Inherent Risk and Organisational Design in European Tort Law

Abstract

This paper is devoted to a complex set of issues relating to the functions of tort law in distinguishing acceptable and unacceptable risks. Often, such risks are brought about by deliberate organisational design choice. On many occasions, legislators and courts are called upon to assess which of these design choices are acceptable and which are not.

By evaluating a number of recent legislative drafts and proposals I present an outline of what seems to be becoming a standard of 'organisational liability' for organisational failure. Moreover, I put forward a threefold typology of risks in tort law which seems to go a long way in categorizing tort law cases involving organisational design risks. Finally, I call the reader's attention to the fact that tort law is in need of rational recalibration with regard to the 'ranking of risks', as it seems that some risks are inconsistently categorized as either acceptable or unacceptable.

Keywords: European tort law, risk assessment, organisational design, strict liability, inherent risks

JEL Classification: K13