Course ResourceDualplex 360 Notice: Contains confidential information. Colossal Corporation maintains a subsidiary in Serafini, a small country in Eastern Europe. This subsidiary is incorporated in the state of Delaware as New Brand Design, Inc. (NBD), a company that designs, brands, and manufactures innovative electronic products, and markets and distributes them for resale across the globe. NBD has been admitted to conduct business in Serafini. NBD has been manufacturing and distributing a laptop computer with 360-degree technology. The thin tablet can easily convert into a laptop by flipping the screen over and locking it in place against the back of the keyboard. The laptop, marketed under the name Dualplex 360 is very popular and is distributed primarily in Western Europe, North America, and South Africa. The Dualplex 360 went on the market six months ago, and the product is selling out in the United States and Europe. Unfortunately, consumers have reported that some laptops that were shipped to the United States have overheated and ignited when they have remained plugged into a power source for too long. In a few cases, the laptops have burned users and damaged property. NBD’s research and development team was fully aware of the overheating problem when putting the Dualplex 360 on the market but performed a cost-benefit analysis and determined that the payouts from lawsuits would be less than the cost of redesigning and manufacturing a new laptop. The research and development team covered up the defect but included the following disclaimer in the instruction manual: DO NOT LEAVE THE DUALPLEX 360 PLUGGED IN TO A POWER SOURCE AFTER THE BATTERY IS FULLY CHARGED. SELLER EXPLICITLY DISCLAIMS ALL WARRANTIES. SELLER MAKES NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE. NOR IS THERE ANY OTHER EXPRESS OR IMPLIED WARRANTY. The instruction manual contained no other warnings regarding the possibility of overheating or danger. To date, all instances of overheating have resulted from consumers ignoring the warning and leaving their computers plugged in after the battery is fully charged, although some claim they never read the instruction manual so did not see the warning. The executive board of NBD has reached out to the CEO of Colossal to discuss these issues and the potential that NBD will be held liable for the overheating laptops and resulting injuries and damage to property. The CEO informed the board that the company’s international task force will research and address these concerns. Learning ResourceFraud and Negligence Torts Types of Torts There are three broad categories of torts: · intentional torts—Intentional torts, as the name implies, are characterized by the mental intent of the tortfeasor. The tortfeasor undertakes an activity with either the desire to bring about an intended result or with the knowledge that the result is “substantially certain." When the action results in an identifiable harm or loss to a third .

1. Course ResourceDualplex 360
Notice: Contains confidential information.
Colossal Corporation maintains a subsidiary in Serafini, a small
country in Eastern Europe. This subsidiary is incorporated in
the state of Delaware as New Brand Design, Inc. (NBD), a
company that designs, brands, and manufactures innovative
electronic products, and markets and distributes them for resale
across the globe. NBD has been admitted to conduct business in
Serafini.
NBD has been manufacturing and distributing a laptop computer
with 360-degree technology. The thin tablet can easily convert
into a laptop by flipping the screen over and locking it in place
against the back of the keyboard. The laptop, marketed under
the name Dualplex 360 is very popular and is distributed
primarily in Western Europe, North America, and South Africa.
The Dualplex 360 went on the market six months ago, and the
product is selling out in the United States and Europe.
Unfortunately, consumers have reported that some laptops that
were shipped to the United States have overheated and ignited
when they have remained plugged into a power source for too
long. In a few cases, the laptops have burned users and damaged
property.
NBD’s research and development team was fully aware of the
overheating problem when putting the Dualplex 360 on the
market but performed a cost-benefit analysis and determined
that the payouts from lawsuits would be less than the cost of
redesigning and manufacturing a new laptop. The research and
development team covered up the defect but included the
following disclaimer in the instruction manual:
DO NOT LEAVE THE DUALPLEX 360 PLUGGED IN TO A
POWER SOURCE AFTER THE BATTERY IS FULLY
CHARGED. SELLER EXPLICITLY DISCLAIMS ALL
WARRANTIES. SELLER MAKES NO WARRANTY OF

2. MERCHANTABILITY OR FITNESS FOR A PARTICULAR
USE. NOR IS THERE ANY OTHER EXPRESS OR IMPLIED
WARRANTY.
The instruction manual contained no other warnings regarding
the possibility of overheating or danger. To date, all instances
of overheating have resulted from consumers ignoring the
warning and leaving their computers plugged in after the battery
is fully charged, although some claim they never read the
instruction manual so did not see the warning.
The executive board of NBD has reached out to the CEO of
Colossal to discuss these issues and the potential that NBD will
be held liable for the overheating laptops and resulting injuries
and damage to property. The CEO informed the board that the
company’s international task force will research and address
these concerns.
Learning ResourceFraud and Negligence Torts
Types of Torts
There are three broad categories of torts:
· intentional torts—Intentional torts, as the name implies, are
characterized by the mental intent of the tortfeasor. The
tortfeasor undertakes an activity with either the desire to bring
about an intended result or with the knowledge that the result is
“substantially certain." When the action results in an
identifiable harm or loss to a third party, it constitutes an
intentional tort. If one person physically batters another person
by punching him in the face. This is an intentional tort because
the individual intended her actions and the probable result.
· negligence—Negligence is conduct by an individual that drops
below a reasonable standard of care and causes harm to another
person. Succinctly, an individual has a duty to act reasonably
when interacting with others. When that individual fails to act
reasonably and thereby causes harm to others, that individual is
negligent. A person who is driving too quickly, following too
closely, or not paying close attention may be negligent if her

3. careless behavior results in an automobile accident.
· strict liability—Strict liability subjects an individual to
liability for activity that causes harm to another without regard
for her intent or the standard of care she shows in carrying out
that activity. That is, simply undertaking the activity that
results in harm is sufficient to make the actor liable. The
injured party is not required to demonstrate the actor’s intent or
the level of care they exercised in undertaking the activity. A
person who deals in very hazardous material, has a vicious or
wild animal, or takes part in the production or sale of an
unreasonably dangerous product may be liable if her activity
causes injury to someone. It does not matter that the person did
not intend to harm anyone or that the person took extra
precautions to not harm anyone. These activities alone are
enough to subject the person to liability.Ask Yourself
· Why do you think that torts are generally categorized based
upon the mental state of the tortfeasor? Should the mental state
of the tortfeasor affect the severity of the potential liability for
the tort? Why or why not? How should the intent of the
tortfeasor be compared against the result of the tort when
determining the liability of the tortfeasor?
· Doug is speaking with his friend Annie about an unfortunate
accident involving her pet dog. Her pit bull bit the mailman,
apparently mistaking him for an intruder. The mailman is now
suing Annie. Annie says that she is going to trial to contest her
liability because her dog broke out of its cage and it wasn’t her
fault. Animal bites are strict liability torts in Annie’s state.
What does Annie need to know before going to trial?
Fraud
Fraud is the intentional misrepresentation of a material fact that
is justifiably relied upon by someone to his or her injury. The
false statement inducing the other party’s misunderstanding
must regard a material fact about the prospective transaction.
Fraud often involves intentional misrepresentations regarding
ownership of property or one’s financial status.

