Showing papers on "Damages published in 1986"

Legislator Uncertainty, Legislative Control, and the Delegation of Legislative Power

Abstract: On May 2, 1878, the House Commerce Committee favorably reported a bill "to regulate interstate commerce and to prohibit unjust discrimination by common carriers." Known as the Reagan bill, after the chairman, John Reagan, of Texas, H.R. 3547 outlawed rebates and other forms of discrimination and included a restrictive longand short-haul clause. The bill did not establish a federal commission to enforce the law, however, providing only that aggrieved shippers could bring suit in the federal courts and, if successful, could recover triple damages. To supply additional enforcement incentives railroads were to be fined a minimum of $1,000 for each offense, this amount to be divided between the government and the "informer." After lengthy debate and the addition of a provision outlawing pools (agreements to split traffic or revenue) the Reagan bill passed the Democratic House, only to disappear without a trace in the Republican Senate.l Senate inaction stalled the regulatory drive until 1885. In that year the Republican Senate adopted a bill reported by a select committee chaired by

Product safety and product liability — An analysis of the EEC Council Directive of 25 July 1985 on the approximation of the laws, regulations, and administrative provisions of the Member States concerning liability for defective products

Abstract: After more than ten years of fierce European product liability debate, the Council has finally promulgated the Directive 85/374 in an attempt to harmonize Member State law about the responsibility for defective products. The directive starts out from the principle of strict liability, but allows certain exceptions mostly concerning the so-called “state of the art” which, however, according to the author should be narrowly interpreted. Compensation due to the consumer because of damage suffered from a defective product includes both personal injury and property damage, but does not expressly allow for pain and suffering. The directive gives Member States power to have (global) ceilings for personal injury compensation, and contains rigid limitations for property damages. Implementation of the directive must be undertaken by the Member States by August 1, 1988, but leaves it to their discretion to have different rules concerning liability for agricultural products and for development risks, thus putting law approximation in danger. In his conclusion, the author is of the opinion that the directive is less a means to protect the consumer in the event of damage than a means of regulating safety aspects of products freely circulating in the Common Market. It is the task of the judges — of the Member States and the European Court of Justice — to determine the safety standards of products and to harmonize these within the EEC.

Contract Remedies and Inalienable Rights

Abstract: I. IntroductionTwo kinds of remedies have traditionally been employed for breach of contract: legal relief and equitable relief. Legal relief normally takes the form of money damages. Equitable relief normally consists either of specific performance or an injunction – that is, the party in breach may be ordered to perform an act or to refrain from performing an act. In this article I will use a “consent theory of contract” to assess the choice between money damages and specific performance. According to such a theory, contractual obligation is dependent on more fundamental entitlements of the parties and arises as a result of the parties' consent to transfer alienable rights.My thesis will be that the normal rule favoring money damages should be replaced with one that presumptively favors specific performance unless the parties have consented to money damages instead. The principal obstacle to such an approach is the reluctance of courts to specifically enforce contracts for personal services. The philosophical distinction between alienable and inalienable rights bolsters this historical reticence, since a right to personal services may be seen as inalienable.I will then explain why, if the subject matter of a contract for personal services is properly confined to an alienable right to money damages for failure to perform, specific enforcement of such contracts is no longer problematic. Finally, I shall consider whether the subject matter of contracts for corporate services is properly confined to money damages like contracts for personal services, or whether performance of corporate services can be made the subject of a valid rights transfer and judicially compelled in the same manner as contracts for external resources.

The logical case for "wrongful life".

Abstract: Suits that claim that a child would be better off never having been born often founder on conceptual and logical dilemmas. However, the correct interpretation of "wrongful life" does not require a comparison between existence and nonexistence. The New Jersey Supreme Court's decision in the Procanik case to limit damages to extraordinary medical expenses, barring recovery for pain and suffering, is a reasonable resolution.

