Strict Liability Flashcards
Strict Liability
Tort liability without the requirement of fault
Generally used for arm caused by an abnormally dangerous activity.
A Case of Strict Liability is found where:
- the risk (probability) of harm is great;
- the harm that would ensue if the risk materialized is great;
- yet, such an accident cannot be prevented by the exercise of due care;
- the activity is not a matter of common usage;
- the activity is inappropriate to the place in which it takes place;
- the value to the community of the activity doesn’t appear to be great enough to offset its unavoidable risks
Factors to Determine if something is Abnormally Dangerous
- The activity creates high risk of significant harm, which can’t be eliminated even with reasonable care by all actors, and is reasonably foreseeable to the D
- Activity isn’t a matter of common usage, or is not commonly carried on, in the local community or area
- The P’s injury flows almost solely from that aspect of the activity that makes it abnormally dangerous and must not depend on the actions of persons other than the D engaging in the activity
These factors are not a checklist - rather a balancing act
Most important factor is the level of reasonably foreseeable danger than can’t be eliminated with reasonable care; common usage is also important
Fletcher v. Rylands
Strict Liability
F: P owned and operated a mine next to D’s constructed artificial pond. There was a soil defect under the pond which cause water to leak into P’s mine, cause a shaft collapse, which caused a flood.
I: Does the D have an absolute duty to take all reasonable a prudent precautions when he brings something on his land that would do harm if it escapes?
H: Yes. When the D willfully brings an item on his land that isn’t naturally there and causes damage if it escapes, the D will be held strictly liable. D is allowed to keep such material on his land, but he does so at his own peril.
This case involves principles of fairness and responsibility
Prima Facie Landowner Strict Liability (from Fletcher)
A person who for his own purposes:
- Brings on his lands (that is not naturally there) and collects and keeps there anything
- likely to do mischief if it escapes, must keep it in at his peril, and
- if he doesn’t do so (if it does escape), that is prima facie answerable for all the damages which is the natural consequence of its escape
Not sure if this is right or not?
Sullivan v. Dunham
Strict Liability
F: D hired men to dynamite a 60 ft tree on the land. Blast hurled a fragment of wood that struck the P and killed her.
I: Was this an abnormally dangerous activity that imposes strict liability on the Ds?
H: Yes. An individual is liable for injuries caused to a person or property due to activities like blasting where the injury is direct and not consequential w/o need for proof of negligence. Both parties were acting lawfully; however, when the D’s actions/exercise of his rights cause harm to the P’s “higher rights” (life over property), D will be liable for his actions.
Restatement Factors for Abnormally Dangerous Activites
- Existence of a high degree of risk
- likelihood the harm would be great
- inability to eliminate risk using reasonable care
- Activity not of common usage
- Inappropriate place where activity occurred
- Extent that the activity has community value
Indiana Harbor Belt RR Co. v. American Cyanamid Co
Strict Liability - Stream of Commerce
F: D (manufacturer) loaded a bunch of cyanamid on a train (extremely flammable, toxic, and possibly carcinogenic). When it was stopped at a switching line (P), they discovered that it had leaked significantly. Rail line had to be evacuated to clean up spill.
I: Was the D strictly liable where D was not involved in the transportation and the inherent properties of the chemical did not cause the spill?
H: No. Negligence captures the risk in this case and is sufficient - if they had exercised due care the accident wouldn’t have happened. If the chemical itself and eroded through the train and caused damage that way, then strict liability would be more appropriate. Posner also said that it wasn’t fair to hold D to a strict liability standard to events downstream that are out of their control.
Prof: There are aspects of this activity that can’t be eliminated through the exercise of due care - transporting a very dangerous chemical through a largely populated area, for example.
