The Evolving Landscape of Modern Tort Liability

The philosophical dilemma is: Who should be charged with knowing or crafting what is good for the people? Accepting that law exists for the purpose of establishing or preserving equal justice for all our citizens means the primary goal of the common law should be to secure a place where everyone has a workable venue to right wrongs. Our system of justice has, from its earliest days, embraced the responsibility of government to protect our right to civil reparation for harm caused.

The common law, and tort law specifically, represents the principles and rules of law related to the security of persons and property, which has been developed and derived through judicial decisions. Tort law, then, is a child of the common law. It is the body of law establishing and defining legal duty, fault and damages recoverable when someone is harmed by legally cognizable action or inaction of another. These principles and rules of law are predicated upon stare decisis, rather than specific declarations of the legislature (although legislative enactment can help define a tort action). The doctrine of stare decisis is one of policy, which acknowledges the importance of precedent that is intended to provide predictability, security and certainty. It is the judicial philosophy embracing the notion that rights once acquired should not be easily removed.

At its base, the common law serves as an evolving constitution of civil rights. Power is divided among branches of government to prevent the temptation to place power in one location as an expedient solution to the crisis of the day, or to rely upon one branch of government as the only voice for defining the common good.

Product Liability Negligence Law

Product liability negligence law has its modern origins in a 1916 decision that caused the common law of tort liability to extend a product manufacturer's duty to those people who have suffered injury or death, regardless of contractual privity, when the product's design or manufacture places someone in peril of life and limb because of the negligence of the manufacturer. This notion was later extended by a ruling that a manufacturer that misrepresents the character or quality of a product may be held legally responsible even if it was not negligent.

By the 1950s and early 1960s, there had developed a school of thought saying that traditional theories of negligence were inadequate to afford necessary protection to the consumer. In view of the complexity of modern mass production systems utilized by manufacturers, it was believed that it would be difficult, if not impossible, for the plaintiff to identify at what point along the assembly line the manufacturer had been negligent. Thus, the doctrine of strict liability was devised to alleviate the plaintiff's evidentiary burden in cases involving manufacturing defects. This new theory of recovery was distinguishable from negligence in that it focused not on the reasonableness of the manufacturer's conduct but rather on the condition of the product itself. By relieving the plaintiff of this evidentiary burden, the loss shifted from the consumer to the manufacturer, spurring product safety.

Modern tort liability, and its evolution through the early 1990s, provided legal remedies and legal defenses that were consistent with both economic and societal attitudes toward corporate and personal responsibility for harm, injury and death. However, an inordinate amount of money and effort to change what has been perceived as the excesses of tort law has been spent by big business and academia. They seek to alter the landscape of the common law so that the role of tort law is relegated to deter undesirable behavior rather than foster fair compensation and/or financial punishment for intentional wrongdoing.

One of the most reassuring attributes of the common law has been its predictability. Despite constant change in the personnel called upon to police and interpret the law, both consumers and businesses have known for many years what can be expected from the law. Nevertheless, times change, people's attitudes evolve, and the expectations of our society change with time. Philosophically, good should not change with time; however, pragmatically, it is quite obvious that no truism in social science, like the law, remains unchangeable. The struggle, therefore, has been over the extent to which courts, as opposed to legislators, should dictate how the common law changes.

The Proper Role of the Legislature

Depending upon the scope and course of a state's constitutional provisions, or the scope of the Seventh Amendment of the U.S. Constitution, the proper role of the legislature is to enact legislation that provides appropriate protection for all the populace, and the role of courts is to determine the legislative power to enact changes to the law. It is the court's task to determine whether legislation comports with the principles of separation of power, the integrity of each branch of government and the constitutional rights of citizens.

Historically, courts have acknowledged that the determination of the quantum of damages in a common-law action is uniquely a jury issue. Nevertheless, courts have also observed that a jury's analysis and conclusions are subject to judicial review ' despite the Seventh Amendment. It would strain credibility to assert that a victim's right to unliquidated damages is not a question of fact under the common law. Nonetheless, access to court does not determine, nor does it necessarily guarantee, any substantive rights of recovery.