4. Fraud may be an intentional failure to disclose a material fact
that induces another into action which results in her harm. This
may be the case when a legal duty to disclose the material fact
exists. Lying about assets or liabilities in order to get credit or a
loan is a common form of fraud.Ask Yourself
· How do feel about the requirement that fraud be intentional?
Should a misrepresentation that is reckless and unverified be
considered fraudulent, even if it is not intentional? Why or why
not?
· Daryl is selling a poster bearing the signature of a known
celebrity athlete. Daryl advertises that the poster is 15-years old
and was signed when the athlete was a rookie. In reality, the
poster was signed recently, following the athlete’s retirement. If
someone buys the poster based upon Daryl’s representations, is
there a tortious act? Why or why not?
Negligence
Negligence is unreasonable behavior that causes injury to
another person or business.
Five elements make up a claim for negligence:
· existence of a duty of care owed by the defendant to the
plaintiff
· unreasonable behavior by the defendant that breaches the duty
of care
· causation in fact
· proximate causation
· an actual injuryAsk Yourself
· What are the core differences between intentional torts to
negligence actions? How does the existence of a duty to act
reasonably compare to intentional activity with a specific mens
rea attributable to the activity?
· Luther is driving through a parking lot and listening to music
through his headphones. He inadvertently runs into Sandra, who
is walking through the parking lot. What type of legal action
potentially exists in this scenario?

5. Legal Duty
The first element of a negligence tort is establishing the nature
and extent of the defendant’s duty to the plaintiff. A duty
generally arises pursuant one’s conduct or activity, such as
assuming a position of authority, control, or other special
relationship with someone. Any form of activity in the presence
of or otherwise affecting a third party gives rise to a duty of
care. A special relationship between individuals may include:
parent-child, doctor-patient, attorney-client, etc. The extent of a
person’s duty to others is based upon the nature (or genesis) of
that duty. Once the nature of the duty is determined, the
individual owing the duty must use reasonable care and skill in
her actions. That is, an individual must act reasonably in a
given situation (based upon the nature of the duty owed) to
avoid causing harm to those to whom she owes a duty. The
greater the risk or potential harm to others, the greater the level
of care required to meet the duty owed.
An individual who decides to drive an automobile owes a duty
of care to other motorists and pedestrians. An individual
walking on the sidewalk with others owes a duty not to walk
carelessly and bump into others.Ask Yourself
· How do you feel about the duty to act reasonably? What level
of interaction between individuals gives rise to a duty? What
types of factors should contribute to the establishment and
strength of the duty between individuals?
· Eric is a lifeguard by profession. He is taking a leisurely
strong along the lake when he notices a person in distress. Does
Eric have a duty to attempt to rescue the individual drowning
individual?
Unreasonable Behavior and Breach of Duty
Negligence entails unreasonable behavior that breaches the duty
of care that the defendant owes to the Plaintiff. This standard is
known as the “reasonable person” standard. Whether conduct is
unreasonable is a mixed question of law and fact. The duty of
care exists under the law, but the determination of what is

6. reasonable may be unreasonable in another situation. In
determining whether conduct is unreasonable, a court will
consider “the likelihood that the defendant’s conduct will injure
others, taken with the seriousness of the injury if it happens,
and balanced against the interest which he must sacrifice to
avoid the risk.” Notably, the reasonable person standard of care
is an objective standard based upon the nature of the
relationship and the subjective characteristics of the plaintiff.
A professional, such as a doctor, will be held to the standard of
a reasonable professional in a given situation. A failure of a
professional to act reasonably within the scope of her duties is
known as “malpractice." Further, a large person interacting with
a small child may owe a higher standard of care to avoid
harmful physical contact than a small person interacting with a
large person.Inaction as Unreasonable Behavior
In some situations, inaction may constitute unreasonable
behavior. This is true when a special relationship exists or one
individual causes the risk of harm to the other person. In such a
situation, an individual incurs an affirmative duty to act.
Failing to act drops below a reasonable standard of care.
A mother fails to help her child cross the street. If the child
strays into traffic and is injured, the mother’s inaction is
negligent in causing harm to the child. A mother is assumed to
act in the best interest of her child, such that others will not act
assuming the mother will act. I push a non-swimmer into deep
water, I now have a duty to act reasonably in preventing that
person from drowning. My inaction to rescue her will result in
liability.Gross Negligence, Reckless and Wanton Behavior
Negligence generally entails a simple failure to meet the
standard of care owed to others. “Gross negligence," in contrast,
is a severe departure from the standard owed.
Say I am rock climbing with a friend. I do not hook our
climbing rope in carabiners every 5 feet, as recommended. I
think we will make better time if I hook the rope every 15 feet.
When my friend slips, he falls 15 feet, rather than 5 feet, before
the rope catches him. This causes him to slam very hard into the

7. rock face. This may be an example of gross negligence. I may
not have intended the result or appreciated the risk, by my
actions fall way below an acceptable standard of care.
“Reckless” behavior demonstrates a complete disregard for the
potentially harmful consequences of one’s conduct. It generally
requires a defendant to appreciate the nature and severity of the
potential harm that may arise from the conduct. Though it does
not entail intent to cause the harm, it shows an extreme lack of
due care. Such conduct falls below the standard of care owed to
other individuals and constitutes negligence. In some
jurisdictions reckless conduct is known as “aggravated
negligence." The law frequently allows a plaintiff to recover
punitive damages as well as actual damages in such situations.
Shooting an arrow up into the air without knowing whether
anyone will be harmed by the arrow could be reckless conduct.
Res Ipsa Loquitur and Negligence Per Se
Two situations exist where a defendant may either be held liable
without a showing of unreasonable conduct or the
unreasonableness of conduct is inferred from the facts of the
situation.
· Res ipsa loquitur posits that in some situations the very nature
of the accident or situation indicates that conduct of the
defendant was negligent. That is, this type of harm would not
have occurred in the absence of negligence by someone in the
defendant’s position. As such, it is not necessary to demonstrate
how a reasonable person would or should have acted in the
situation: Tom is walking by a building when a potted plant
falls on his head. It is apparent that the potted plant fell from
the room of the building where there is a community garden.
Ginny keeps a garden and is present in the garden when the
plant falls. There is no evidence that Ginny intentionally
dropped the plant or that she was negligent in allowing the plant
to fall, but this could result in her liability for negligence
pursuant to res ipsa loquitur. It is abnormal that a plant would
fall from the top of the building unless someone was negligent

