The cost of delegated control: vicarious liability, secondary liability and mandatory insurance

Vicarious liability, secondary liability and mandatory insurance are three systems for attaining judgment-proof or disappearing injurers’ precaution through the direct control of a second party (the vicariously liable principal, the secondary liable party, or the insurer). In this way, the legal system delegates control over some injurers to private entities. Such mechanisms generate monitoring costs. In this paper, we consider who bears the cost of such monitoring, and the effect thereof on the equilibrium level of precautions under different liability rules. We use these findings to explain some of the patterns in the coupling of substantive standards of liability and legal regimes of delegated control.     

The GE/Honeywell merger controversy and the path to analytical convergence in international merger assessment: A critical commentary

Globalisation, with its concomitant rise in international merger activity, allied to the proliferation of merger control regimes vetting such activity, increases the likelihood of two or more competition authorities reaching divergent decisions in the same case. This article reveals that this situation arose in the proposed merger between two US-based companies, General Electric (GE) and Honeywell, with the EU prohibiting the merger, and the US Department of Justice approving it. Further, it discusses the analytical and interpretational differences which led to those divergent outcomes. The analytical debate centres on the appropriateness of the two theoretical approaches used to assess proposed mergers, with the EU using the range effects of competitive harm approach and the US giving greater weight to an economic efficiencies merger defence. The fallout from the GE/Honeywell case has given added impetus to progress analytical convergence in relation to the vetting of international mergers. This has found expression at the multilateral level, which links to EU initiatives. The article predicts that the EU is highly likely to incorporate an economic efficiencies defence into its merger control law, bringing it into line with other key players. Of course, analytical convergence cannot guarantee that interpretational differences will not arise, as was evident in aspects of the GE/Honeywell case. This revised version was published online in August 2006 with corrections to the Cover Date.     

Preconception tort liability: recognizing a strict liability cause of action for DES grandchildren.

Over the past decade more than 1,000 "DES daughters" have filed lawsuits against the manufacturers of DES, alleging that their in utero exposure to the drug caused various reproductive tract abnormalities, including cancer. Plaintiffs now allege that their grandmothers' use of DES during pregnancy caused genetic damage leading to cancer in third generations. This Note addresses the validity of preconception tort liability in the context of third-generation DES cases. Plaintiffs in preconception tort liability cases have sought recovery under both negligence and strict liability causes of action. Courts should recognize the validity of preconception tort liability and allow a strict liability cause of action in third-generation cases.     

Scope of liability: the vanishing distinction between negligence and strict liability

The duty-of-care requirement cannot be used anymore as the touchstone to differentiate negligence from strict liability because it can be found in many forms of the latter. Duty of care is smuggled into strict liability hidden under the scope of liability requirement (traditionally called “proximate causation”). As far as the scope of liability requirement is common to negligence and to many forms of strict liability, there is a fairly large common ground to both liability rules, and consequently the marginal Hand formula is applied to both rules. Indeed, under a negligence rule, the marginal Hand formula is applied twice: first to assess whether or not the defendant did breach his or her duty of care, and, second, to delimit whether or not the defendant’s behavior was a proximate cause of the harm suffered by the victim. However, under a strict liability rule, the Hand formula is applied only once when the proximate causation question is raised. Traditional law and economics analysis has almost always taken the normative question raised by the causation requirement as given, which is a potential major problem due to the importance of scope of liability or proximate causation in legal practice. Defining the scope of liability, that is to say, the boundaries of the pool of potential defendants, is the basic legal policy decision for each and every liability rule. In the normative model presented in this paper, the government first chooses efficient scope of liability, and given the scope of liability, the government then decides the liability rule and damages that guarantee efficient precaution. In the article, most known scope of liability rationales developed by both common law and civil law systems are discussed in order to show the substantial common ground between negligence and strict liability.     

The liability of the duressor

Liverpool Law Review - It has been argued that a better understanding of the nature of excuses gives rise to solutions to many problems concerning the liability of secondary parties. The duressor...