Final Exam Feedback-- Torts 97

Prof James Boyle

http://james-boyle.com

Strengths andWeaknesses:

This outline gives a detailed answer to question 1 -- a.) & b) It also offers some hints about questions 2 and 3 a.) & b.) Before I turn to particular answers to the questions, let me provide some general comments about strengths and weaknesses. The quality of writing was generally very high. In terms of structuring your answer -- particularly with question 1 -- some of you might want to work more on the flow chart style of analysis I laid out for you when we did the practice exam. A few people tended to jump right into the middle of an issue and then work backwards and forwards to the beginning and end of their answers. In terms of substance, as I said, the exams were very good. The most common errors, however, were ones that we had discussed a lot in class

• 1.) Being conclusory
• 2.) Failing to argue key points -- particularly points that were important to your client, where the law was a close call and where the class had spent a great deal of time discussing exactly what arguments could be made on both precedential and policy grounds. (For example, the different ways to argue the distinction between providers of goods and providers of services)
• 3.) Failing to pay attention to the material and/or the question. (For example, answering 1. A.) without looking closely at S. 648, answering question 3. B.) without referring concretely to Holmes' writings and Holmes' opinions, answering question 3. A.) and only discussing strict liability and negligence or only discussing the offering/asking problem.)

The positive component to all of this is, that each of these errors can be fixed and fixed easily. If you were guilty of one or more, you can fix the problem before next semester. It should go without saying that you have now learned to avoid the simpler methods of beating yourself; being late to hand something in, not reading the question or the statute, exceeding word or space limits, sloppy presentation. Learn to anticipate problems. Things always go wrong at the last minute; its a law of nature. If the filing deadline has passed, the brief is outside the limits set, or you decided to ignore one of the questions you were asked to research -- judges, bosses and, most importantly, the people you are supposed to be working for, will have little sympathy for the unpredictable, once-in-a-lifetime confluence of events that caused it to happen. A lot of the standards and customs we call "professionalism" aren't particularly admirable; the simple ones that have to do with personal responsibility and pride in one's work have a lot to recommend them. Welcome to the land of high standards, rejected excuses and real deadlines.

Question 1 a.)

Question 1 a.) was a hard question that covered a great deal of material. You were given 50 points and 1750 words -- which meant that you had to be concise, to cut out wordy transitions and to concentrate your energies on the key issues. I am gong to give a relatively full answer -- but I didn't necessarily expect you to cover absolutely everything here. Its more what you chose to cover and how you put together the parts of your answer.

Vitriol: The main case against Vitriol was obviously a product liability case. Warranty or 402A?

Economic Loss?

Under Casa Clara and East River Steamship if the loss was only economic -- merely the "product damaging itself," merely failing to receive the benefit of the bargain -- we would have to use warranty. (Cf. Pennsylvania Glass & Sand) Here, there was other damage (for Americard, the elevator shaft, elevator, and perhaps lost tuition from these and future students: for the parents, wrongful death) However, Vitriol could argue this was like the situation in Casa Clara. (Salt-laden cement corrodes steel reinforcing rods.) I expected a response and some argument here. A number of people made the error I warned you about so many times in class. If damages are purely economic, one is restricted to a warranty claim; the converse is not true however. It is not the case that if there are physical damages one must only sue in tort. One can recover damages for physical injury under warranty (Remember McCabe v Ligget and the exploding coffee maker?). One can also recover tort damages for many kinds of economic harm (provided they are accompanied by other physical or property damage.)

Thus it appeared that one could proceed under both warranty and 402A.

Warranty

However, the key obstacles for the warranty case were .

• a potential statute of limitations problem. Anecdotally, I can tell you that 3/4 of you believe that "several years" is more than four.
• a difficulty in framing the way in which the product was not fit for its intended use. You could try recharacterising "the product" to include the method by which Vitriol rents the bottles out, and demands return of them, but otherwise Cleese's change of the product would seem to make this line of analysis hard to pursue. In any event, certain kinds of damages -- e.g. pain and suffering -- cannot be recovered under warranty and for the families this point might be important.
• Problems of privity: this demanded some 2-318 analysis. There were still some people who --still -- inexplicably believed that plaintiffs get to select alternative A, B or C. Check your notes if you believe this. What was needed was argument in the alternative, to explain what would be the result, depending on what section Confusion had adopted.