8. in her actions causing the resultant harm.
· Negligence per se posits that a failure to meet a standard or
guideline, often established by a statute or regulation, means an
individual is negligent without examining whether the
individual’s conduct in the situation was reasonable: A
professional practice group may establish standards of conduct
for its employees. If an employee does not comply with that
standard, it could be negligence per se. Violating the standards
is assumed negligent without a demonstration of how a
reasonable person would act. Further, if an individual is
involved in a car crash while speeding, the violation of the
speed limit may demonstrate negligence per se without a need to
show that a reasonable person would not have been driving at
that rate of speed.Ask Yourself
· How do you feel about using the fictional, reasonable person
standard to determine whether an individual has acted
reasonably? Do you think that the reasonable person standard
varies depending upon the fact-finder? Why or why not? Does it
surprise you that inaction can constitute unreasonable behavior
in some circumstances and not in others? Why or why not?
Should reckless and wanton behavior be considered an
intentional tort or unreasonable behavior for purposes of
liability? Why?
· Eric is a lifeguard by profession. He is taking a leisurely
strong along the lake when he notices a person in distress. He
begins to swim after the drowning individual. A few feet into
the water, he realizes the water is cold. He does not want to get
sick, so he quickly gets out of the water and goes on his way.
Has Eric committed a tort?
Causation in Fact
In a negligence action, the defendant’s conduct must have
caused the injury to the plaintiff. Causation in fact presents the
question, “but for” the act of the defendant, would the injury
have occurred? This is the broadest aspect of causation, as any
number of causes together could have contributed to the injury.

9. The jury must determine whether the defendant’s conduct is a
“substantial, material factor in bringing about the injury." If
there are multiple defendants, each individual defendant can be
held jointly and severally liable for the collective actions of the
group.Ask Yourself
· Can you think of a situation where an individual is a
contributor to an outcome, but the outcome would have occurred
regardless of the individual’s involvement? Should a person be
held liable if a particular damage would have occurred
regardless of her involvement in a tortious activity? Why or
why not?
· Jessica and five friends are jumping up and down on a
trampoline. Terry falls while bouncing, but the other friends
continue to bounce. Terry is thrown from the trampoline by the
force generated by the other bouncers. Is Jessica’s conduct the
cause in fact of Terry’s injury?
Proximate Causation
Proximate causation means that the harm suffered by the
defendant was reasonably foreseeable as a result of the
plaintiff’s conduct. More specifically, for the type of injury to
be foreseeable, the plaintiff must be one whom the defendant
could reasonably expect to be injured by a negligence act.
Further, the injury must be caused directly by the defendant’s
negligence. The relationship between the defendant’s actions
and the harm caused cannot be too far removed or tenuous. This
may be the case when an unexpected intervening actor or
occurrence is involved in bringing about the harm. It would
breach the “chain of causation” necessary for finding a
defendant negligent. This determination is left for the jury to
decide.Ask Yourself
· How do you feel about the “reasonably foreseeable” standard?
What factors should influence what one determines to be
reasonably foreseeable? Can you think of scenarios where the
outcome would not occur without a person’s involvement, but
the outcome is not reasonably foreseeable from her conduct?

10. Should conduct that is reasonably foreseeable to result in a
particular outcome give rise to liability, even if the outcome
would have occurred without the individual’s involvement?
Why or why not?
· Jessica brings a box of fireworks on a train. While she is
boarding, she trips and the box of fireworks explodes. The
explosion shakes the loading platform violently. At the opposite
end of the loading platform, a large vending machine falls over
and injures a passenger. Is Jessica the proximate of the
passenger’s injury? That is, does bringing fireworks on a train
lead to a foreseeable risk that a distant, heavy object will fall
over and hurt someone? Or, is the tall, heavy, inherently
unstable design of the vending machine an intervening cause
that negates proximate causation?
Common Defenses to Negligence Actions
Jurisdictions commonly recognize three principal defenses to
negligence actions:
· contributory negligence—This doctrine bars a plaintiff’s
recover in a negligence action if her own fault contributed to
the injury “in any degree, however slight.” Contributory
negligence is only applied in a few jurisdictions and in limited
circumstances.
· comparative negligence—Comparative negligence compares
the degree of fault assessable against the defendant with that
assessable against the plaintiff. The jury is left to access the
percentage of negligence between the parties.
· In a pure comparative negligence jurisdiction, the plaintiff can
only recover the percentage of damages not attributable to her
own fault. If the plaintiff is 90 percent negligent for her loss of
$100k, she can only recover $10K from the defendant.
· In a modified comparative negligence state, the plaintiff
cannot recover if her negligence is greater than (or “as great as”
in some jurisdictions) the negligence of the defendant. If the
plaintiff’s negligence is less than 50 percent compared with that
of the defendant, she can recover damages. Her recover is

11. reduced, however, by her percentage of negligence.
· assumption of the risk—Assumption of the risk arises when
the plaintiff knowingly and willfully undertakes an activity
made dangerous by the negligence of another. That is, the
plaintiff identifies a potentially harmful situation brought about
by the defendant’s conduct, understands the risk associated with
the situation, and proceeds to voluntarily expose herself to this
risk of harm. This is a defense against any harm suffered by the
plaintiff as a result of this exposure. In some situations, the
parties can contractually acknowledge certain risks in a given
activity. This may have the effect of assuming the risk of any
harm suffered as a result of those risks.
Skydiving is an inherently risky activity. Bob hires Plane
Jumpers, LLC to instruct him in this activity. Before his first
solo jump, Bob signs an acknowledgement of the potential
dangers inherent in this activity. Bob is injured when heavy
winds cause him to crash while landing. His acknowledgement
is likely an assumption of this risk—which may bar his recovery
from Plane Jumpers for allegedly negligent instruction for not
preparing him for landing in heavy wind.Ask Yourself
· Which, if any, of the defenses to negligence do you find most
compelling? Why?
· Beverly owns a small store. She recently mopped the floor and
placed “wet floor” signs all around the area. William is wearing
sneakers with small wheels on the sole. These wheels allow him
to skate around on smooth surfaces. He approaches the wet floor
area and takes notice of the sign. He proceeds to skate across
the wet floor, but falls and breaks his ankle. If William sues
Beverly, what defenses might she put forward?
Strict Liability?
Strict liability concerns an individual’s legal liability for
injury-causing behavior that is neither intentional nor negligent.
Basically, an individual will be liable for any harm resulting to
a third party from a course of conduct to which strict liability
applies. Injuries caused while working with explosives,