The Economics of Antitrust Compliance

Abstract: The typical Fortune 500 corporation spent nearly $6 million in the decade of the 1970s on antitrust fines, damages, court costs, out-of-court settlements, legal fees, and compliance with the demands of antitrust investigations. This was a 350 percent increase over the 1960s. Attorneys' fees increased the cost to more than $20 million. The number of antitrust cases brought against the Fortune 500 increased approximately 40 percent from the 1960s to the 1970s, when 60 percent of the outcomes were adverse.' Between 1960 and 1980, the intensity of antitrust enforcement activities by government and private parties increased dramatically,2 as did the scope of corporate antitrust compliance programs. These changes are reflected in surveys of the perceptions of attorneys and managers about the antitrust enforcement climate in which they work.3 Yet, violations show little sign of abating.4

The Therapeutic Significance of Compensation Structures

Abstract: This article deals with the therapeutic significance of claims for damages and other types of compensation, and of the processes relating to claims. It examines the influences of legal structures and processes in promoting the recovery of a patient/client from disablement, or in alleviating or aggravating the development of a disability. It is concerned in particular with the spill-over influences of claims on the formation of medical opinions, on the selection of treatment, on patients' responses to treatment, and on rehabilitation. The article examines the assumption that compensation systems promote a widespread psychological problem of "secondary gain", "monetary gain", or "compensation neurosis". The author explains why the assumption exists and he examines its validity. The article provides a commentary relevant to the conduct of claims, and it also seeks to identify the therapeutic significance of structural alternatives in the design of compensation systems .

The intentional infliction of purely mental distress

Abstract: The law of torts today seems to distinguish between three types of personal 'injury'. There is first of all physical or organic injury, secondly there is mental or psychiatric injury (commonly described as 'nervous shock') and thirdly there is purely mental distress, that is, mental or emotional distress unaccompanied by any physical injury or 'nervous shock'. Can a plaintiff who has suffered any one of these three types of personal 'injury' recover damages from a defendant who has intentionally' but indirectly2 (or consequentially) inflicted such an 'injury' on him? The short answer in Britain and Australia3 is that in relation to intentionally and indirectly inflicted physical injury or nervous shock, damages are recoverable but in relation to purely mental distress the matter is much less clear. The purpose of this article is to attempt to clarify this question. Since Bird v Holbrook4 in 1828 it is clear that the courts are prepared to grant a remedy to a plaintiff in an action on the case for damages where it can be shown that the defendant has done an intentional act for the express purpose of doing physical harm to the plaintiff and has in fact succeeded in causing physical injury to the plaintiff even though the physical harm is caused indirectly or consequentially. The action on the case for damages for physical injury is available not only in relation to intentional acts but also in relation to intentional statements which are intended to cause physical harm to the plaintiff. That this is so is well illustrated by the decision of Wright J. in Wilkinson v Downton' which is familiar to all tort lawyers. Further, the action on the case for damages is also available for the intentional infliction of nervous shock. Even though the plaintiff did not succeed in the Australian case of Bunyan v Jordan,6 for reasons which it is not necessary to go into here, Dixon J (later Chief Justice) of the High Court of Australia made it quite clear that an action on the case for damages for nervous shock is available if a defendant by his act or statement intends to cause nervous shock to a plaintiff and succeeds in doing so. As he said: 'I have no doubt that such an illness (i.e. a sufficiently emotional condition to lead to a neurasthenic

Detrebling versus Decoupling Antitrust Damages: Lessons from the Theory of Enforcement

Abstract: This continent compares two alternative systems of private antitrust enforcement. In one (referred to as the "damage multiplier approach"), the plaintiff receives what the defendant pays; in the other (the"decoupling approach"), this constraint is not imposed. Reducing treble damages to single damages("detrebling") would be an example of the first approach. Making the defendant pay treble damages while only giving the plaintiff single damages would be an example of the second approach. It is shown, using the principles of the the economic theory of enforcement, that the decoupling approach is preferable to the damage multiplier approach, and that the optimal system of decoupling could award the plaintiff more or less than what the defendant pays. Several additional issues are raised that need to be considered before decoupling can be recommended in practice.

