Unmaking and remaking tort law *.

• Author: Feinman, Jay M.

1. INTRODUCTION

   The topic for this portion of the symposium is the future of tort law, and it is a challenging one; as Yogi Berra said, "It's tough to make predictions, especially about the future." Because of (or despite) that difficulty, this article offers alternative futures for tort law.

   One increasingly likely future is the extension of a radical conservative, liability-limiting process that has been underway for the past twenty years, which has come to be called the unmaking of tort law. (1) If it comes to pass, the unmaking of tort law will be a dramatic transformation of tort law.

   Through a combination of its own conceptual defects and the political efforts of its opponents, the unmaking may not fully take effect. If it does not, tort law is unlikely to extend in a grand way the liability expansion based on general principles of negligence and strict liability that dominated the 1960s and 1970s. Instead, a remade, progressive tort law is likely to be ad hoc, emphasizing the need to apply tort law and to innovate to fill gaps in other means of the regulation of safety and the compensation of victims.

   The one near-certainty about tort law in the foreseeable future, of course, is that in many ways it will look like tort law today. Debate about tort law tends to focus on dramatic cases, cutting-edge issues, or drastic reform proposals, but a great deal of tort law is just a process of carrying-on. In making these predictions, however, the focus here is on large-scale changes of the kind we can see only at the generational level.

2. UNMAKING TORT LAW

   One possible future is the unmaking of tort law. Broader than what is ordinarily referred to as the tort reform movement, this future is the dismantling of neoclassical tort law, the body of tort law that developed through most of the twentieth century and culminated in the liability-expanding developments of the 1960s and 1970. (2) Without overestimating the long-term effect of short-term events, the realization of this future has become more likely as a result of the November 2004 election, in which George W. Bush was elected on a platform that prominently featured medical liability reform, Republican majorities in the Senate and House of Representatives were strengthened, tort reform ballot measures were adopted in several states, and business-friendly judicial candidates won election to prominent state courts.

   1. Origins of the Unmaking

      This vision of tort law and tort reform crystallized during the Reagan Administration, in the Report of the Tort Policy Working Group. (3) The Report begins by identifying a "rapidly expanding crisis in liability insurance availability and affordability," (4) and dismisses any explanation for the crisis--economic conditions, a fall in interest rates, or insurance company mismanagement--other than four "problem areas" (5) in tort law. Three of the areas relate to substance: the decline of fault as a basis of liability, (6) the undermining of causation, (7) and the "explosive growth" (8) in damage awards, a growth caused by disregard of the established principles of fault and causation. The fourth problem area is the allegedly high transaction costs of the system, (9) only of benefit to lawyers, presumably caused by litigating exaggerated or spurious claims.

      The Report then presents a non-exhaustive list of reforms "which if implemented should return tort law to a credible fault-based compensation system that provides a fair and reasonable level of compensation to deserving plaintiffs through a more predictable and affordable liability allocating mechanism." (10) The first two of its principal reforms reestablish the core principles: "Retain fault as the basis for liability" (11) and "Base causation findings on credible scientific and medical evidence and opinions." (12) The next four aim to reduce victims' damages, by eliminating joint and several liability, (13) limiting noneconomic damages (including limiting or abolishing punitive damages), (14) providing for periodic payment of damages, (15) and abolishing the collateral source rule. (16) The two remaining recommendations go to process: Reduce contingency fees and establish alternative dispute resolution mechanisms with strong disincentives to litigation. (17)

   2. Changes Made and Proposed

      From the Working Group report to the present, conservatives have proposed and often have been able to implement a variety of changes in three categories. First, make it harder for injury victims to get to court. Second, make it harder for plaintiffs to win if they get to court. Third, reduce damage recoveries for plaintiffs who do win. The changes have come through the tort reform movement in the legislatures and a shift to conservatism in the courts. The list is familiar, so here are simply a few highlights (or lowlights).