12. dangerous animals, product design or manufacturing, and
serving alcohol to the public are strict liability torts in most
states.
For example, Beth has a business conducting fireworks shows.
She is hired to conduct the fireworks display during a 4th of
July celebration. During the event, a large firecracker veers into
the crowd and explodes. Two people are injured by the
explosion and sue Beth. She will be held strictly liable
regardless of the amount of care she exerted in orchestrating the
show.
Strict Products Liability
Strict products liability involves the commercial sale of
defective products. In most states, any retail, wholesale, or
manufacturer who sells an unreasonably dangerous, defective
product that causes injury to a user of the product is strictly
liable. This applies to commercial sellers who normally sell
products like the one causing injury or who place them in the
stream of commerce, such as suppliers of defective parts and
companies that assemble a defective product.
There are two kinds of defects for purposes of strict product
liability:
· production defects—A production defect occurs when products
are not manufactured to a manufacturer’s own standards.
Consumers of the defective product are later injured as a result
of this variation from the manufacturer’s standards.
· design defects—A design defect occurs when a product is
manufactured according to the manufacturer’s standards but is
an unsafe design. The product injures a user due to its unsafe
design.
If either of these defects makes the product unreasonably
dangerous if used as intended, any seller of the product (from
manufacturer to retailer) may be liable for an injury caused by
the defective product. Strict products liability is useful in
protecting individual consumers who suffer personal injury or
property damage.Ask Yourself

13. · How do you feel about the fact that anyone in the chain of
distribution can be liable for design or manufacture defects?
Why do you think the law allows for such wide liability?
· Fancy Motors is a car manufacturing company. They develop a
new, compact car for the US market. The car has troubles from
the minute it comes off of the assembly line. The gas tank is
located behind the fender-well of the vehicle. This leads to an
increased risk of fire in the event of a rear-end collision. Also,
Fancy Motors installed a seatbelt system that is designed to
have three points of contact with the car frame. Due to space
concerns and a lack of understanding of the seat belt system,
Fancy only attached the seatbelt to the frame in two locations.
Can you identify any points of potential liability for Fancy
Motors in this scenario?
Other Common Strict Liability Causes of Action
Most states recognize similar types of conduct as subject to
strict liability:
· ultrahazardous activity—Courts may impose strict liability in
tort for types of activities they call ultrahazardous. This may
include activities such as working with explosives, wild
animals, or extreme sports.
· dram shop acts—These laws make sellers of alcoholic
beverages directly to customers on the seller’s premises liable
for harm caused as a result of the consumer becoming
intoxicated.
· common carriers—Carriers of cargo on behalf of others may
be strictly liable to the owner for any harm suffered by the
cargo. Risk of loss, however, may be shifted back on the owner
via contract.Ask Yourself
· How do you feel about the idea that an individual can be held
liable for actions without having any intent to achieve a result
or knowledge that the action is wrong? What if an individual is
intentionally deceived into undertaking activity that entails
strict liability?
· Garth has a Rottweiler named Alf. Alf is generally very

14. amiable. She has a buried electric fence that keeps Alf in her
yard. One day, Alf sees a bicyclist riding by her house. She runs
through the electric fence and bites the bicyclist. What is the
likelihood that Garth will be held liable in this situation?
Defenses to Strict Product Liability Actions
The following defenses affect liability in a strict product
liability case:
· contributory and comparative negligence—These are generally
not defenses to strict products liability actions; though, the
negligence of the plaintiff may be used to reduce damage
awards.
· assumption of the risk—If a plaintiff knowingly undertakes a
dangerous activity to which strict liability applies, she may be
barred from recovering from the defendant for harms suffered.
Individuals may contractually acknowledge their assumption of
any risks in a given activity. In most jurisdictions, however,
assumption of the risk may constitute a defense.
· misuse of a product—Strict product liability depends upon an
individual use the product as intended by the manufacturer or in
an otherwise reasonable manner. This means that the defendant
may avoid liability if the injury to the plaintiff was the result of
using the product in a manner that is not intended or is
cautioned against. Compliance with federal or state standards
regarding the manufacture and design of a product is evidence
that the product is not defective, but it is not a complete
defense. Many states are beginning to adopt a reasonableness
standard for design defects, failure to warn, and testing
inadequacies. These standards replace the traditional strict
liability standard. Handling fireworks while smoking could be
an assumption of the risk if the explosive nature of the product
is known or expressed to the user. Removing safety guards from
equipment is a common misuse that could constitute a defense
to strict product liability.Ask Yourself
· How do you feel about the available defenses to strict product
liability actions? Should comparative negligence apply to such

15. actions? Why or why not? Why do you think assumption of the
risk is a commonly accepted defense? Should any defense apply
differently depending upon who is being sued (manufacturer,
distributor, retailer, etc.)? Why or why not?
· Mycroft purchases a new Sherlock model of riding lawn
mower from Watson’s hardware. After using the mower once, he
decides to remove the cover guard from the top of the mower
deck. This makes it easier for him to clean excess trimming
from the deck after use. One day, he accidentally sticks his foot
in the pulleys and severely injures his foot. If he sues Watson’s
and Sherlock, Inc., under strict product liability, what potential
defenses apply?
Licenses and Attributions
Business Law: An Introduction by TheBusinessProfessor.com,
Jason M. Gordon & Colleagues has been adapted with
permission from Jason M. Gordon. © Business Professor, LLC.
Learning ResourceTort Damages
Compensatory Damages
Tort plaintiffs may generally recover compensatory damages for
injuries or losses suffered as a result of the tortious conduct. As
the name implies, these damages are used to compensate the
plaintiff for an injury suffered and to make the plaintiff whole
again. Compensatory damages may include financial loss, pain
and suffering, decreased life expectancy, loss of enjoyment, and
loss of life or limb. Calculation of damage awards are made by
the jury.
Juries may employ life expectancy tables and present value
discounts in arriving at a damages award.Ask Yourself
· Do you have any opinions on how compensatory damages
should be calculated? Should any factors other than the harm
suffered by the plaintiff be considered? Do you think the award
of compensatory damages is always fair? Why or why not?
Should there be cap on damages? Why or why not?

16. · Arthur gets into an automobile accident. He suffers some
bruising and a broken ankle. He also has to take leave from
work for several months until his ankle fully heals. The doctors
are concerned that Arthur could suffer long-term pain and
arthritis in the ankle. He sues the other driver for negligence
and wins. What do you think the jury will consider in awarding
compensatory damages to Arthur?
Punitive Damages
Punitive damages are used to punish defendants for committing
intentional torts and for negligent behavior considered "gross"
or "willful and wanton." The key consideration in the award of
punitive damages is the defendant's motive. Usually, a
defendant's motive must be malicious, fraudulent, or evil.
Punitive damages are also awarded for dangerously negligent or
reckless conduct that shows a conscious disregard for the
interests of others.Ask Yourself
· How do you feel about the award of punitive damages? If
punitive damages are awarded by the jury, is it fair that they go
to the defendant? Why or why not?
· Happy Motor Co. manufactures cars. The company learns that
the braking system in the vehicle is subject to fail in certain
weather and road conditions. The company calculates the
likelihood of losses from lawsuits from the failed braking
system and realizes that it would be far cheaper to pay out
awards in those lawsuits than to recall all of the vehicles and
replace the braking system. When a plaintiff is severely injured
because of the malfunction and sues Happy Motor Co., what
type of damages do you think the jury will award and why?
Licenses and Attributions
Business Law: An Introduction by TheBusinessProfessor.com,
Jason M. Gordon & Colleagues has been adapted with
permission from Jason M. Gordon. © Business Professor, LLC.
Learning ResourceWarranties

