Corrective Justice "Making the victim whole,"

Strict liability is liability imposed without regard to the negligence of the defendant.

Historically, plaintiffs had to categorize their cause of action as either trespass or case. Trespass required a direct and forceful harm and the defendant could escape liability only by proving that he was utterly without fault. Case was brought for harms that werer indirect or consequential and operated on a negligence standard.

The negligence standard replaced the trespass/case distinction (Brown v Kendall – held that there was no liability for a defendant who accidentally hit the plaintiff while the defendant was trying to break up a dogfight unless that defendant failed to exercise reasonable care.)

What was the reason for the rise of negligence in the 19th century? 

a. Morton Horowitz: Rise of negligence standard created immunity from legal liability in order to provide a kind of subsidy to infant industry (harder for injured workers to obtain damages).

b. Modernizing the outdated, specific writ system into more general legal principles

The modern standard for strict liability was developed in a series of cases dealing with flooding disasters. (Rylands v Fletcher – held that a defendant was strictly liable for the damage caused by his broken reservoir on the plaintiff’s underground mines even though the defendant was not negligent.) Courts in the United States initially resisted this standard. (Brown v Collins – rejected Rylands and declined to impose strict liability) (Turner v Big Lake Oil Company – rejected strict liability as inapplicable to Texas, since large water cisterns were a natural use of the land in a dry climate.) But after the Johnstown Flood 1889, more and more courts were willing to hold defendants strictly liable for flooding harm. (Shug says) This shift was led by elected judges, especially those who had been elected to long terms. Democratic role fidelity combined with political insulation to erode judicial resistance to holding defendants strictly liable for these types of disasters.

Old categories = fire, animals, nuisance, respondeat superior

New categories = blasting, ultrahazardous activities, products liability for manufacturing defects

1. Nuisance

A Nuisance is a substantial and unreasonable interference with the right of an owner or occupier of land to the use and enjoyment of the land.

[[NB: Nuisance is distinct from trespass, which involves interference with the right of possession and occupancy of land.]]

There are two kinds of nuisances: public and private. A public nuisance is not a tort, but a low-level quasi-criminal offense that affects the general public in common. In contrast, a private nuisance is simply a nuisance that does not affect the public at large, but particular individuals. Private nuisance actions do sound in tort.

Remedial options for private nuisance include:

a. Damages

In determining whether or a defendant’s private nuisance activity should be remedied by damages or an injunction, courts might look to the particular context and balance the equities involved. (Boomer v Atlantic Cement – held that plaintiff should be awarded permanent damages as opposed to an injunction for a nuisance claim because of the disproportionate importance of the defendant’s factory use.)

If the plaintiff has come to the defendant’s nuisance, the court may require the plaintiff to purchase the injunction from the defendant. (Spur Industries v Del Webb Development – held that a real estate developer who brought homeowners to the nuisance of defendant’s feed lot should pay for the damage that the defendant would sustain in moving or shutting down.)

The decision that there is no nuisance protects the defendant with a property right, which he can decide to sell or not sell, at his price. Similarly, a decision enjoining the defendant from continuing a nuisance protects the plaintiff with a property right, which she can decide to sell or not, at her price. An award of future damages to the plaintiff protects the plaintiff with a liability right or liability rule only and with an entitlement set by the jury, rather than the plaintiff. An award of future damages to the defendant protects the defendant with a liability right or liability rule only and with an entitlement set by the jury, rather than the defendant.

2. Abnormally Dangerous Activities

Strict liability is imposed for injuries caused by activities—ordinarily uses of land—that were first termed “ultrahazardous” and that are now termed “abnormally dangerous.”

The two factors that determined whether an activity was ultrahazardous were the degree of danger it posed and how common it was in the area. The more dangerous and the less common the activity, the more likely it was to qualify as ultrahazardous.

The new test for abnormally dangerous activities included three different factors affecting dangerousness (degree of risk, probability of harm, and inability to eliminate the risk by the exercise of reasonable care), two factors affecting the commonness (the extent to which the activity is uncommon and its “inappropriateness” to the area), plus a new consideration: the extent to which the value of the activity to the community is outweighed by its dangerousness. (Second Restatement 520)  Note that the “value to community” standard is now disfavored because that isn’t really a question of law. Courts are moving away from this value question.

Factors that affect the court’s willingness to impose SL for Abnormally Dangerous Activities include:

a. Policy Factors

The threat of liability for an abnormally dangerous activity furthers goals of deterrence, efficiency, and judicial economy. It places the burden on the best cost avoider. (Holmes – “it may be considered that the safest way to secure care is to throw the risk upon the person who decides what precautions shall be taken.”)

