The Emergence of Cost-Benefit Balancing in English Negligence Law
132 Pages Posted: 19 Jun 2002
The subject of this article is whether, and to what extent, modern English negligence law relies on cost-benefit balancing. Some scholars have claimed that actors are subject to liability under English negligence law when they create a substantial foreseeable risk of harm to others, without regard to the costs of avoiding that risk. A close look at the leading English decisions (most of which date from the period 1945-1970) shows that this account is incorrect. Reasoning from the fundamental principle that negligence is failure to act as a reasonably prudent person would have acted, the English judiciary has repeatedly endorsed the proposition that a reasonable person balances the costs and benefits of avoiding foreseeable risks of harm to others. The practical importance of this proposition varies: in some contexts, such as workplace accidents, English judges -- who both find the facts and apply the law in negligence cases -- routinely and explicitly engage in balancing; in other contexts, such as automobile accidents, some judges balance, while others simply imagine what a reasonable person would have done. In no context, however, is balancing forbidden and liability imposed solely for creating a substantial foreseeable risk. On the other hand, when they do balance, English judges often say that a precaution should be taken unless its costs are disproportionately (not merely marginally) greater than its benefits. English law thus makes cost-benefit balancing a major component of the reasonable person standard, while leaving substantial room for divergent intuitions about fault and responsibility.
JEL Classification: K00, K13
Suggested Citation: Suggested Citation