17. The Uniform Commercial Code (UCC) governs express
warranties and various implied warranties. For many years, it
was the only statutory control on the use and meanings of
warranties. In 1975, after years of debate, Congress passed—
and President Gerald Ford signed into law—the Magnuson-Moss
Act, which imposes certain requirements on manufacturers, and
others who warrant their goods. We will examine both the UCC
and the Magnuson-Moss Act.
Types of WarrantiesExpress Warranties
An express warranty is created whenever the seller affirms that
the product will perform in a certain manner. Formal words
such as "warrant," or "guarantee" are not necessary. A seller
may create an express warranty as part of the basis for the
bargain of sale by means of (1) an affirmation of a fact or
promise relating to the goods, (2) a description of the goods, or
(3) a sample or model. Any of these will create an express
warranty that the goods will conform to the fact, promise,
description, sample, or model. Thus a seller who states that "the
use of rustproof linings in the cans would prevent discoloration
and adulteration of the Perform solution" has given an express
warranty, whether he realized it or not. Claims of breach of
express warranty are, at base, claims of misrepresentation.
However, the courts will not hold a manufacturer to every
statement that could conceivably be interpreted to be an express
warranty. Manufacturers and sellers constantly "puff" their
products, and the law is content to let them inhabit that gray
area without having to make good on every claim. UCC 2-
313(2) says that "an affirmation merely of the value of the
goods or a statement purporting to be merely the seller's opinion
or commendation of the goods does not create a warranty."
Facts do.
It is not always easy, however, to determine the line between an
express warranty and a piece of puffery. A salesperson who says
that a strawberry huller is "great" has probably puffed—as
opposed to warranted—when it turns out that strawberries run

18. through the huller look unappetizing. Consider the classic cases
of the defective used car and the faulty bull. In the former, the
salesperson said the car was in "A-1 shape" and "mechanically
perfect." In the latter, the seller said not only that the bull calf
would "put the buyer on the map," but that "his father was the
greatest living dairy bull." The car, carrying the buyer's seven-
month-old child, broke down while the buyer was en route to
visit her husband in the army during World War II. The court
said that the salesperson had made an express warranty (Wat
Henry Pontiac Co. v. Bradley, 210 P.2d 348 1949). The bull calf
turned out to be sterile, putting the farmer on the judicial rather
than the dairy map. The court said the seller's spiel was trade
talk, not a warranty that the bull would impregnate cows
(Frederickson v. Hackney, 198 N.W. 806 1924).
Is there any qualitative difference between these decisions,
other than the quarter-century that separates them and the
different courts that rendered them? Perhaps the most that can
be said is that the more specific and measurable the statement's
standards, the more likely it is that a court will hold the seller
to a warranty. In addition, it's important to note that a written
statement is easier to construe as a warranty than an oral one. It
is also possible that courts look, if only subliminally, at how
reasonable the buyer was in relying on the statement (although,
this ought not to be a strict test). A buyer may be unreasonable
in expecting a car to get 100 miles to the gallon, but if that is
what the seller promised, that ought to be an enforceable
warranty.Implied Warranties
Express warranties are those over which the parties bargained
for—or could have. Express warranties go to the essence of the
bargain. An implied warranty, by contrast, is one that
circumstances alone—not specific language—compel reading
into the sale. In short, an implied warranty is one created by
law, acting from an impulse of common sense.Implied Warranty
of Merchantability
Section 2-314 of the UCC lays down the fundamental rule that
goods carry an implied warranty of merchantability if sold by a

19. merchant-seller. What is merchantability? Section 2-314(2) of
the UCC says that merchantable goods are those that conform at
least to the following six characteristics:
· pass without objection in the trade under the contract
description
· in the case of fungible goods, are of fair average quality
within the description
· are fit for the ordinary purposes for which such goods are used
· run, within the variations permitted by the agreement, of even
kind, quality, and quantity within each unit and among all units
involved
· are adequately contained, packaged, and labeled as the
agreement may require
· conform to the promise or affirmations of fact made on the
container or label, if any
For the purposes of Section 2-314(2)(c) of the UCC, selling and
serving food or drink for consumption on or off the premises is
a sale subject to the implied warranty of merchantability: the
food must be "fit for the ordinary purposes" to which it is put.
The problem is common: You bite into a cherry pit in the
cherry-vanilla ice cream, or you choke on the clam shells in the
chowder. Is such food fit for the ordinary purposes to which it
is put? There are two schools of thought. One asks whether the
food was natural as prepared. This view adopts the seller's
perspective. The other asks what the consumer's reasonable
expectation was.
The first test is sometimes said to be the "natural-foreign" test.
If the substance in the soup is natural to the substance—as
bones are to fish—then the food is fit for consumption. The
second test, relying on reasonable expectations, tends to be the
more commonly used test.Fitness for a Particular Purpose
Section 2-315 of the UCC creates another implied warranty.
Whenever a seller, at the time she contracts to make a sale,
knows—or, has reason to know—that the buyer is relying on the
seller's skill or judgment to select a product that is suitable for
the particular purpose the buyer has in mind for the goods to be

20. sold, there is an implied warranty that the goods are fit for that
purpose. For example, you go to a hardware store and tell the
sales clerk that you need a paint that will dry overnight, because
you are painting your front door and a rainstorm is predicted for
the next day. The clerk gives you a slow-drying oil-based paint
that takes two days to dry. The store has breached an implied
warranty of fitness for particular purpose.
Note the distinction between "particular" and "ordinary"
purposes. Paint is made to color, and when dry, to protect a
surface. That is its ordinary purpose, and, had you said only that
you wished to buy paint, no implied warranty of fitness would
have been breached. It is only because you had a particular
purpose in mind that the implied warranty arose. Suppose you
had found a can of paint in a general store and told the same
tale, but the proprietor had said, "I don't know enough about
that paint to tell you anything beyond what's on the label—help
yourself." Not every seller has the requisite degree of skill and
knowledge about every product he sells to give rise to an
implied warranty. Ultimately, each case turns on its particular
circumstances.Other Warranties
Article 2 contains other warranty provisions, though these are
not related specifically to products liability. Thus, under UCC,
Section 2-312, unless explicitly excluded, the seller warrants he
is conveying good title that is rightfully his and that the goods
are transferred free of any security interest or other lien or
encumbrance. In some cases (e.g., a police auction of bicycles
picked up around campus and never claimed), the buyer should
know that the seller does not claim title in himself, nor that title
will necessarily be good against a third party, and so subsection
2 excludes warranties in these circumstances. But the
circumstances must be so obvious that no reasonable person
would suppose otherwise.
In Menzel v. List, an art gallery sold a painting by Marc
Chagall that it purchased in Paris. The painting had been stolen
by the Germans when the original owner was forced to flee
Belgium in the 1930s. Now in the United States, the original

