Civil Justice Memo
No. 11 August 1988
In The Public Interest
Next month the Academy of Political Science will publish New Directions in Liability Law, a book of essays on the tort revolution by prominent scholars in law and the social sciences. As the ones who commissioned and edited the essays, we modestly think the book showcases some of the most stimulating work being done in this field, from a diverse range of opinion.
The distinguished quarterly The Public Interest, in its summer issue, reprints a highlight from the New Directions book, the essay by Professor Peter Schuck of Yale Law School. Schuck is the author of the widely acclaimed Agent Orange on Trial: Mass Toxic Disasters in the Courts and numerous other writings on large-scale litigation. His essay dissects what its title calls "The New Ideology of Tort Law."
The dramatic, continuous expansion of tort law in recent years, he writes, can best be seen as an ideological revolution, "ideology" here used not pejoratively but to refer to an underlying set of assumptions brought to bear on cases by the courts. The courts are now "preoccupied not with meting out corrective justice between individuals based on their past interactions, but with advancing public control of large-scale activities and altering both the distribution of power and the nature of social values."
One of the primary steps in this direction is the increased empowerment of juries. Tort juries have always exercised great power because of the "featureless generality," as Justice Oliver Wendell Holmes described it, of such tort concepts as the "reasonable man." But courts now abdicate to juries the power "not only [to] find the facts but also [to] supply the normative standards for interpreting and applying them." Paradoxically, the empowerment of juries allows judges themselves to innovate freely, because they can pass off to the jury the responsibility for putting their doctrinal creations into practice.
Judges have always concerned themselves to some extent with the broader social implications of their rulings. But a "new functionalism" has begun to permeate liability law, Schuck says, affecting not only the length and cost of trials, but the outcomes of the cases themselves. At some point, the "deep structures" of liability law, such as its orientation toward right and wrong and its party-directed dynamic, will give way, leading to the "deformation of tort law, and its transformation into something very different." The courts are held in high public esteem because they have been good at their limited tasks; as they move into the territory formerly occupied by politicians and other policymakers, we may expect their failure rate to rise, and the level of public dissatisfaction with the legal system on the part of the public to rise as well.
The new ideology of tort law
PETER H. SCHUCK
The recent transformation of American tort law has attracted much attention, and with good reason. On almost all fronts and in almost all jurisdictions, liability has dramatically expanded. It does not seem to matter what kind of party is being sued. Doctor or public official, landlord or social host, government agency or product manufacturer—all are more likely to be held liable today.
Numerous legal doctrines reflect and reinforce this change. Courts have enlarged the concept of "action," a traditional prerequisite for liability, to encompass inaction. In this way, they have placed individuals under a legal duty to help strangers in many situations, thereby hauling new kinds of relationships (and non-relationships) into the net of tort liability. They have accorded legal protection to new categories of interests, including emotional well-being, freedom from fear of cancer, and avoidance of unwanted children. They have extended the domain in time and space over which defendants' duties apply by imposing responsibility for risks that eventuate long after dependents acted and, in some toxic-tort cases, for risks that were scientifically unknowable at that time. They have accepted relatively weak claims of causation, especially in drug, toxic-tort, and medical-malpractice cases, where proving cause and effect is often difficult. They have routinely ignored or overridden express contractual limitations on tort liability, as well as implicit agreements by parties to allocate risk between themselves. They have abandoned or severely curtailed long-standing charitable, governmental, and familial immunities from tort liability.
Presumably, this expansion of liability will not continue indefinitely and without limit. Like other tides in human affairs, it will ebb as well as flow. Even so, one is struck by its duration. Tort scholars appear to agree that liability has expanded steadily since at least the late nineteenth century, when employers' traditional defenses against industrial-accident liability began to erode (even before the enactment of workers' compensation schemes). Some scholars argue that the trend toward wider liability may have begun earlier. Decisions like Brown v. Kendall (1850), which declared that, in general, liability could not be found without "fault," are an apparent exception to the trend. But Gary Schwartz and some other commentators have suggested that these decisions did not so much put new limits on liability as codify existing limits that had been concealed by earlier doctrines and practices.
Legislatures have occasionally sought to arrest this growth in certain areas; product liability and medical malpractice are obvious recent examples. But as the periodic crises in these insurance lines suggest, legislative intervention has seldom been effective in curbing the growth of liability. And at the same time, these legislatures have been busy expanding liability in other areas (as in the 1986 federal vaccine law) and in other ways (as In new laws authorizing courts to make defendants pay the attorney's fees of plaintiffs). In tort law, however, courts almost always have the last word, and that word has usually been compensate.
