Sandy Steel, Compensation and Continuity
, Oxford Legal Studies Research Paper
(July 20, 2019), available at SSRN
“Wrongdoers may incur duties to compensate the victims of their wrongs.” This, the opening sentence of Sandy Steel’s Compensation and Continuity, sounds like a truism. Who would deny it? It’s hard to imagine the defendant in a normal tort lawsuit conceding liability but insisting that her concession in no way implied responsibility for repairing that wrongfully inflicted harm. In tort law, the obligation to repair harm tortiously inflicted seems to tumble out of the breach of the primary duty to avoid tortiously wronging someone. Moreover, the continuity here seems both reasonable and rooted in basic morality.
Suppose I am cycling past a grove of peach trees. I stop, sample a peach, and decide to fill my pockets and bag with as many peaches as I can. I take them home and make peach pies out of them. Unsurprisingly, it turns out that the peaches weren’t just there for the taking. They were the property of a farmer who was growing them for sale. After reviewing her security tapes and deploying face recognition technology, the farmer shows up at my door demanding compensation. Surely, her demand is justified. I was wrong to have taken the peaches. I committed the tort of conversion, even if my assumption that the peaches were just there for the taking was an innocent mistake. Having baked the peaches into pies I am now unable to return them. So I must compensate the farmer for the peaches. This is what Aristotle called corrective justice and what John Locke called the obligation of reparation. The obligation of reparation seems to be a basic principle of morality, picked up in the law of torts.
Professor Steele’s paper investigates whether the fundamental logic of reparation is persuasively explained by what the late John Gardner called the “continuity thesis”. That thesis explains remedial responsibility to repair in the following way. Failure to perform a primary obligation—to, say, exercise reasonable care to protect the plaintiff from avoidable harm—leaves that primary obligation undischarged. Yet, when that failure leads to avoidable, negligent harm, it also prevents “first-best” conformity with that obligation. It is no longer possible to exercise reasonable care and avoid harming the plaintiff. That impossibility does not, however, extinguish the defendant’s obligation to the plaintiff tout court. Instead, it requires the defendant to do the “next-best” thing and repair the harm that it should have avoided in the first place. That remedial obligation is the rational residue of the undischarged primary obligation. Factually, matters have changed. It is no longer possible to exercise reasonable care and avoid harming the plaintiff. This factual impossibility is not the end of the normative obligation, however. The defendant’s breach of her primary obligation does not discharge that obligation. On the contrary, the failure to perform the obligation leaves it unsatisfied. Indeed, a special responsibility tumbles out of that breach. The defendant’s failure to perform her obligation makes her uniquely responsible for repair the harm that she has wrongly done.The fact that the obligation has been breached is the reason why the defendant must now do what she can to repair the harm that she has wrongly inflicted. As Steele puts it, “[i]f an agent fails to conform to a reason, and that reason persists, the person has a reason to come as close to conformity to the reason as possible.” (P. 4.)
The thought that the normative continuity coupled with factual impossibility explains and justifies reparation in tort (and elsewhere) is intuitively attractive but it presents its own puzzles. For one thing, although it is true that breaching an obligation is not a way of discharging that obligation it does not follow that an undischarged obligation must continue to constrain the person who breached it in some legally enforceable way, as scholars like Arthur Ripstein are plausibly read to assert. Breach of an obligation might extinguish that obligation without discharging it; breach might simply make it impossible to perform the obligation. In fact, we know that some primary obligations in tort do not survive their breach. In the nineteenth century, tort law did not recognize any recovery for wrongful death. Even now, the vast majority of jurisdictions do not attempt to award damages for the value to the victim of the life the victim has lost. In the circumstance where the primary obligation to exercise reasonable care to avoid inflicting harm on the plaintiff is breached and the ensuing harm is death, the law of torts effectively concludes that the failure to discharge a primary obligation brings that obligation to an end. Why should we think that other cases are different? Why should we think that the primary obligation persists when an arm, or a leg, or a table, or a chair is destroyed? As Steele says, “there is no duty not to kill the killed, to keep in confidence information that is no longer confidential, [and] there is no duty not to damage an irreparably damaged arm (in the precise respect in which it was irreparably damaged).” (P. 4.)
For another, upon reflection, there are salient respects in which the obligation of reparation in tort seems to rest on reasons that arise from the failure to comply with the primary obligation. These reasons do not exist prior to the breach of the primary obligation and are not continuous with the reasons which justify the primary obligation in any obvious way. For example, it seems that obligations of reparation grounded on breach of primary obligations to, say, exercise reasonable care are grounded in new reasons created by the breach. It is the defendant’s failure to discharge the primary duty of care which, along with various facts such as causation of harm to the plaintiff, subjects the defendant to an obligation of reparation. Breach of the duty makes the defendant responsible for the plaintiff’s harm and it is that responsibility which explains and justifies the defendant’s obligation of reparation. The tortious wrongdoer singles herself out as uniquely responsible for repairing the harm to the victim because she is uniquely responsible for wrongly inflicting that harm. The wrong, not the original duty, is the ground of responsibility. When, for example, I appropriate the farmer’s peaches without her permission, through that wrongdoing I bring unique responsibilities upon myself. Everyone in the world was under an obligation not to take the peaches, but only I breached that obligation. By doing so, I subjected myself to a special obligation of reparation owed specifically to the farmer.
Third, it is unclear how to characterize the normativity that “continues”. The existence of multiple “continuity theses” evidences the problem. Some scholars assert that continuity of reasons is the key (e.g., John Gardner); other scholars insist that continuity of duty is (e.g., Ernest Weinrib); and still others cast their lot with continuity of right (e.g., Arthur Ripstein). To an outsider, all of this can look like the proliferation of distinctions without differences or, worse, a circumstance where we don’t even know what would make one of these competing versions of the continuity thesis more illuminating than the others, much less which formulation of the thesis is better. Is it, for example, an objection to “duty continuity” that the specific duty not to carelessly break someone’s arm cannot be conformed to once the arm has been carelessly broken? Or does that just show that we must conceive of the relevant continuing duty more abstractly? Perhaps the relevant duty is not a duty to avoid breaking the victim’s arm carelessly but “a ‘duty to respect the victim’s right to the physical integrity of their person.’” When we move to a higher level of abstraction it is unclear why that highly abstract duty calls for the particular action of reparation by the defendant. In some contexts, respecting a person’s right to their body may require recognizing their right to have an abortion. Why does it now call for compensation?
Compensation and Continuity wrestles with these and other questions with subtlety, precision, and insight. It’s a rich and clear paper which advances our understanding it at least three important ways. First, the paper clarifies respects in which claims of reasons continuity, rights continuity, and duty continuity are saying the same thing and respects in which they are disagreeing. Second, the paper argues persuasively that continuity explains some things about reparation but not everything. Breach of a primary obligation, and the responsibility that it brings upon the breaching party, plays a role in justifying many instances of reparation in tort. Other kinds of reasons may also be relevant. In a case like Vincent v. Lake Erie, for instance, reasons relating to the fair allocation or distribution of harm may play a role in explaining the obligation of reparation. Reasons of fair allocation are different from reasons rooted in the commission of a wrong and they may come to bear only after the fact—only when the squall has passed and the loss has landed on the plaintiff. These reasons may interact with reasons rooted in the plaintiff’s pre-existing property rights and the continuing respect those rights demand.
Third, and most originally, in an all too modest way, Compensation and Continuity advances the hypothesis that the normative notion at the bottom of the “continuity thesis” may be value, not reason, duty or right. (Pp. 4, 9, 19-20.) The same value(s) may ground both a duty of non-interference and a duty of compensation. Steele’s arguments here are, in some respects, quite technical. They turn on how we should understand the relations among values, reasons, rights, and duties. But they are also intuitively attractive and restore direction to a debate which was in danger of becoming aimless. For example: the value of individual autonomy might ground the right not to be battered (and the correlative duty not to batter) and also the duty of reparation that a batterer has. Unrepaired physical harm impairs autonomy. Its repair is necessary to restore autonomy. The right not to be battered differs from the right to reparation; they impose different constraints. But the same value underpins them.
Among other things, this line of argument provides a satisfying explanation of why it is that the breach of a primary obligation sometimes ends all relevant obligation and why it sometimes does not. In some cases—when the plaintiff is killed, for instance—there may no way of continuing to serve the value that justified the prohibition on her killing. In other cases—when a table is totally demolished, say—it may still be possible to serve the relevant values by making compensation to the owner of the table sufficient to replace the value destroyed.
There is a still more general lesson, too. Primary and secondary obligations in tort (and elsewhere) form a unity and it pays to put that unity front and center in our thinking about the subject. There are much worse questions to ask than “what value is the law of torts serving here?” Indeed, few, if any, questions are better.
Cite as: Gregory Keating, Why Reparation?
(September 5, 2019) (reviewing Sandy Steel, Compensation and Continuity
, Oxford Legal Studies Research Paper
(July 20, 2019), available at SSRN), https://torts.jotwell.com/why-reparation/
As distributed ledger or “blockchain” technology continues to offer decentralised and distributed decision-making, Yeung considers the way in which those automated processes (code as law) are likely to interact with conventional means of governance (code of law). This technology is based on peer-to-peer verification of transactions: it takes various forms, but the common theme is that the record of transactions is shared with all users of a given system, and transactions only make it on to that record after a fierce process of mathematical ratification. As a result, the intermediaries on which transactions have for so long depended, such as banks, clearing houses and property registries, are no longer required. Altruism and self-interest are aligned because all users have a vested interest in the continued integrity and success of the closed system, and third party intervention is neither required nor (for many users, at least in principle), desired.
Distribution and decentralisation are the crucial components of distributed ledger technology, and are the principle features which distinguish them from those forms of electronic payments which use intermediaries and electronic bank money, such as Paypal, WorldPay and BACS, for example. These characteristics also explain why cybercurrencies are often described as “trustless”, meaning that transacting parties need not have any trust for one another in the real world, so long as they trust the payment protocol (which, for reasons which will soon become apparent, they probably should). Decentralisation in this context simply means that everyone who might want to use the currency, and so has a copy of the relevant software, also has a copy of the ledger. The ledger is a record of every transaction made using that currency, and each computer operating the software (known as a node) has a copy of the entire thing: from the beginning (the “Genesis Block”) to today’s latest block. This is where the term Distributed Ledger Technology (DLT) comes from: Blockchain, which was created to underpin Bitcoin, was the first distributed ledger, but there are now distributed ledgers of several different forms. Common to every one, however, is the idea that all participants have access to the full history of transactions made using that protocol. This is a novel way of dealing with the ages-old double spend problem. Historically, the challenge of how to prevent double spending has been met in two ways: the first is by using physical tokens, whose corporeal form physically prevents their being spent more than once, and the second is by employing an independent third party, such as a bank, to keep a record of transactions and their effects on the subsequent spending power of the parties involved. Cybercurrencies achieve the same thing by sharing information with every user and by ensuring that the information so shared is perfectly synchronised. This way, “coins” cannot be spent twice because everyone would know that this is what was being attempted, and the consensus necessary for validation and recording would not be reached. Security is thus achieved through complete transparency, and distributed ledgers have no need for any centralised record-keeping, nor for any third party intermediary to verify the integrity of transactions.