21. owner discovered that a new owner had the painting and
successfully sued for its return. The customer then sued the
gallery, claiming that it had breached the implied warranty of
title when it sold the painting. The court agreed and awarded
damages equal to the appreciated value of the painting. A good-
faith purchaser who must surrender stolen goods to their true
owner has a claim for breach of the implied warranty of title
against the person from whom he bought the goods.
A second implied warranty—related to title—is that the
merchant-seller warrants that the goods are free of any rightful
claim by a third person that the seller has infringed his rights
(e.g., that a gallery has not infringed a copyright by selling a
reproduction). This provision only applies to a seller who
regularly deals in goods of the kind in question. If you find an
old print in your grandmother's attic, you do not warrant when
you sell it to a neighbor that it is free of any valid infringement
claims.
A third implied warranty in this context involves the course of
dealing or usage of trade. Section 2-314(3) of the UCC says
that, unless modified or excluded, implied warranties may arise
from a course of dealing or usage of trade. If a certain way of
doing business is understood, it is not necessary for the seller to
state explicitly that he will abide by the custom—it will be
implied. A typical example is the obligation of a dog dealer to
provide pedigree papers to prove the dog's lineage conforms to
the contract.
Problems with Warranty Theory
It may seem that a person asserting a claim for breach of
warranty will have a good chance of success under an express
warranty or implied warranty theory of merchantability or
fitness for a particular purpose. In practice, though, claimants
are in many cases denied recovery. Here are four general
problems:
· The claimant must prove that there was a sale.
· The sale was of goods rather than real estate or services.

22. · The action must be brought within the four-year statute of
limitations under Article 2-725, when the tender of delivery is
made, not when the plaintiff discovers the defect.
· Under UCC, Section 2-607(3)(a) and Section 2A-516(3)(a),
which covers leases, the claimant who fails to give notice of
breach within a reasonable time of having accepted the goods
will see the suit dismissed, and few consumers know enough to
do so, except when making a complaint about a purchase of
spoiled milk or about paint that wouldn't dry.
In addition to these general problems, the claimant faces
additional difficulties stemming directly from warranty theory.
Exclusion or Modification of Warranties
The UCC permits sellers to exclude or disclaim warranties in
whole or in part. That's reasonable, given that the discussion
here is about contract, and parties are free to make such
contracts as they see fit. But a number of difficulties can
arise.Exclusion of Express Warranties
The simplest way for the seller to exclude express warranties is
not to give them. To be sure, Section 2-316(1) of the UCC
forbids courts from giving operation to words in fine print that
negate or limit express warranties if doing so would
unreasonably conflict with express warranties stated in the main
body of the contract—as, for example, would a blanket
statement that "this contract excludes all warranties express or
implied." The purpose of the UCC provision is to prevent
customers from being surprised by unbargained-for
language.Exclusion of Implied Warranties in General
Implied warranties can be excluded easily enough also, by
describing the product with language such as "as is" or "with all
faults." Nor is exclusion simply a function of what the seller
says. The buyer who has either examined or refused to examine
the goods before entering into the contract may not assert an
implied warranty concerning defects an inspection would have
revealed.Implied Warranty of Merchantability
Section 2-316(2) of the UCC permits the seller to disclaim or

23. modify the implied warranty of merchantability, as long as the
statement actually mentions "merchantability" and, if it is
written, is "conspicuous." Note that the disclaimer need not be
in writing, and—again—all implied warranties can be excluded
as noted.Implied Warranty of Fitness
Section 2-316(2) of the UCC permits the seller also to disclaim
or modify an implied warranty of fitness. This disclaimer or
modification must be in writing, however, and must be
conspicuous. It need not mention fitness explicitly; general
language will do. The following sentence, for example, is
sufficient to exclude all implied warranties of fitness: "There
are no warranties that extend beyond the description on the face
of this contract."
Here is a standard disclaimer clause found in a Dow Chemical
Company agreement: "Seller warrants that the goods supplied
here shall conform to the description stated on the front side
hereof, that it will convey good title, and that such goods shall
be delivered free from any lawful security interest, lien, or
encumbrance. SELLER MAKES NO WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR
USE. NOR IS THERE ANY OTHER EXPRESS OR IMPLIED
WARRANTY."Conflict Between Express and Implied
Warranties
Express and implied warranties and their exclusion or limitation
can often conflict. Section 2-317 of the UCC provides certain
rules for deciding which should prevail. In general, all
warranties are to be construed as consistent with each other and
as cumulative. When that assumption is unreasonable, the
parties' intention governs the interpretation, according to the
following rules: (a) exact or technical specifications displace an
inconsistent sample or model or general language of
description; (b) a sample from an existing bulk displaces
inconsistent general language of description; (c) express
warranties displace inconsistent implied warranties other than
an implied warranty of fitness for a particular purpose. Any
inconsistency among warranties must always be resolved in

24. favor of the implied warranty of fitness for a particular purpose.
This doesn't mean that warranty cannot be limited or excluded
altogether. The parties may do so. But in cases of doubt whether
it or some other language applies, the implied warranty of
fitness will have a superior claim.The Magnuson-Moss Act and
Phantom Warranties
After years of debate over extending federal law to regulate
warranties, Congress enacted the Magnuson-Moss Federal Trade
Commission Warranty Improvement Act (more commonly
referred to as the Magnuson-Moss Act) and President Ford
signed it in 1975. The act was designed to clear up confusing
and misleading warranties, where—as Senator Magnuson put it
in introducing the bill:
Purchasers of consumer products discover that their warranty
may cover a 25-cent part but not the $100 labor charge or that
there is full coverage on a piano so long as it is shipped at the
purchaser's expense to the factory.…There is a growing need to
generate consumer understanding by clearly and conspicuously
disclosing the terms and conditions of the warranty and by
telling the consumer what to do if his guaranteed product
becomes defective or malfunctions.
The Magnuson-Moss Act only applies to consumer products (for
household and domestic uses); commercial purchasers are
presumed to be able to hire lawyers, and to be able to include
the cost of product failures into the prices they charge, in
addition to being knowledgeable enough not to need these
protections.
The act has several provisions to meet these consumer concerns;
it regulates the content of warranties and the means of
disclosing those contents. The act gives the Federal Trade
Commission (FTC) the authority to promulgate detailed
regulations to interpret and enforce it. Under FTC regulations,
any written warranty for a product costing a consumer more
than 10 dollars must disclose in a single document and in
readily understandable language the following nine items:
· The identity of the persons covered by the warranty, whether