If a defendant benefits from participation in an abnormally dangerous activity, it may be fairer to make him internalize the social costs of his activities along with his profits. (Powell v Fall – held that when defendant’s locomotive threw sparks that started a fire on plaintiff’s farm, even though the defendant was not negligent, the defendant should have to compensate the plaintiff for the damage because the defendant benefits from being able to use a dangerous machine.)

If the evidence of negligence is likely to be destroyed in the tort arising from a dangerous activity, the court may decide to make the defendant bear the cost of the accident. (Siegler v Khulman – the court imposed strict liability for gas transported on public highways, because it is very dangerous to transport, the magnitude of harm is very high, and the evidence of any negligence is likely to be destroyed in an explosion.)

If the accident could have been prevented by reasonable care and the accident could not have been prevented by a change in the overall activity, then a court may decline to impose strict liability on a defendant. (Indiana Harbor Belt RR v American Cyanamid Co – the court didn’t impose strict liability when defendant’s chemical spilled in plaintiff’s railroad yard because reasonable care could have prevented the accident and the alternative way of transporting the chemical would not have reduced the harm.)  Shug says that this case was wrongly decided because Transportation of toxic chemicals is paradigmatic ultra-hazardous activity; very high magnitude of risk, even if reasonable care is used. Plus, Posner’s “activity level” analysis is at a low or intermediate level. There are lots of more general alternatives: find different methods of transport (specialized rail cars), make the material less flammable or toxic). Posner is not the “best cost avoider” expert. Put liability on the actors themselves and their chemists and consultants.

Affirmative Defenses to Strict Liability for Ultra Hazardous Activities

a. If the harm is not within the risk of the ultra-hazardous activity, there may be no recovery for the plaintiff. (Madsen v East Jordan – held that minks eating their young because of the loud noise caused by an explosion was not the harm within the risk of blasting)

b. If there is unforeseeable 3rd party intervention, the defendant may not be held liable for the ultra-hazardous activity. But if the intervention was foreseeable, then recovery is allowed. (Yukon v Fireman’s Fund – held that thieves blowing up a factory to cover their tracks was foreseeable)

c. Plaintiff’s assumption of risk bars recovery (2nd Restatement 523)

d. Plaintiff’s contributory negligence is not a defense except when the plaintiff is contributorily negligent in knowingly and unreasonably subjecting himself to the risk of harm.  Shug thinks that you should use comparative risk creation analysis

e. There is no strict liability if the harm would not have resulted but for the abnormally sensitive character of the plaintiff’s activity.

The principle example of vicarious liability—liability for injury caused by the conduct of another party—is the doctrine known as respondeat superior. Under this doctrine an employer is liable under some circumstances for the torts committed by an employee.

Requirements:

1. The agent of the defendant be an employee.

2. The tort at issue must be committed within the scope of employment. If the employee is off on a frolic of his own, the employer is not liable, but if the employee takes a small detour, then the employer is liable. In determining whether or not an employee was acting within the scope of employment, courts have focused on foreseeability and proximity/access (Bushey v United States – held that the defendant employer was liable for the damage caused by its employee drunken sailor to the plaintiff’s drydock.)

Pro: Places the risk on the best cost avoider; deep pockets reduce the risk of insolvency; ensures loss spreading

4. Products Liability: Manufacturing Defects

Strict Liability is imposed for manufacturing defects. (Greenman v Yuba – held that a manufacturer was strictly liable for a product that does not conform to his own design.) This idea was first developed in Justice Trayor’s concurrence in Escola v Coca Cola (the majority decided a case where a bottle of coke exploded and injured the plaintiff on res ipsa loquitur). Traynor advocated for strict liability for these types of injuries because:

1. Companies are the best cost avoiders.

2. Companies are the best insurers.

3. Res ipsa is not enough protection – the Plaintiff cannot refute evidence of due care because of the complexity.

4. There is currently under the table strict liability anyway.

5. Adopting strict liability would cut out the retailer middleman and reduce litigation costs.

6. Adopting strict liability would do away with all the fictions associated with the warranty-contract rules.

[[BUT Note that design defects adhere to a negligence standard instead of SL. To determine whether a design defect was negligent, there are two tests: risk-benefit/risk-utility test (which asks whether the risks posed by the design outweigh its benefits) and the less-favored consumer expectations test (which states that if the design is not as safe as consumers expect it to be, then it is defective  this is pretty circular though).]]

Affirmative Defenses to Strict Liability for Products Liability:

a. Contributory negligence: The Second Restatement says if the contributory negligence was the consumer’s failure to discover defect or guard against potential defect, there is no defense. But if the contributory negligence was more like the assumption of risk (the specific consumer discovered a hidden defect and proceeded to use it voluntarily and unreasonably) then the plaintiff is barred from recovery.

b. If the plaintiff’s negligence combines with the defect to cause the harm, the result is less clear. (Daly v GM – held that the jurors should engage in equitable apportionment of liability.)

