Notes re Palsgraf:

    Controversial:
    Friedman thinks it illustrates an "implausible chain of causation"

    Cardozo, for the 4-3 majority: "[plaintiff] must show that the act as to him had possibilities of danger so many and apparent as to entitle him to be protected against the doing of it"
    Andrews, for the dissent: "Everyone owes to the world at large the duty of refraining from those acts that may unreasonably threaten the safety of others.... [W]hen injuries do result from our unlawful act we are liable for the consequences. It does not matter that they are unusual, unexpected, unforeseen and unforeseeable. But [t]he damages must be so connected with the negligence that the latter may be said to be the proximate cause of the former."

    See Posner's review of the case, pp.33-41.

    "Partly as a consequence of the Palsgraf case, it is now standard practice everywhere for railway employees to discourage running on platforms. Under the standard procedures of today, the unnamed passenger with the package would have been stopped by the platform conductor, not boosted onto the train." (Barnes and Stout)
    Scales are also located away from passenger areas

    Logically, the Palsgraf decision itself did not provide the incentives for these adjustments.

    D. Liability

    You are driving down a busy street.
    You are distracted by an attractive pedestrian who is provocatively dressed
    You crash

    Is the provocatively dressed pedestrian liable?

    Liability requires 3 ingredients: (1) harm; (2) causation and
    (3) breach of a duty owed to the plaintiff by the defendant

    Liability topics:
    1. negligence
    2. victim fault
    3. strict liability
    4. joint liability

    1. Negligence

    United States (p) v. Carroll Towing Co. (d,app), 159 F.2d 169 (1947)
    Cast: The Conners Marine Co., Inc., was the owner of the barge, ['Anna C'] which the Pennsylvania Railroad Company had chartered; the Grace Line, Inc., was the charterer of the tug, 'Carroll,' of which the Carroll Towing Co., Inc., was the owner. U.S. is a claimant on the lost cargo. Grace Line: chartered tug Carroll to get the barge, after which Anna C got free and sank. Grace Line blamed for its harbor master not ensuring Anna C was secure; all blame Anna C for absence of bargee. Grace Line and Carroll both blamed for not ensuring secure line for Anna C and held responsible for collision damage; but absence of bargee held responsible for 1/3 of sinking damages.

1. What are the facts of the case?
2. This case is most famous for its consideration of whether Conners, the owner of the Anna C barge was negligent by not having a bargee aboard--how does the judge suggest addressing this issue?
3. Why not automatically assume that the bargee should have been there?
4. Did the judge consider the barge owner to be negligent?
   yes--bargee should have been there during working hours

    explicitly states the classic negligence rule
    "if the probability be called P; the injury, L; and the burden, B; liability depends upon whether B is less than L multiplied by P: i.e., whether B < PL."
    Judge: Learned Hand
    Hand formula: B < P·L
    Econ formula: MCs < |dPr/dS·L|

    We call B the marginal cost of safeguards (MCs) and stipulate that P is the marginal change in probability of injury |dP/dS|, but the court decision explicitly aims at defining negligence in economic terms: the failure to take cost-justified precautions.

    United States v. Carroll Towing Co. (1947) is one of the most famous of all tort cases, with a famous judge

    perhaps the most famous and respected US judge who never served on the Supreme Court. (served on 2d circuit court of appeals)
    full name: Billings Learned Hand
    served 52 years, until his death in 1961 (officially retired in 1951)
    Famous in antitrust: his 1945 Alcoa decision made monopoly virtually per se illegal (and was designated a Supreme Court precedent since the S.Ct. could not come up with a quorum)

    Saglimbeni (p) v. West End Brewing Co. (d,app) , 274 A.D. 201; 80 N.Y.S.2d 635 (1948)

1. What are the facts of the case?
2. You are the judge: Defendant is found to have exercised ordinary and reasonable care in marketing safe bottles.
   Would you award damages?
3. You are the judge: Defendant is found to have exercised care that was usual and customary for the bottling industry.
   Would you award damages?
4. Did the appeals court hold the brewer liable? yes

    Affirms that negligence is based on the reasonable-person standard
    People vary in fact, so someone negligent under the law per the reasonable-person standard may not be truly negligent.
    Information costs of person-specific negligence standard is high