What accounts for this long period of liability growth? The answer is not at all obvious. In many other areas of the law, after all, the courts oscillate between traditionalism and innovation, self-restraint and self-assertion, and other familiar antinomies. The emphasis in constitutional law, to take one example, has cycled between governmental interests and individual liberties, federal power and states' rights, broad and strict construction. In administrative law, one observes shifts from close judicial scrutiny of agency decisions to greater deference to administrative expertise, and then back to "hard looks." Even in private-law fields, such as domestic relations, legal evolution often seems to come full circle. Why has tort liability followed so straight a path?
Institutional developments have surely played an important role. The growth of private liability insurance, for example, has meant that more "deep pockets" are now available to satisfy judgments. But this explanation is plainly incomplete, for expanded insurance has also undercut the argument for compensation through the tort system. Prospective accident victims now purchase more of their own direct ("first-party") insurance against accident losses, and the government has established massive income-maintenance, disability, and health-insurance programs. Coverage is still far from complete, of course, but it is much more comprehensive today than even before, even when compared with the far larger accident costs—wages, medical costs, pain and suffering, emotional harm, and third-party consortium claims—that the expansive tort law now makes compensable. In short, most accident victims would now be compensated for most of their economic losses even without having recourse to the extremely costly, protracted lottery known as the tort system.
Other explanations of a more sociological kind are equally unsatisfying. Community life in the United States is indeed fragmented, and strangers increasingly demand that tort law protect them from risks posed by people with whom they lack a relationship of trust of shared experience. But this development is not a new one. The anomie and individualism of American culture, deeply imprinted upon our law, impressed Toequeville more than a century before David Riesman dissected it in The Lonely Crowd. And even Riesman's lament antedated the dramatic liability expansion of recent years.
This essay will emphasize a different cause for the expansion of liability: a change in the ideology that courts bring to tort cases. The term ideology is not meant pejoratively here. It simply denotes a set of assumptions by contemporary judges that organize and render coherent their perceptions of legal reality. To furnish a fully satisfying account of this ideology, it would be necessary to trace the history of its principal ideas, the social forces that have shaped it, the functions it has served, and the personalities of the individual judges who have implemented it. Such a comprehensive account is well beyond the scope of this essay. For now, it is enough to identify the nature of this ideology, to examine how it leads to expanded liability, and to consider whether the tort law that it has spawned can satisfy its own normative criteria of legitimacy and effectiveness.
Although the new ideology of tort law is complex and multifaceted, four elements stand out: (1) a profound skepticism about the role of markets in allocating risk; (2) a shift in the dominant paradigm of causation; (3) a tendency to broaden jury discretion; and (4) a preoccupation with achieving broad social goals instead of the narrower, more traditional purpose of corrective justice between the litigants. This last element entails a change in the conception of the judges' role that serves to link, legitimate, and effectuate the first three elements. Needless to say, some of these elements are further developed than others, and few courts have yet taken them as far as have the supreme courts of New Jersey and California (at least until the electoral defeat of several liberal justices in California in 1986). But anyone who has read a large sample of contemporary tort cases will recognize the importance of these elements.
Distrust of markets
Judges' rulings, and occasionally their supporting rhetoric, bespeak increasing skepticism about both the efficiency and the justice of permitting the market to allocate risk. This is most apparent in cases arising from disputes over liability-insurance coverage. One might expect courts to defer to bargains explicitly concluded between insurers and their customers concerning the risks a policy will cover. Yet, as Kenneth Abraham has demonstrated, courts have devised numerous techniques to reshape or interpret insurance contracts so as to provide coverage of risks that the parties never agreed to shift. (Kenneth Abraham, Distributing Risk: Insurance, Legal Theory, and Public Policy (New Haven: Yale University Press, 1986)) Although this development has affected all areas of tort law, its implications are especially profound in mass toxic-tort cases. A dramatic example occurred recently in the massive asbestos litigation pending in San Francisco. In that case, Judge Ira Brown ruled that in order to maximize the pool of funds available to compensate victims, all insurers who wrote policies over several decades would be liable for all injuries, regardless of whether any given risk came into being during any given policy period. (Asbestos Insurance Coverage Cases, Judicial Council Coordinating Proceeding No. 1072, Superior Court, San Francisco Court, May 29, 1987)
In tort law proper, decisions concerning the allocation of risks are seldom as explicit as they are in insurance contracts, and judicial respect for them is correspondingly lower. The courts' skepticism is entirely warranted in many tort disputes in which it would have been prohibitively costly for the two sides to reach some agreement about risk, the classic example being the collision between total strangers on the highway. Such skepticism may even make sense in those cases, also common in tort law, in which the parties could in principle have bargained at low cost about risk but in which one of the parties is a "low-attention" decision maker, to use Howard Latin's phrase.