25. it is limited to the original purchaser or fewer than all who
might come to own it during the warranty period.
· A clear description of the products, parts, characteristics,
components, or properties covered, and where necessary for
clarity, a description of what is excluded.
· A statement of what the warrantor will do if the product fails
to conform to the warranty, including items or services the
warranty will pay for and, if necessary for clarity, what it will
not pay for.
· A statement of when the warranty period starts and when it
expires.
· A step-by-step explanation of what the consumer must do to
realize on the warranty, including the names and addresses of
those to whom the product must be brought.
· Instructions on how the consumer can be availed of any
informal dispute resolution mechanism established by the
warranty.
· Any limitations on the duration of implied warranties—since
some states do not permit such limitations, the warranty must
contain a statement that any limitations may not apply to the
particular consumer.
· Any limitations or exclusions on relief, such as consequential
damages—as above, the warranty must explain that some states
do not allow such limitations.
· The following statement: "This warranty gives you specific
legal rights, and you may also have other rights which vary
from state to state."
In addition to these requirements, the act requires that the
warranty be labeled either a full or limited warranty. A full
warranty means (1) the defective product or part will be fixed or
replaced for free, including removal and reinstallation, (2) it
will be fixed within a reasonable time, (3) the consumer need
not do anything unreasonable (like shipping the piano to the
factory) to get warranty service, (4) the warranty is good for
anyone who owns the product during the period of the warranty,
and (5) the consumer gets money back or a new product if the

26. item cannot be fixed within a reasonable number of attempts.
But the full warranty may not cover the whole product: it may
cover only the hard drive in the computer, for example; it must
state what parts are included and excluded. A limited warranty
is less inclusive. It may cover only parts, not labor; it may
require the consumer to bring the product to the store for
service; it may impose a handling charge; it may cover only the
first purchaser. Both full and limited warranties may exclude
consequential damages.
Disclosure of the warranty provisions prior to sale is required
by FTC regulations; this can be done in a number of ways. The
text of the warranty can be attached to the product or placed in
close conjunction to it. It can be maintained in a binder kept in
each department or otherwise easily accessible to the consumer.
Either the binders must be in plain sight or signs must be posted
to call the prospective buyer's attention to them. A notice
containing the text of the warranty can be posted, or the
warranty itself can be printed on the product's package or
container.
Phantom warranties are addressed by the Magnuson-Moss Act.
As we have seen, the UCC permits the seller to disclaim implied
warranties. This authority often led sellers to give what were
called phantom warranties—that is, the express warranty
contained disclaimers of implied warranties, thus leaving the
consumer with fewer rights than if no express warranty had
been given at all. In the words of the legislative report of the
act, "The bold print giveth, and the fine print taketh away." The
act abolished these phantom warranties by providing that if the
seller gives a written warranty, whether express or implied, he
cannot disclaim or modify implied warranties. However, a seller
who gives a limited warranty can limit implied warranties to the
duration of the limited warranty, if the duration is reasonable.
A seller's ability to disclaim implied warranties is also limited
by state law in two ways. First, by amendment to the UCC or by
separate legislation, some states prohibit disclaimers whenever
consumer products are sold. A number of states have special

27. laws that limit the use of the UCC implied warranty disclaimer
rules in consumer sales. Some of these appear in amendments to
the UCC and others are in separate statutes. The broadest
approach is that of the nine states that prohibit the disclaimer of
implied warranties in consumer sales (Massachusetts,
Connecticut, Maine, Vermont, Maryland, the District of
Columbia, West Virginia, Kansas, Mississippi, and, with respect
to personal injuries only, Alabama). There is a difference in
these states whether the rules apply to manufacturers as well as
retailers. Second, the UCC at 2-302 provides that
unconscionable contracts or clauses will not be enforced. UCC
2-719(3) provides that limitation of damages for personal injury
in the sale of "consumer goods is prima facie unconscionable,
but limitation of damages where the loss is commercial is not."
A first problem with warranty theory, then, is that it's possible
to disclaim or limit the warranty. The worst abuses of
manipulative and tricky warranties are eliminated by the
Magnuson-Moss Act, but there are several other reasons that
warranty theory is not the panacea for claimants who have
suffered damages or injuries as a result of defective products.
Privity
A second problem with warranty law (after exclusion and
modification of warranties) is that of privity. Privity is the legal
term for the direct connection between the seller and buyer, the
two contracting parties. For decades, the doctrine of privity has
held that one person can sue another only if they are in privity.
That worked well in the days when most commerce was local
and the connection between seller and buyer was immediate.
But in a modern industrial (or postindustrial) economy, the
product is transported through a much larger distribution
system, as depicted in the following figure.
Chain of Distribution
Two questions arise: (1) Is the manufacturer or wholesaler (as
opposed to the retailer) liable to the buyer under warranty

28. theory? and (2) May the buyer's family or friends assert
warranty rights?Horizontal Privity
Suppose Carl Consumer buys a new lamp for his family's living
room. The lamp is defective: Carl gets a serious electrical shock
when he turns it on. Certainly Carl would be covered by the
implied warranty of merchantability: he's in direct privity with
the seller. But what if Carl's spouse Carlene is injured? She
didn't buy the lamp; is she covered? Or suppose Carl's friend
David, visiting for an afternoon, gets zapped. Is David covered?
This gets to horizontal privity, which is when noncontracting
parties suffer damages from defective goods. These parties
could be nonbuyer users, consumers, and bystanders. Horizontal
privity determines to whose benefit the warranty "flows"—who
can sue for its breach. In one of its rare instances of
nonuniformity, the UCC does not dictate the result. It gives the
states three choices, labeled in Section 2-318 as Alternatives A,
B, and C.
Alternative A says that a seller's warranty extends "to any
natural person who is in the family or household of his buyer or
who is a guest in his home" provided (1) it is reasonable to
expect the person suffering damages to use, consume, or be
affected by the goods and (2) the warranty extends only to
damages for personal injury.
Alternative B "extends to any natural person who may
reasonably be expected to use, consume, or be affected by the
goods, and who is injured in person by breach of the warranty."
It is less restrictive than the first alternative: it extends
protection to people beyond those in the buyer's home. For
example, what if Carl took the lamp to a neighbor's house to
illuminate a poker table? Under Alternative B, anybody at the
neighbor's house who suffered injury would be covered by the
warranty. But this alternative does not extend protection to
organizations; "natural person" means a human being.
Alternative C is the same as B except that it applies not only to
any "natural person" but "to any person who is injured by
breach of the warranty." This is the most far-reaching