Neo-no-fault remedies for medical injuries: coordinated statutory and contractual alternatives.

Abstract: Suits to recover for personal injuries resulting from medical malpractice can be among the most unpredictable and most complex to litigate. Because provider fault is frequently difficult to measure-even (and sometimes especially) with the assistance of the parties' alleged (and opposing) expertsa lay jury is apt to be influenced more by its subjective and emotional reaction to the injured patient's plight than by the appropriateness of the defendant's conduct. Thus, lengthy and costly litigation can yield unpredictable results, and this unpredictability raises the costs of claims evaluation and often makes settlements harder to reach. Perceptions of the system as a game of chance rather than as a sound mechanism for catching negligent behavior may undercut the system's value in raising professional standards and deterring injuries.' If providers of health care believe that the legal system lacks the capacity to be reasonable and may penalize even the appearance of negligence, they may err in the direction of practicing inefficient "defensive medicine" by spending large amounts to make it appear that nothing was spared in the plaintiff's case. The system's haphazardness also diminishes its value as a protection for injured patients. One seriously injured party may recover nothing at all or far less than fair compensation, while another receives an award far in excess of his actual loss. Inconsistency is enhanced by allowing juries to award damages for such noneconomic losses as pain and suffering and loss of consortium. Because monetary valuation of such nonmonetary losses is inherently irrational, plaintiffs are encouraged to play upon the jury's sympathy, further distracting attention from the issue of provider fault. The cost of the tort system is also increased, without increasing its value as a

The Therapeutic Significance of Compensation Structures

Abstract: This article deals with the therapeutic significance of claims for damages and other types of compensation, and of the processes relating to claims. It examines the influences of legal structures and processes in promoting the recovery of a patient/client from disablement, or in alleviating or aggravating the development of a disability. It is concerned in particular with the spill-over influences of claims on the formation of medical opinions, on the selection of treatment, on patients' responses to treatment, and on rehabilitation. The article examines the assumption that compensation systems promote a widespread psychological problem of "secondary gain", "monetary gain", or "compensation neurosis". The author explains why the assumption exists and he examines its validity. The article provides a commentary relevant to the conduct of claims, and it also seeks to identify the therapeutic significance of structural alternatives in the design of compensation systems.

Punitive and Nonpecuniary Damages in Actions Based Upon Contract: Toward Achieving the Objective of Full Compensation

Abstract: The stated objective of contract remedies is to compensate the aggrieved party fully for breach by putting her as closely as possible in the same position as she would have been had the contract been performed.l Because of the traditional and still largely prevailing preference of Anglo-American law for substitutional remedies, courts seek to fulfill this full-compensation objective largely by awarding monetary damages rather than by granting specific performance or other equitable relief. It is now almost commonplace, however, to recognize that traditional contract damage remedies leave many victims of contract breach (probably a substantial majority) undercompensated. One reason for this situation is that there is an important and countervailing corollary to the principle of full compensation: Do not overcompensate the victim of contract breach; As others have shown, this desire to avoid overcompensation has multifaceted origins. Most important among these is the fear that excessive liability for contract breach may discourage valuable commercial and economic activity and thus create an undesirable barrier to the efficient reallocation of resources. Because of these concerns, the corollary of avoiding overcompensation has dominated the principle of full compensation for the past century.This Article reviews the recent (circa 1985-86) developments concerning punitive and nonpecuniary damages in actions founded upon breach of contract, regardless of whether the pleadings are framed in contract or in tort, and focuses on both the overt and the covert ways in which courts recently have permitted these recoveries.In the course of this review, I argue for a broader and more overt recognition of both nonpecuniary loss and punitive or supracompensatory damages in contract. Ultimately, however, I also suggest a substantial reformulation of objectives with respect to "punitive" damages in contract. These new objectives would shift the primary focus from deterrence and punishment to complete and full compensation for contract plaintiffs, at least in situations involving egregious breach. I make these suggestions fully recognizing the risks of abuse and overcompensation inherent in permitting recovery for such open-ended items as mental distress and punitive damages and acknowledging that these risks are presently of substantial concern with respect to punitive damage claims in tort actions. An appreciation of these risks and the recognition that they already may have become reality in some contract actions, particularly in some punitive damages awards against insurers for bad faith refusal to pay or settle claims, leads me to recommend that careful attention be paid to the standards for awarding nonpecuniary and punitive damages and that new procedural safeguards be employed when determining and awarding punitive damages. Before discussing these recommendations, however, it is necessary to examine more fully the ways and the extent to which traditional contract damage remedies systematically tend to undercompensate contract plaintiffs.