Courts' disregard for risk markets, however, now extends well beyond these kinds of situations. Increasingly, judges override market risk allocations even in those cases in which both parties are plainly "high-attention" decision makers who have already engaged in actual bargaining over the very sorts of risks that are at issue. Yet many of these decisions serve no evident purpose; they do not even promote a more progressive distribution of wealth.
The traditional approach to such cases is represented by a 1927 Supreme Court decision, Robins Dry Dock and Repair Co. v. Flint. The defendant, a dry dock, had negligently damaged a ship and rendered it unusable for a time. The plaintiff was not the owner of the ship but a third party who had chartered the vessel and was deprived of its use. The terms of the chartering agreement relieved the plaintiff of any hiring charges in case of such mishap but did not indemnify him for his lost profits, for which he proceeded to sue the dry dock in tort. Justice Oliver Wendell Holmes, Jr. rejected the claim, holding that even if the plaintiff might recover against the owner of the vessel, who might in turn recover against the dry dock, the dry dock owed no direct obligation to its customer's customer. Such an obligation, the Court reasoned, could arise only through contract.
Contrast this decision with the 1979 case of J’Aire Corp. v. Gregory, in which the California Supreme Court, confronted with roughly analogous facts, had no trouble imposing tort liability. A commercial tenant sued its landlord's contractor in tort for the profits it lost when the contractor negligently delayed completing repairs to the tenant's premises. Both parties had negotiated commercial contracts with the landlord; these contracts presumably took into account the risk to all sides of an interruption of business. The tenant was hardly without remedy, since he could have sued the landlord under the lease and may even have had a direct contract remedy against the defendant as a third-party beneficiary of its promise to repair. For aught that appears, the parties were equally wealthy and equally insured. Moreover, shifting the tenant's loss to the contractor in this situation may well be economically inefficient, for two reasons. It may fail to establish incentives that minimize the costs of repair errors, since the landlord and tenant are best situated to allocate that risk between them; and it may require needless administrative outlays in the course of establishing tort liability.
The examples could easily be multiplied. In Sprecher v. Adamson Cos., another California case, the court upheld a tort claim by the owner of an oceanfront home in Malibu against his uphill neighbor for failing to install a fence that might have prevented damage from a naturally occurring mud slide. The defendant did not cause the mud slide, the plaintiff could as readily and perhaps more cheaply have erected the fence, the prices of Malibu lots reflect such a common, notorious risk, and Malibu neighbors are remarkably well situated to allocate it among themselves justly and efficiently. Still, the court—rushing to the rescue of downhill members of the upper class—imposed liability. In yet another revealing group of cases, courts have overruled or seriously qualified the long-standing doctrine that prevented third-party investors from suing accountants for neglectfully preparing financial statements for client companies on which the investors relied to their detriment.
Decisions like these reflect what Grant Gilmore called "the death of contract." (Grant Gilmore, The Death of Contract (Columbus: Ohio State University Press, 1974)) Gilmore was referring to the courts' growing tendency to resolve contract disputes through principles drawn from tort law, with its relatively fluid legal obligations grounded in social goals, rather than from contract law, with its more structured rules grounded in the mutual consent of the parties. Gilmore's insight must now be extended to tort cases proper, where the courts are increasingly rejecting market risk allocations that would limit legal responsibility for accidental injuries.
New causal paradigms
A plaintiff cannot establish tort liability without proving two analytically distinct propositions. He must show that a particular act or omission is what caused his injury (the "determinate plaintiff” issue), and also that a particular defendant is the one responsible for that conduct (the "determinate defendant" issue). This two-step paradigm of causation, which has governed tort law from its inception, was traditionally grounded in turn on two interrelated ideas: a moral conception of how people are responsible for actions, and a phenomenological conception of how harmful consequences come about.