Under the duty of reasonable care, breach asks whether the defendant’s actions were negligent. Negligence is the failure to use that degree of care that a reasonably prudent person would have used under the same circumstances.

[[NOTE: THIS CATEGORY DOES NOT APPLY TO STRICT LIABILITY.]]

A. Foreseeability

A defendant is negligent if he knew or reasonably should have known that his actions posed a risk of harm. Consequently, a person cannot be negligent for failing to take precautions against an unforeseeable risk of harm. “Foreseeability” in this context refers to the known or knowable possibility that there exists a risk that will result in harm. (Blyth v. Birmingham Waterworks – held that that a directed verdict should have been granted for the defendant because the risk was so improbable that as a matter of law a reasonable person need not take it into account in determining what precautions to take.

BUT NOTE that today, Blyth would almost certainly pose a question of fact for the jury. Few risks are so unforeseeable as to warrant granting a directed verdict to the defendant on that ground alone. But even if the improbability of the risk that caused harm is not, in itself, a basis for exonerating the defendant, this factor may figure in the overall cost-benefit negligence calculation.)

B. Untaken Precautions/Cost-Benefit Analysis

Generally

A defendant is negligent if a reasonable person under the circumstances would have taken precautions that the defendant did not take in order to avoid that risk. Cost-benefit analysis is one way of assessing the reasonableness of untaken precautions. This view uses economic efficiency to define reasonableness.

The cost-benefit analysis formula described by Learned Hand and advanced by Richard Posner states that a defendant is negligent if the cost of the untaken precaution is less than the probability of the accident multiplied by the magnitude of the harm.

A defendant is negligent if B

the burden/cost of the untaken precaution (B)

the probability of the accident (P) multiplied by the magnitude of the harm (L)

(United States v Caroll Towing – held that it was a fair requirement for Connors to have a bargee on board because the B was less than PL in this case)

1. According to Academics and Appellate Courts

Not every precaution is worth taking. If the cost of safety measures/curtailment exceeds the benefit in accident avoidance to be gained by incurring that cost, society would be better off, in economic terms, to forgo accident prevention. When the cost of accidents is less than the cost of prevention, a rational profit-maximizing enterprise will pay tort judgments to the accident victims rather than incur the larger cost of avoiding liability. (Posner, Theory of Negligence).

1. The Hand formula offers more guidance in assessing ‘reasonableness’ and ‘foreseeability,’ because it is a less subjective standard.

2. It also focuses on broader social goods and total utility across society, as opposed to the interest of just one plaintiff.

3. For the plaintiff, the “untaken precaution” is a clear tool for focusing litigation.

4. The formula both furthers deterrence and avoids over-deterrence because it incentivizes taking efficient precautions, but not those that are wasteful or unnecessary.

Cons:

1. Money and injuries are often incommensurable.

2. There is also a more general challenge of quantifying B and PL. It is a fact-intensive question and information costs are high.

3. Relatedly, there is an institutional challenge in which laypeople like juries and judges are not well equipped to assess the assertions of dueling experts.

4. What is economically rational is not necessarily what is reasonable; there may be a mismatch in values.

2. In Practice

The factors are not usually susceptible to any quantitative estimate, so this type of mathematical analysis is disfavored by trial judges and juries. The Third Restatement calls the elements of the Hand Formula “primary factors” to consider in deciding whether a defendant’s conduct breached the standard of reasonable care. (Third Restatement 3).

The defendant is not required to take a precaution that would benefit the plaintiff but would also cause a greater risk to third parties. Cost-benefit analysis focuses on social goods and total utility, as opposed to self-interest or just the interest of one plaintiff. (Cooley v Public Service Co. – held that a company did not need to use a device that would have prevented harm to the plaintiff but would increase risk to others because the danger to the plaintiff was remote whereas the danger to others was obvious and immediate.)

When the standard is higher than reasonable care, the cost/benefit analysis changes a bit. You don’t need as high of a cost to justify the benefit because the duty owed is that of a very cautious person. (Andrews v United Airlines – suggested that a common carrier would have to demonstrate that a precaution was prohibitively expensive or grossly inconvenient to justify not having taken it.)

A defendant may try to use his conformity with custom as a shield to show that his actions were not negligent. Conversely, a plaintiff may try to use a defendant’s non-compliance with custom as a sword to show that the defendant was negligent. While evidence of custom is both relevant and admissible as to whether a party was negligent, it is not dispositive. (The T.J. Hopper – held that despite the fact that there was no general custom to equip tugboats with radios, it was negligent not to have done so.) (Bimburg v. Northern Pacific Ry. – held that local usage and general custom will not justify or excuse negligence.) (Third Restatement – states that compliance with custom is evidence that an actor’s conduct is not negligent, but does not preclude a finding of negligence.) Principally, it’s relevant simply because it reflects the judgment of a large number of people that engage in an activity as to the reasonable way to conduct that activity. Thus, a practice need not be universal to constitute a custom, although it must be more than just one of a number of different practices.