Nonmarket Valuations of Accidental Oil Spills: A Survey of Economic and Legal Principles

Abstract: This paper presents an overview of legal and economic theories used to assess liability and damages for loss of nonmarket goods arising from an accidental oil spill Several different economic methods used for quantifying values are discussed and critiqued Also reviewed are the fundamental legal doctrines that permit individuals and public agencies to seek compensation for these damages To illustrate the applicability of these economic and legal theories, two case studies are presented and evaluated in terms of the principles presented earlier

Legal aspects of sinkhole development and flooding in karst terranes: 1. Review and synthesis

Abstract: Structures built within the area of influence of a sinkhole can be affected by collapse, subsidence, or flooding Unanticipated property losses may be involved, and litigation commonly ensues Insurance compensation for damages that result from sinkhole collapse or subsidence in a karst terrane are covered by statute only in Florida and by voluntary agreement of companies operating in Tennessee Liability or insurance compensation for damages resulting from sinkhole flooding is not specifically covered by any state or federal statute Regulations of the National Flood Insurance Program have been interpreted to allow coverage by this program for homes affected by sinkhole flooding in Bowling Green, Kentucky In the present article, case law, legal concepts of groundwater and surface water, liability, and law review articles relevant to sinkhole litigation are summarized The rationales of plaintiffs and defendants are reviewed Liability for damages have been based on allegations of negligence, breach of various water law doctrines, trespass, nuisance, loss of support, breach of contract, and implied warranty of habitability Defenses against these allegations have been based on the merits of each of them and oncaveat emptor Several alternative rationales for claiming liability for losses incurred because of sinkhole development or flooding are proposed and discussed The little-knownHenderson v Wade Sand and Gravel is highly recommended as an alternative leading case that clearly and justifiably gives protection to adjacent landowners, and ties liability for damages caused by groundwater pumpage to nuisance law and related interference with property rights Several little-known litigated cases of sinkhole development in response to groundwater pumpage will be summarized in a second article at a later date Concepts of liability are evolving It can be expected that the professional geologist or engineer will have an increasing number of claims made against him or her which allege responsibility for sinkhole-related damages Such damages can often be prevented by creative zoning, sound engineering, and better husbandry of land

Detrebling versus Decoupling Antitrust Damages: Lessons from the Theory of Enforcement

Abstract: This continent compares two alternative systems of private antitrust enforcement. In one (referred to as the "damage multiplier approach"), the plaintiff receives what the defendant pays; in the other (the"decoupling approach"), this constraint is not imposed. Reducing treble damages to single damages("detrebling") would be an example of the first approach. Making the defendant pay treble damages while only giving the plaintiff single damages would be an example of the second approach. It is shown, using the principles of the the economic theory of enforcement, that the decoupling approach is preferable to the damage multiplier approach, and that the optimal system of decoupling could award the plaintiff more or less than what the defendant pays. Several additional issues are raised that need to be considered before decoupling can be recommended in practice.