Such transparency is achieved through what is known as distributed consensus protocol, and this is characterised by two features:
- All computers on the network (referred to as nodes) must agree on which transaction data is ultimately recorded on the ledger
- The transaction data must have been generated by an honest node
The question remains how any of this can be achieved. One method, used by Bitcoin, is known as proof-of-work, and this allows nodes to reach a consensus on which transactions to record and in which order to do so. (The order is of course all-important, as it is with any spending pattern, since what you have already spent determines how much you can spend in the future.) Proof-of-work is the means by which nodes persuade other nodes that the block of transactions that they wish to add to the chain is legitimate and should be trusted. The work involved here is the cryptography: the solving of a mathematical puzzle, and this puzzle is of a very specific type: the optimum way of solving it is simply to work through very large numbers of trial and error iterations. In other words, lawyers might say that it is a difficult case, but not a hard one. It is clear what needs to be done, but doing it takes an immense amount of computational power simply to work through the many repetitions of the same calculation, each time trying a different input. Once this happens, the proposed block gets added to the chain and the transactions in it get confirmed. This, however, is not the only thing which happens when the block gets verified. Another of Bitcoin’s revolutionary qualities is its alignment of self-interest with altruism. Verifying blocks is hard grind and very expensive in computational terms, and yet it is essential to the continuation and security of the system. So, when a node successfully adds a block to the chain, it gets rewarded with bitcoin. In the Bitcoin protocol, the verification process is known as mining, and is simultaneously the means by which new coin is minted. This is a system, therefore, in which self-interest works in favour of the collective interest, and the two are mutually reinforcing.
The ethos underlying these technological developments (particularly that of Bitcoin) is that peer-to-peer transactions should be able to avoid the intervention of intermediaries or external regulators. In Yeung’s view, the belief that blockchain systems are capable of operating outside of conventional law rests on two assumptions: first, that conventional state legal systems are rendered redundant by the alternative governance frameworks offered by distributed ledger technology and, second, that the state will not intervene in these alternative modes of governance because it has no interest in doing so. Yeung makes it clear from the outset that the notion of a self-contained cybertopia in which national laws hold no sway is not likely to be realised: whilst the genius of blockchain technology allows for exceptionally high transactional security, it can do nothing to guarantee the wraparound rights that conventional law protects and upholds, such as security of personal integrity, property and dignity.
Yeung sets out three models of potential interaction between conventional law and blockchain systems, which she labels “cat and mouse”, “the joys of marriage” and “uneasy coexistence and mutual suspicion”. The first of these arises in a context in which blockchain systems are used deliberately to try and evade the reach of conventional law; a form of cyber-anarchy which provokes the state into asserting its sovereignty in some substantive way. Yeung’s prediction is that this will not take the form of wide-ranging, high-level regulation, but will instead occur on a more localised, ad hoc basis as individual “mice” are identified and reined in. So, for instance, a state is unlikely to allow the formation and enforcement of private contracts which exploit inequalities of bargaining power between commercial entities and consumers. Once attention is brought to any such arrangements, national law is very likely to step in and subject such transactions to some form of regulation, as it commonly does with conventional contracts.
The “joys of (patriarchal) marriage” model describes a situation in which the supremacy of conventional law is ultimately recognised, and in which there is a mutual commitment to co-operation between the two available modes of governance and decision-making. This refers to a situation in which parties transacting by means of distributed ledger technology do so in order to take advantage of the efficiencies of that medium, rather than with any desire to evade regulation and accountability. In such circumstances, their agreements will recognise and accommodate the restrictions imposed by national laws. For example, parties making a contract on a blockchain platform for software development services might code into their agreement a means of granting one party a compensatory amount of cryptocurrency in the event of a breach by the other party. This recognises the authority of national law, but does not require the intervention of a judge or court.
Finally, Yeung’s “uneasy coexistence” refers to a situation in which there is mutual suspicion from both sides, but in which intervention from national law enforcement will only occur where there is a threatened or perceived harm to third parties. This account reads like something of a hybrid of the previous two models: there is no express avoidance of national law by contracting parties, but neither is there an open or willing accommodation of its authority. Instead, both parties and national authorities warily keep tabs on each other, interacting only when is necessary for the prevention of unacceptable risk or loss.
Underlying the uncertainty of regulation and dispute resolution in this context is the constantly-evolving technological foundation on which it all sits, and the challenges this presents to established “bright line” boundaries between the private and public legal spheres. Should blockchains be regulated? Or should individual private disputes be resolved on an ad hoc basis? Yeung predicts that, ultimately, both code of law and code as law will have to provide some form of combined solution by finding an equilibrium which, like any other legal construct, balances the creation of value with the prevention of harm. Brave new technology invites brave new ideas.
There is a certain inevitability in this combined outcome: the impetus behind the development of autonomous code was the desire to achieve pure peer-to-peer interaction, but it is naïve to think that anyone, however technologically literate, can unilaterally contract out of states’ legal jurisdiction. The ability of parties to design their own dispute resolution processes could be a very welcome means of reducing transaction costs, judicial time and what can sometimes be a long wait for an appropriate remedy. It must, however, be a process within a process; reflecting the objectives, constraints and policies of the wider legal landscape of which it forms part. The efficiencies and advantages of coded agreements should, in other words, enhance individuals’ rights but not to bypass them.
Eric Descheemaeker, Rationalising Recovery for Emotional Harm in Tort Law, 134 Law Q. Rev. 602 (2018).
In English law, there is no general duty not to cause reasonably foreseeable mental distress, even if the distress-causing conduct is culpable. Indeed, the same is true in respect of psychiatric harm. What, however, is the recoverability of damages for mental distress that occurs as a result of a tortious wrong to the person who suffers the distress? Suppose, for instance, that A negligently damages B’s property with the result that B suffers foreseeable mental distress. Here, B’s claim is not that A owed a duty of care not to cause reasonably foreseeable mental distress by A’s act. It is that B is entitled to damages for loss consequential upon a violation of B’s right that A not negligently damage B’s property. This is the question skilfully examined in Descheemaeker’s article. He explores the extent to which damages are recoverable for emotional harm, defined as “any unpleasant emotional reaction” (P. 603), suffered as a consequence of rights violation. Interestingly, he concludes that the law is largely consistent with a simple principle: damages for consequential (or “parasitic”) emotional harm are, in principle, recoverable, within the usual limits of causation and remoteness, for the violation of any tort law right.
Descheemaeker begins by considering why this simple principle is not generally explicitly recognised by the law. Compare damages for economic loss. It is approaching trite law that damages may be recovered for economic loss that is consequential upon the violation of a right, even if a person’s economic interest does not serve to generate wide-ranging freestanding rights that others not set back that interest. Yet it seems true, as Descheemaeker says, that most (English) tort lawyers would be considerably more doubtful of the proposition that any reasonably foreseeable emotional harm that results from the violation of right is recoverable in damages.
The article gives two specific explanations for the absence of explicit recognition amongst doctrinal writers. First, Descheemaeker describes a general attitude of suspicion about whether emotional harm is truly “harm” or “loss.” There is a tendency to think that “the concept of loss…[is] restricted…to concrete detriments that are pecuniary, i.e. directly valuable in money (damnum in the historical sense of economic or financial loss).” (P. 605.) He rightly notes the tension between this notion of loss and other well-accepted forms of recoverable loss, such as pain and suffering, and loss of amenity. If the law accepts that pain and suffering can constitute “loss”, is it not required as matter of consistency to accept that the currency of loss extends beyond the pecuniary? It is plausible to think so. One might object that emotional harm is different from pain. Pain is not an emotion. Emotions are belief-mediated, and often judgment-mediated: one’s emotions are directly responsive to one’s beliefs about and evaluations of the world. This seems true, but the point still stands that the law is already deeply committed to extending the concept of loss to comparisons between non-pecuniary states of affairs. Perhaps, however, the belief and judgment-mediated quality of emotional harm has also played a role in emotional harm being viewed with greater suspicion than other forms of harm.
The second explanation is that courts have gone some way to cloaking recovery for consequential emotional harm in terminology that obscures the true nature of the harm in respect of which damages are granted. For example, courts award aggravated damages” in circumstances where the defendant had committed the tort in a high-handed way. The focus here on the defendant’s conduct obscures the fact (reasonably well accepted now) that the loss in respect of which aggravated damages are awarded is the additional mental distress occasioned by the humiliating way in which the wrong was committed. Another example discussed is the Court of Appeal decision in Bryant where trespass by the defendant’s cattle had damaged trees on the claimant’s land. The diminution in value was minimal. The claimants were nonetheless awarded the much greater cost of replacing the trees, the reasonableness of this measure being justified by reference to the claimant’s non-pecuniary interest in the amenity value of their land.
Descheemaeker also claims that awards made for “abstractly-defined loss” indirectly compensate for emotional harm. An abstract definition of loss is adopted where the law switches “from the usual perspective of loss as a concrete detriment flowing from the wrong to the abstract definition of loss as the wrong itself.” (P. 608.) So, for Descheemaeker, damages for loss of privacy, loss of liberty, and loss of autonomy all involve indirect compensation for emotional harm.
This seems open to question, however. In some cases, courts make separate awards for the mere fact of the violation of the right in addition to an award of distress. Furthermore, it is clear that sometimes damages may be awarded in this category of case independently of any distress being suffered at all. If B wrongfully uses A’s property for a certain period, B is liable to pay user damages generally representing the reasonable rent for the use. This is also particularly clear in cases where B wrongfully damages A’s property and A is entitled to damages for the loss of use of the property, in addition to the cost of repair, even if the destruction has occasioned no financial loss, because A already had a replacement ready to stand in for the damaged object. Descheemaeker writes of such cases: “if a chattel is immobilised while being repaired, damages can be claimed for the period of immobilisation even when it is not profit-earning. What detriment is being compensated for here? Clearly it is not a pecuniary loss. This must mean that the relevant concrete detriment is emotional: damages for loss of use are in effect damages for mental distress.” (P. 609.)
