Thursday, April 17, 2008

Simons on Negligence and Cost-Benefit Analysis

Kenneth Simons (Boston) has posted Tort Negligence, Cost-Benefit Analysis and Tradeoffs:  A Closer Look at the Controversy on SSRN.  Here's the abstract:

What is the proper role of cost-benefit analysis in understanding the tort concept of negligence or reasonable care? A straightforward question, you might think. But it is a question that manages to elicit groans of exasperation from those on both sides of the controversy.

For most utilitarians and adherents to law and economics, the answer is obvious: to say that people should not be negligent is to say that they should minimize the sum of the costs of accidents and the costs of preventing accidents. Under the economic formulation of the famous Learned Hand test, they should take a precaution if but only if the marginal costs (or burden, B) of that precaution are less than its marginal benefits (in the form of reduced risks of injury, measured by multiplying the probability (P) of the injury times the magnitude (L) of the injury if it occurs). If B>PxL, it would be absurd to require the greater expenditure, B.

For many advocates of a fairness, corrective justice, rights-based, or contractualist perspective, the opposite answer is equally obvious. Permitting a person to impose risks of harm on others merely because he would thereby obtain a benefit (or would otherwise incur a burden) greater than the discounted value of the harm he might inflict, amounts to authorizing him to dump the costs of his risky activities on innocent victims. To permit this type of sacrifice of individuals on the altar of aggregate social welfare is morally abhorrent.

Both sets of criticism have important elements of truth. Neither an unqualified cost-benefit analysis nor an unqualified rights-based rejection of tradeoffs is defensible - either as a description of tort doctrine and practice or as a normative prescription. However, a qualified (sensitive) consequentialist approach can accommodate legitimate criticisms of cost-benefit analysis: the consequentialist can launder preferences, and can consider the distribution of risk both in the social welfare calculus and in determining whether to compensate. At the same time, a qualified (tough-minded) deontological approach can accommodate the legitimate need to recognize tradeoffs: the deontologist can permit intrapersonal but not interpersonal aggregation of risks and benefits, can apply the concept of threshold deontology to risky activity, and can consider individual rather than population risk. I conclude that the formulation of the Learned Hand test found in the Restatement Third of Torts is broad enough to encompass each of these qualified approaches.

(Via Solum/Legal Theory Blog)

--CJR

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Comments

Naturally both sides peddle appalling, insulting, lying lawyer propaganda. The audience here has to consist of children if it buys any of it. The Rent Seeking Theory explains all torts and anomalous appellate decisions. Those it does not explain, are explained by judge bribery.

No one derives any benefit from torts except the lawyers on both sides and the little tyrant in the middle. If torts achieved any of these lies, the lawyer would relinquish all self-dealt immunities and enjoy the benefits of torts himself. Until these lawless, self-dealt lawyer and judge immunities end, all lawyer claims are lies and hypocrisy. Sell it to the Marines. They just got off the bus from home.

To the viewers of The Sopranos, torts has a familiar and simple explanation. At the point of a gun, the lawyer profession extorts its taste from all productive entities. One thing Tony does not do? He takes money by force. However, he does not consume a 1000 hours a year of wasted time on litigation from his crime victims.

This Rent Seeking Theory fully justifies total self-help against the land pirate. There is full intellectual and moral justification to shoot Tony. Feed his body to the pigs, when he shows up to collect. He is not even human. He deserves no human consideration. To deter. Watch the local economy bloom from his remains as fertilizer.

The central doctrines of torts are supernatural and violate the Establishment Clause. The word, reasonable, means, in accordance with the New Testament. The core of duty, foreseeability of rare injuries, is a supernatural power. These violations makes all torts pretextual, and lawless.

Posted by: Supremacy Claus | Apr 17, 2008 7:50:28 PM

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