Chapter 7 – Negligence and Strict Liability

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Powerpoint from textbook Business Law - the ethical, global, and e-commerce environment to accompany BA 330 course at the University of Alaska Fairbanks.

Powerpoint from textbook Business Law - the ethical, global, and e-commerce environment to accompany BA 330 course at the University of Alaska Fairbanks.

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  • This case is similar in nature to the cases in which citizens injured by guns sued gun manufacturers.
  • An example of reckless behavior that may harm another is an intoxicated driver in a vehicle who injures another person. The driver intentionally drove in an intoxicated condition, but intended no harm to result. However, the driver’s intent is irrelevant – only the behavior of driving drunk and the end result is relevant to the determination of negligence.
  • Interim Personnel of Central Virginia, Inc. v. Messer: Ricky Edward East was intoxicated and caused a motor vehicle accident. Messer was injured as a result. The Alumni Association of the University of Virginia (Association) owned the truck that East was driving when the collision occurred. At the time, East was employed by Interim Personnel of Central Virginia, Inc. (Interim). According to the job description for the Association position held by East, “a valid Virginia driver’s license” was required, but East did not have a valid driver’s license as a result of his two criminal convictions for driving under the influence of intoxicants (DUI). When East applied to work for Interim, he falsely stated that he possessed a driver’s license. Interim personnel interviewed East, had him perform certain skills tests, and did some checking of his references. Interim then hired East. Interim did not perform criminal background checks on applicants and did not quest a copy of East’s driving record from the Department of Motor Vehicles. Relying on Interim to verify that East was a licensed driver, the Association accepted East. On the Wednesday of Thanksgiving week, East was told to keep a key to the alumni building. Because he had access to the building, East was able to procure a key to the truck he routinely operated. Messer filed a negligence lawsuit against East, Interim, and the Association in an effort to collect damages for the injuries she sustained in the collision. Negligent hiring was the specific theory she employed with regard to Interim and the Association. After hearing the evidence and receiving legal instructions from the trial judge on proximate cause, foreseeability, and other negligence principles, the jury returned a verdict in favor of Messer and against all of the defendants. The defendants were held liable for $100,000 in compensatory damages. In addition, East was held liable for $25,000 in punitive damages. When the trial judge denied their motions to set aside the verdict, Interim and the Association (though not East) appealed to the Supreme Court of Virginia. Supreme Court of Virignia’s reasoning: The cause of action for negligent hiring “is based on the principle that one who conducts an activity through employees is subject to liability for harm resulting from the employer’s conduct if the employer is negligent in the hiring of an improper person in work involving an unreasonable risk of harm to others.” The tort of negligent hiring is distinct from tort liability predicated upon the doctrine of respondeat superior. Under the latter, an employer is vicariously liable for an employee’s acts committed within the scope of employment. In contrast, the tort of negligent hiring is a doctrine of primary liability; the employer is principally liable for placing an unfit individual in an employment situation that involves an unreasonable risk of harm to others. Negligent hiring enables a plaintiff to recover in circumstances when respondeat superior’s “scope of employment” limitation protects employers from liability. The evidence is clear that neither Interim nor the Association had actual knowledge of East’s propensities for operating a motor vehicle without a valid operator’s license. The question then becomes whether those defendants should have discovered these propensities by reasonable investigation. According to the uncontradicted evidence, East’s employment history showed he had been a model employee, never had consumed alcohol at work or reported for work intoxicated, never had been in any motor vehicle accidents, never had taken any item from any employer without permission, and had no record of theft. In sum, it was not Interim’s placement of East, or his subsequent acceptance for work at the Association, which was a proximate cause of the plaintiff’s injuries. Consequently, we conclude that the trial court erred in ruling that foreseeability was a jury issue, and in refusing to sustain Interim’s and the Association’s respective motions to set the verdict aside. Thus, final judgment will be entered here in favor of those defendants.
  • Stahlecker v. Ford Motor Co. is the case in which Firestone tires failed on a Ford Explorer and rendered the vehicle inoperable. A criminal abducted, raped, and murdered the female driver of the vehicle. Her parents filed suit against the criminal, Ford, and Firestone. The district court dismissed Ford and Firestone because the criminal acts constituted an intervening cause that would relieve Ford and Firestone of any liability they might otherwise have had. The parent plaintiffs appealed and the state supreme court affirmed the district court’s dismissal of the corporate defendants, stating: “We have found no authority recognizing a duty on the part of the manufacturer of a product to protect a consumer from criminal activity at the scene of a product failure where no physical harm is caused by the product itself.”