Limiting Financial Exposure

Tort reform seeking to limit financial exposure for harm caused has been going on for the past decade. Depending upon the scope of legislative enactment, this movement has had mixed success in our courts. In 1997 and then in 1999, the Supreme Courts of Illinois and Ohio struck down very broad legislative efforts to change major tort common law principles. In Ohio, the court found unconstitutional the following legislative provisions:

• The re-enactment of statutes and rules relating to tort and civil actions previously found unconstitutional.
• A 15-year statute of repose for actions arising from defective and unsafe conditions of real property and products because of constitutional guarantee of right to a remedy.
• A six-year statute of repose governing malpractice claims other than medical claims based upon constitutional guarantee of right to a remedy.
• Statutory enactments pertaining to court procedural matters based upon separation-of-powers principles.
• A statute abrogating common-law collateral source rule and creating a post-verdict setoff for collateral payments and allowed reduction of amount of compensatory damages by amount of collateral payment violated due process clause.
• Limits on punitive damage awards by juries violated right to jury trial established by the state constitution.
• Caps/limits on noneconomic damages were unreasonable and arbitrary, and therefore violated the due process clause of the state constitution.

In the Illinois case, the primary arguments in favor of legislative tort reform were that the legislature had the right to change the common law and that the changes made were needed to control both escalating and out-of-control litigation costs. While the Illinois Supreme Court was of the opinion that it was not entitled to judge whether or not the legislative provisions were wise, it was responsible to determine its constitutionality. The most interesting philosophical analysis made by the Illinois Supreme Court was that the various tort reform measures were unconstitutional because they represented special legislation ' a concept disallowed by the state constitution. Similar constitutional provisions are found in most state constitutions.

Addressing the legislative effort to put limits on the monetary recovery for noneconomic injuries, the court began by acknowledging that it did not disagree with the notion that such damages are difficult to quantify. Nevertheless, it did not follow from that observation that caps on these damages would make the process any less arbitrary. Since there is universal agreement that the common law is intended to make an injured plaintiff whole, by allowing for fair compensation, any limitation of this right is without legal justification.

Conclusion

While not currently a favored legal basis for the judiciary's rejection of some legislative tort reform, it is vitally important to remember that a tort action for money damages is a basic common-law privilege and one that is protected under the Seventh Amendment ' and by analogy by every state constitution containing the same protective provision.

At the heart of reform is the notion that legislative bodies are free to pre-empt the common law. Courts have been increasingly called upon to decide whether an act of Congress or state legislation was intended, or appropriately couched, to preclude or restrict civil liability at common law. Because common-law actions have traditionally been preserved and entrusted to the common law, there should be a higher scale of analysis employed in order to protect state common-law actions for damages against pre-emption. A strict textualist approach would ensure that Congress and state legislators meet a heavy burden before allowing for the elimination of state common law.

Presently, our current legal environment allows for courts and legislatures to change the common law. Not long ago, it was the courts of this country that adopted strict product liability law as an alternative to negligence theories, but it is obvious that legislatures have been given varying degrees of latitude to change the common law. What it boils down to is whether the particular change in the common law was originally based upon historical legislative enactment or judicial pronouncement. Given this, the true question is philosophical not legal: Who is best suited to make changes in the common law that will have the most satisfying effects, over time, on the consuming public?

Government at its base is designed to provide for the common good of its citizens, and the most consistent means of predicting and controlling human behavior bent on causing injury to others is to provide judicial redress. Limiting access or the scope of this redress is always dangerous.

Unlike any other court system in the world, the American civil justice system provides opportunity and protection to its citizens through the jury system. Access is meaningless if the traditional remedies are taken away. Our fellow citizens should be left to judge the value and extent of injury, undaunted by legislative fiat. Personal and corporate responsibility for tortious harm should not be legislatively protected because it may be costly, as nothing is more costly then needless injury or death. The common good requires that these basic rights be protected by both the legislature and the court system.

Larry E. Coben is a shareholder at Anapol Schwartz Weiss Cohan Feldman & Smalley P.C., Philadelphia.This article also appeared in The Legal Intelligencer, an ALM sister publication of this newsletter.

The common law has provided predictability in the product liability system for decades. Despite this historically sound conclusion, proponents of legal reform, intent on reducing unnecessary legal costs and using “predictability” as their mantra, have sought ways to alter this landscape through caps on both compensatory and punitive damage awards, abolishing joint liability, eliminating the collateral source rule, limiting a seller's liability for express warranties or direct negligence, creating comparative fault for product misuse and setting a statute of repose within the ordinary use-life of most products.