Primary Goals of Strict Liability
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Loss-Spreading: Spread losses caused by accidental injuries among a broad class of persons
- “Bottom Dollar” Thesis
- Depends on the extent to which the actor can anticipate and evaluate the underlying risk, take appropriate steps to insure against the loss, then pass the loss onto consumers
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Loss Avoidance/Risk Reduction: Imposing liability in a way that reduces the number and severity of accidents
- Requires that the defendant be able to properly evaluate the risks and make a sound cost/benefit judgment
-
Loss Allocation (Internalization): The loss should be initially borne by the enterprise whose activities engendered it and whose activities sufficient connected (caused) the harm/loss
- Underlying premise of Fletcher v. Rylands
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Administrative Efficiency: Seek to achieve an acceptable level of administrative costs
- removes the need for proving fault
- most strict liability cases would involve settlement
- Fairness: it’s the defendant that caused the risk, yet the P was the one who was harmed
- Protection of Individual Autonomy
The Ideology of Enterprise Liability
Two Kinds of Justice Considerations
- Corrective Justice
- Distributive Justice
Torts is a mix of both of these - even though there are some who strongly prefer one over the other
Corrective Justice
Ideology of Enterprise Liability
- Liability rectifies (corrects) injustice inflicted by one party on another
- Corrective Justice rests on a baseline that assumes that parties are lawfully entitled to what they have at the beginning of the transaction
- Injustice occurs when one party unlawfully gains by imposing a loss on the other
- Corrective justice is satisfied when the law restores through liability whatever each party is entitled to have
- It follows that corrective justice is correlative: Liability is imposed b/c what the perpetrator has taken is what the victim has lost
Ex: D took something that belonged to P - D laid a trap for P - D took advantage of P’s weakened position - etc.
Distributive Justice
Ideology of Enterprise Liability
- Pertains to the scheme through which various goods (wealth, power) and bads (risk, deprivation) are allocated to individuals
- Some criterion for just distribution is thus necessary - such as need, desert, equality, etc.
- Distributive justice is achieved when distribution occurs according to an accurate comparison of the individuals according to the selected criterion
- Assigning liability to the D will allow loss/risk/cost spreading to consumers (diffusion of cost/compulsory/self-insurance)
- Limiting the duty of the D will prevent ruinous liability
Economic Considerations with Strict Liability
- Unlike an ordinary negligence regime, with strict liability the D will automatically consider “optimal activity” by weighing the potential benefits of the harmful activity in comparison to costs
- When the most efficient method of accident prevention is found by the D changing the activity level, strict liability should be imposed
- Costs of Litigation and Court also vary between negligence and strict liability
- strict liability is cheaper b/c there are fewer issues, but it could also increase the number of damages claims
Cheapest Cost Avoider
Calabresi
By Calabresi & Hirschoff - more left of center b/c of Loss Spreading idea
Cheapest cost avoider: Liability should be placed on the party who can most cheaply avoid the loss, not on wrongdoer
Primary Costs:
- Cost of Injury and everything that flows from injury
- Basically try to figure out which party in a given situation is in the best position to make the cost-benefit analysis between accident costs and accident avoidance costs
- Who knows or can learn about the risk? Who can act?
- Should one party engage in their activity less? or find an alternative?
Secondary Costs:
- Loss Spreading - assign the cost to the person in the best position to spread it out (like a business who can charge higher rates, but take on cost of loss)
- Declining marginal utility of the dollar: my next dollar is worth more to me than Bill Gate’s next one.
Tertiary Costs: Administrative Costs of Running the System:
- Error costs v. Decision costs (inversely related)
- If you use simple hard-line rules, you’ll have larger error costs but less decision costs
3 Goals of Tort Law
- Corrective Justice: D is responsible for repairing wrongs to P
- Compensation: Primary concern w/ compensating injured victims
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Economic Efficiency/Incentives: Examines whole system to achieve optimal level of deterrence, rather than focusing on particulars to P and D
- Cheapest Cost Avoider
- Loss Spreader
- Hand Formula
Strict Liability v. Negligence
Posner
Posner represents the right-wing of economics of law
- Strict liability means P will be compensated for:
- cost/benefit unjustified (negligent injury) and,
- cost/benefit justified (non-negligent injury)
- Strict liability is like a rule where negligence is like a standard
- Cost of errors v. Cost of running the system
- Strict liability results in more errors, but less systematic costs
- Cost of errors v. Cost of running the system
- Willingness to pay is a function of the intensity of desire AND budget
- If you’re poor, you’re not willing to pay