  • Res ipsa loquitur is not only a wonderful phrase for cocktail conversations, but common doctrine used in malpractice cases since the defendants typically have an advantage with regard to evidence
  • The formula for comparative negligence is: Plaintiff ’s recovery = defendant’s percentage share of the negligence causing the injury X plaintiff’s proven damages. In the famed McDonald’s coffee case, the jury determined that Stella Liebeck was 20% at fault for her injury caused by a spill of unreasonably hot coffee, thus reduced her damage award by 20%. The jury awarded Leibeck $200,000 in compensatory damages for her multiple surgeries and skin grafts. The amount reduced to $160,000 because jury found Liebeck 20% at fault for spill. The jury awarded punitive damages of $2.7 million (2 days of McDonald’s coffee sales), but the trial court reduced punitive award to $480,000.
  • The key to assumption of risk claims is that the plaintiff KNEW of the danger. Therefore, if a plaintiff undertakes a dangerous or risky activity, then the plaintiff is liable for foreseeable injuries. In the snowboarding case, common injuries include broken bones. However, plaintiffs have won lawsuits in which they undertook a risky activity but did not suffer foreseeable injuries. For example, a defendant ski resort may be liable if a snowboarder’s injury was caused by a fall onto an object hidden by snow, which was known to be a danger by the resort operators and which did not have a sign or protective fence to warn invitees of the hidden danger.
  • Opportunity to discuss with students about whether companies should be responsible to consumers for defective products and get students to relate ethical decision making to product design and manufacturing decisions
  • False. A special relationship (property owner and invitee, lawyer and client, doctor and patient, etc.) may create a duty of due care. True. True. False. Negligence per se refers to a situation in which a defendant violates a regulation and is therefore “negligent per se.” Contributory negligence occurs when a plaintiff contributes to his or her own injury.
  • False. True. True.
  • The correct answer is (e) The correct answer is (a)
  • The correct answer is (d) The correct answer is (a).
  • Class discussion Relevant facts that expose the “tort reform” myths: Tort claims account for only 5% of the 19.7 million civil claims filed in state courts ( Nat’l Center for State Courts, 1992 ) Products liability cases account for 4% of all tort cases in state courts ( Nat’l Center for State Courts, 1992 ) Business cases (financial damages) account for 47% of all punitive damage awards (Rand Institute for Civil Justice, 1996) In contrast, only 4.4% and 2% of punitive damage awards are due to product liability and medical malpractice cases respectively (Rand Institute for Civil Justice, 1996) Businesses suing each other over contracts comprised nearly half of all federal court cases filed between 1985 and 1991 (The Wall Street Journal, 12/93) Contract and property cases - most involving business - comprise more than 1/3 of all civil cases in state courts; by comparison, only 0.21% of all civil cases were product liability claims (National Center for State Courts, 1995)

Transcript

  • 1. Crimes Intentional Torts Negligence & Strict LiabilityIntellectual Property & Unfair Competition © 2010 The McGraw-Hill Companies, Inc. All rights reserved.
  • 2. Negligence and Strict Liability Mistakes are a fact of life. It is the response to error that counts. Nikki Giovanni© 2010 The McGraw-Hill Companies, Inc. All rights reserved.
