62 Pages Posted: 17 Oct 2007 Last revised: 15 Jan 2008
Tom Broadbent, George Bernard Shaw's memorable hero in John Bull's Other Island, forcefully avers in Act IV that "there are only two qualities in the world: efficiency and inefficiency, and only two sorts of people: the efficient and the inefficient." Broadbent is an Englishman, but his commitment to the gospel of efficiency has made him representative of modern America in the eyes of many commentators. Peter Keegan, Broadbent's ideological adversary, mocks his simple-mindedness, and concludes his ironic reproach with an inspiring prediction: "For four wicked centuries the world has dreamed this foolish dream of efficiency; and the end is not yet. But the end will come." Will it?
Broadbent's scorned vision seems to underlie the proposed definition of negligent-conduct in the draft Restatement (Third) of Torts. Section 3 embraces the renowned "Hand formula," which defines negligence in economic, cost-benefit, terms. This Article endeavors to disprove the drafters' alleged normative choice from an internal-economic perspective, and buttress an external-deontological alternative. It is addressed to legal scholars, judges, practitioners, and law students, and attempts to rescue all who might be swept away by the recent triumph of the "foolish [but very vivid] dream of efficiency." Admittedly, this will not be an easy task. The gatekeepers of legal scholarship, namely student editors, are trained to think about negligence in aggregative consequentialist terms. Consequently, my argument may be deemed somewhat subversive, if not outright heresy; but only at first glance.
Part I briefly presents Section 3 of the Third Restatement. It explains that despite some apparent discrepancies this Section embraces the Hand formula. It then shows that the Hand formula, at least as embodied in Section 3, is a purely aggregative consequentialist norm. Finally, it demonstrates that in embracing the Hand formula Section 3 fails to restate prevailing law. Instead, it promotes a certain normative commitment that does not truly dominate American tort doctrine. These conclusions lay down the infrastructure for the critical assessment of Section 3.
Part II shows that while it may be possible to formulate an economic definition of negligent-conduct, it is practically impossible to achieve efficiency through its application. Once this is acknowledged, the dream of efficiency is shattered. If Section 3 cannot achieve its purported goal, it must be reconsidered. Some of the arguments set forth in this Part are not in themselves novel, but their systematic compilation yields the most profound and comprehensive "internal" retort thus far.
Part III defends and develops the view that efficiency should not underlie the legal definition of negligent-conduct. An alternative, deontological, definition should be considered instead. The proposed definition has been mentioned in several positive accounts of tort law, but these are somewhat dubious. This Article, on the other hand, has no positive pretense. It advances a normative proposition, and attempts to refute possible criticisms that have not yet been addressed. This is a purely "external" retort.
Keywords: tort law, negligence, learned hand, standard of care, law and economics, law and philosophy, deterrence, reasonable person, restatement, restatement third, reasonableness, fairness, corrective justice
JEL Classification: K13
Suggested Citation: Suggested Citation