      1. Make it harder for injury victims to get to court

         More than twenty states already regulate contingent fee agreements, either in all cases or, as a result of tort reform efforts, in medical malpractice and other health care liability cases, but proposals for stricter limitations are pending in other states and in Congress. The organization "Common Good," for example, has introduced a proposal in more than a dozen states so far that would cap the fees of the victim's lawyer at 10% of the first $100,000 and 5% of anything more (18)

         Another means of increasing the risks to victims' lawyers is to threaten sanctions for questionable cases. In September 2004, the House of Representatives passed proposed amendments to Rule 11 that would impose mandatory sanctions, including suspension from practice, on lawyers who file pleadings that a judge decides are unwarranted. It also would make the revised Rule 11 mandatory in state courts as well as federal courts. (19)

         Under "early offer" mechanisms, defendants in tort cases could offer to pay a plaintiff's economic losses, often before the plaintiff's lawyer had an opportunity to engage in discovery. If the plaintiff accepted the offer, she would be barred from seeking recovery for noneconomic losses, and her attorney would be limited to an hourly fee that could not be greater than a modest percentage of the recovery. If the plaintiff rejects the offer and goes to trial, she could recover her economic loss less the amount of insurance or other benefits received, but could recover damages for noneconomic loss only if she proved by "clear and convincing evidence" that the loss was caused by "intentional or wanton misconduct." (20)

         A limitation of access to lawyers on a grander scale is the object of legislation making it more difficult for states and municipalities to hire private attorneys to assist in major litigation, such as the landmark litigation against the tobacco companies or pending cases against gun manufacturers, manufacturers of lead paint, and oil companies that produce MTBE, a gasoline additive that has polluted water supplies around the country. (21) Some proposals, for example, establish a special, politically-freighted approval process for contingent fee contracts and limit the amount of the fee without regard to the complexity or the riskiness of the litigation. (22)

         A final means of keeping victims out of court is to limit their ability to join together in a class action. A series of tort reform proposals, such as the Class Action Fairness Act, aims to move most class actions out of state courts into federal courts, which are traditionally less plaintiff-friendly, to give defendants greater powers to challenge whether a class action is appropriate, to delay the proceedings, to limit plaintiffs' attorneys fees, and to punish attorneys who bring defective class actions. (23)

      2. Make it harder for plaintiffs to win if they get to court

         The principal means of preventing victims from winning if they do get to court is through doctrinal change, particularly through halting and reversing the generalization of negligence and contracting the law of product liability.

         The most dramatic method of limiting the generalization of negligence is by increasing the number of potential defendants who are simply immunized from liability altogether. (24) Immunities have been extended in this way to suppliers of raw materials for medical devices, (25) teachers, businesses that donate food to charitable groups, "Good Samaritans" of various sorts, ski resorts, community volunteers, (26) and airlines and security firms following the September 11 attacks. (27) The Protection of Lawful Commerce in Arms Act would prohibit suits against gun manufacturers for injuries suffered by the unlawful misuse of a gun. (28) The Personal Responsibility in Food Consumption Act--the "cheeseburger bill"--aims to provide immunity to food manufacturers and sellers for health claims related to obesity. (29) The Energy Policy Act of 2005, as passed by House of Representatives, contained a controversial immunity for manufacturers of MTBE. (30)

         Other limitations of negligence include pockets in which special rules rather than general principle negligence applied. The move toward a general standard of liability for occupiers of land has arguably been halted, for example, in favor of preservation of the traditional categories of invitee, licensee, and trespasser. (31)

         In product liability law, the basis of liability was always participating in the chain of distribution of a product, but there is a broad effort to reverse that presumption, immunizing distributors and retailers in whole or part except for their individual negligence. (32) In another limitation, statutes undertake to prohibit suits brought by cities against gun manufacturers for the wrongful marketing and distribution of handguns. (33)

         The definition of a design defect has been a major focus for narrowing liability. One step is...