  • 3. Learning Objectives The Elements of Negligence Defenses to Negligence Special Doctrines Related to Negligence7-3
  • 4. Negligence The elements of a negligence claim are  Defendant owed a duty of care to plaintiff,  Defendant committed a breach of duty,  Breach was actual and proximate cause of  Injury experienced by the plaintiff7-4
  • 5. Duty of Due Care In general, a defendant owed the plaintiff a duty of reasonable care if the plaintiff would foreseeably be at risk of harm from the defendant’s conduct  A duty may arise if a special relationship existed between the parties  Examples of a special relationship: doctor- patient, lawyer-client, accountant-client7-5
  • 6. Williams v. Cingular Wireless Facts & Procedural History:  Plaintiff was injured by a driver using a cell phone provided by Cingular  Plaintiff sued Cingular for negligence in providing the cell phone  Trial court dismissed case; Plaintiff appealed Issue:  Did Cingular owe a duty of care to plaintiff?  Without a duty, there can be no breach7-6
  • 7. Williams v. Cingular Wireless Law Applied to Facts:  Defendant had no relationship to plaintiff so as to create a duty  Little or no foreseeability that the sale of a cell phone would cause plaintiff’s injury  Imposing a duty on defendant would not be sound public policy Holding:  Dismissal of claim against Cingular affirmed7-7
  • 8. Breach of Duty of Due Care If a duty existed, then the question is whether the defendant acted as a reasonable person of ordinary prudence would have acted under the same or similar circumstances  Reasonable person standard The test focuses on defendant’s behavior, not defendant’s intent  Reckless behavior may be unreasonable7-8
  • 9. Scully v. Fitzgerald Facts & Procedural History:  Plaintiff leased store property from defendant  Debris in adjacent building owned by defendant caught fire and fire damaged plaintiff’s property  Plaintiff sued defendant alleging that defendant failed to use reasonable care in maintaining the adjacent building Issue:  Did defendant landlord breach a duty of care to the plaintiff tenant?7-9
  • 10. Scully v. Fitzgerald Legal Reasoning:  Landowner may be liable for fire if property kept in unsafe condition and owner did not take reasonable precautions to prevent harm  Test: would reasonably prudent person recognize and foresee an unusual risk or likelihood of harm?  Defendant’s exposed collection of papers and refuse was flammable and potentially dangerous Holding:  Trial court erred in denying jury the opportunity to decide if defendant breached a duty to plaintiff7 - 10
  • 11. Causation and Injury Injuries may include bodily or emotional injury, and property or economic damage Causal link between the alleged misconduct and the injury requires:  Actual cause: plaintiff would not have been hurt “but for” defendant’s breach of duty (act or omission)  Proximate cause: plaintiff’s injury was foreseeable consequence of defendant’s act or omission7 - 11
  • 12. Causation and Injury An event that occurs after initial breach of duty may worsen a plaintiff’s injury  Example: plaintiff injured in accident and while unconscious, a thief steals the plaintiff’s wallet If latter event is foreseeable, defendant will be deemed liable If latter event not foreseeable, defendant will be absolved from liability  Example: Stahlecker v. Ford Motor Co.7 - 12
  • 13. Causation and Injury An important doctrine concerning causation is res ipsa loquitur (the thing speaks for itself) Res ipsa applies when: (1) defendant has total control of the instrument of harm, (2) harm would not occur in absence of negligence, and (3) plaintiff not responsible for his own injury  Example: after abdominal surgery, patient complains of pain in abdomen and X-ray shows surgical clamp left in abdomen7 - 13
  • 14. Defenses: Contributory Negligence  Contributory negligence is the plaintiff ’s failure to exercise reasonable care for his/her own safety  Example: auto accident in which defendant rear-ended plaintiff but alleges that plaintiff was talking on a cell phone and not driving carefully7 - 14
  • 15. Comparative Negligence Contributory negligence used to be a complete defense, but most states enacted comparative negligence systems in which a court or jury will determine relative negligence of parties and award damages in proportion to the degrees of negligence7 - 15
  • 16. Defenses: Assumption of Risk Assumption of risk is the plaintiff’s voluntary consent to a known danger  Example: plaintiff goes snowboarding and breaks leg during a fall7 - 16
  • 17. Defenses: Assumption of Risk One can expressly assume the risk of injury by entering into a contract that attempts to relieve the defendant of a duty of care otherwise owed to plaintiff  Such contract provisions are called exculpatory clauses7 - 17