The moral conception, closely linked to the norm of corrective justice, emphasized the personal responsibility of each autonomous individual for his actions. A defendant, in this conception, was liable to a plaintiff only if that particular defendant was the agent of harm to that particular plaintiff, and the extent of responsibility determined the extent of liability. The phenomenological conception was based on an essentially Newtonian understanding of how events occur: it posited a set of mechanical relationships between things and events governed by general scientific laws, so that once the defendant's action was set in motion the plaintiff's harm followed in the same way that one moving billiard ball strikes another.
These linked conceptions, of course, did not always furnish satisfactory answers to causal questions in real-world cases; indeed, perhaps no issue has bedeviled tort scholars more than that of causation. But together, the conceptions set important normative and practical limits on tort liability. Recently, however, this traditional view of causation has been challenged by a competing paradigm premised on the contingent character of all phenomena and the inevitably probabilistic nature of all causal statements. This probabilistic view of causation is most salient in cases of mass exposure to toxic hazards, in which it has eroded both the determinate-defendant and the determinate-plaintiff requirements.
The effect on the determinate-defendant rule is illustrated by the well-known 1980 case of Sindell v. Abbott Laboratories. Women whose mothers had taken diethylstilbestrol (DES) during pregnancy brought a class-action suit against eleven DES manufacturers alleging that the drug caused their vaginal cancers. The plaintiffs could not identify which particular firms had manufactured the DES that each of their mothers had taken. But the California Supreme Court nonetheless permitted their claims to go forward. Liability, the court held, could be found if the defendants' products were interchangeable and companies with a "substantial share" of the DES market were before the court as defendants. Under the court's "market share" approach, each defendant's share of liability for the plaintiff's injuries would be determined by its original share of total industry production of the drug; hence its liability would be based on the probability that its product injured a particular plaintiff, even though it might not actually have done so. This approach plainly attenuates the determinate-defendant requirement. Indeed, it may even eliminate the requirement in some cases, for it means that a manufacturer can be liable to a plaintiff who never even used its product.
In mass-exposure cases, probabilistic causation also threatens to overthrow the traditional determinate-plaintiff limit on liability. The Agent Orange case, a class action on behalf of 2.2 million veterans exposed to dioxin in Vietnam, demonstrates this development. (Peter H. Schuck, Agent Orange on Trial. Man Toxic Disasters in the Courts, enlarged ed. (Cambridge: Belknap/Harvard University Press, 1987)). The causal issue in Agent Orange was muddied by the presence not only of indeterminate defendants (because various manufacturers' products had been mixed before being used) but also of indeterminate plaintiffs (because the veterans' symptoms could have had many causes other than exposure to the defendants' products). In approving a class-action settlement, Judge Jack Weinstein endorsed an ensemble of innovations that could vastly enlarge tort liability in indeterminate-plaintiff cases: these include the use of class actions in mass-exposure cases, the use of epidemiological and other statistical evidence rather than "particularistic" evidence to establish causation, and proportional liability for defendants that create any "excess risk" above background levels, however small. (The traditional threshold for liability is creation of a risk that is more probable than not—that is, greater than 50 percent.)
These innovations fit comfortably into what a leading proponent, David Rosenberg, has called a "public law vision of the tort system. " (David Rosenberg, "The Causal Connection in Mass Exposure Ca : A 'Public Law' View of the Tort System," Harvard Law Review 97 (1984): 849929). It is far too early, of course, for Rosenberg to declare victory. The recent appellate court decision in Agent Orange, while essentially affirming Weinstein's rulings, casts serious doubt on future use of this kind of class-action device in most cases, although that device would seem essential if epidemiological evidence and the concept of probabilistic causation are to be made use of in mass tort cases.
Still, these developments, along with some parallel changes in the legislative arena, such as the federal government's passage of the National Childhood Vaccination Act of 1986, place enormous pressure on the traditional view of causation. They may prefigure a fundamental shift in the ruling paradigms, not only of causation but also of tort law itself. Tort law is abandoning its individualistic grounding and groping toward a more collective one. Increasingly, it treats the parties less as idiosyncratic actors than as relatively interchangeable units within large, impersonal aggregations, and their actions or injuries less as discrete occurrences than as statistical events within broadly defined classes and populations.