Efficiency and Justice in Tort Damages: The Shortcomings of the Pecuniary Loss Rule

Abstract: WE wish to investigate how far tort law on pecuniary loss can, by appropriately fashioned rules, achieve two goals: percent incentives for allocative efficiency in accident precautions and full corrective justice, in the sense of restoration of the distribution of wealth to the status quo ante casu. In the usual accidents case both are achieved: damages simultaneously provide compensation for the victim and incentive for the injurer to take precautions. Where pecuniary losses are concerned, because of contracts and proprietary rights, there may be gainers as well as losers. If the law is constrained not to remove the gainers' gain, then the allocative efficiency aim and the corrective justice aim will in general not be compatible: damages sufficient to compensate all who suffer pecuniary loss will give to the tortfeasor an excessive incentive to take accident precaution, while damages sufficient for incentive maintenance will be inadequate to compensate for all unjustly caused losses. The pecuniary loss rule is roughly this: even where a plaintiff can prove that the defendant was negligent, he cannot get damages if the loss he suffered was purely pecuniary. Only if the plaintiff suffered some physical injury to his person or property can he recover pecuniary losses resulting from that injury. We begin by stating four propositions that form the basis of our argument. i) Allocative Efficiency. For allocative efficiency the damages payable to the tortfeasor cannot depend on either contracts about or property rights in the thing damaged.

Racism, psychological injury, and compensatory damages.

Abstract: Psychiatrists and other mental health professionals have paid only modest attention to the idea that discriminatory conduct causes emotional suffering for those who are the object of it. However, courts have held that if such racist conduct is willful and outrageous and the ensuing suffening is severe, the plaintiff has a reasonable claim to compensatory damages. The authors trace these developments in the legal arena in both tort actions and complaints under civil rights statutes. They also point out how psychiatrists could be more influential in sharpening considerations about the idea that racism causes psychological injury.

Damages for Personal Injury and Death

Abstract: This practical working manual considers many recent and far-reaching developments in damages for personal injury and death. Both the general practitioner and the specialist will find the advice and information provided useful when handling personal injury cases. The work will be equally useful to those investigating insurance claims in this field. The book is a stage-by-stage guide to the conduct of cases and the calculation of damages and it sets out the pre-trial considerations (including litigation), damages on death, danages for pecuniart loss and future pecuniary loss. pecuniary in "the lost years". the actuarial assessment of damages and damages for non-pecuniary loss. The book includes case summaries and statutes and important case and statutory developments are considered.

The Welfare Implications of Costly Litigation in the Theory of Liability

Abstract: One of the principal results in the economic theory of liability is that, assuming litigation is costless, the rule of strict liability with compensatory damages leads the injurer to choose the socially appropriate level of care. This paper reexamines this result when litigation is costly. It is shown that strict liability with compensatory damages generally leads to a socially inappropriate level of care and to excessive litigation costs. Social welfare can be increased by adjusting compensatory damages upward or downward, with the desired direction depending on the effect of changes in the level of liability on the injurer's decision to take care and on the victim's decision to bring suit.

Justice in Settlements

Abstract: INTRODUCTIONIn any society relatively few disputes are brought to judges for resolution. Most are handled informally or forgotten. Fewer still are cases that go to trial. Most are settled. Compromises are reached even in cases where issues are hotly contested and where millions or billions of dollars in damages are claimed. Recently, for example, one of the most controversial lawsuits of our time, the Agent Orange case, was settled. In that case, veterans of the Vietnam War, their spouses, and their children alleged that a defoliant — Agent Orange – used in Southeast Asia contained dioxin and was responsible for deaths, debilities, miscarriages, and birth defects suffered by members of the plaintiff class. Class members argued that the manufacturers of the defoliant, seven major chemical companies, knew that it was tainted and should be made to compensate them for their injuries, claiming billions of dollars in damages. The case received national exposure and became a rallying point for veterans, a means they hoped to use to publicize their plight and to spur Congress to come to their aid. On the eve of trial, the case was settled. The defendants, who denied liability throughout the pretrial period, agreed to pay the veterans $180 million. In turn, the plaintiff class agreed to drop the suit. Thus ended a controversy which not only presented novel legal issues and tested the ability of the federal courts to handle complex lawsuits, but concerned the well-being of a large number of veterans, their spouses, and their handicapped children as well.