This analysis faces two problems. First, it is not clear how Descheemaeker would reconcile this proposition with his later acceptance that de lege lata damages for non-pecuniary loss are not available in cases of juridical persons. (P. 625.) Second, why think that the only options are pecuniary loss or mental distress? On the face of it, a person can suffer a loss which consists neither in their being financially worse off nor being distressed. A person who is deprived of consciousness for a continued period, and is thereby unable to enjoy their life, is worse off than they would be if they were not so deprived. English law recognises this in granting damages for lost amenity to the comatose. It may be that Descheemaeker endorses a kind of hedonism about loss: on this view, one suffers a loss only if one suffers a conscious negative experience. But the law already accepts a non-hedonistic concept of loss. The clearest example is vanilla pecuniary loss: a person can suffer a financial loss while being entirely unaware of it.
Descheemaeker briefly develops an intriguing reply to this sort of objection. He writes that: “damages for emotional harm are not normally for what the specific claimant has suffered: they are standard awards for what an ordinary claimant would have suffered in similar circumstances.” (P. 624.) In the case of an unconscious person, Descheemaeker claims that the law can treat their being unconscious as an “idiosyncrasy” which is discounted from consideration in determining whether they suffered loss. This reasoning, he suggests, could even be extended to juridical persons. It is true that we see evidence of standardisation in the law in determining the loss a person has suffered. If A wrongfully damages B’s car, the fact that C, B’s friend, has repaired the car gratuitously will be ignored in determining B’s damages. C will be entitled to the diminution in value of the object, measured normally by the market rate for cost of repair. Yet there is a sense in which standardisation calls for justification. If the claimant herself is not any worse off, then why is she awarded compensation? In the case of A, B, C, we might say it is because B will feel obligated to compensate C in some way for C’s doing this work. But it is not clear what justification can be given for extending the standardisation of loss to the circumstances Descheemaeker describes (unconsciousness, juridical personality). There is nothing “idiosyncratic” about being a juridical person.
Although we might dispute the idea that the various phenomena adduced to establish the thesis are all reducible to the single notion of emotional harm, Descheemaeker’s analysis, overall, is highly persuasive. He succeeds in making out the case for the existence of an implicit general principle permitting recovery for emotional harm consequential upon a violation of a tortious right in English law. More generally, his article makes a number of interesting observations about the general idea of loss in tort law, in particular concerning the currency of loss, and the standardisation involved in applying the concept of loss. As yet, these issues remain relatively underexplored.
Allen Kachalia, Kenneth Sands, Melinda Van Niel, Suzanne Dodson, Stephanie Roche, Victor Novack, Maayan Yitshak-Sade, Patricia Folcarelli, Evan M. Benjamin, Alan C. Woodward & Michelle M. Mello, Effects of A Communication-And-Resolution Program on Hospitals' Malpractice Claims and Costs
. 37 Health Aff.
Allen Kachalia and ten co-authors’ new piece, entitled Effects of a Communication-and-Resolution Program on Hospitals’ Malpractice Claims and Costs, offers an insight to address one of the most daunting challenges that looms over the field of tort law—and, indeed, one of the most daunting challenges that confronts the “sister professions” of law and medicine more generally. The question is how to address the problem of preventable medical injury. In human terms, the problem is enormous. Roughly 35 million Americans are hospitalized annually, and the best evidence suggests that approximately 1% of those individuals will be victims of bona fide medical malpractice, while perhaps another 1.3% will be “preventably,” though not necessarily negligently, hurt by the care they receive. That adds up to some 800,000 individuals. Further, while many of these injuries are minor or transient, others are serious. Each year, 44,000 to 98,000 Americans die because of medical mistakes, which means that medical errors may cause more deaths per year than all other accident types, combined.
The medical malpractice system—the civil justice system’s attempt to address the above injuries—also takes a significant toll. The system’s direct cost is substantial: Administrative costs alone (in legal fees and insurer overhead) reportedly top $6 billion annually. Its indirect costs are considerable, as an abiding fear of liability reportedly impacts the tests physicians perform, the medication they prescribe, and the referrals they make, which contributes to “defensive medicine” (which is, itself, costly). And, the physicians who are sued are, by all accounts, deeply, and negatively, affected.
Nor is the situation particularly satisfactory from the injured patients’ perspective. For a host of reasons, only a miniscule fraction of those hurt by medical error (2% to 3%) ever seek compensation, even informally. When injured patients do initiate claims, many fall short: Doctors prevail in roughly three-quarters of medical malpractice jury trials, and, overall, approximately 40% of patients who retain counsel fail to recover a cent. And, even when compensation does come, it comes slowly and is often inadequate, particularly for the grievously hurt.
Understandably, unsatisfied with all the above, the past four decades have witnessed a flurry of med-mal-related reform activity. Some reforms—damage caps and contingency fee restrictions, most prominently—have been enacted. Yet, these reforms only tinker at the margins, and their social utility is dubious. Other reform ideas—such calls to adopt enterprise liability, a move to base liability on contract, rather than tort, principles, and proposals to jettison the traditional tort system in favor of no-fault regimes or specialized “health courts”—are bolder. But some of these reform ideas have been subject to harsh criticism, and, so far, none has taken root. Indeed, the med mal landscape is so bleak that one scholar has likened it to the “law’s Vietnam—an unpleasant quagmire of unending skirmishes and full-scale engagements” with, I would add, uncertain objectives, raised voices, and pointed fingers, all while the casualties mount.
Into this quagmire, enters a promising new study undertaken by a large team of many of the field’s most esteemed researchers. Recently published in Health Affairs and entitled Effects of a Communication-and-Resolution Program On Hospitals’ Malpractice Claims and Costs, the study offers a glimmer of good news. It finds that hospitals can disclose certain medical mishaps to patients and even apologize for the harm they inflict, without causing liability costs to skyrocket.
In the study, Allen Kachalia and ten co-authors examine the effect of four Massachusetts hospitals’ communication-and-resolution programs, CRPs for short. To understand the study, a brief primer on CRPs is necessary.
Fueled by swirling ethical concerns and buttressed by a desire for greater transparency and accountability, over 200 hospitals and health care organizations have adopted CRPs. Programs vary on the specifics, but the general idea is that, if a hospital adopts a CRP, it commits to “communicate with patients about adverse events; investigate and explain what happened; and, when appropriate, apologize, take responsibility, and proactively offer compensation” (P. 1836). The attraction of CRPs is obvious. At least in theory, the programs foster candid dialog between physicians and patients, promote timely investigations into the causes of injury (which might reveal golden opportunities for quality improvement), and, when warranted, offer a streamlined system to ensure fair, efficient, and prompt compensation.
Adoption of CRPs has been stunted, however, by liability concerns. Hospital administrators are well aware of the statistics above—and particularly the fact that, currently, a tiny fraction of those hurt ever seek compensation, even informally. Administrators are understandably concerned that, if their doctors start to confess their mistakes, and particularly if doctors or hospitals proactively offer compensation to those hurt, liability costs will rise, as a higher proportion of injured patients will seek recompense, and those who do will demand ever-higher amounts. But, while this liability concern has loomed large and has dampened some institutions’ interest in adopting CRPs, no one has really known whether the concern was theoretical or real. That’s where Kachalia et al.’s Health Affairs study comes in.
Starting in late 2012, four Massachusetts hospitals implemented a communication-and-resolution program specifically known as CARe (Communication, Apology, and Resolution). Consistent with the general CRP script, under CARe, evidence that a patient has sustained significant harm triggers an internal investigation. If the investigation reveals that the harm was caused by caregiver negligence, the matter is referred to the hospital’s insurer. Following the insurer’s review, the hospital then convenes a meeting with the patient and his or her family (and their attorney, if desired) to discuss next steps, which may include an explanation or apology, a waiver of medical bills, an offer of compensation, or some combination of the above.
By comparing the liability experience of four hospitals that implemented CARe against control hospitals that didn’t, and also comparing the four hospitals’ pre-CARe liability experience against their experience once CARe was in effect, Kachalia and co-authors assess CARe’s impact. Most prominently, they discover:
Although in theory, routinely offering compensation where negligence causes serious harm should mean that more injuries are compensated, and although the hospitals in our study adhered to the CRP protocol faithfully, total liability cost trends did not worsen, and trends in defense costs and rates of new claims improved.
The study is ambitious and rigorous, and its methodology is technologically sophisticated. Its finding, therefore, sheds welcome light on CRPs’ utility. Still, as the researchers forthrightly acknowledge, questions remain.
For starters, Kachalia and co-authors examine—and help to debunk fears regarding—the “cost” side of CRP’s cost-benefit coin. The study suggests that, contrary to the fears of some, the adoption and implementation of a CRP probably won’t cause a hospital’s liability costs to spike. But reforms are, and should be, evaluated based on both costs and benefits, and the benefit side of the ledger needs further elaboration. Some of the questions that must be answered include: Are the benefits believed to be associated with CRPs real? Or are they understated or, alternatively, exaggerated? Further, do these benefits actually accompany CRPs, even when the programs are implemented in messy real-world conditions? This question is important as some research suggests that, once researchers aren’t looking, some organizations’ commitment to CRP may become selective or halfhearted. Some organizations may follow the CRP script some of the time but not all of the time, or they may offer “transparency” but actually, in a given scenario, shade what is or is not revealed. Any lack of fidelity will affect the program’s utility.
In addition to the fidelity question, future researchers must also address what I’ll call the durability question. In particular, researchers must assess whether perceived improvements are lasting or merely ephemeral, and they must also investigate whether, as years go by (and the initial zeal that spurred the reform ebbs), the cost side of the ledger swells. This question is crucial, as Kachalia and co-authors understandably examined only the first four-and-a-half years of CARe’s implementation. Yet, past research evaluating other (admittedly different) tort reform efforts suggests that initial benefits tend to diminish as years go by, while certain costs trend upward. Only time will tell whether we will see such reversion here, but researchers must be alert to the risk.
Finally, when evaluating both costs and benefits, researchers should examine questions from the perspectives of all who may be affected by the reform effort, including but not limited to past and future patients. Three categories of questions must be addressed. First, do injured patients and their families believe the programs are fair, and how does satisfaction compare to claimant satisfaction within the traditional tort system? Second, are CRP compensation offers prompt, adequate, predictable, consistent, and equitable? Third and most crucially: Do CRPs promote or inhibit quality improvement? Do those medical errors that currently injure some 800,000 patients each year tick upward or downward when a CRP is in effect?
Still, the questions above and work that lies ahead do nothing to diminish the importance of Kachalia et al.’s analysis. In a battlefield that’s long been marked by more heat than light, in their sustained and sober analysis, Kachalia and co-authors are beginning to let some sunlight in.