The empowerment of juries
The American jury evokes the mythic symbols of democracy and the living law. It is viewed, especially in tort cases, as the repository of yeoman virtues, community norms, intuitive justice, and common sense. But juries are prone to certain dangers. Their natural sympathies for the unfortunates who come before them can offend the principle of a justice blind to contingencies of wealth or status. juries, moreover, are neither learned in the law nor elected to legislate. Their proper role is to find facts and apply existing norms, not to discern or make law in a quest for a more just society.
In principle, at least, judges control juries by making procedural and evidentiary rulings and formulating the substantive law that juries are to apply. Rising judicial caseloads, along with recent concerns about the threat that juries can pose to constitutional values, have intensified pressures to fortify these controls. In the Agent Orange case, Judge Weinstein granted summary judgment despite conflicts in expert medical testimony on the all-important issue of causation. In three different 1986 cases—Celotex Corp. v. Catrett, Anderson v. Liberty Lobby, Inc., and Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corp.—the Supreme Court urged lower courts to grant summary judgment more liberally on matters ranging from defamation to antitrust.
But in tort cases, at least, this restraint on juries is blunted, neutralized, and sometimes overborne by powerful forces working to broaden their role. Perhaps the most important of these countervailing forces is the relative ambiguity of most of the substantive rules of tort law. Standards based on "reasonableness" are common in many areas of modern law, of course, but tort law's "featureless generality” (as Holmes once described it) (Oliver Wendell Holmes, Jr., The Common Law (Boston: Little, Brown & Co., 1881). p. 111)—especially its "reasonable person" negligence standard—probably surpasses that in any other field.
This generality, moreover, is unlikely to diminish in the future. Statutes are seldom used to define standards of care, and even then they are rarely binding on juries. Dogged efforts by judges and legal scholars to make tort norms more specific and outcomes more determinate will always be confounded by the factual richness and diversity of the circumstances under which tort disputes arise. In practice, then, tort juries not only find the facts but also supply the normative standards for interpreting and applying them. The latitude of juries has always been great in the United States, but it has steadily grown, as judges have increasingly employed it for broad social purposes. As tort law seeks to regulate relationships and interactions whose value conflicts are harder to resolve, with consequences that are harder to predict, even the most elaborate and refined doctrinal tools are useless unless the jury can answer the kinds of questions that courts now put to it. Those questions, however, often turn out to be intractable.
We can glimpse this dynamic at work in the case of Barker v. Lull Engineering Co. (1978), in which the California Supreme Court tried to define the concept of "design defect" in product-liability cases through a two-part test. One part of that test requires the jury to decide whether "the risk of danger inherent in the challenged design outweighs the benefits of such design." In applying that standard, the jury is to "consider, among other relevant factors, the gravity of the danger posed by the challenged design, the likelihood that such danger would occur, the mechanical feasibility of a safer alternative design, the financial cost of an improved design, and the adverse consequences to the product and to the consumer that would result from an alternative design."
For present purposes, it is irrelevant whether these are the “right" questions for the law to ask, or whether a jury could ever undertake the kind of analysis that would be necessary to address them responsibly and answer them competently. The point is that beneath most of today's innovative legal doctrines lies a broad set of ultimate, policy-laden factual issues that a jury must resolve if the doctrine is to be applied at all. Barker is not an isolated example; throughout contemporary tort law, especially (but not only) in toxic-tort cases, courts are busy elaborating new doctrines that pose questions of similar complexity and policy significance for the jury. By multiplying the occasions that call for jury discretion, these doctrines further empower the jury.
In Rowland v. Christian (1968), another California Supreme Court case, in which a precedent was set that has been followed in other states, the court abandoned the traditional method of evaluating the claims of people injured while on another person's land. Over the course of centuries, judges had used this method to clarify the rights and obligations of landowners and their visitors through rules that limited jury discretion and produced relatively predictable outcomes. In Rowland, the court jettisoned this familiar structure, substituting a new legal regime of broad jury discretion. Under this approach, landowners' obligations to persons injured on their property are now decided by juries on a case-by-case basis under a "reasonableness" standard without any meaningful guidance from the courts.
But the relation between expansive new tort doctrines and jury empowerment may run both ways. It may be that jury discretion not only follows but also generates the judicial innovations that expand liability. Today's judges often seem to use the jury as a kind of deus ex machina to relieve themselves of troublesome responsibilities, doubts, and anxieties. judges themselves can feel freer to innovate, secure in the knowledge that it will be up to anonymous jurors to determine the concrete meaning and consequences of new doctrines.
