BOOK REVIEW: Accidental Justice: The Dilemmas of Tort Law, Peter A. Bell and Jeffrey O'Connell

Reviewed by Anne M. Dooley and Bradley J. Nicholson*

New Haven: Yale University Press, 1997

This book provides an excellent starting point for anyone, especially a nonlawyer, who wishes to understand the debate over tort reform. The authors, professors of law at Syracuse and Virginia, wrote this book not to defend any particular thesis about the tort system, but to educate the public about the strengths and weaknesses of our legal framework for compensating personal injuries and to outline the most significant proposals for improvement. They have performed this task admirably well.

To give structure to the book and to provide a human element to the discussions of legal theory, the authors tell the tale of a young lawyer with a family who, having risked his reputation within his firm on an ill-fated (apparently expensive contingent-fee) discrimination case, consoles himself with drink after a judge dismisses the case. While on his way home, he falls before a subway train and is seriously injured. Driven to desperation by rising bills and loss of income, the young man sues the driver of the train -- in addition to some more deeply-pocketed entities -- seeking compensation for his injuries.

The authors' approach is an effective one, permitting them to discuss nuts-and-bolts topics such as how plaintiffs' lawyers choose clients and how claims are negotiated with insurance companies, thus providing an effective foil to the more theoretical discussions about what kinds of legal schemes would best provide just compensation for people's injuries.

The authors recognize that compensation is one of the most widely debated issues in tort law. Under the current tort system, plaintiffs seek payment for their medical expenses, even if they were paid by a collateral source, lost income and non-economic damages such as "pain and suffering." Viewed by some as advancing social welfare by sharing responsibility for financial distress, transferring the injured person's loss to others is clearly a redistribution of income. Assuming this is a legitimate goal, tort law fails to achieve it in several ways. First, most injured people are never compensated as they have no legal claim based on fault and causation; only a small group of persons injured by someone else's fault will ever receive close to full compensation for their injuries. Second, payments are not absolutely necessary to ease suffering when there are other sources of compensation available such as health and disability insurance and workers' compensation. Third, compensation is often excessive. It is a kind of forced insurance against intangible injuries for which people do not normally insure themselves. Also, payments are relatively higher for minor injuries due to factors such as inflated claims and exposure to bad-faith claims. Fourth, individualized compensation is regressive, favoring wealthier persons; the poor pay the same tort insurance costs as everyone else. Last, extravagant transaction costs result in plaintiffs' receiving less than half of the total money spent on the average tort suit.

In theory, the authors note, the economic threat of tort liability accurately deters behavior that risks injury with its image of "the cop on the beat." As regulator of the marketplace, tort law adds the costs of avoidable accidents to the cost-benefit analysis of behaviors, increases the cost of dangerous products and activities, thereby dampening demand for injury-producing items, and encourages the development of safer ways of living. Critics see other effects. They consider sanctions weak (although they may be significant to relatively rational actors such as businesses and insurance companies.) They point to unclear communication about tort rules, dangers of behavior and uncertain liability costs; this can be ameliorated by information and experience. They claim unchangeable behavior, both human and organizational, is unresponsive to the threat of sanctions largely because it is non-conscious to potential penalties. Tort-prone behaviors can be modified, however. Finally, countertheorists say the threat of tort liability discourages innovation, although their evidence is mostly anecdotal.

Evidence of the validity of tort's deterrent theory is mixed, according to the authors. It is strongest regarding auto accidents, weakest regarding environmental hazards. Would-be reformers allege other factors are likelier than tort law to enhance safe behavior, including criminal law, self-preservation, government regulation, individual and organizational morality and the market. This last depends on how well informed people are about the safety of goods and services. Tort law may complement some of these factors, however.

In addition to legal fees and expenses which typically meet or exceed the amount of compensation actually received by injured parties, there are social costs due to the characteristic delay and uncertainty of the tort system. Other compensation systems have much easier determinations and correspondingly lower administrative costs. Tort law must decide issues of fault, causation and damages on an individualized basis with no concrete rules to follow. Plaintiffs face a trade-off between access to legal services and full compensation for their injuries.

The authors list several criticisms of tort as a system of corrective justice. Payment from the actual wrongdoer is rare, although he or she may suffer unpleasant consequences. Similarly injured people without an arguable tort claim are not compensated at all. There is great inconsistency in decisions through individualized court judgments, and damages disproportionate to the defendant's wrong are often assessed. In addition, critics claim that the system maintains and may actually contribute to distributive injustice. There are also differing concepts of justice. But the authors also note the advantages of tort over other compensation systems, including access to the courts and equality of representation, where court proceedings are supposed to be infused with the idea of justice.

The book outlines three major categories of reform plans which have been implemented in varying degrees. Each must resolve questions regarding eligibility criteria, amount of compensation, source of funding and type of administration. "Tinkerers" propose keeping the system and making incremental, sometimes one-sided, changes in tort rules, for example, abolition of collateral source rules and establishment of limits on non-economic damages. Class actions, which arose in response to mass or toxic tort cases, are a type of tinkering with the current system. Another suggested reform of this kind would be to hold institutions liable for actions of individuals in medical malpractice cases.

"Shakers" want to discard the system as we know it and substitute new compensation systems. These would be no-fault plans focused on compensation without payment for pain and suffering, funded by taxes and levies on employers. The strengths of these initiatives are reduced transaction costs, higher compensation for economic losses and speedier resolution of claims. Ideas of justice and deterrence would be abandoned along with familiar common law tort rights. There are no guarantees that benefits would not be reduced in the future.

"Movers" envision a combination of alternative compensation systems and tort law. Most auto no-fault plans in the United States today fall into this category. One drawback is that claims are often inflated to allow tort claims above a certain threshold. Consumers could waive common law rights for savings by choosing no-fault policies for economic losses only. A "neo-no-fault" plan developed by author O'Connell is potentially applicable to all kinds of accidents. In this early offer/choice plan, payment for economic loss and reasonable legal fees would encourage early dispute resolution while continuing to discourage unreasonable behavior. Limited contingency fees would avoid abuses by plaintiffs' lawyers and reduce incentives for defendants to stall.

In closing, we think that while many people would benefit from reading this book, the undergraduate contemplating law school might benefit as much as anyone. Many attorneys eventually find themselves practicing some kind of tort law. The authors present a realistic portrait of how the legal system works in attempting, and sometimes failing, to provide compensation to the injured in a rational and efficient manner. Many idealistic would-be law students would do well to think about the costs of the tort system that they may one day shape as lawyers.

*Anne M. Dooley is a former claims adjuster for a major insurance company and Bradley J. Nicholson is the Vice President of Publications for the Federalist Society's E.L. Weigand Litigation Practice Group.


2001 The Federalist Society