Is Reform Necessary?

While the call for tort reform is a continuing cry by opponents of our civil justice system, the necessity for, and the scope of, reform remains largely debatable. Most legal scholars and courts have resolved the notion that legislation in the area of tort reform can meet constitutional muster ' if written correctly and substantively warranted. Analysis does not question whether such legislation can be written, but rather whether such legislation should be written and, if so, where the line should be drawn between legislative tort reform and judicial control of stare decisis.

The philosophical dilemma is: Who should be charged with knowing or crafting what is good for the people? Accepting that law exists for the purpose of establishing or preserving equal justice for all our citizens means the primary goal of the common law should be to secure a place where everyone has a workable venue to right wrongs. Our system of justice has, from its earliest days, embraced the responsibility of government to protect our right to civil reparation for harm caused.

The common law, and tort law specifically, represents the principles and rules of law related to the security of persons and property, which has been developed and derived through judicial decisions. Tort law, then, is a child of the common law. It is the body of law establishing and defining legal duty, fault and damages recoverable when someone is harmed by legally cognizable action or inaction of another. These principles and rules of law are predicated upon stare decisis, rather than specific declarations of the legislature (although legislative enactment can help define a tort action). The doctrine of stare decisis is one of policy, which acknowledges the importance of precedent that is intended to provide predictability, security and certainty. It is the judicial philosophy embracing the notion that rights once acquired should not be easily removed.

At its base, the common law serves as an evolving constitution of civil rights. Power is divided among branches of government to prevent the temptation to place power in one location as an expedient solution to the crisis of the day, or to rely upon one branch of government as the only voice for defining the common good.

Product Liability Negligence Law

Product liability negligence law has its modern origins in a 1916 decision that caused the common law of tort liability to extend a product manufacturer's duty to those people who have suffered injury or death, regardless of contractual privity, when the product's design or manufacture places someone in peril of life and limb because of the negligence of the manufacturer. This notion was later extended by a ruling that a manufacturer that misrepresents the character or quality of a product may be held legally responsible even if it was not negligent.

By the 1950s and early 1960s, there had developed a school of thought saying that traditional theories of negligence were inadequate to afford necessary protection to the consumer. In view of the complexity of modern mass production systems utilized by manufacturers, it was believed that it would be difficult, if not impossible, for the plaintiff to identify at what point along the assembly line the manufacturer had been negligent. Thus, the doctrine of strict liability was devised to alleviate the plaintiff's evidentiary burden in cases involving manufacturing defects. This new theory of recovery was distinguishable from negligence in that it focused not on the reasonableness of the manufacturer's conduct but rather on the condition of the product itself. By relieving the plaintiff of this evidentiary burden, the loss shifted from the consumer to the manufacturer, spurring product safety.

Modern tort liability, and its evolution through the early 1990s, provided legal remedies and legal defenses that were consistent with both economic and societal attitudes toward corporate and personal responsibility for harm, injury and death. However, an inordinate amount of money and effort to change what has been perceived as the excesses of tort law has been spent by big business and academia. They seek to alter the landscape of the common law so that the role of tort law is relegated to deter undesirable behavior rather than foster fair compensation and/or financial punishment for intentional wrongdoing.

One of the most reassuring attributes of the common law has been its predictability. Despite constant change in the personnel called upon to police and interpret the law, both consumers and businesses have known for many years what can be expected from the law. Nevertheless, times change, people's attitudes evolve, and the expectations of our society change with time. Philosophically, good should not change with time; however, pragmatically, it is quite obvious that no truism in social science, like the law, remains unchangeable. The struggle, therefore, has been over the extent to which courts, as opposed to legislators, should dictate how the common law changes.

The Proper Role of the Legislature

Depending upon the scope and course of a state's constitutional provisions, or the scope of the Seventh Amendment of the U.S. Constitution, the proper role of the legislature is to enact legislation that provides appropriate protection for all the populace, and the role of courts is to determine the legislative power to enact changes to the law. It is the court's task to determine whether legislation comports with the principles of separation of power, the integrity of each branch of government and the constitutional rights of citizens.

Historically, courts have acknowledged that the determination of the quantum of damages in a common-law action is uniquely a jury issue. Nevertheless, courts have also observed that a jury's analysis and conclusions are subject to judicial review ' despite the Seventh Amendment. It would strain credibility to assert that a victim's right to unliquidated damages is not a question of fact under the common law. Nonetheless, access to court does not determine, nor does it necessarily guarantee, any substantive rights of recovery.