Thus, most of you concentrated -- rightly -- on 402A..

402A v. Vitriol

The initial difficulty here in the case against Vitriol was that the product had obviously been modified before it reached the consumer.

• 402A 1 b.) says that 402A liability only applies where the product "Is expected to and does reach the user or consumer without substantial change in the condition in which it is sold" A lot of people missed this simple but vital point.

The way to beat this problem from the plaintiff's point of view, is to restate the case so that something about the product caused, or induced or contributed to Cleese's action, or to the eventual harm. One's case becomes, essentially, that some defect in the product caused it to reach the consumer "with a substantial change.." or to change the timeline by saying that some defect caused it to reach Cleese with its unreasonable danger (i.e. its propensity to react to glass) still present and that Americard was injured as a result. (A side issue is whether the defect is in product or packaging -- Vitriol apparently sells the product but rents the packaging. Nevertheless, 402A says there is no reason to distinguish between the two -- see generally comments f, g, and h) Thus the type of defect one can argue for here must be either

Design: the design being either the design of the entire product packaging system and method of delivery, or the design of Melt i.e. failing to test for its reaction to glass.

• The issues here were the components of Barker and other design defect tests, "consumer expectations" might fare better than the second prong of Barker. The issue of foreseeable misuse is obviously relevant here. Micallef v. Miehle

Or

Failure to Warn:

• either failure to warn of the fact that Melt reacts with glass (which gets us into "knowability,"
• or failure to warn for unknowable risks (Beshada) as an incentive to test, (though this risk seemed at least potentially knowable given how common a substance glass is)...
• or at least failure to warn that Melt could only be stored safely in its original Hexene container -- even if the danger that the warning would have specified is that Melt would dissolve glass and not that it would form a corrosive gas.

N.B. Depending on which defect you picked, the proximate cause arguments could be easier or harder. Why?

Pre-emption: The problem with the failure to warn section was obviously pre-emption by the FARA. This issue caused a lot of problems.

A lot of people confused pre-emption (the states, including the states' courts, are constitutionally forbidden from regulating an area if the Federal government has pre-empted) with the general issue of whether complying with Federal or State regulations is a defense in a tort action. Its a two stage analysis.

1. First one decides whether the particular action by a state body (court or legislature) applying a particular body of law (in this case failure to warn) is pre-empted. See King Here I wanted serious textual analysis of the words of the regulation, and comparison to Cipollone, King, Myrick and others-- with Cipollone particularly to the 1965 regulations. The distinctions here were

• successful failure to warn action doesn't imply mandating particular warning (I think this is weak, but the courts have accepted it.)
• does "regulation" include common law rules?
• are the types of warnings other than those mentioned in the FARA? -- external advertising etc?
• are there other places than packaging for warnings to be placed?

2. If the particular court action would not be pre-empted, then one can decide whether complying with the Federal regulation should be a defense to the particular claim presented. Here the issue goes to the substantive adequacy of the warning and one must decide whether the particular regulation is proof of adequacy or merely a "floor."

If one got by the pre-emption hurdle (and the arguments appeared stronger than the '65 Cipollone law)that the warning given was inadequate. Basic claim here was that Cleese was warned not to change containers, but not told why. McDonald v. Ortho seemed relevant. You are helped by the fact that Cleese used all the precautions for dealing with the dangers of which he was warned.

There was also a potential negligence action against Vitriol, but it was hard to see its advantages, at least compared to the strict liability action. The strongest negligence suit would be that the entire method of product delivery (including repossessing the containers -- was negligent.)