Jurors thus serve as a buffer that insulates judges from full responsibility for what happens when their doctrinal creations are implemented. By tradition, the jury is expected to be a "black box": explanation of how it reached its decision is not even permitted (except informally, after the case is over). This lack of accountability encourages judicial irresponsibility (in this special sense). Consider an analogy: if it were somehow made easier for men to conceal their paternity, they would presumably father more children—at least until the children's mothers took a stand. Similarly, when the cost to judges of innovating goes down, it is not surprising that they engage in more of it—at least until legislatures catch on.
If this is so, then an interesting paradox follows. Courts often invoke the principle of cost internalization to justify expanding enterprise liability. But the very same courts fail to apply that principle to the judicial enterprise itself. By relying upon the opacity of jury verdicts, judges can externalize the error and administrative costs of innovative, liability-expanding doctrines onto the parties and the social system as a whole. Any remaining inhibitions about innovation are further reduced by judges' near-absolute immunity from liability for their errors. (Peter H. Schuck, Suing Government: Citizen Remedies for Official Wrongs (New Haven: Yale University Press, 1983 ), pp. 9091.) The paternity analogy suggests that many of the judicial progeny spawned by this incentive structure will be illegitimate.
Changing legal purposes
From the earliest days of the common law, judges have considered how their decisions will affect the larger society outside the courtroom. Sometimes their decisions have invoked explicit social purposes, especially the deterrence of risky behavior. Nor is an emphasis on compensating injured persons anything new; it is central to any justification of tort law. Still, tort law was traditionally and preeminently the domain of corrective justice, which required a wrongdoer to return to a victim what he had "taken." This conception encouraged courts to view tort cases as essentially isolated disputes in which the law's role was simply to allocate losses between two (or among a few) injurers and victims. The court could readily adjudicate such disputes by eliciting from the parties relatively simple, comprehensible accounts of past events. And because the ultimate decision owed much to the specific facts and was not explained by the jury, it rarely constituted much of a precedent for other cases.
Today, in contrast, the law books abound with tort cases that affect not a few individuals but great aggregations of people and vast economic and social interests. The decisions in these cases are preoccupied not with meting out corrective justice between individuals based on their past interactions, but with advancing public control of large-scale activities and altering both the distribution of power and the nature of social values. In such cases, the parties are often little more than quaint anachronisms, mere placeholders for these larger social interests. Even in conventional tort cases, judges and juries increasingly act (and view themselves) as risk regulators, cost-benefit analysts, and social-problem solvers, rather than as adjudicators of isolated, morally self-contained disputes.
This shift toward a more functional view of tort law derives in part from a heightened concern for the goal of compensating victims in an era of soaring medical costs, high litigation fees, and extended life expectancies, and in part from institutional changes, such as the spread of liability insurance, that appear to make compensation more feasible. But the shift goes further. As George Priest has shown, many other functional concepts—enterprise liability, risk-spreading, deterrence through cost internalization, and incentives to produce information—have moved to the center of discussions of private tort law by contemporary judges, scholars, and litigants. (George Priest, "The Invention of Enterprise Liability: A Cultural History of the Intellectual Foundations of Modern Tort Law," 14 Journal of Legal Studies 461527 (1985); and "The Current Insurance Crisis and Modern Tort Law," 96 Yale Law Journal 15211590 (1987)). Administrative efficiency, another functional goal, dominates analysis of the mass-exposure cases involving asbestos, dioxin, and DES. The same goals animate most of the proposals for legislative tort reform.
The new functionalism, in supplanting the old corrective-justice ideology, has not simply changed how parties litigate tort cases and judges and juries rationalize their decisions. It has also altered the outcome of cases, systematically enlarging the scope of tort liability. Indeed, courts (and most tort scholars) cite each policy goal as a reason to expand liability; ironically, even administrative efficiency, certainly tort law's weakest suit, has been invoked—to justify abandoning negligence rules in favor of strict liability.
The courts have striven to integrate these discrete elements of the new ideology—skepticism about markets, a stochastic view of causal responsibility, broad jury discretion, and a shift to functionalism—into an intelligible, morally compelling world view, in which judges play a central policy role. Most of the courts' justificatory techniques are familiar and not particularly noteworthy. In tort cases, as in others, judges continue to reshape legal doctrine through the repertoire of methods sanctioned by a millennium of the common law. They reclassify legal categories and issues, invoke "changed conditions," choose among competing analogies, select the level of generality at which to characterize facts, carve out and widen some exceptions to rules while narrowing or abolishing others, shift burdens of proof, alter procedural settings, devise new remedies, and regulate juries. Although the case names may have changed, the techniques with which judges make laws and apply them remain the same.