  • 18. Davenport v. Cotton Hope Plantation Facts & Procedural History:  Plaintiff leased condo at defendant’s resort and told defendant stairway floodlights inoperable  Plaintiff injured when trying to ascend stairs in dark  Trial court directed a verdict against plaintiff because he assumed the risk of his injury  Intermediate appellate court reversed because under state’s comparative negligence system, assumption of risk was a factor to be considered by a jury in determining relative fault7 - 18
  • 19. Davenport v. Cotton Hope Plantation Issue:  Whether assumption of risk survives as a complete bar to recovery under South Carolina’s comparative negligence system? Legal Reasoning and Holding:  A plaintiff is not barred from recovery by assumption of risk unless plaintiff’s degree of fault is greater than the negligence of the defendant7 - 19
  • 20. Special Doctrines Premises liability Negligence Per Se Strict Liability7 - 20
  • 21. Premises Liability Cases Based on the duty a property owner or tenant has to those on the property Duty varies with type of person on property Invitee (business visitor or member of the public)  Owner or tenant must exercise reasonable care for safety of his/her invitees7 - 21
  • 22. Premises Liability Cases Licensee (those on property for his/her own purpose)  Owner or tenant obligated only to warn licensee of hidden, dangerous conditions Trespasser (those on property illegally)  Owner or tenant owes no duty, but may not willfully injure trespassers7 - 22
  • 23. Delgado v. Trax Bar & Grill Facts & Procedural History:  Patron of Trax causing serious physical injury to plaintiff defendant’s parking lot  Patron convicted of assault, filed for bankruptcy  Plaintiff sued defendant for negligence and premises liability theory  Jury found for plaintiff and awarded damages Issue:  Did defendant owe a duty of care to the plaintiff?7 - 23
  • 24. Delgado v. Trax Bar & Grill Legal Reasoning and Holding:  A special relationship is an exception to the general no-duty-to-protect rule  Plaintiff was invitee, thus special relationship existed  Proprietor’s general duty owed to invitees includes duty to take reasonable steps to secure common areas against foreseeable criminal acts of third parties that are likely to occur in the absence of such precautionary measures7 - 24
  • 25. Negligence Per Se The defendant’s violation of such laws may create a breach of duty and may allow the plaintiff to win the case if the plaintiff  (1) was within the class of persons intended to be protected by the statute or other law, and  (2) suffered harm of a sort that the statute or other law was intended to protect against7 - 25
  • 26. Hargis v. Baize Facts & Procedural History:  Widow of deceased employee sued defendant employer (Baize) alleging that a fatal accident was caused by the employer’s failure to comply with a state safety regulation  Employer’s representative admitted: (a) not company policy to comply with regulation, (b) insurance representative visited two weeks before incident and recommended compliance, and (c) another employee recently injured similarly7 - 26
  • 27. Hargis v. Baize Holding:  Negligence per se principle applies and enables plaintiff to satisfy first two elements of negligence: duty and breach of duty  Jury would need to determine the remaining elements of negligence7 - 27
  • 28. Strict Liability Liability without – or irrespective – of fault Thus, a defendant is liable even though s/he did not intend to cause harm and did not act recklessly or negligently Basic for product liability cases7 - 28
  • 29. Strict Liability Imposing strict liability is a social policy decision that risk associated with an activity, especially an abnormally dangerous activity, should be borne by those who pursue it, rather than by innocent persons who are exposed to that risk7 - 29
  • 30. Test Your Knowledge True=A, False = B  A duty of due care may arise only if a contract or statute creates such a duty  Without a duty, there can be no breach  Res ipsa loquitur means the thing speaks for itself and is related to causation  Negligence per se occurs when a plaintiff contributed to his or her own injury7 - 30
  • 31. Test Your Knowledge True=A, False = B  Contributory negligence and comparative negligence mean the same thing  Assumption of risk is the plaintiff’s voluntary consent to a known danger  Imposing strict liability is a social policy decision7 - 31
  • 32. Test Your Knowledge Multiple Choice  The elements of a negligence claim include: (a) duty of due care (b) breach of the duty of due care (c) causation (actual and proximate) (d) injury to plaintiff (e) all of the above  The reasonable person test focuses on: (a) Defendant’s behavior (b) Defendant’s intent7 - 32
  • 33. Test Your Knowledge Multiple Choice  The causation element requires proof of: (a) actual cause (the “but for” test) (b) proximate cause (c) sufficient cause (d) both (a) and (b), but not (c)  A property owner or tenant must exercise reasonable care for the safety of his/her: (a) Invitees (b) Licensees (c) Trespassers7 - 33
  • 34. Thought Question Do you think tort reform is necessary?7 - 34