Cite as: Nora Freeman Engstrom, Letting Some Light In: Resolving a Key Question Regarding Communication-and-Resolution Programs
(May 24, 2019) (reviewing Allen Kachalia, Kenneth Sands, Melinda Van Niel, Suzanne Dodson, Stephanie Roche, Victor Novack, Maayan Yitshak-Sade, Patricia Folcarelli, Evan M. Benjamin, Alan C. Woodward & Michelle M. Mello, Effects of A Communication-And-Resolution Program on Hospitals' Malpractice Claims and Costs
. 37 Health Aff.
1836 (2018)), https://torts.jotwell.com/letting-some-light-in-resolving-a-key-question-regarding-communication-and-resolution-programs/
Suicide has become an important public-health problem, leading Alex Long to revisit the unduly neglected question of whether tort law should recognize wrongful-death actions for cases in which the defendant’s tortious conduct caused the victim to commit suicide. After describing the increasingly worrisome trends—suicide is now the tenth leading cause of death in the country—Long insightfully constructs the historical, religious, and sociological motivations embedded in the tort doctrines, labeled the “suicide rule” by one jurisdiction, that ordinarily bar recovery for suicides. “Tort law’s historical treatment of cases involving suicide represents a combination of society’s traditionally negative views regarding suicide and tort law’s traditional concerns with foreseeability and expanding liability in cases involving emotional injury” (P. 16).
Long identifies “a slight trend among court decisions away from singling out suicide cases for special treatment and toward an analytical framework that more closely follows traditional tort law principles” (P. 6). Long defends this approach, drawing on the principles that courts use to formulate the tort duty in cases of pure emotional distress. “Ordinarily, suicide will be outside the foreseeable scope of the defendant’s negligence” and therefore not subject to liability as per the traditional approach (P. 49). But if the plaintiff can prove “that the negligent conduct is especially likely to result in suicide,” courts should permit recovery for the wrongful death. (Id.) Long correctly diagnoses the problem—tort principles do not justify the suicide rule—although these wrongful-death recoveries will be more common than he concludes. The increased liability is fully justified in my view.
Relying on doctrines that originated in English law from the Middle Ages, courts ordinarily dismiss these wrongful-death claims as a matter of law. In nearly every jurisdiction, courts hold that suicide—subject to limited exceptions discussed below—is an unforeseeable consequence of negligence that absolves a defendant of liability for the wrongful death (though not necessarily for the predicate physical or emotional harms that caused the decedent to commit suicide) (P. 17). In addition, “[n]egligence defendants have had some success in asserting that suicide is an immoral or unlawful act and thus bars recovery” (P. 20). Some courts deny recovery for comparative-fault reasons, concluding that suicide “is more than mere contributory negligence and is of a higher culpability level than the defendant’s negligence.”
Courts recognize exceptions to the suicide rule if “the defendant’s negligence causes injury that results in insanity or delirium in a form that prevents an individual from understanding the nature of his act or that creates an irresistible suicidal impulse” (P. 22). In addition, some defendants (like schools and psychiatrists) may have the very duty to prevent the decedent from committing suicide, in which case the suicide could be foreseeable (Pp. 26-27). Finally, for liabilities based on an intentional tort (typically the intentional infliction of emotional distress), most courts permit recovery if the plaintiff can prove that the tortious conduct was a substantial factor in causing the suicide (P. 32).
Long’s article surfaces a host of interesting issues that cannot be adequately addressed here. I will instead focus on his primary proposal that courts should reject the suicide rule in favor of an approach that only asks whether the defendant’s tortious conduct was especially likely to cause the decedent to commit suicide.
In defending this approach, Long concludes that liability will still be exceptional because “experts with superior knowledge regarding suicide have been unable to develop a reliable method for determining those at high risk of suicide,” and so “the hypothetical reasonable person will ordinarily not be able to do better” (P. 37). The question, however, is not whether one can reliably identify whether a particular person will commit suicide. A negligent actor is liable for the foreseeable risks that cause compensable injury, and a foreseeable risk does not require knowledge of whether it will actually materialize in a particular case. A defendant, for example, can incur liability to cancer victims for having negligently exposed them to carcinogens, but at the time of the tortious behavior there ordinarily is no way to reliably determine which exposures will ultimately cause cancer.
The prevalence of suicide today often makes that type of harm foreseeable for reasons fully established by Long. By causing chronically severe pain or emotional distress, the defendant’s tortious conduct substantially increases the likelihood of suicide. “The reality is that the most common description of the mental state of those who have committed suicide is that they did not want to die; they just wanted the pain they were experiencing to stop, a seemingly rational decision to a person who otherwise sees no realistic end to the pain he or she is suffering” (Pp. 45-46). To be sure, the decedent’s reasoning may have been impaired, but under the majority rule “the plaintiff’s contributory negligence must be evaluated by using a subjective standard that takes into account the plaintiff’s own mental state, including any mental impairments” (P. 56, n. 368). Insofar as a victim’s chronic pain and the associated mental state significantly increase the likelihood of suicide, those factors make the suicide a foreseeable consequence of the defendant’s negligence.
To recover, the plaintiff must also prove that the defendant’s negligent conduct actually caused the decedent to commit suicide—the same inquiry that courts employ for determining the liability of intentional tortfeasors. “In practice, the substantial factor standard [for establishing causation] has not proven to be a particularly onerous requirement for plaintiffs” (P. 32). The same should be true for negligent tortfeasors.
Consider cases in which the proof already shows that the defendant’s negligence caused the decedent to suffer severe bodily injury with the associated pain and emotional distress that then allegedly caused the decedent to commit suicide. At this point, the plaintiff has established liability and an entitlement to compensatory damages for the predicate bodily injury. The causal problem accordingly reduces to the question of whether the negligence caused the full extent of the injuries alleged by the plaintiff—the wrongful-death damages for the suicideallegedly caused by the predicate (compensable) bodily injury. The evidentiary standard for establishing causation in the damages phase of the case is less demanding than in the liability phase. Instead of having to prove causation by a preponderance of the evidence, the plaintiff is only required to prove “the extent of the [tortiously caused] harm with as much certainty as the nature of the tort and the circumstances permit.” After the fact, we will not ordinarily know why someone took his or her life. That inherent uncertainty, however, should not bar recovery when the reasonably available evidence shows that the defendant’s negligence substantially increased the risk of suicide. For these reasons, the substantial factor standard has not been particularly onerous for plaintiffs seeking to recover from intentional tortfeasors; those reasons apply with equal force to negligent actors.
The foregoing analysis does not imply that the decedent necessarily bears no responsibility for taking his or her life. Such a determination is relevant to the apportionment of liability under comparative responsibility; it is not a sufficient reason to deny liability altogetherunder the suicide rule.
Established tort principles, therefore, support Long’s conclusion that courts should abolish the antiquated doctrines that limit liability for suicides. By demonstrating that the persistence of the suicide rule stems from the stigma and immorality that traditional conventions ascribe to these desperate acts, Long has made a valuable contribution to our understanding of tort law.
Kenneth S. Abraham & G. Edward White, Recovering Wagner v. International Railway Company, 34 Tuoro L. Rev. 21 (2018).
Featuring the memorable phrase “Danger invites rescue,” Cardozo’s opinion in Wagner v. International Railway Co. is engaging and beautifully written. The same can be said of Recovering Wagner v. International Railway Company (hereinafter “Recovering Wagner”)─the recent study of Wagner by Ken Abraham and Ted White (hereinafter “AW”). Through historical research principally into the litigation of the case, they generate an important new interpretation of Wagner. According to AW, Wagner forced Cardozo to confront what lawyers then and now would call a “proximate cause” question. Yet his opinion does not explicitly mention proximate cause (or duty, for that matter). Instead, it employs a notion of relationality of risk. Indeed, AW powerfully argue, the whole point of Wagner is that relationality of risk is far more important than the idea of a “natural and probable” sequence from breach to injury, or any kind of remoteness criterion, in determining whether a defendant should be held responsible in negligence for a plaintiff’s injury. Their larger point is that Wagner can be seen to encapsulate Cardozo’s powerful influence on American negligence law.
Abraham and White’s research confirms that Cardozo’s depiction of the facts in Wagner is largely accurate. I follow their judgment that quoting Cardozo’s account is the best way to re-acquaint readers with the facts of the case:
The defendant operates an electric railway between Buffalo and Niagara Falls. There is a point on its line where an overhead crossing carries its tracks above those of the New York Central and the Erie. A gradual incline upwards over a trestle raises the tracks to a height of twenty-five feet . . . Then comes a turn to the right at about the same angle down the same kind of an incline to grade. Above the trestles, the tracks are laid on ties, unguarded at the ends . . . On the bridge, a narrow footpath runs between the tracks . . . .
Plaintiff [Arthur Wagner] and his cousin Herbert [Wagner] boarded a car at a station near the bottom of one of the trestles . . . The platform was provided with doors, but the conductor did not close them. Moving at from six to eight miles an hour, the car, without slackening, turned the curve. There was a violent lurch, and Herbert Wagner was thrown out, near the point where the trestle changes to a bridge . . . Plaintiff walked along the trestle, a distance of four hundred and forty-five feet, until he arrived at the bridge, where he thought to find his cousin’s body . . . Reaching the bridge, he had found upon a beam his cousin’s hat, but nothing else. About him, there was darkness. He missed his footing, and fell (P. 437).
Wagner holds that a person injured while trying to rescue a person who was imperiled by the defendant’s negligence may himself recover from the negligent defendant. “Danger invites rescue” is widely understood to express the rule that, because it is foreseeable that someone will try to rescue another engulfed in a danger that the defendant negligently created, the defendant is liable to the rescuer if he is injured during the rescue attempt. AW are not especially concerned to contest this reading. Their thesis is that when we understand how the case was litigated at trial, and the precedents on which the case was decided, we learn a great deal about how Cardozo understood the basis of the defendant’s responsibility.
On first blush, Wagner actually looked easy for the plaintiff on the law but difficult on the facts. On the law, it looked easy because the New York Court of Appeals had already prominently decided that a rescuer had a claim against the source of the unreasonable risk imperiling the original victim. A key case was Eckert v. Long Island R.R., but there were other applicable precedents too, both from New York and elsewhere. The actual facts of this case made it more difficult for the plaintiff. First, the plaintiff Arthur Wagner may well have been drunk. Second, his cousin was rescued by others, and the plaintiff was not even looking in the right place when he was injured. Third, and in many ways most importantly, the act of going to rescue his cousin was not an impulsive leaping to aid (as in Eckert), but a deliberate decision about how and where to look. Relatedly, there was a controversy at trial regarding whether Arthur was accompanied by (or perhaps led by) an employee of the defendant.