What has changed dramatically is the courts' conception of their own place in the ongoing business of government. Traditionally, judges tended to view themselves as adjudicators who effected legal change incrementally through the slow accretion of precedents, moving in directions that were often discernible only in hindsight. Of course, there were always exceptions: judges like Blackburn, Shaw, and Cardozo, who did not shrink from using individual tort cases to propel the law toward one policy goal or another. But even these exceptional judges felt constrained to conceal their instrumentalism by paying conspicuous obeisance to the normative premises of the common law: the rule of stare decisis, the discipline of particularized facts, the obligation to defer to the legislature, and the strong presumption in favor of private ordering. They invoked these pieties even as they flagrantly and creatively violated them.
Today both the pretense and the underlying reality have changed. Not only legal innovators like Roger Traynor and Jack Weinstein but ordinary, standard-issue judges as well increasingly regard themselves not simply as logicians and case analysts but as policymakers and systems analysts. They have become less principle-oriented and more goal-oriented.
The signs of this change can be found in almost any sample of modern tort decisions. The court's opinion usually begins with a perfunctory bow to traditional legal categories and distinctions, followed by a critique of these distinctions as "wooden" or "formalistic." The court then explains why the precedents do not ordain any particular decision in this case, leaving it free to choose the "best" rule. From that point on, instrumental rationality is the mode of analysis: the court identifies the relevant social goals (the current favorites are compensation, deterrence through cost internalization, and loss spreading), then assesses how well these goals would fare under alternative legal rules, and ends by selecting the optimal one.
In these opinions, certain rhetorical features often recur. Plausible arguments, general assertions, and profuse footnoting take the place of hard empirical evidence. The court couples facile conclusions about the perversity of the existing rule with heroic predictions about the excellent effects of the rule being adopted. It characterizes the facts of the case abstractly enough to support broad, rule-like decisions. It further enlarges its discretion by assuming that unless the legislature has spoken to an issue with unmistakable clarity, the court is on its own. It proceeds as if private behavior were infinitely plastic, easily molded by legal rules into new, more functional forms.
Contemporary tort decisions are almost wholly benefit-oriented. Although they often read like a government agency's policy memoranda, they seldom address the kinds of questions about the costs of legal change that would preoccupy any self-respecting policy analyst. It is the rare tort decision, for example, that takes seriously matters like these: the opportunity cost of adopting a particular rule; the institutional barriers to its implementation; the rule's secondary and tertiary consequences; the strategies people will use to evade it; the costs of administering it; the competence of juries to comprehend and apply it; the effects it will have on insurance markets; and its implications for more elusive, difficult-to-measure values like innovation, diversity of choice, and political accountability.
In ignoring or only casually touching on these questions, judges are no worse than most of the professors who train their law clerks—not to speak of the legislators who write the statutes they interpret. Judges are often like architects who are instructed to design a splendid, state-of-the-art edifice but are also told not to worry too much about costs because the money will be found somehow. When that is the case, it is perhaps not surprising that they come up with the juridical equivalent of Washington's Rayburn Office Building.
The problem with all this is not that the new functionalism fails to advance some of its goals all of the time or all of them some of the time. It does both. Thus, it succeeds in compensating victims—at least that tiny subset who are fortunate enough to be injured by negligent, fully insured defendants and can gain access to the tort system. And it deters some risk—at least that small subset of activities that tort law's incentives affect. In many cases, the functional approach may well be superior to what preceded it. This is true if today's judges get the rule "righter" than their predecessors, or if the rule that "defendant is almost always liable" is so much clearer than the "reasonable person" standard that people can more easily plan and bargain around it. But any gains of this kind have been purchased at an enormous price in sheer administrative cost. And the real question remains: Do functionalist courts achieve anything approaching the right mix of social goals under the present system?
