Apportioning Liability Behind a Veil of Uncertainty
65 Pages Posted: 6 Nov 2010 Last revised: 3 Sep 2011
Date Written: November 5, 2010
This article challenges the reason that led most states to abandon the “no contribution” rule. Under the rule if a victim obtains a judgment against two tortfeasors but chooses (even arbitrarily or out of spite) to recover only from one, the “chosen one” must pay the entire judgment while the other is exempt although both are liable. This is the case even if the paying tortfeasor is only 1% at fault while the non-paying tortfeasor is 99% at fault. The rule has been lamented by tort reform crusaders as immoral and unfair. One tortfeasor, the argument goes, should not bear the entire burden while the more culpable tortfeasor is exempted from liability. In deviation from the prior literature, the article employs economic theory to show that the “no contribution” rule that has been crowned as efficient is fair and just. It adopts a contractarian approach to analyze different apportionment regimes including joint and several liability (with and without contribution), several liability and market share liability. Relying on modern decision theory the article shows that individuals behind a veil of ignorance, unaware as to whether they would be victims or injurers may in fact choose the much criticized "no contribution" rule. In doing so the article sheds new light on a fierce and ongoing debate and concludes with a new framework for analyzing apportionment policies.
Keywords: Apportionment, Contribution, Joint and Several Liability, Market Share Liability, Rawls, Veil of Ignorance, Harsanyi, Fairness, Justice, Economic Analysis
JEL Classification: K13, D61, D63, D31, A12, A13
Suggested Citation: Suggested Citation