Cleese: The key issue with Cleese was whether or not he was a product seller. (And in the business of selling) Obviously he provided both goods and services. This was a place to dig in and argue, vital to your client's case, close on the law, and with lots of distinctions in terms of both precedent and policy. As analogies, on the one side one had Murphy and pharmacists, (but cf the dissenting arguments and states) on the other side restaurants, carpenters and so on. How is Cleese different from a home improvement store that sells you materials and also provides instruction and advice? There was precedent on both sides and there were very strong arguments of policy. I wanted both. Remember, you are Americard's lawyers and they had some strong arguments here. A lot of exams fell down on this point.

If there was a product liability action against Cleese, the first part of the Vitriol analysis would apply. In particular, the warranty problems seemed similar to those with Vitriol -- with the exception of the 2-318 problems. Americard wouldn't need 2-318 and the families would most likely be covered. Again 402A seemed superior.

402A -- If Cleese was classed as not only a product seller, but a manufacturer (in that he made the Melt different from its intended design) then for that very reason one would have an argument about his manufacturing defects.

Assuming Cleese was not a manufacturer, but merely a product seller, then your recovery against him is still a little easier because, as we noted earlier, 402A 1 b.) says that 402A liability only applies where the product "Is expected to and does reach the user or consumer without substantial change in the condition in which it is sold" Since Cleese is the one changing the product, and if we have successfully argued that he is in the business of selling, then he can't benefit from this provision.

The rest of the analysis is the same as for Vitriol -- the arguments about product defect are to some extent independent of the issue of who made the product defective. There might also be an extra duty to warn of the fact that the container has been changed.

Ultrahazardous Activities:

Was Cleese engaged in an ultrahazardous activity? §519, 520 definitions could cut both ways. How do we define place in which activity was carried on -- inside of a heavily used building or demolition site? The key issues though are:

1.) Was the activity capable of being made safe by the exercise of due care? Posner in American Cyanamid is the key opinion here.

2.) Was he engaged in the activity at all, or was this something done by his clients?

3.) What is the risk/utility calculus for Melt?

4.) Strict liability is limited to the type of harm, the possibility of which made the activity abnormally dangerous -- how is this damage to be classed? As an unforeseeable type of damage, or as "dangerous corrosion" -- exactly what one might have expected

Negligence against Cleese:

There is a relatively good negligence case against Cleese with several possible components and some difficulties.

Breach of Duty:

One could claim that his breach of duty was in moving the Melt from the original container to the glass bottle, but this runs into some problems.

Custom -- glass bottles are normally used to store acids of this kind.

Criminal Statutes: the FARA tells him not to transfer from one container to another, but appears to be contemplating a different kind of danger. (Gorris v Scott, purpose of statute -- causation.) The licensing statute was interesting -- he was not in violation, but if he was not allowed to conduct the demolition should he have allowed the Americard workers to conduct the demolition, even if he was supervising?

Cost-Benefit Analysis -- the cost of prevention was low (just keep it in the original bottles/ don't lose your old bottles) the risk of harm is indeterminate, the likely harm (given that the nature of the harm was unknown) is more likely that the Melt would live up to its name, eat through its container and damage something. (This runs into the proximate causation analysis, discussed below.)

Still, putting these together seems enough to argue that he was negligent.

Could Americard use Res Ipsa Loquitur against Cleese (or Vitriol)?

It appears to be hard -- neither was in sole control of the instrumentality, indeed there would be doubt about what the instrumentality was, events like this might -- it could be argued -- happen in the absence of negligence and there is the possibility of contributory negligence. Actually, Americard itself is a far better target for the use of res ipsa, as we will see in a moment.

Causation: Here we will consider not merely the causation requirement for negligence, but also the causation requirements for all of the actions being pursued against all of the parties.

Cause-in-fact: "But for" causation.

The different causes of action here produced different issues of cause-in-fact (and proximate causation.) I was glad to see that most people paid at least some attention to the issues of causation, but there were still a lot of holes in the analysis. The key to a good answer here, was figuring out what was the particular negligence or product defect or ultrahazardous activity being alleged, and then gearing your answer to consider the particular causal chain involved in that analysis.