29. alternative because it provides redress for damage to property as
well as for personal injury, and it extends protection to
corporations and other institutional buyers.
One may incidentally note that having three different
alternatives for when third-party nonpurchasers can sue a seller
or manufacturer for breach of warranty gives rise to unintended
consequences. First, different outcomes are produced among
jurisdictions, including variations in the common law. Second,
the great purpose of the Uniform Commercial Code in
promoting national uniformity is undermined. Third, battles
over choice of law—where to file the lawsuit—are generated.
UCC, Section 2A-216, provides basically the same alternatives
as applicable to the leasing of goods.Vertical Privity
The traditional rule was that remote selling parties were not
liable: lack of privity was a defense by the manufacturer or
wholesaler to a suit by a buyer with whom these entities did not
themselves contract. The buyer could recover damages from the
retailer but not from the original manufacturer, who after all
made the product and who might be much more financially able
to honor the warranty. The UCC takes no position here, but over
the last 50 years the judicial trend has been to abolish this
vertical privity requirement. (In the Chain of Distribution
figure, the entities in the distribution chain are those in vertical
privity to the buyer.)Contributory Negligence, Comparative
Negligence, and Assumption of Risk
After disclaimers and privity issues are resolved, other possible
impediments facing the plaintiff in a products-liability warranty
case are issues of assumption of the risk, contributory
negligence, and comparative negligence.
Courts uniformly hold that assumption of risk is a defense for
sellers against a claim of breach of warranty, while there is a
split of authority over whether comparative and contributory
negligence are defenses. However, the courts' use of this
terminology is often conflicting and confusing. The ultimate
question is really one of causation: was the seller's breach of
the warranty the cause of the plaintiff's damages?

30. The UCC is not markedly helpful in clearing away the confusion
caused by years of discussion of assumption of risk and
contributory negligence. Section 2-715(2)(b) of the UCC says
that among the forms of consequential damage for which
recovery can be sought is "injury to person or
property proximately resulting from any breach of warranty"
(emphasis added). But "proximately" is a troublesome word.
Indeed, ultimately it is a circular word: it means nothing more
than that the defendant must have been a direct enough cause of
the damages that the courts will impose liability. Comment 5 to
this section says:
Where the injury involved follows the use of goods without
discovery of the defect causing the damage, the question of
'proximate' turns on whether it was reasonable for the buyer to
use the goods without such inspection as would have revealed
the defects. If it was not reasonable for him to do so, or if he
did in fact discover the defect prior to his use, the injury would
not proximately result from the breach of warranty.
Obviously if a skydiver buys a parachute and then discovers a
few holes in it, his family would not likely prevail in court
when they sued to recover for his death because the parachute
failed to function after he jumped at 5,000 feet. But the general
notion that it must have been reasonable for a buyer to use
goods without inspection can make a warranty case difficult to
prove.
Licenses and Attributions
20.2 Warranties from The Law, Sales, and Marketing is
available under a Creative Commons Attribution-
NonCommercial-ShareAlike 3.0 Unported license without
attribution as requested by the site’s original creator or
licensee. UMUC has modified this work and it is available
under the original license.
Learning TopicNegligence and Product Liability
Tort law, an important component of civil law within the US
common law system, generally encompasses situations in which

31. an individual's conduct causes harm to another. Tort is literally
translated from French as a "wrong." Conduct gives rise to
claims in court when a specific statutory or common law tort
has been committed. When a tort is committed, one may seek
compensation for the tort in court in the form of damages
(monetary compensation).
Tort law can be divided according to three broad categories of
tort: intentional torts, negligence, and strict liability torts.
Intentional torts generally require that one "intended" to cause
the consequences of the act. That is, that one meant to perform
the act that caused harm to another.
Negligence generally requires that one be at fault for
committing the act. Negligence theory underlies many personal
injury actions, such as car accidents.
Strict liability torts require neither intent nor fault; simply
causing harm to an individual while performing one from an
enumerated list of strict liability torts gives rise to damages
(even if the individual did not intend the act and was not at
fault for it).
Negligence is a legal doctrine that underlies many types of
lawsuits when someone or an entity is at fault for harm caused
to another. In order to prove negligence, the injured party
(plaintiff) must prove the following five elements:
· existence of a duty of care owed by the defendant to the
plaintiff
· unreasonable behavior by the defendant that breaches the duty
of care
· causation in fact
· proximate causation
· an actual injury
There are various methods of proving these five elements during
or before a trial. The absence of any one of these elements will
undermine the potential for a successful negligence claim.
Negligence is the basis for not only personal injury actions but
also most malpractice lawsuits and many lawsuits involving
damage to person or property caused by products on the market,

32. when strict liability is not available for those suits.
Strict liability torts are torts that impose liability upon an
individual or an entity simply for the individual's or entity's
causing harm or engaging in an activity from an enumerated
list. The law imposes this strict liability in order to protect
certain vulnerable populations from harm caused by those who
engage in certain high-risk activities. These activities include
the following:
· dealing in very hazardous material
· possessing a vicious or wild animal
· taking part in the production or sale of an unreasonably
dangerous product
If any person causes injury to another pursuant to participation
in one of these activities, then, absent an adequate and
applicable defense, that person is liable to the injured regardless
of fault or intent. Strict liability thus makes it easier for a
plaintiff to recover from harm done.
Products liability is a type of strict liability, but the term is
sometimes used to denote something more than mere strict
liability for dangerous products. In some cases, products
liability is used to denote all causes of action against producers
or distributors of products that harm consumers. These causes
of action include strict liability and negligence claims based on
design defects, manufacturing defects, and inadequate warnings.
The causes also include breaches of express and implied
warranty claims. This broader conception of products liability is
often employed in lieu of the narrower sense encompassing just
strict products liability.Resources
· Fraud and Negligence Torts
· Warranties
Licenses and Attributions
Business Law: An Introduction by TheBusinessProfessor.com,
Jason M. Gordon & Colleagues has been adapted with
permission from Jason M. Gordon. © Business Professor, LLC.

33. Learning TopicTort Damages
The overarching purpose of tort law is to provide remedies,
usually in the form of damages (monetary awards), to persons
injured by the civil wrongs of others. Damages awarded for tort
violations include compensatory and punitive damages.
The aim of compensatory damages is to place the injured party
in the same position that party would have been in had the tort
never been committed, that is, to make the injured party whole.
Compensatory damages are sometimes categorized into two
types: special and general compensatory damages. Special
damages are quantifiable monetary losses incurred by the
injured party, such as the cost of replacing or repairing damaged
property, medical costs, past lost wages and benefits, future lost
wages and benefits, and other quantifiable costs resulting from
the tort. General damages, on the other hand, are not easily
quantifiable and include pain and suffering, loss of consortium,
loss of reputation, and loss of mental or physical capacity
resulting from a tort.
In some egregious cases, courts also award punitive damages.
Punitive damages are intended to punish a tortfeasor (person
who commits a tort) for engaging in particularly wanton or
reckless conduct that reflects a disregard for the interests of
others. Punitive damages are often limited by courts to
approximately three times the amount of compensatory
damages, in order to satisfy the due process requirements of the
Constitution (exceeding these approximate amounts may be
deemed an unconstitutional deprivation of another person’s
property). Thus, punitive damages are reserved for the most
egregious of tort cases, and appeals often follow when a trial
court awards them. They are generally only available for
intentional torts, although they are sometimes available for
cases of gross negligence.