Economic welfare, price and profit: the deterrent effect of alternative antitrust regimes

Abstract: This paper critically examines the deterrent effect of price-fixing statutes under alternative antitrust regimes. A regime is defined by the litigation strategy which the antitrust agency employs in detecting cartels and in determining whether prosecution is warranted and by the basis upon which courts estimate damages. The results of the analysis suggest that antitrust policy may actually induce cartels to further restrict output, increasing welfare loss above the level imposed by an unthreatened, perfect monopoly. Litigation strategy and damages should be founded upon consideration of welfare loss measures to avoid this possibility.

Compensation for personal injury: the Swedish alternative

Abstract: The "Swedish Alternative" for compensating personal injuries, the subject of the colloquium, can be roughly described as follows. The basis is a highly developed system of general social insurance which provides compensation for all kinds of economic loss due to disease, accident or death, and consequently also for personal injuries. The benefits lie far above subsistence level, and they accordingly cover the greater part of the economic loss due to an injury. The benefits are deducted from tort damages and there is no recourse against a tortfeasor. The losses which the insurance covers are therefore removed entirely from the sphere of tort liability. The general social insurance is supplemented by other means of indemnification. For work-related injuries and diseases, there is a special-compulsory and state-operated-insurance that provides benefits by which most of the economic loss not indemnified by the general social insurance is compensated. Some other institutions provide benefits that are not dependent on the cause of the loss. These include sick-leave pay, employers' pensions, and group sickness and pension. The insurance benefits are also deducted from tort damages without any recourse against tortfeasors, and they accordingly also reduce the damages that can be recovered from tortfeasors. The remaining gaps, including pain and suffering, are sometimes covered by tort liability and sometimes by "no-fault" insurance of different types which provides compensation on the same level as tort damages, i.e., with the aim of covering the economic loss in full and the non-economic loss to the extent that it corresponds with current principles (an admittedly vague description). One such insurance is compulsory and regulated by statute but operated by private insurers. It is the motor traffic damage insurance. There are three other types that are voluntary and privately operated on the basis of group agreements of various kinds. These are "security insurance for work-related injuries" (another expression sometimes used in translation of the Swedish name is Labor Market No-Fault Liability Insurance), "patient insurance" and "pharmaceutical insur-

Entitlement and the body politic: rethinking negligence in public law

Abstract: In using the law of negligence to extend the liability of public bodies for the recovery of losses associated with negligent or inadvertant state or, bureaucratic inaction, the courts have distorted the principles of private law. Tort law is inadequate for the task of formulating the obligations public bodies owe to private individuals, as the state is a fundamentally different kind of body than are actors in the private sector . The authors set out, and argue for, a new principle or ground for defining the duties of the state: a principle of entitlement which rests on the presupposition that, while the state has the right to decide what benefits individuals are to receive, once the state has conferred those benefits upon any group, its members are entitled to that benefit, or to damages in lieu thereof.

The Principles Governing the Recovery of Damages for Negligently Caused Nervous Shock

Abstract: Two “landmark” decisions on the recovery of damages for negligently caused nervous shock have now been delivered in two years by the highest courts in Britain and Australia— McLoughlin v. O'Brian by the House of Lords in 1983 and Jaensch v. Coffey by the High Court of Australia in 1984. Despite these decisions, it is difficult to say that the principles of law to be applied in such a case can be stated with absolute clarity and one tends rather to sympathise with the view of Comyn J. in Whitmore v. Euroways Express Coaches Ltd . that “no absolutely clear picture emerges and many of the judgments speak with different voices.” Nevertheless, certain principles in this area are clear and others are becoming clearer, and a statement of these principles now might be of assistance in allowing an absolutely clear picture to emerge.