For example, if your claim is a failure to warn action; then your cause in fact argument must be that the harm would not have occurred had a particular better warning been included. Would Cleese have still have transferred the Melt into a different container, might the Melt have come in contact with glass anyway? If your cause of action was a claim against Americard for failure to inspect (see below) then your cause in fact analysis had to be that, had the inspection been performed, the harm would never have occurred.

Proximate Causation: the key proximate causation issue here was that -- with most but not all of the causes of action -- some harm was foreseeable if the warning wasn't put on, the Melt wasn't transferred and so on, but the harm that was foreseeable was much more likely to be damage from the Melt spilling out of the bottle having dissolved it. This situation was much more like the Polemis situation where harm is directly caused, but the actual harm that comes to pass is not the foreseeable one. This means that if the state of Confusion has adopted the directness test for proximate causation then the case is fairly easy. If, however, the test is foreseeability then the argument is harder -- one has to use a broad definition. Again, this was a place where you could use your broad and narrow interpretation skills -- in particular arguing why it would be good policy for the court to take a broad interpretation of foreseeability in cases such as these.

Comparative Negligence:

If Vitriol was the defendant, it could make a number of arguments based on Cleese's product misuse, to argue that their liability should be extinguished or reduced. (This point became more pressing in question 1 b.) under S.648.)

Special Features of the Families' Suits:

The main differences here were the damages -- the already weak Casa Clara argument disappears altogether, the families are in a better position in terms of privity under 2-318 and the possibility of a negligence action against Americard itself (conflict of interest having been assumed away) for failure to inspect the elevator cables. To prove this action the families would have to rely on a Colemenares idea of res ipsa loquitur plus non-delegable duty. Some people seemed to think that res ipsa loquitur was a cause of action.. remember that it is a way of proving the negligence case.

Question 1 b.):

While some people did a fine job with this question, it was also the question on which the most people made the most mistakes. The goal of the question was to read S.648 closely in the light of a particular problem -- exactly as we had done with a number of other cases and statutory or quasi statutory sections (King & Cipollone §2-318, §519 et seq. of the Restatement, 402A and its comments etc. etc.). As you may remember from those sessions, my litany was -- "you have to read the statute/case/rule closely." It is hard to over-estimate the importance of this skill for a lawyer. Most of the problems you deal with in practice will be dealing with materials -- be they contracts, cases, statutes, regulations or what-have-you -- that no-one has ever taught you about, where you have no secondary sources or pre-digested guides to what you are reading. In this case, we had actually been over S.648 and covered most -- but not all -- of the issues that you needed to deal with. Your job was to focus closely on the statute, to work out which portions of it were relevant and to then apply them to the case. The people who had problems with this question exhibited the following complementary errors

• Ignoring the statute. Never quoting a section or a particular provision.
• Ignorance of the law. Misstating the effect of 648, describing the changes that affected sellers as affecting manufacturers, ignoring comparative negligence, or professional service sections, generally getting the analysis wrong.

Here is what I was looking for:

• Under §102(a) (1) S.648 pre-empts any product liability action on any theory -- but then expressly leaves the standards for suit of manufacturers unchanged -- with a few exceptions.
• §102 (a) (2) excludes implied warranty actions -- affecting the claims against both Vitriol and Cleese, to the extent that those flow out of a warranty theory
• §101(17) B ii says that someone offers a service+product (as Cleese does) is not a product seller where "the sale of use of the product is incidental to the transaction and the essence of the transaction is the furnishing of judgment skill or services" Thus Cleese may not even need the safe-harbor provided for product sellers by
• §103(a)(1) which holds product sellers to a negligence standard -- but either way, the strict liability claim against Cleese disappears. (Unless Vitriol was bankrupt or otherwise unavailable and the court classed Cleese as a seller despite §101 (17) B ii.) It would also be harder to make a failure to inspect type of argument. As against Vitriol, the 402A liability might seem to be alive but..
• The failure to warn case would be even harder
• The comparative negligence sections of the statute would -- under §105 (a) 1 (A) -- either reduce or perhaps eliminate the liability of Vitriol (if Cleese was held to have been misused the product and his negligence was judged as greater than 50% cause of the accident)
• The arbitration/settlement sections might make settlement more desirable, even if you felt the amount was not adequate.
• Any possibility of punitive damages (already very unlikely) would be ruled out and
• The new statute of limitations would mean that actions would have to be commenced within 2 years from the time of the accident.