The Railroad was understandably eager not to depend exclusively on the (then-complete) defense of contributory negligence, as it was simply unclear what a jury would find on that front. AW show how the Railroad’s lawyer, Edward Franchot, managed to use the aforementioned peculiarities of the fact pattern to generate another argument against liability (Pp. 36-39). Specifically, he persuaded the trial judge to instruct the jury that the alleged negligence of the Railroad in going around the bend and overpacking its train – the alleged negligence that caused Arthur’s cousin Herbert to fall in the first place – could not be the basis of Arthur’s action. Rather, the judge instructed the jury that Arthur could recover only a finding that the conductor had negligently instructed Arthur going on the trestle. This left the jury to weigh the conductor’s testimony and Arthur’s testimony with regard to what was said and done during the panicky moments following Herbert’s fall. Arthur’s testimony was evidently less credible to the jury than the conductor’s, so the Railroad won the case.
On appeal, Arthur’s lawyer, argued quite plausibly that the New York Court of Appeals’ own leading precedent – Gibney v. State – permitted liability to be predicated on the negligence of the railroad that led to Herbert’s need for rescue. Franchot distinguished Gibney by arguing that that the rescuer’s conduct in that case was an instinctive reaction, whereas in Wagner the attempted rescue was a deliberate act. The instinctiveness of the rescue in Gibney permitted the continuity between breach and injury that allowed a finding of proximate cause. Given the absence of comparable continuity in Wagner, Franchot argued that the railroad’s original negligence was not the proximate cause of Herbert’s rescue attempt. The judge’s instructions to the jury were therefore correct.
In his opinion for the Court of Appeals, Cardozo confronted this argument head on, pointedly rejecting it:
The defendant says that we must stop, in following the chain of causes, when action ceases to be ‘instinctive.’ By this is meant, it seems, that rescue is at the peril of the rescuer, unless spontaneous and immediate. If there has been time to deliberate, if impulse has given way to judgment, one cause, it is said, has spent its force, and another has intervened . . . We find no warrant for thus shortening the chain of jural causes. We may assume, though we are not required to decide, that peril and rescue must be in substance one transaction; that the sight of the one must have aroused the impulse to the other; in short, that there must be unbroken continuity between the commission of the wrong and the effort to avert its consequences. If all this be assumed, the defendant is not aided. Continuity in such circumstances is not broken by the exercise of volition . . . The law does not discriminate between the rescuer oblivious of peril and the one who counts the cost. It is enough that the act, whether impulsive or deliberate, is the child of the occasion (P. 438).
Cardozo’s opinion thus abandons the notion that a deliberate act inserted into the causal chain destroys the possibility of liability. Notably, while he does not use the phrase “proximate cause” or “legal cause,” he does indeed use the phrase “the chain of jural causes,” and he rejects the idea of shortening this chain because of intervening volitional action.
More generally, Cardozo embraces a risk-based notion of the connection between the injury and the underlying risk-creating action:
The wrong that imperils life is a wrong to the imperiled victim; it is a wrong also to his rescuer. The state that leaves an opening in a bridge is liable to the child that falls into the stream, but liable also to the parent who plunges to its aid (citing Gibney). The railroad company whose train approaches without signal is a wrongdoer toward the traveler surprised between the rails, but a wrongdoer also to the bystander who drags him from the path . . . The risk of rescue, if only it be not wanton, is born of the occasion. The emergency begets the man (Pp. 437-38).
AW’s article explains that Cardozo was, in effect, supplanting what was at the time the dominant way in which New York courts (and other courts) had formulated the proximate cause requirement: namely, whether the defendant’s carelessness had led to the plaintiff’s injury through a “natural and probable” sequence. Now the question is whether the injury complained of by the plaintiff was an actualization or realization of the risk negligently taken by the defendant (P. 57).
Abraham and White’s reading of Wagner as having effected a tacit change in proximate cause law also supports a longstanding Twentieth Century reading of another Cardozo opinion – that of Harvard Professor Warren Seavey in Palsgraf v. Long Island R.R. Seavey saw Palsgraf as a proximate cause case that hinged on Cardozo’s quiet substitution of a risk-rule conception of proximate cause for the prevailing natural-and-probable-sequence conception. What rendered “negligent” the LIRR guard’s pushing of the passenger was the risk of destroying the passenger’s package, not the risk of physically injuring a woman down the platform, Seavey observed. Liability in negligence requires a match between the risk and the injury. In Wagner, the risk of a rescuer’s injury is part of what made the Railroad negligent, so a plaintiff who suffered the realization of that risk has a claim based on the Railroad’s negligent conduct in rounding the bend with open doors.
Once they have drawn the connection with Seavey’s Palsgraf reading, AW arrive at their most striking scholarly claim: “We think the decision in Wagner contains virtually everything necessary to its more celebrated offspring, Palsgraf” (P. 56). They proceed to list these necessary ingredients: “the centrality of risk-analysis to questions involving what others had analyzed in terms of proximate cause”; “the causal-chain analysis that Judge Andrews would later employ in his Palsgraf dissent”; and the willingness to classify as a “matter of law” the question of which risks are associated with a defendant’s negligence. “In a very real sense,” they conclude, “it isWagner, not Palsgraf that is Cardozo’s seminal decision in this area of tort law” (P. 58). AW will not be surprised that I (a self-described Palsgraf maven) would wholeheartedly reject this particular conclusion, but that is a matter for another time; I concede that their case for Wagner as a Palsgraf preview is nicely laid out.
There are numerous reasons to regard AW’s article as essential reading for Torts professors. Among these are the article’s erudition and its reminder of the importance of detail in the analysis of canonical cases. There is also its recognition that relationality of risk can be (as it was in Wagner) a sword, and not just a shield (as it was in Palsgraf). Most importantly, AW’s “recovery” of Wagner flags for all of us the important historical truth that proximate cause analyses were once very different than they are today. Foreseeability and relationality of risk played a lesser role, while “natural and probable” and “directness” played a greater role. In this vein, we should remember that courts were not always comfortable including within causal chains the voluntary conduct of the plaintiff or of third parties. Unforeseeable wrongful conduct today may sever liability via the doctrine of superseding cause, but for a large part of the 20th century, a far broader range of voluntary conduct would have severed liability via proximate cause. In this former world, we would not have seen Tarasoff v. Regents of the University of California, or Kline v. 1500 Mass. Ave. Those progressive duty cases were arguably only possible because a relationality if risk conception of “jural cause” replaced a more mechanistic and naturalistic one. Seen through the prism of AW’s analysis, it was partly Cardozo’s achievement in Wagner that made this possible.
In basic tort damage doctrine, a person injured by a tort can recover lost wages. This means it costs less to harm some people than others. People who earn less, whether because of reduced educational opportunities, racism, geography, family responsibilities, or other factors, will suffer lower damages than people who earn more. Defendants (and insurance companies) will have to pay less to “make them whole.” This aspect of tort damages is in tension with, if not in contradiction to, the notion that—formally—everyone counts equally in torts. This tension rarely gets attention or critique, in part because tort damages are determined individually, usually through informal and private settlements
In one context of U.S. tort law, however, the relationship between damages and inequality is on the surface and subject to critique. When an injured individual lacks an earnings history, race-based statistical tables estimating wages, life expectancy, and work-life expectancy are still routinely used in calculating tort damage awards. African-American plaintiffs, as a result, receive lower damage awards than white plaintiffs in such circumstances. Many people are surprised to hear this practice endures, although scholars have criticized it for decades. Valuing Black Lives is the most detailed explanation yet published as to why the use of race-based tables in calculating tort damages is unconstitutional. It is a companion piece to the authors’ previous article, Torts and Discrimination, earlier reviewed in Jotwell. Valuing Black Lives is excellent. In this era of resurgent racism, it is also particularly timely.
A key question in tort damages, especially where a child is grievously injured, is how much the child would have earned if she had not been hurt. This question is particularly challenging because the child obviously does not have a personal earning history that could be used to estimate lost future earnings. Courts and experts often use race-based and gender-based tables to calculate future lost wages in such a situation. Yuracko and Avraham argue that the use of race-based tables to calculate damages disadvantages individuals and creates incentives for companies to disproportionately allocate risks to minority communities so as to minimize tort damages. They claim, for example, that it would be economically rational for a large delivery company to concentrate its routes and its risky drivers in African-American neighborhoods because the company would end up paying lower damages as a result. As they note, the use of tables ‘embeds effects of racial discrimination into individual tort awards and channels past levels of racial discrimination into predictions about the future.’ The authors painstakingly and persuasively argue that race-based tables are racial classifications when used in court. Further, tables ‘stereotype individuals and make predictions about individual preferences and proclivities based on group membership,’ much like racial profiles. Because tables operate as race-based classifications, their use will be subject to strict scrutiny as long as state action is present. Based on a detailed discussion of state action doctrine, the authors methodically show how judicial reliance on race-based tables to calculate tort damages constitutes state action. Then they carefully apply strict scrutiny and conclude use of the tables doesn’t pass muster. They close by highlighting important aspects of tort damages calculations that will not be remedied by simply discarding race-based tables. As noted above, an injured person whose education and employment opportunities have been stunted by racism will have lower lost wages than a more privileged, higher earning person who suffers a similar injury.Inequality rooted in race and privilege pervades our torts damage calculation regime. The authors provide no solution to this deeper problem; I hope they write an additional article which focuses on that topic. I also hope they focus on gender-based tables which are also still used but are not discussed in Valuing Black Lives (perhaps because of the different standard of review). Their analysis provides a strong and detailed foundation for a court to hold that use of race-based tables to determine tort damages is unconstitutional.
The article and the earlier Torts and Discrimination join a growing literature on race and torts. This literature goes beyond targeting use of race-based tables which is perhaps the only remaining overt use of race on the surface of tort litigation. Up until the 1960s judges generally mentioned the race of tort litigants if they were not white; there are hundreds of published tort opinions dealing directly or indirectly with race to which few torts scholars have paid attention. Now that race is absent from the surface of tort opinions, the topic is even harder hard to study. A race-based discount was clear from older opinions. Race-based devaluation probably persists in many contexts, such as settlement, that are exceedingly difficult to study. A fascinating empirical analysis published in 2016 argues that the failure of some Southern states to adopt reforms such as comparative negligence can be traced to race and geography rather than explanations such as economics. A recent international comparative analysis shows that the use of race-based and gender-based tables is neither universal nor inevitable. There is more work to do.
It is or should be widely seen as extremely objectionable that race-based tables are still used in tort litigation and the authors’ concentrated attention to this issue is welcome. Other aspects of race, racism and torts deserve more attention than they have received. It’s high time outstanding work like this gets center stage.