1. Custom provides clear, bright-line rules for decision-making;

2. The plaintiff may have relied on custom;

3. Custom as the standard for negligence is easier for juries to understand;

4. Custom reflects the wisdom of time and numbers;

5. Custom serves as a shield for Defendant, explaining why he behaved a certain way;

6. Custom corrects against hindsight bias, highlighting what people believed at the time.

Cons:

1. Entire industries can lag, and custom can favor conformity to outdated, and unsafe practices simply because they’re widespread, and disfavor innovative and safer measures just because they’re less common;

2. There is also a problem of defining ‘custom’;

3. Custom tracks the economic self-interest of actors, rather than the broader social good.

In some cases, courts have differentiated internal house rules from statutes and municipal ordinances and stated that internal rules cannot be used as evidence of custom because of the perverse incentives created by enforcing house rules. (Fonda v St Paul City) However, more recent cases have allowed plaintiffs to introduce evidence of the defendant’s internal rules as evidence on the standard of care question. (Lucy Webb Hayes National Training School v Perotti – held that the jury could conclude that a hospital’s failure to observe the standard of care it had established itself represented negligence.)

With regard to professional malpractice (including physicians, attorneys, and accountants) the general rule is that compliance with custom insulates the defendant from liability, and failure to comply with custom is malpractice. In professional malpractice cases, custom is dispositive, not just admissible.

It is also important to note that there are two schools of thought available to medical experts, not just one custom. If a respectable minority practices in a certain way, that testimony can serve as an additional shield against liability.

D. Statutes and Regulations

Some statutes preclude tort liability explicitly or by implication, and other statutes create tort liability for their violation, but most statutes simply say nothing about the role their violation should play in tort litigation.

Unexcused violation of a statute designed to promote safety is negligence as a matter of law. A statute prohibiting a certain action may be used by a litigant to supplement an existing negligence case with dispositive evidence. (Martin v Herzog – held that a plaintiff was contributorily negligent when his buggy was hit by a car because he had violated a statute requiring vehicles to have lights at night, which constituted negligence per se.) (2nd Restatement 286 – states that a court may adopt a legislative enactment or administrative regulation as a standard of reasonable conduct.)

A court may excuse a person from the presumption of negligence created by violating a statute if the violation was necessary or the harm at issue was not within the statutory purpose.

If noncompliance with the statute is safer, then a person may be excused from complying with the statute because of necessity. (Tedla v Ellman – held that a plaintiff was NOT contributorily negligent despite the fact that she had violated a statute that said pedestrians should walk facing traffic in part because it would have been more dangerous for her to comply with the statute since traffic was particularly heavy on that side of the road that day.) (2nd Restatement 288 – states if compliance would involve greater risk of physical harm to the actor, statutory violation is excused.)

If the plaintiff was not within the class of persons, or did not suffer the type of harm, intended to be protected by the statute that the defendant violated, a court may not view violation of the statute as evidence of negligence. (Gorris v Scott – held that, in case where animals where washed overboard in a storm, failure to comply with a statute requiring animals to be penned up on a ship was not necessarily evidence of negligence because the statutory purpose was to prevent the spread of disease.) (Brunett v Imerys Marble Inc. – held that a defendant working in the commercial trucking industry who fell off a truck could not claim that it was negligent not to comply with federal regulations because those regulations were meant to protect miners, not truckers.) HOWEVER, courts often interpret statutory purposes liberally, and if a plaintiff could conceivably have been an intended beneficiary of the statute’s protection, modern courts are inclined to view violation of the statute as evidence of negligence. (Stimpson v. Willington Service – held that a statute whose purpose was to protect streets from harm from heavy vehicles had secondary purpose of protecting property below the streets from injury and allowed plaintiff to use the statute to his advantage under that theory.) (Kernan v American Dredging Co – held regulation specifying the appropriate height of lamps over the water that was aimed at the risk of collision could protect a plaintiff suffered died as a result of a fire caused by a lamp was not in compliance with the regulation.)

Statutory violations do not create private rights of action if no private cause of action would exist at common law. (Uhr v Greenbush did not allow a private right of action for school child that was not screened for scoliosis. The court stated that a private right of action may be implied if (a) The plaintiff is one of the class for whose particular benefit the statute was enacted; (b) Recognition of a private right of action would promote the legislative purpose; and (c) Creation of such a right would be consistent with the legislative scheme.”)