Moral: Read the statute and learn to piece together the meaning of a multi-section enactment. All of your great interpretive arguments aren't much use if you haven't read the statute first.

• to have you discuss the cases (and perhaps select others) and to explain their definitions of act, intentional and legally protected interests -- funnily enough, although the question was well done, this was the area where the answers was the weakest.
• to have you analyse whether the definitions in the cases were consistent; an important part of this question was that you got to pick the ways in which you compared the definitions given in the cases. Thus, for example, you could have analysed them in terms of whether their definitions were plaintiff-favouring or defendant favouring, whether the definitions of act etc were internally consistent (i.e. the same definitions were given in every case), whether the arguments in favour of the particular results reached in different cases were all the same and so on.
• to make you come up with an explanation of the consistency (or inconsistency) that you found. Many of you said that the law needs to be vague and contradictory so that it could grow, but I was disappointed that you did not spend more time dealing with the counter arguments to this position. If the law is genuinely incoherent and contradictory, then where is its legitimacy? Why should anyone respect it? If that is your definition of "law" then how can you ever criticise a decision as wrong? Would the judge in Vosburg have been wrong if he had ruled that it was not an intentional tort? And if there is no way of saying when a decision is wrong..then what? This seems to demand a more sophisticated version of what the law is doing than either "logic" or "whim." These were important issues -- and indeed we had addressed them in class, but they did not really get addressed in the exams.

3. a.) The question asked you to compare an example of the choice between strict liability and negligence and the choice between offering price and asking price, to offer an explanation of each choice (either in a case or in an entire body of doctrine) and to say whether the explanations you offered were the same or different and, if the latter, to explain why. It is hard to give a single answer for a question that offered so much choice, but the typical errors were:

• Only talking about one of the two choices (strict liability v. negligence, say) and not the other or -- less seriously -- concentrating 90% of the answer on one.
• Picking poor examples. Some people chose to use intentional torts cases which they thought presented an analogy to the choice between strict liability and negligence. Given the richness of the material we had on the actual choice, particularly as an historical matter, this was a bad decision.
• Failing to incorporate our discussions in class, (e.g. arguments for and against strict liability, Pareto superiority, property rights and offer-asking) the supplementary materials (e.g. the White book) or the cases themselves (for example, in Boomer for offer asking or Losee for negligence strict liability)
• Failing to complete the last part of the answer. At the same time as Boomer was decided, effectively moving from an asking price remedy (the injunction) to an offering price remed (continuing damages) courts all over the country were moving to strict liability for products. Are the two changes consistent? I was looking for answers that focused on some of the historical material, that dealt with the economic arguments and that discussed the distributional consequences.

3 b.) The Holmes question was another one which gave some people a lot of trouble. The idea was for you to

• reveal how much you knew about Holmes' ideas -- drawing from the two excerpts from The Common Law, the opinions we had read in which Holmes was the author (given the context, Leroy Fibre and Lamson seemed particularly relevant), and the lengthy discussions in White's Tort Law in America. The question explicitly told you that you had to discuss your answer in the context of Holms' actual writings, and opinions and the commentaries on them. The answers that fared poorly, often failed to do so.
• To apply those ideas to the two doctrines cited -- the incomplete privilege of necessity (Vincent v. Lake Erie) and §879, which we had discussed in the context of nuisance law, a rule which effectively codified an interesting fusion of Pareto superiority and Kaldor-Hicks efficiency. If the winner can afford to compensate the loser, then he should do so, if he cannot, but the activity is thought to be socially valuable, then it should not be labeled an invasion. Are these two doctrines merely extensions of what Holmes said in Leroy (property rights are not absolute but relative, their boundaries must be determined by utilitarian calculation)? How do they fit in with his claim that the law needs a single underlying universal principle? If this is true, then can we have strict liability under an Escola type of utilitarian rationale? Are Holmes' ideas internally contradictory, then?