Kenneth S. Abraham & Leslie Kendrick, There’s No Such Thing as Affirmative Duty
, Virginia Public Law and Legal Theory Research Paper No. 2018-59, available at SSRN
When it comes to inherited scholarly categories and taxonomies, a prominent strand of modern American tort scholarship pursues a particular kind of deflationary agenda. The First and Second Restatements divided the law of negligence into sub-rules distinguished by spurious differences (for example, the section on “type of negligent acts” distinguished between “Use of Incompetent or Defective Instrumentalities” and “Want of Preparation”). The Third Restatement combined many rules that could be brought under a more general description – the laundry list of types of negligent acts has been radically pruned, leaving just a handful, such as “negligent failure to warn”.
Because the mission of the Restatement is to organize concepts latent in the common law, it is understandable that subsequent generations of reporters will see common themes between categories that were overlooked by their predecessors (and it is also possible that the law itself might evolve over time towards fewer principles as courts eliminate ad hoc categories). But reducing the number of rules, or principles, in the common law is not an unalloyed good. Debates still rage over whether the Restatement has, for all intents and purposes, removed duty as an element of the prima facie case in negligence in most cases of personal injury or property damage, and if it has, whether that move was salutary. Last year I reviewed for Jotwell an article by Prof. Stephen Sugarman calling for the merger of battery – an intentional tort – into negligence.
And now comes a proposal from Professors Ken Abraham and Leslie Kendrick to merge Chapters 3 and 7 of the Third Restatement, so that, instead of two general categories of duty in connection to physical harm, there will be just one rule of negligence for risk creation and there would be no need for a rule concerning affirmative duties. I will review Abraham and Kendrick’s arguments for the merger, suggest a few criticisms of their arguments, and conclude by evaluating the costs and benefits of pursuing yet another round of doctrinal deflation.
Abraham and Kendrick’s argument – which they recognize as somewhat radical – is that the category of “affirmative duties” ought to be abandoned. Their recommendation, in terms of the Restatement, is that §§ 37 – 43) be eliminated, and any claim by injured victims for physical harm that would have arisen under these sections come under the relevant sections elsewhere in the Restatement. Since the article is mostly a critical project, Abraham and Kendrick do not address where the orphaned causes of action would go, and this should not be held against them. Presumably, they would find a home in Chapter 3 (“The Negligence Doctrine and Negligence Liability” or Chapter 9 (“Duty of Land Possessors”).
Abraham and Kendrick’s argument is simple and familiar to anyone who has tried to teach torts: The line drawn between act and inaction is vague, and because it is vague, the doctrinal rules that purport to rely on that line are either over-inclusive or under-inclusive. As a descriptive matter, I agree with Abraham and Kendrick, and a brief tour of their argument will induce, I suspect, in many torts professors a familiar sense of frustration with the common law rules in this area.
The Third Restatement preserves a categorical distinction between duties grounded on risks of physical harm “created” by the defendant (§ 7) and those risks of physical harm not created by the defendant (§ 37). I will note in passing that Abraham and Kendrick organize their argument by comparing § 7 and § 37, but that § 37 deals with risks of emotional harm not created by the defendant as well as with risk of physical harms. Their focus only on the treatment of affirmative duties in relation to risk of physical harms leaves open the question of how their analysis would apply to “pure” negligent infliction of emotional distress unconnected to physical imperilment (e.g. Section 47(b)). As an initial matter, I will only address the topic they have chosen for themselves – affirmative duties in relation to physical harm.
In tort law, it is commonplace for terms used frequently by laypeople to turn out be vague when those terms are put to work in tort. The “reasonable” person is a prime case in point. Modern doctrine, it could be argued, usually handles the problem of vagueness is ways that do not produce unnecessary complexity. One way tort law deals with vagueness is to delegate the final act of line drawing to the factfinder. Not so with the line between risk creation and risk non-creation. The line is drawn as a matter of law, note Abraham and Kendrick (P. 53), and the conclusion that a risk was created by the defendant – or not – has significant consequences for the parties. If the court holds that the risk was created by the defendant then it falls under the “standard” rules of negligence for physical injury, which impose a very broad duty on the defendant. As the Third Restatement says in § 6, comment f, “[i]n cases involving physical harm, courts ordinarily need not concern themselves with the existence or content of this ordinary duty. They may proceed directly to the elements of liability.” However, the reverse is true if the court determines that the defendant did not create the risk. Unless the plaintiff can demonstrate that the risk falls into one of three limited categories, the defendant will be held to have had no duty to reduce the risk at issue, or mitigate any harm it may cause.
Abraham and Kendrick claim that there are descriptive and normative dimensions to the vagueness problem described above. (P. 10.) Yet, according to Abraham and Kendrick, the point of their article is not to criticize the ultimate holdings of any of the many courts that have applied the distinction between risk creation and risk non-creation. They are careful to emphasize that their project does not entail a normative argument that any particular case (including such chestnuts as Tarasoff orMoch) ought to have been decided differently. Their critique is conceptual. Abraham and Kendrick believe that there is no bright line separating affirmative duty cases from negative duty ones. Dispensing with the distinction might bring valuable clarity to our legal categories but it would not necessarily change the outcome of any of the cases they discuss.
The conceptual critique can be seen best in their treatment of cases involving the duties owed by landlords to tenants and other entrants in regard to criminal assault. (Pp. 12 – 14.) These cases, such as Kline v. 1500 Mass Ave. Apartment Corp., are treated as affirmative duties by the Third Restatement in § 40. Abraham and Kendrick’s problem with Kline is not with the outcome – a finding that there was a duty – but with the rationale for the duty provided under § 40. § 40 describes a situation where (1) the defendant did not create the risk that harmed the plaintiff but (2) there was a special relationship between the plaintiff and the defendant. Abraham and Kendrick’s conceptual critique is twofold: first, the Restatement’s reasons for holding that a special relationship exists between landlords and tenants and other entrants are conclusory and, second, that the conclusion that a landlord doesn’t create risk in cases like Kline is question-begging. Abraham and Kendrick think that the landlord, by maintaining the property, creates the opportunity for criminal assault on that property (“landlords . . . create the very conditions under which risk to the individuals with whom they deal may arise” P. 52.) and hence participates in creating the risk of criminal assault.
If the landlord in Kline created the risk, then the case should have been analyzed under § 7 or § 39. Under § 7, the landlord would owe a duty if his or her unreasonable conduct created the risk of criminal assault. Under § 39, the landlord would owe a duty because, despite the exercise of reasonable care, the relevant conduct created a continuing risk of physical harm that the landlord could prevent or minimize. In neither case would the court in Kline have to resort to finding a special relationship between the landlord and the victim. According to Abraham and Kendrick, given the breadth of § 7 and § 39 (negligent risk creation and non-negligent prior risk creation), duties based on special relationships (§ 40) end up being a fifth wheel.
Abraham and Kendrick’s treatment of the third category of affirmative duties, the duty to perform a gratuitous rescue reasonably (§§ 42 – 44) is extremely brief. This is probably because they see these duties as clear cases of risk creation, and therefore not true cases of affirmative duty. The bulk of their argument is devoted to showing that despite its many subsections, only one special rule for affirmative duties is needed to explain the doctrine – the rule concerning duties arising from prior risk creation (§ 39).
It must be observed that Abraham and Kendrick choose a rule for affirmative duty that is often viewed as having the most limited scope of application, as compared to the other two rules (affirmative duties based on special relationships and the duty to perform a gratuitous rescue reasonably). And although they concede that courts don’t actually hold that landlords in the sort of cases discussed above are found to have affirmative duties under § 39, they insist that this is a mistake. Abraham and Kendrick point to Illustration 1 of § 39 to prove their point. This illustration describes a golfer who, after carefully scanning the course and carefully hitting a long drive, sees a stranger walking towards the point where her ball is likely to land. (P. 17.) There is a duty to warn says the Restatement, even though the golfer was careful in every respect. If the golfer has a duty to warn because she non-negligently created a risk which imperils a foreseeable victim, then the landlord in Kline also owes a duty, and for the same reason.
The overall conclusion of Abraham and Kendrick’s article is that almost all of the cases that the Restatement breaks off from §7 are really instances of what they call “prior risk creation” described in § 39. For Abraham and Kendrick, Chapter 8 contains two mistakes. The first is its failure to see that if it needed to exist at all, it would only need one rule – the duty to take reasonable precautions to protect others from the consequences of prior risks one has created non-negligently. The second mistake is to fail to see that there is no need to have a special rule for affirmative duties based on prior risk creation at all. In other words, § 39 can be collapsed into § 7 (and vice versa). They say this quite clearly on P. 18.
“Prior risk creation” threatens to transform most negligence cases into affirmative duty cases. Many standard negligence cases assume that the defendant had a duty to anticipate that his conduct might impose risks on others and to take reasonable precautions to prevent this. If this constitutes an “affirmative” duty of anticipatory risk reduction – if it essentially turns every case into a rescue case –then there is no distinction left between negative and affirmative duties.
This second mistake is based on the naïve belief that tort law should (and can) distinguish between conduct and non-conduct. While some might think that the line exists but is vague, Abraham and Kendrick don’t think there is a line at all. They assert: “All conduct creates some risk of harm” (P. 48, emphasis added.) The real meaning of this statement is that by choosing any course of action (including inaction), one is engaging in risk producing conduct, since at every moment one is potentially, no matter how remotely, in a position to affect the risk of harm faced by another. The “conventional duty of care [§ 7] often involves minimizing or protecting another against a risk of harm whose source is not the defendant’s negligence” (P. 45.) Of course, in much of a person’s daily life the practical opportunity to reduce the risks faced by others is so minimal as to be almost invisible, but that does not undermine the point that, in theory, there is always a potential opportunity to mitigate another’s experience of risk. The choice to do nothing is “conduct”. The choice to do something is “conduct”. All choosing is conduct, and since “all conduct creates some risk of harm,” every choice may, in theory, may create a risk to which another is exposed.
The viewpoint that “all of life is conduct and all conduct produces risk to others” is illustrated by Abraham and Kendrick with the following example. Driver, through no fault of her own, is confronted with a pedestrian entering into the street. Sidewalk User sees the pedestrian at the same time. Abraham and Kendrick insist that there is no reason to evaluate Driver’s response to the pedestrian under § 7 (with all the attendant issues of comparative fault) and Sidewalk User’s response under § 39. They have no objection to the likely outcome that today’s doctrine would produce (Driver likely liable; Sidewalk User likely not liable) but they insist that, since Sidewalk User’s “conduct” potentially created risk (since Sidewalk User could reduce the pedestrian’s risk of injury) the question of duty should be analyzed under the part of the Restatement at the question of duty for Driver.
