (no comparative negligence) We want the consumers to act as though the product is optimally safe and any

deviation from that fact would negligence

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Warnings indicate risk levels and provide directions for safe use (this is a departure from general negligence conception of warnings)

There should be a regulatory compliance test: would have a symmetry between regulatory compliance and negligence per se

Would reduce the amount of liability Appeal to an outside standard (as opposed to the hand formula—

internal standard) Strong bias in favor of bureaucrats as deciding these case

Wyeth v. Levine (2009):

Facts: A Vermont jury found that petitioner drug manufacturer had failed to provide an adequate warning of the risk of directly injecting its drug into a patient's vein and awarded damages to respondent patient for the amputation of her arm. The Vermont Supreme Court affirmed. The manufacturer's petition for certiorari was granted on whether Food and Drug Administration's (FDA's) drug labeling judgments preempted state law product liability claims.

Holding: The purpose of Congress is the touchstone in every pre-emption case. In cases where there is no enumerate preemption, you start with the assumption that the historic powers of the States were not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress.

o Manufacturer failed to demonstrate that it was impossible for it to comply with both federal and state requirements (Impossibility Preemption)

o It has remained a central premise of federal drug regulation that the manufacturer bears responsibility for the content of its label at all times. It is charged both with crafting an adequate label and with ensuring that its warnings remain adequate as long as the drug is on the market.

o An agency regulation with the force of law can pre-empt conflicting state requirements. In such cases, courts perform their own conflict determination, relying on the substance of state and federal law and not on agency proclamations of pre-emption.

o Courts have attended to an agency's explanation of how state law affects the regulatory scheme. While agencies have no special authority to pronounce on pre-emption absent delegation by Congress, they do have a unique understanding of the statutes they administer and an attendant ability to make informed determinations about how state requirements may pose an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.

o The weight courts accord the agency's explanation of state law's impact on the federal scheme depends on its thoroughness, consistency, and persuasiveness.

Dissent: Turning a common-law tort suit into a “frontal assault” on the FDA’s regulatory regime for drug labeling upsets the well-settled meaning of the Supremacy Clause and our conflict pre-emption jurisprudence.

o Juries may not second-guess the FDA’s labeling decisionso Express Congressional intent is irrelevanto Supremacy Clause applies to a state tort law that merely countermands a

federal safety determination (DOT rule should be the same as FDA preamble)o Agencies are by far in the best position to make a decision about the risks

over the long term Juries only go with a fact-specific analysis.

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DAMAGES

COMPENSATORY DAMAGES: There are two types of compensatory damages:

Pecuniary Damages: damages to compensate the victim for the economic consequences of the injury, such as medical expenses, lost earnings, and the cost of custodial care.o Hard to measure future damages:

By using a per diem approach, you are making small hourly differences that add up to a huge net difference

Nonpecuniary Damages: those damages awarded to compensate an injured person for the physical and emotional consequences of the injury, such as pain and suffering and the loss of the ability to engage in certain activities.o Grounds for controversy:

Are there actually separate categories What should be included? Should they be included at all? Variation in the amount of damages:

i) Fairnessii) Confidenceiii) Deterrence: don’t know what to expectiv) Expensive to administerv) Insurance theory: individuals themselves don’t choose ex ante to insure

against noneconomic damages (they choose to insure for economic damages). Will buy life insurance for themselves, but not their children

Bovbjerg Solutions:o Scheduling Model: Provide a matrix and determine values based upon those different

categories of harmo Scenario-Based System: Provide juries with a case that is comparibleo Caps: not recommended

Chamallas:o Structural bias within tort law:

i) Hierarchy of damages: Property (Male) damages valued more than emotional damages (Female)

o Comparable worth theory: There is gender segregation in jobs that leads to a sizable disparity in earnings between male and female.

i) Status Composition Hypothesis: Jobs and organizational structure may be fundamentally influence by gender

o Need to use a blended table of men and womeno You are perpetuating differences from the past into the futureo Argument: Tort law should not just be a reflection but a pro generator of equalityo Tort reform has forced attorneys to be more direct with how they approach and argue

damages

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McDougald v. Garber (1989):

Facts: Plaintiff underwent surgery by defendant doctor and suffered severe brain damage as a result of oxygen deprivation, leaving plaintiff comatose. On appeal, the court modified the award and granted a new trial on nonpecuniary damages on the basis that the trial court had erred in its jury instructions. Argument was made that you have to have some consciousness to receive nonpecuniary damages.