    Where differences in capacity to avoid accidents are ascertainable at low cost, the courts do recognize exceptions to (or subclasses of) the reasonable-person rule. For example, blind people are not held to as high a standard of care as sighted ones, although within the class of blind people a uniform standard of care is imposed. (P171)

    Resulting issue: how does the court decide what is reasonable as a practical matter?

    illustrates that compliance with custom is not a defense
    "the defendant's duty [is] to exercise the care that a reasonably prudent and careful person would exercise.... Common usage is a test of negligence to be considered by the jury but not a conclusive test."

    there is no presumption that the average safety level in the industry is optimum (P172)
    major exception: medical malpractice (since the involved parties are provider and customer, no 3rd party effects)  (P172)

    2. Victim fault

    Under a negligence rule, victim fault becomes an issue only if the defendant is negligent
    Otherwise, we have only an accident, not a tort, and the case is over

    a. Alternatives under the law

    Option 1: simple negligence

    Defendant negligence => automatic liability
    No follow-up consideration of victim behavior
    Example: Winn-Dixie

    Butterfield v. Forrester, King's Bench, 11 East 60 (1809)
    p = horse rider; d = injurer, homeowner

1. What are the facts of the case?
2. Had the defendant injurer been negligent?
3. So why not award the plaintiff damages?
4. Who had the last clear chance in this case, the injurer or the victim? plaintiff--speeding caused the injury

    Illustrates Option 2: "contributory negligence"
    => after asking whether the defendant had been negligent and concluding that he had (if he had not, that would be the end of the case), ... ask whether the plaintiff had been negligent. If the answer was "yes," the plaintiff lost. (P173)
    from the case: "One person being in fault will not dispense with another's using ordinary care for himself."

    Not all victim negligence is contributory--injurer remains liable if injurer's negligence supersedes the contributory negligence
    Davies v. Mann: defendant injurer had the last clear chance to avoid injury despite victim negligence in tying up the donkey

    Contributory negligence must be a proximate cause of the injury at the time the injury occurs

    Dobson (p) v. Louisiana Power & Light Co. (d), 567 So. 2d 569 (1990)

1. What are the facts of the case? (8000 volt line v. 2000 for executions)
2. A power company explicitly informs a tree cutter that its power lines can be uninsulated. The tree cutter then gets electrocuted from an uninsulated power line. Would you hold the power company liable for damages?
3. A power company informs a tree cutter that it is available for assistance and has helped the tree cutter in the past with insulated single-residence power lines. The tree cutter gets electrocuted from an uninsulated distribution line.
   Would you hold the power company liable for damages?
4. A power company has actual knowledge that an inexperienced tree cutter will be operating near uninsulated distribution lines, and provides no warning. The tree cutter gets electrocuted from an uninsulated distribution line.
   Would you hold the power company liable for damages?
5. What ruling did the appeals court reach?
   Power company liable for 60% of damages + costs

    As in Butterfield v. Forrester, the court acknowledges victim negligence: "Actual lack of knowledge by victim is not sufficient to find lack of victim fault: "Any person is required by law to recognize that his conduct involves a risk of causing harm to himself if a reasonable person would do so while exercising such attention, perception of the circumstances, memory, knowledge of other pertinent matters, intelligence and judgment as a reasonable person would have.... [Plaintiff's] failure to take precautions to avoid the risk of which he should have known amounted to negligence."

    Illustrates Option 3: Comparative negligence: "We do not think that the unreasonableness of [defendant's] conduct was so great as to be double the fault of [plaintiff]. But we conclude that a palpable majority of the fault should be attributed to the [defendant] in order to achieve substantial justice in this case. Accordingly, we attribute 60% of the negligence herein to [defendant] and 40% to [plaintiff].

    b. Economic analysis of legal options

i = injurer     v = victim     efficient level of combined precautions:     Si* and Sv*     At S*: MBs = |dP/dS x L|         = MCsi = MCsv     efficiency => both sides must internalize L.

    Option 1: simple negligence: victim collects if Si < Si*
    Option 2: contributory negligence: victim collects if Si < Si* 
        and Sv > Sv*
    Option 3: comparative negligence: victim collects qi of loss, where
    qi = the injurer's share of combined negligence:
           = (Si* - Si) / [(Si* - Si) + (Sv* - Sv)]

    Conduct under alternative legal rules: see handout