The elegance of Abraham and Kendrick’s approach is that it deflates so many categories with a single blow. Of course, there is no reason to have three exceptions to the no affirmative duty rule covered in Chapter 8: Once a defendant’s ex ante opportunity to reduce another’s risk of injury is deemed to be an act of potential risk creation, the obligations imposed by special relations, gratuitous undertakings and the non-negligent creation of a continuing risk can be fused into a single class of conduct. Further, since the test of conduct is purely based on circumstance – whether one is in a position to reduce the risk of injury to another – any focus on conduct prior to the decision to reduce risk to another is irrelevant, and so the distinction between conduct and non-conduct at the point of that decision is erased.
Obviously, it is a serious question whether the concept of “conduct” adopted by Abraham and Kendrick has much currency in everyday language or the moral conventions of the societies to which the Restatement is addressed. In moral philosophy, their position is most closely associated with act-utilitarianism. In tort theory, there is a superficial connection between their account and a simplistic version of Calabresi’s cheapest cost-avoider. After all, Calabresi did, for rhetorical purposes, hypothesize that anyone who could most cheaply reduce the cost of car accidents ought to be held liable in tort for those accidents. But Calabresi was making a point about the relationship between strict liability and negligence, and Abraham and Kendrick claim to be offering an interpretation of negligence law. Therefore, it makes sense to evaluate their proposal from the perspective of their target, which is a reconstruction of negligence in the common law. I want to conclude with a much more limited critical observation.
As mentioned above, Abraham and Kendrick do not explicitly call for significant changes in liability judgments. They are calling for a significant change in legal process. They note that, once the ad hoc segregation of a case like Pedestrian v. Sidewalk User is abandoned, the case against Sidewalk User will be handled by the same process as the case of Pedestrian v. Driver. In the modern era of the Third Restatement, that means that, unless § 7(b) is invoked, the liability decision will depend on a factual judgment about breach, causation, and proximate causation. This is the clear implication of the statement that “prior-risk-creation cases can be more simply and more accurately be seen as asking whether the defendant exercised reasonable care under all the circumstances” (P. 54, emphasis added.) Abraham and Kendrick mention that in some cases, like Pedestrian v. Sidewalk User, the court will exercise its “tools for policing the outer-boundaries of fact-finding” to routinely find for Sidewalk User. (P. 53.)
My point is not that there is any reason to distrust the capacity of courts to use their supervisory power over fact-finding to preserve the status quo’s consensus that the defendants who today are found not liable under Chapter 8 will continue to be found not liable. It is rather, to observe that it is just as likely that many of the defendants who today are found not liable under Chapter 8 will be diverted into § 7(b). § 7(b) states “[i]n exceptional cases, when an articulated countervailing principle or policy warrants denying or limiting liability in a particular class of cases, a court may decide that the defendant has no duty or that the ordinary duty of reasonable care requires modification.” It was added, of course, in response to the concern that, by adopting the view that there was a “ordinarily” a duty to all with regard to the creation of unreasonable risk (§ 7(a)), judges needed some way to block plaintiffs from asking whether the defendant “exercised reasonable care under all the circumstances” as a matter of law in some familiar classes of cases.
Even if one were persuaded that the conceptual deflation of the word “conduct” is defensible, I suspect that it will not achieve Abraham and Kendrick’s aim of removing complexity from the Third Restatement. It is just as likely that they have done nothing more than moved a difficult problem from one chapter to another.
For the past century, the car accident has served as the paradigmatic (über-?) tort. What does this tell us about tort law’s past, present, and future? Nora Freeman Engstrom’s elegant and informative When Cars Crash offers some highly illuminating reflections on this question.
Engstrom starts with the facts. In the U.S., millions of car crashes each year generate upward of 30,000 fatalities and countless injuries. Only heart disease and cancer account for more life-years lost, and the toll is particularly severe for teens and young adults. On the litigation side, many more lawsuits are filed, and more dollars paid out, for car accidents than for any other type of accident. Car wrecks also appear to generate a higher percentage of frivolous or at least overstated claims—think here of the stereotypical “whiplash” plaintiff. Thanks to the presence of settlement formulae established by repeat players, including plaintiffs’ lawyers and insurance adjusters, these suits tend to be resolved quickly and cheaply. When trials happen, they are brief and straightforward. Car accident plaintiffs who go to trial win more than half the time but generally recover modest amounts—$16,000 on average.
So the first lesson is that, even within the domain of accident law, suits for car crashes operate in distinctive ways. The second moral of the story, for Engstrom, has to do with tort reform. Roughly half a century after workers’ compensation statutes displaced a great deal of negligence litigation over workplace accidents, the next great step was supposed to come in the form of auto no-fault. However, after some enthusiasm and successes in the early 1970s, the movement stalled. With due credit to Gary Schwartz, Engstrom first notes that no-fault’s failure to sweep the nation was nonetheless important to the development of negligence doctrine: in an effort to weaken the campaign for no-fault, auto insurers dropped their resistance to the shift from contributory negligence to comparative fault. She then entertains an intriguing counterfactual. Suppose auto no-fault had taken root nationally. Along with workers’ compensation, would this have spelled the death knell for tort law as we know it? What would have counseled against the adoption of similar plans for medical errors, slips and falls, and product-related injuries?
Engstrom next considers the importance of automobile accident litigation to doctrinal development. She observes that the modern torts canon is filled with opinions rendered in car accident cases: MacPherson v. Buick, Baltimore & Ohio Railroad v. Goodman, Pokora v. Wabash Railway, Henningsen v. Bloomfield Motors, and Dillon v. Legg, to name a few. She also suggests that negligent entrustment claims (involving defendants who allow incompetent drivers to use their cars), as well as decisions holding owners who leave their keys in the car liable for accidents caused by thieves, made an important contribution to the emergence of the category of claims that Robert Rabin has dubbed “enabling torts.”
Finally, Engstrom observes that close attention to negligence litigation over car accidents confirms the suggestion made by some scholars that the tort system has distinctive contributions to make even in a heavily regulated area such as auto safety. Here, she focuses on litigation brought against GM by the parents of Brook Melton, who was killed in 2010 in the crash of her Chevrolet Cobalt. Thanks to the diligence of Melton’s parents and attorney, it was discovered that, for several model years, Chevrolet—with the knowledge of at least some of its engineers—had installed a defectively designed ignition switch. The defect allowed car keys attached to heavy key chains to slip out of the ignition while the car was operating, thereby disabling its power steering, brakes, and airbags. Although the relevant regulatory body (NHTSA) was aware of data suggesting a suspicious pattern of air bags failing to deploy in Cobalt accidents, it dithered. As a result of the Meltons’ suit, GM incurred a substantial fine, fired numerous employees and reorganized its engineering division, and implemented a privately run scheme to compensate victims. Here, and presumably elsewhere, Engstrom suggests, it is old-fashioned negligence litigation that is needed to bring to light information crucial to deterring wrongdoing, compensating victims, and enhancing safety regulation.
The topic of When Cars Crash is an important and timely one, given (as Engstrom notes) what may prove to be the impending transformation of motorized transportation through the use of autonomous vehicles. Moreover, in its fair-minded and illuminating comparison between tort and non-tort alternatives in the car accident context, it reminds us of the continuing value of the law-and-society approach to tort scholarship. Like her colleague Rabin, Engstrom in her work combines historical erudition, institutional sensitivity, and superb judgment, while providing a remarkably clear view of a complex yet fundamental topic.
While I find Engstrom’s observations and conclusions largely convincing, I would push back on some. For example, I don’t agree that the “enabling torts” category was forged in the furnace of car accident litigation. But that’s mainly because I would deny that there is any such category. Indeed, as Ben Zipursky and I have detailed elsewhere, several types of car-accident cases— including cases in which cell-phone manufacturers and banks that lend money for the purchase of automobiles are categorically spared from liability for ‘enabling’ negligent driving—indicate that use of the label “enabling torts” involves a vast and distorting overgeneralization.
Predominantly, however, Engstrom’s insightful inquiry leaves me inclined not to quibble but to join in by considering other ways in which the primacy of the auto accident has mattered to the development of tort law. At the risk of being myopically academic, I would suggest that car crashes have cast an equally long shadow over tort theory. Although the seed of the idea was planted before the heyday of the motorcar, the notion that modern tort law just is accident law surely owes a lot to the prevalence of litigation over car accidents.
Here’s one way to make my point: Judge Guido Calabresi’s landmark book could easily have been titled “The Costs of Car Accidents.” Recall the opening passage of its first chapter: “The last few years have seen a rebirth of interest in accident law. Popular reaction to the increasing number of automobile accidents and rising automobile insurance rates, as well as attempts by some insurance companies to deal only with preferred risks, has made automobile accidents and insurance controversial political issues.” Clearly, Calabresi was writing in reaction to car accidents and to the emergence of auto no-fault plans. Equally clearly, his thinking partook of the regulatory mentality of the “Great Society” era. On this approach, one starts with a social problem—here, the problem of car accidents—then figures out what technologies, legal or otherwise, can best solve it. Liability, Calabresi argued, is such a technology.
Like rubbernecking motorists, many contemporary tort theorists have been badly distracted by car accidents. Fundamentally, tort law is about wrongs, not accidents or losses, and tort theory is about something more than the choice between negligence and strict liability, or between negligence and compensation systems. It is one thing to recognize that, empirically, the car accident has for decades been the “it” tort, and that such accidents often involve the commission of the particular wrong of negligence. It is quite another to suppose that negligence law – not to mention tort law as a whole, which covers everything from battery and defamation to conversion and fraud – is best understood as law for the deterrence of accidents and the compensation of accident victims.
Of course, the tort of negligence is frequently committed by means of conduct—including momentarily inattentive or aggressive driving, or the production of vehicles that turn out to be unreasonably unsafe—that is not highly culpable or blameworthy. (Often, however, it does involve grave misconduct, such as driving while seriously intoxicated.) The lesser culpability of standard instances of car-related negligence, combined with the use of routinized claims-resolution processes, renders superficially plausible the thought that a body of tort law dominated statistically by car accidents cannot be a law of wrongs. Still, the thought is mistaken. Even when not punishable or highly blameworthy, careless driving that injures another is the violation of a substantive standard of safe conduct set by courts out of concern to protect basic human interests, and to reinforce and clarify equally basic correlative responsibilities.
It is no “accident” that parents and teachers emphasize even to very young children the importance of being careful not to injure one another. Taking care not to injure is a fundamental form of moral responsibility; one that reflects the fact that, as we go about our lives focusing largely on our own interests, we must nonetheless give due regard to aspects of others’ well-being. And, of course, when children reach driving age, these lessons about taking care are only amplified, for driving is among the most dangerous activities of which the vast bulk of ordinary citizens partake. It is thus not the least bit surprising to find that a duty to avoid injuring others through imprudent conduct, including a duty to avoid injuring through imprudent driving, is a wrong not only in our positive morality but a wrong recognized in our law. When a car-accident victim sues for negligence, just as when a plaintiff sues for battery or fraud, she is not acting as a private attorney general, nor is she applying for benefits from an accident-victim relief fund. She is exercising the legal power that tort law confers on victims of the legal wrongs that it recognizes to obtain redress from those who wrong them.
