4.1 Tort Theory

What are the three main tort theories?

1. Corrective Justice

2. Social Benefit

3. Civil Recourse

Summarise principles of corrective justice

1.        We owe each other duties of conduct.

2.        Breaching a duty is a wrong.

3. A wrong entitles a victim to repair.

What does corrective justice imply about harm?

Harm alone is not sufficient for liability.

• Fair competition harms rivals, but it is not wrongful so no tort arises.

What does corrective justice argue about insurance?

Insurance is irrelevant. The basis of liability arises from wrongdoing, not the ability to bear costs.

Lord Reed in Cox v Ministry of Justice

The mere possession of wealth is not in itself any ground for imposing liability. As for insurance, employers insure themselves because they are liable: they are not liable because they have insured themselves.

How does corrective justice explain Sturges v Bridgman?

The doctor who could not use his consulting room because of the noise from a neighbouring confectioner succeeded in nuisance. On the wrongs model, this is easily explained: the confectioner violated the doctor's right to use his land without unreasonable interference; the court vindicated that right.

How does product liability challenge corrective justice?

It imposes strict liability for defective products even when a manufacturer has taken all due care and not wronged the claimant.

Main ideas of social benefit

• Tort law is an instrument for achieving social goals

• We should evaluate tort rules by their consequences

What is the Coase Theorem?

where transaction costs are zero, parties will negotiate the most efficient outcome regardless of how courts interpret entitlement.

What is the function of the law under the Coase theorem?

Adopt rules that mimic the agreement of rational parties if they had freely negotiated beforehand.

Why does social benefit favour insurance?

Placing liability on the party best placed to insure is socially rational as it achieves loss-spreading at minimum cost

Lord Phillips in Christian Brothers [2012], justifying vicarious liability,

vicarious liability is justified because the employer is more likely than the employee to have the means to insure against liability.

Features of the New Zealand System

• Liability is collective and capped

• Tax-funded

• No direct litigation

• Looks at social risk, not treating torts as wrongs

Solutions to Split between theories

1. Pluralism - but this sacrifices principle

2. Abandoning unified theory and accepting that some areas of tort are best explained by different theories

3. Seeking a unified theory

Zipursky and Civil Recourse Theory

• The function of tort law is to provide victims with a legal mechanism to respond to wrongs committed against them

How is civil recourse different to corrective justice?

Where corrective justice focuses on repairing loss and focuses on compensation, civil recourse theory argues that tort victims have a intrinsic right to respond to wrongs, which is not always about compensation

How did Posner and Calabresi critique civil recourse theory?

• civil recourse is true but trivial.

• It offers no support to judges attempting to decide cases.

• Entitlement to bring proceedings is a generic feature of private law, not necessarily tort law.

Weinrib and Corrective Justice

• Private law is composed of bilateral relationships. It is an end in itself, not a means to other political, economic or social change.

• Tort law should correct wrongs only. There should be no retribution or punitive damages.

Lewis and Morris: Socio-Legal Approach

• Insurers are the driving engine of the tort system.

• In practice, tort is heavily influenced by institutional arrangements and insurance.

Stapleton and Pragmatism

• Rejection of grand theory and promotion of “reflexive tort scholarship”

• Focus on analysing judicial decision-making.

Merkin and Insurance

• Insurance in tort theory is underappreciated but structurally central.

• Tort cannot be theorised in abstraction – insurance underpins it.

Critique of Weinrib

Abandoning deterrence cannot explain punitive damages

Critique of Coase

Zero transaction costs is a myth and leaves judges with no workable guidance.

Critique of Lewis and Morris

Focus on personal injury, ignores other torts

Criticism of Merkin

Insurance is separate to tort, it is a sociological approach more than a legal one.