Limiting Financial Exposure

Tort reform seeking to limit financial exposure for harm caused has been going on for the past decade. Depending upon the scope of legislative enactment, this movement has had mixed success in our courts. In 1997 and then in 1999, the Supreme Courts of Illinois and Ohio struck down very broad legislative efforts to change major tort common law principles. In Ohio, the court found unconstitutional the following legislative provisions:

• The re-enactment of statutes and rules relating to tort and civil actions previously found unconstitutional.
• A 15-year statute of repose for actions arising from defective and unsafe conditions of real property and products because of constitutional guarantee of right to a remedy.
• A six-year statute of repose governing malpractice claims other than medical claims based upon constitutional guarantee of right to a remedy.
• Statutory enactments pertaining to court procedural matters based upon separation-of-powers principles.
• A statute abrogating common-law collateral source rule and creating a post-verdict setoff for collateral payments and allowed reduction of amount of compensatory damages by amount of collateral payment violated due process clause.
• Limits on punitive damage awards by juries violated right to jury trial established by the state constitution.
• Caps/limits on noneconomic damages were unreasonable and arbitrary, and therefore violated the due process clause of the state constitution.

In the Illinois case, the primary arguments in favor of legislative tort reform were that the legislature had the right to change the common law and that the changes made were needed to control both escalating and out-of-control litigation costs. While the Illinois Supreme Court was of the opinion that it was not entitled to judge whether or not the legislative provisions were wise, it was responsible to determine its constitutionality. The most interesting philosophical analysis made by the Illinois Supreme Court was that the various tort reform measures were unconstitutional because they represented special legislation ' a concept disallowed by the state constitution. Similar constitutional provisions are found in most state constitutions.

Addressing the legislative effort to put limits on the monetary recovery for noneconomic injuries, the court began by acknowledging that it did not disagree with the notion that such damages are difficult to quantify. Nevertheless, it did not follow from that observation that caps on these damages would make the process any less arbitrary. Since there is universal agreement that the common law is intended to make an injured plaintiff whole, by allowing for fair compensation, any limitation of this right is without legal justification.

Conclusion

While not currently a favored legal basis for the judiciary's rejection of some legislative tort reform, it is vitally important to remember that a tort action for money damages is a basic common-law privilege and one that is protected under the Seventh Amendment ' and by analogy by every state constitution containing the same protective provision.

At the heart of reform is the notion that legislative bodies are free to pre-empt the common law. Courts have been increasingly called upon to decide whether an act of Congress or state legislation was intended, or appropriately couched, to preclude or restrict civil liability at common law. Because common-law actions have traditionally been preserved and entrusted to the common law, there should be a higher scale of analysis employed in order to protect state common-law actions for damages against pre-emption. A strict textualist approach would ensure that Congress and state legislators meet a heavy burden before allowing for the elimination of state common law.

Presently, our current legal environment allows for courts and legislatures to change the common law. Not long ago, it was the courts of this country that adopted strict product liability law as an alternative to negligence theories, but it is obvious that legislatures have been given varying degrees of latitude to change the common law. What it boils down to is whether the particular change in the common law was originally based upon historical legislative enactment or judicial pronouncement. Given this, the true question is philosophical not legal: Who is best suited to make changes in the common law that will have the most satisfying effects, over time, on the consuming public?

Government at its base is designed to provide for the common good of its citizens, and the most consistent means of predicting and controlling human behavior bent on causing injury to others is to provide judicial redress. Limiting access or the scope of this redress is always dangerous.

Unlike any other court system in the world, the American civil justice system provides opportunity and protection to its citizens through the jury system. Access is meaningless if the traditional remedies are taken away. Our fellow citizens should be left to judge the value and extent of injury, undaunted by legislative fiat. Personal and corporate responsibility for tortious harm should not be legislatively protected because it may be costly, as nothing is more costly then needless injury or death. The common good requires that these basic rights be protected by both the legislature and the court system.

Larry E. Coben is a shareholder at Anapol Schwartz Weiss Cohan Feldman & Smalley P.C., Philadelphia.This article also appeared in The Legal Intelligencer, an ALM sister publication of this newsletter.