Omri Ben-Shahar, "Data Pollution,"
University of Chicago Public Law & Legal Theory Paper Series, No. 679 (forthcoming 2018), available at SSRN.
What was the nature of the harm when data on 143 million Equifax consumers was stolen? More generally, what is the problem with personal data use and misuse by commercial players? The most immediate answer: privacy, individuals’ privacy interests are infringed. But then the question becomes what is the problem with infringing one’s privacy? Here, the answer usually is that infringing one’s privacy infringes upon her autonomy, dignity, emotional wellbeing, and such. To these non-monetary harms, one can add various monetary harms such as monetary losses associated with identity theft and other economic losses. These personal harms have led privacy scholars to focus on the private and personal aspects of data breaches. This, in turn, has naturally also led them to focus on private law solutions, such as tort and contract law-type protections for individual’s privacy interests.
However, despite years of attempting to combat irresponsible data sharing and handling, the problem persists. People treat their private personal information as if they do not much care about it. They may trade it quid pro quo for access to various services from navigation and communication services on their cell phones to participation in social networks, or even just to play Fortnite. And yet, when asked about how important privacy is to them, people overwhelmingly claim it matters a lot. Similarly, when people sue for damages for data breaches, they claim they suffered significant losses. The gap between what people claim (privacy matters) and what they do (sell it cheaply) is the so called “privacy paradox.” How can this paradox be resolved?
Some scholars have suggested that the gap stems from the fact that people are misinformed, irrational, or rationally misinformed or even rationally irrational. In a brand-new paper titled “Data Pollution,” Omri Ben Shahar offers a different solution.
In “Data Pollution,” Ben Shahar shifts the focus of data breaches from the private harm suffered by individuals whose information was used to the societal harm writ large. And the harm to society Ben Shahar has in mind is not at all the aggregate harm of the class of individuals harmed, nor is it an abstract, derivative harm stemming from the emerging distrust of individuals in private or public institutions. Rather, it is a direct and concrete harm to the public ecosystem. Indeed, the social harm might occur even when individuals suffer no private harm,or even benefit from willingly sharing their private data.
How can it be? Think about the potential harm to the integrity of the American election system as a result of Facebook data-share with Cambridge Analytica. The individuals whose data was shared might be personally happy about the data share, yet the truly troubling problem was to the American democratic ecosystem. Or think about users of the Strava fitness app who share their running trails with the world, not realizing they were revealing locations of secret military bases, and therefore harming national security interests. This type of harm, Ben Shahar argues, stems from the fact that data is hazardous and if not handled well, might create dangerous “data pollution.”
When data misuse is viewed less as a personal harm to the privacy interest of individuals and more as a social harm to the public sphere, the paradigm shifts. Thus, according to Ben-Shahar, policy makers’ focus should not only be on the best ways to protect individuals from commercial players in the public sphere, but also on the best ways to protect the public sphere from individuals sharing their personal data with commercial players. The problem, in other words, is not just that commercial players trade individuals’ private data without adequately compensating them in an ex-ante user agreement, a fact that can be explained by individuals being misinformed or irrational. Nor is the problem just that commercial players mishandle individuals’ private data without adequately compensating them in an ex-post tort suit, a fact that can be explained by the difficulty in proving causation, estimating the harm, etc. Rather, according to Ben Shahar, the problem also is that private individuals trade their own private data at a price which does not reflect the negative externalities they create. It is this last feature – the negative externality – which is Ben Shahar’s main contribution to the literature and which will be my focus here.
“Data are to this century what oil was to the last one.” This quote opens Omri Ben-Shahar’s new thought-provoking paper. Data is the fuel of the information economy and like fuel in the oil economy, data pollutes, and it pollutes the digital ecosystem in ways which directly disrupt the public interest. For years, privacy advocates have spent much energy unsuccessfully trying to raise people’s awareness to the privacy interest in their own data, while not spending any energy raising people’s awareness to the social problem of data pollution. And yet, the external social costs associated with shared data might be,sometimes at least,much larger than the private costs.
It is as if policy makers had warned people about the fire hazards from using household kerosene lamps and had not warned them about the contribution to global heat from black carbon emissions. Only that in the data pollution case, unlike in the kerosene case, the social harm from the emission might be much more significant and more dangerous than the private harm to any individual.
The external costs of data emission are neglected any time individuals agree to various user agreements; thus, causing the sale of the private data to be at a price which is lower than the socially-optimal price. The external costs of data emission are also neglected when individuals demand compensation after a privacy breach, thus causing the wrongdoer to pay compensation which is lower than the socially-optimal level of compensation. As a result of these two problems, the level of information which is shared by individuals is excessive, just like pollution. The analogy to pollution and externality is what helps us better see the problem as it really is.
The analogy to pollution is of course not one-to-one; there are several differences between data pollution and industrial pollution. For example, there are two major types of externalities in data pollution, only one of which also clearly exists in industrial pollution. The first type is similar to the harm in industrial pollution: shared data can be aggregated and used or misused in ways which affect the public interest at large. The second type of externality is on other users. This type is unique to data pollution—individuals often share information not just about themselves, but also about others who do not want their information to be shared. An example would be when individuals agree to share their contacts. Perhaps the closest analogy from “real” pollution here is second-hand smoking, where people ignore the costs they incur to friends and family members near them.
Another difference is that data pollution does not only create negative externalities, it also creates positive externalities (think about predicting flu epidemics by looking at google pharmacy searches). Indeed, data collection is among the most productive activities of the 21st century.
Still, the analogy is helpful, and not just in providing a fresh and helpful re-conceptualization of data misuse problems. The analogy assists in analysing potential policy solutions. Data misuse can be regulated by policies long used to control industrial pollution, such as emission quotas, Pigouvian taxes, and legal liability. Indeed, one should not be surprised that private law tools, such as contract and torts, were unable to control the social problem of data pollution. After all, they failed to control industrial pollution as well. And they failed, Ben Shahar argues, primarily because they cannot handle externalities well.
The analogy to industrial hazards pertains not just at an abstract level, but also in specific details. What is the equivalent of quotas imposed on polluters? Restrict what data can be collected, from whom, by whom, for what purposes and for how long. Sounds crazy, right? But this is exactly what European regulators do. What about a Pigovian tax? Ben Shahar proposes, contra to current practice and scholarship, to tax individuals who share personal information quid pro quo for various services. No more free access to cable TV in return for allowing cable companies to collect data on subscribers. A tax would make subscribers (and cable companies) internalize the social external cost associated with the emission to the digital sphere of subscribers’ personal data. And, what about liability for data breaches? Because, unlike physical spills, data spills cannot be cleaned up ex-post. Ben-Shahar proposes imposing liability which equals the expected social costs of the spill, hopefully generating enough deterrence to prevent these spills from occurring in the first place.
Occasionally, the analogy can only be pushed so far. For example, there is no equivalent, yet, in data pollution to cap-and-trade in industrial pollution. Since the objective is to prevent massive data from being accumulated in the hands of a few players, policy makers should forbid players from trading data with each other. Rather than cap-and-trade, policy makers should enforce a strict cap-and-don’t-trade policy. Or, alternatively, since accumulation of data in the hands of the few is analogous to the problem of “hot-spots” in industrial pollution, there is even more that can be borrowed from the regulation of industrial pollution to the regulation of data pollution.
What is Ben Shahar’s preferred tool for combating data pollution? Readers who want to know that are left to find the answer themselves. Instead, in the space left for me here, I will make two comments.
The first comment has to do with the insight that private individuals are themselves not just victims, but also wrongdoers—they are polluters. True, the magnitude of the harm they can create is much smaller than the potential harm of data aggregators, but still… they are polluters. Recognizing that, recall that Ben Shahar proposes a tax on individuals who data-share. But taking the idea of end-user pollution seriously brings to mind another solution: end-user liability.
Consider a case of an individual who clicks on a malicious link, which enables hackers to install ransomware on his contacts’ computers. As a result, some of his contacts need to pay thousands of dollars to free their computers. The law usually will not find the individual liable. But why not? One potential answer is that end-users lack the expertise to protect their computers effectively as well as lack the resources to pay damages. What is missing from this answer is the availability of insurance, perhaps even mandatory insurance, for all online users. Insurance might help individuals protect themselves and others not just by providing coverage, but also by offering technical means to prevent the losses before they occur as well as the technical help to mitigate them after they have occurred. With insurance, it is no longer clear why end-user liability is not currently an option.
My second comment tries to push the pollution metaphor even further from the context of data into other contexts. In a recent working paper, my co-authors and I used the pollution metaphor in the context of civil procedure. Yet here, I would like to use it in the context of discrimination.
Consider a minority religious student group, which organizes an event on university grounds. The group announces that seating will be separated by gender. Should the university approve the event under these terms? This is not a hypothetical example, but it is based on real events that happened recently in the U.K. On the one hand, gender-separated events infringe upon notions of equality as by now we are accustomed to thinking that separate but equal is usually not equal. On the other hand, what if most members of the student group (both men and women) prefer gender-separated seating? Should we not respect their preferences?
Policy makers who want to forbid gender-separated seating can do it in one of two ways. First, a paternalist approach, where they basically ignore the preferences of the group members under the assumption that their consent to separated seating is not free, well informed or rational. Second, policy makers may choose to protect a minority-within-the-minority, which prefers gender-mix seating but is subject to social pressures to comply with the more extremist gender-separated agenda. In the U.K., the Equality and Human Rights Commission has forbidden such events (with some exemptions for religious prayers) exactly on these grounds.
Both ways are problematic. Being paternalistic towards group members by arguing they are misinformed, irrational or not free is problematic exactly because it is…paternalistic. And, defending the minority-within-the-minority is problematic because it is not always clear that there is such a group at all. And yet, our intuition many times is to forbid such events.
Adopting the pollution approach to discrimination exposes the problem with having segregated events on university grounds even when the group members want it. It reveals that “the toxicity from discriminatory treatment degrades the environment also for those not discriminated.”(P. 8.) Segregation (on racial, gender or other forbidden grounds) pollutes the university grounds for the rest of the community. It is akin to a public “moral nuisance.”
Ben Shahar’s “Data Pollution” is an insightful paper. Every time I thought Ben Shahar could not possibly push the analogy to environmental hazards further, I discovered I was wrong. It remains to be seen if others will find it a useful conceptualization of the problems associated with the use and misuse of personal data by commercial players as much as I did.