Holding: The justification for damages ends when it ceases to serve the compensatory goals of tort recovery. If a person is not conscious, money damages have no meaning or utility to the injured person.

o Corrective Justice Approach: To compensate the victim, not punish the wrongdoer. Goal is to restore the injured party to the position that would have been occupies that the wrong not occurred

Punitive damages are only allowed in situations where the harmful conduct is intentional, malicious, outrageous, or otherwise aggravated beyond mere negligence

o Application of this murky process to the component parts of nopecuniary injuries cannot make it more accurate. Distortion will be amplified by repetition.

o Paradox situation: the more you are injured, the less you are able to recover (because you would be less likely to be able to use the damages

O’Shea v. Riverway Towing Co. (1982):

Facts: A cook is injured when she is exiting a boat. The injury is such that she cannot be a cook any longer and she is such an age and background that it is unlikely that she would be able to get another job.

Holding: A person only has to mitigate future damages when by reasonable diligence find gainful employment, give the physical condition in which the accident left you. Wages are not to be determined based upon previous wages.

o You are entitled to damages based on what they would have earned in the future rather than on what they may or may not have earned in the past

o The object of discounting lost future wages to the present value is to give the plaintiff an amount of money which, invested safely , will grow to sum equal to those wages.

McMillan v. City of New York

Facts: Black man rendered quadripeligic due to the negligent crash of a ferryboat. Evidence entered to show that black people with spinal cord injuries have shorter life expenctancies, so this race-specific data should be used to calculate damages.

Holding: Racially based life expectancy and related data may not be utilized to find a reduced life expectancy for computing damages. Different damages based on race is unconstitutional. Equal protection demands that claimant not be disadvantaged in damages due to "racial" classification.

PUNITIVE DAMAGES: serve a broader function: aimed at deterrence and retribution.

Products Liability: Often require that the plaintiff prove, by clear and convincing evidence, that the defendant have actual knowledge of the defect and deliberately disregarded the consequences

Corporations: They can be imposed upon a corporation no matter if the staff that cause the wrong is no longer employed by the company

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o Theory: encourage the stockholders to be more vigilant

Using funds for State Projects: This has been upheld in Fl (33% go to state), but denied in CO as an unconstitutional taking of private property without just compensation.

o It is not the plaintiff’s property—you encourage them to go after it by giving them a share of the damages (real reason for the damages is for deterrence, not for the actual plaintiff as those damages should have been covered in the other compensatory judgments

o It serves retributive rights—It is a part of the plaintiff’s damages and suffering

Nonparties: Punitive damages cannot used to punish a defendant for injury that is inflicts upon nonparties or those whom they directly represent (“strangers to the litigation”) (Phillip Morris)

Due Process: Judicial review must be allowed to occur, provide sufficient procedualr safeguards against “the danger of arbitrary awards”

o BMW: $2 mil for a car that was repainted and sold as newo They are constitutional if they fulfill their historical role of punishing the defendant for

the private wrong committed upon the individual plaintiff, but they are unconstitutional in their recent incarnation as punishment for the public wrong visited on society.

Theories:o Deterrence (Calabresi): Ensure the wrongdoer bears all the costs of its actions and it is

thus appropriately deterred from causing harm, in those categories of cases in which compensatory damages alone result. In systematic underassessment of costs, and hence in systematic underdeterrence.

o Retribution/Social outrage: While the courts demand a manufacturer to make cost-benefit calculations, juries hate these and punish people for them

o Societal Compensation: the redress of harms caused by defendants who injure persons beyond the individual plaintiffs in a particular case

Sustein Article:Reasons for Punitive Damages:

Deterence: Works if and only if it is easy to identify the injurer, bring suit, and collect full damages. Punitive damages is to ensure that the award of compensatory damages is supplemented by an amount sufficient to cause wrongdoers to internalize the costs of their actions

o Social judgment: that certain subjective gains ought not to be allowed to count in a global utility calculus

o What about other regulatory controls Retribution: Damages are meant to punish as well as to deter. A community’s outrage at

certain forms of behavior

Constitutionality Are always constitutional Unconstitutional as violations of the Due Process Clause of V and XIV Amend when they are

grossly excessive Unconstitutional as violations of Due Process Clause when they are too likely to be arbitrary

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Study Findings: Juries are not good for optimal deterrence:

o Ordinary people do not spontaneously think in terms of optimal deterrence when asked questions about appropriate punishment, and it is very hard to get them to think in these terms

o Hindsight Bias Retribution is the major factor. They are very good at measure the scale of punishment and

liability Juries should decide liability and judges should decide on the appropriate level of punitive

damages, just as they do in criminal case, with guidelineso Elicit punitive intent

Kemezy v. Peters (1996):

Facts: Off-duty police officer beat person with club. The jury returned a verdict with $20,000 in punitive damages. Appealed based upon the notion that it is the plaintiff’s burden to introduce evidence concerning the defendant’s net worth for purpose of equipping the jury with information essential to a just measurement of punitive damages.

Holding: The majority rule, which places no burden of production on the plaintiff, is sound

o Main goal of punitive damages is to punish defendant for reprehensible conduct and to deter him and other form engaging in similar conduct

o Other reasons that have been given (none of them depends on the amount of wealth that a defendant has):

Compensatory damages do not always compensate fully: Need to provide full compensation without impeding socially valuable conduct

Ensure there is proper deterrence: compensatory damages might be too low to deter

Want to ensure it is in line with the market costs of the transaction: That someone will not be encourage to act because the transaction costs are low

Expresses the community’s abhorrence Relieves the pressures of the criminal justice system Prevents people from going after self-help

o It would not be good to force plaintiffs to disclose, because a plaintiff would always seek punitive damages in order to show that the defendant has deep pockets and should be forced to pay a large amount no matter what

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State Farm v. Cambell (2003):

Facts: There was a crash. State Farm told them not to settle. They lost, sued State Farm for bad faith. Utah Supreme reinstated a $145 mil punitive damages claim as a penalty for a national scheme of fraud where 1 in 50,000 cases were being discovered. Year and half of emotional distress.

Holding: The 14th Amendment guards against grossly excessive and arbitrary punishments on a tortfeasor. This is to give fair notice not only of the conduct that will subject him to punishment, but also of the severity of the penalty that a state may impose. Few awards beyond a single digit-ratio will satisfy Due Process.

o Compensatory Damages: are intended to redress the concrete loss that the plaintiff has suffered by reason of the defendant’s wrongful conduct

o Punitive damages: serve a broader function: aimed at deterrence and retribution

o Prongs of BMW (goal: application of the law, not the decisionmaker’s caprice): Degree of reprehensibility of the misconduct

Physical vs. economic Indifference to or a reckless disregard for the health or safety

of others Target was financially vulnerable Repeated action or isolated incident Harm result of intentional malice, trickery, or deceit v. mere

accident (Ratio factor)Disparity between the actual or potential harm suffered

by the plaintiff and the punitive damages award Difference the punitive damage award and the civil penalties

o A state cannot punish a defendant for conduct that may have been lawful where it occurred. Nor, as a general rule, does a State have a legitimate concern in imposing punitive damages to punish a defendant for unlawful acts committed outside of the state’s jurisdiction

May not use evidence of conduct that is legal in another state to show illegal conduct in home state (States should be able to say what is legal and what is not

o The existence of a criminal penalty does have bearing on the seriousness with which a State views the wrongful action

Punitive damages are not a substitute for criminal penalty

Dissent: (Scalia) There is no federal guarantee a damage award will actually be reasonable. Due Process Clause provides no substantive protection. (O’Connor) The laws of the particular State must suffice to superintend punitive damages awards until judges or legislators authorized to do so initiate system-wide change .