Beyond the new ideology
Policymaking in this complex world is problematic, regardless of how it is organized institutionally. The real choice is between better and worse ways of structuring it. But however wise or efficacious the courts' central role in accident-cost allocation may be, its legitimacy cannot really be doubted. Tort law has always been preeminently a field in which judges initially devise common-law principles to which politicians then react. All that legislators need in order to have their way is a willingness to take political responsibility for the change. They may control judicial rulings by substituting different principles or by establishing administrative regimes to supplant or supplement the common law. But if the past is prologue, they will usually acquiesce in the judicial innovation; future legislative interventions will be confined to a few areas and will not much disturb the central corpus of judicially created tort law.
Even if "liability-insurance crises" did not periodically erupt, there would be ample reason to doubt that tort litigation is a good vehicle for deciding how to distribute risks in society. These doubts remain even (or especially) when one asks the essential question: "Compared to what?" The defects of legislatures and administrative agencies have been demonstrated in great detail. But even a brief comparison of the courts' policymaking capacities with those of legislatures and agencies indicates the severe limitations on courts' competence to perform the kind of policymaking to which their new ideology of tort law commits them. The most important comparisons can be grouped under three headings: organizational expertise and rationality, success in implementation, and political responsiveness.
Judges are trained as generalist lawyers (usually as litigators), not as policy specialists. They are unlikely to acquire, or know how to exploit, the kinds of information that competent policy analysis requires. Few litigants possess the resources needed to adduce this information, and most lack adequate motivation to do so as well, such information being in the nature of a public good—one that is often marginal (or even harmful) to their cause. Only a fraction of the many social interests affected by a legal rule are represented by the parties before the court, and the relatively few tort cases that reach trial are likely to be unrepresentative of the social reality that a policy must address.
Finally, courts lack a reliable way to obtain feedback on their policies' real-world effects. They must depend for fresh information on the particular litigants and disputes that happen to come to their courtrooms, and one case is a vehicle for policy change only if it raises the same policy issues as an earlier one, but manages to provide better data for making a decision. Even if the precedent can simply be distinguished, disregarded, or overruled, a court that realizes it has made a mistake may still have to wait for a properly framed new case to come along before changing course.
Perhaps most inimical to a sound policy-making framework are the deep structures of tort law—its vestigial moralism, its adversarial, party—centered control of litigation, its radical decentralization and nonaccountability, its glacial accumulation of precedents, its factual diversity and particularity, and its view of problems only in hindsight, transfixed by palpable human suffering. The new functionalism's rejection of most of these features amounts to the deformation of tort law, and its transformation into something very different.
Even if courts could readily determine the correct social policy for distributing risk, they would be hard put to implement it. The relatively few policy instruments they possess tend to be weak, inflexible, or both. In tort cases, their principal tools are general prohibitions enforced by money damages. With the exception of nuisance cases, all they can do is order A to pay B a prescribed sum of money for breaking a rule. Leaving aside certain cases in which government is the defendant, they cannot impose fines or taxes, subsidize, educate, reorganize, inform, hire, fire, insure, establish bureaucracies, build political coalitions, or coerce third parties. The damage remedy they can deploy is undeniably important in shaping some kinds of behavior, but it affects quite a narrow band on the broad spectrum of human motivation.
The need to decide cases on principled grounds also limits courts' ability to implement even sound intuitions about policy. When courts abandon the traditional regime of contributory negligence, for example, they nearly always feel constrained to adopt the alternative approach of "pure" comparative fault, which can be derived from general tort principles, rather than adopting any of a number of "modified" approaches that might make better policy but would require the court to select arbitrary cutoff points. Legislatures that enact reforms in this area, by contrast, virtually always choose “modified" systems. (Marc Franklin and Robert Rabin, Tort Law and Alternatives: Cases and Materials, 4th ed. (Mineola, NY: Foundation Press, 1987), pp. 38182.)
Courts have one significant advantage: they can ordinarily count on strong political support from the public. As institutions, they enjoy greater respect than markets, legislatures, or most bureaucracies inside or outside government. But adherents of the new tort ideology should not take too much comfort from this public support, which is probably more a product of what courts have traditionally done than a tribute to what they now attempt to do. In fact, the tasks of legislatures and agencies are generally more intellectually demanding, more politically sensitive, and harder to implement than the traditional functions of courts in resolving tort claims. It should come as no surprise, then, that the other governing institutions have seemed to fail while courts remain popular, for they are playing very different games by altogether different rules. As courts increasingly assume the more comprehensive and problematic tasks that their new ideology thrusts upon them, and as the public learns more about how effectively they perform them, one may expect their failure rate—and the general level of public disappointment in them—to rise as well.