This quarter I am a Teacher’s Assistant in a Law and Economics class at UCSD. In one of the lectures I learned about economists’ favorite judge: Justice Learned Hand.
Hand is most famous for his rule for determining negligence in the U.S. v. Carroll Towing case. Legally, negligence occurs when 1) the defendant has a duty of care to the plaintiff, 2) the defendant breaches this duty, 3) there must be a factual causal connection between the breach and the harm and 4) the harm must not be too remote a consequence of the breach.
Hand claimed that negligence was to be found only if the burden (cost) of precautions was less than the probability of the accident multiplied by the gravity (cost) of the accident. The pragmatic formula can be seen from some examples on the Economica Ltd. website.
- “…in Hewson v. City of Red Deer (1977) 146 DLR (3d) 32 (Alta. CA), a City employee left the keys in the ignition of a bulldozer. Subsequently, the bulldozer was stolen and driven into the side of Hewson’s house. The City was found not to be negligent largely because (a) the bulldozer was left two blocks from Hewson’s house; (b) it was left at midnight; and (c) the operator was absent for only 25 minutes. All three of these factors suggest that the probability of an accident was quite low. And the first factor suggests that the average damages which might occur if the bulldozer was stolen were low (because the bulldozer would have to be driven a long distance before causing any harm.)
- In Weaver v. Buckle (1982) 35 AR 97 (Alta. QB), Weaver (a child) ran out in front of Buckle’s car and was injured. The court implied that it would not normally have found Buckle to be negligent for causing this accident. However, as the road was narrow, it found that he should have been driving more slowly, to take account of the general conditions of that road. The court concluded that if he had been driving more slowly, the probability that this accident would have occurred would have been reduced substantially. Buckle was found 60 percent liable. In economic terms, this finding suggests that it is not simply this accident which determines the “costs of an accident” (A, in my terminology). Rather, it is all accidents which might have been prevented had the defendant taken additional precautions.
- In Jordan v. Schofield (1996) 148 NSR (2d) 104 (NSSC), Schofield’s 7 year-old son played with a lighter and caused a fire in an apartment building belonging to Jordan. The court concluded that Schofield was not negligent. Although parents are responsible for taking “reasonable” precautions to watch their children and to put harmful things out of their way, at some point the costs of additional precautions become prohibitive. Parents will not be found negligent for failing to take precautions beyond that point. For example, parents will not be negligent for leaving children unattended around “ordinary” dangers (such as knives or scissors) for a few minutes. They may, however, be negligent for leaving their children unattended around such dangers for longer periods of time, or for leaving them for only a few minutes around more dangerous items (such as fires burning in fireplaces). In economic terms, the cost of taking additional precautions is to be weighed against the probability that an accident will occur if those precautions are not taken.”
Hand was also famous for his ‘Spirit of Liberty‘ address in New York’s Central Park in 1944. Below is an excerpt from this speech:
What do we mean when we say that first of all we seek liberty? I often wonder whether we do not rest our hopes too much upon constitutions, upon laws and upon courts. These are false hopes; believe me, these are false hopes. Liberty lies in the hearts of men and women; when it dies there, no constitution, no law, no court can even do much to help it. While it lies there it needs no constitution, no law, no court to save it. And what is this liberty which must lie in the hearts of men and women? It is not the ruthless, the unbridled will; it is not freedom to do as one likes. That is the denial of liberty, and leads straight to its overthrow. A society in which men recognize no check upon their freedom soon becomes a society where freedom is the possession of only a savage few; as we have learned to our sorrow.
“What then is the spirit of liberty? I cannot define it; I can only tell you my own faith. The spirit of liberty is the spirit which is not too sure that it is right; the spirit of liberty is the spirit which seeks to understand the mind of other men and women; the spirit of liberty is the spirit which weighs their interests alongside its own without bias; the spirit of liberty remembers that not even a sparrow falls to earth unheeded; the spirit of liberty is the spirit of Him who, near two thousand years ago, taught mankind that lesson it has never learned but never quite forgotten; that there may be a kingdom where the least shall be heard and considered side by side with the greatest.