Journals
Volume 35, No. 2, Spring 2005
An Economic Model Costing "Early Offers" Medical Malpractice Reform: Trading Noneconomic Damages for Prompt Payment of Economic Damages
Jeffrey O’Connell, Jeremy Kidd & Evan Stephenson
Today the key to the unworkability of tort liability as applied to personal injury is the complexity of the insured event. Tort liability insurance calls for payment of economic and noneconomic (i.e., mostly pain and suffering) damages in lawsuits based on fault. The determination of both fault and the value of pain and suffering is especially complex in medical malpractice litigation. Consequently, the liability insurance system is fraught for both sides with uncertainty that causes long delays and huge costs, including huge transaction costs. The result is not an insurance system for promptly paying needy injury victims, but an insurance system for prolonged and hugely expensive fighting about payments to both deserving and undeserving claimants—to the great detriment of both patients and health care providers.
As a cure for much of this sad tale, we focus on a proposed statute which gives a defendant…an incentive to make an “early offer,” defined as a sum large enough to recompense injured victims for their net economic losses, including attorneys’ fees. If such an early offer is tendered, the injured victim will normally forfeit the opportunity in a negligence action of winning full common-law damages for both economic and noneconomic damages at trial.
Valuing Relationships: The Role of Damages for Loss of Society
JoEllen Lind
Damages for “loss of society” redress a noneconomic harm that is not well understood, namely, the destruction of socially significant relationships when a tort victim is injured or killed. The paradigm case for loss of society is wrongful death, where, in many jurisdictions, the plaintiffs—usually close family members—may recover not only for lost income the decedent brought to the household and lost services the decedent performed, but also for their lost future relationships with the loved one. “Valuing Relationships: The Role of Damages for Loss of Society,” more clearly defines what makes this harm different from other types of noneconomic injury, such as pain and suffering and mental distress. It concludes that loss-of-society damages have a unique communal component with important implications for proof, valuation, and tort reform.
Heart of Stone: What Is Revealed About the Attitude of Compassionate Conservatives Toward Nursing Home Practices, Tort Reform, and Noneconomic Damages
Michael L. Rustad
In his address accepting the Republican nomination to be President for a second term, President George W. Bush promised to “build a safer world and more hopeful America for our workers, families, and children.” He not only favors tort reform capping noneconomic damages in nursing home cases. His 2005 budget cuts targets nursing home residents, the disabled and other vulnerable groups. This article uses the device of an associate’s memorandum to a senior partner as a device to question the moral dimension of President Bush’s policies that give special legal advantages to profit driven nursing homes and padlock the courtroom door to the victims of neglect, abuse, and mistreatment.
Part I of this article draws upon nursing home cases decided over the past decade to understand the critically important role that noneconomic damages play in the decision to agree to represent a nursing home abuse victim. Part II examines the social functions of uncapped noneconomic damages in nursing home cases. The purpose of nursing home liability is not only to compensate the elderly resident or her estate but to correct unbelievably horrible conditions in which there is excessive preventable suffering. Part III argues that a tsunami of nursing home abuse, neglect and mistreatment is coming very soon as the Baby Boomers reach the age of sixty-five or over in unprecedented numbers. Uncapped noneconomic damages make it possible to file nursing homes needed more than ever to discipline a profit-oriented industry. President Bush has also mentioned that Jesus Christ is his favorite philosopher and most powerful influence. President Bush needs to reexamine the moral dimension of his policy decision to cap noneconomic damages given that this remedy is critically important to bringing lawsuits to redress elder abuse.
Loss
Heidi Li Feldman
This article examines the political movement by self-proclaimed “tort reformers” to cap “noneconomic” damages or damages for “noneconomic” loss. Dr. Feldman argues that the distinction between “economic” and “noneconomic” losses or damages is specious. This categorization does not derive from the field of economics or of law. In both of these fields, any diminution in individual wellbeing constitutes a reduction in welfare. To create a false dichotomy between “economic” and “noneconomic” losses, and then legislate or advocate caps on those losses deemed “noneconomic” is contrary to the rule of law, since the distinction that purportedly licenses the cap has no rational basis.
Examining the Spectrum of Noneconomic Harm: An Introduction
M.E. Occhialino
It is my task simply to set the table for the feast of ideas that we will hear from the speakers. I start with two simple propositions. First, the purposes of tort law are to compensate, to deter, and to punish. Second, the primary vehicle for doing that is the exchange of money from Defendant to Plaintiff. One aspect of our topic is to determine what conduct we want to deter. That is a question of creating tort causes of action, setting forth the elements of the cause of action, and determining affirmative defenses. One speaker will talk about how tinkering with elements and defenses of causes of action may have some impact on the way we measure and think about damages, but that will not be the primary topic today.
Making the System Work Better: Improving the Process for Determination of Noneconomic Loss
James F. Blumstein
In this presentation, I want to focus initially on proposals for improving the system of determining nonpecuniary loss, the most variable and the most visible part of the tort damages process. But I also want to consider one component of the medical liability system because it is related to the problems of cost containment—a critical concern of those advocating reform of nonpecuniary damages awards in the medical area. So, I will link up liability and damages, since they both contribute to the overall policy concern regarding the costliness of the medical liability process.
The Value of Life and Loss of Enjoyment of Life Damages from an Economists Perspective
Brian McDonald
New Mexico law allows monetary compensation for the loss of enjoyment of life or the value of life itself in personal injury (Isidro Sena v. New Mexico State Police et al.) and wrongful death (Romero v. Byers) cases. The concept of loss of enjoyment of life or hedonic damages is premised on the assumption that the value of an individual’s life exceeds the sum of that person’s economic productivity, which includes his or her earning capacity and the value of household services. Loss of enjoyment of life damages consider the effect of the injury on the plaintiff’s activities of daily living, leisure, hobbies, and recreational activities, the ability to pursue a chosen occupation, and internal well-being.
In Sena the court concluded that “where an expert witness has been properly qualified, it is not improper for the trial court to permit an economist to testify regarding his or her opinion concerning the economic value of a plaintiff’s loss of enjoyment of life.” In Couch v. Astec Industries, Inc. et al. the New Mexico Court of Appeals further defined the allowable contours of expert testimony on hedonic damages to include testimony on the economic research on the value of a statistical life as well as the broad areas of the human experience to be considered by the jury in determining such damages.
My presentation will focus on the economic research on the value of a statistical life, discussing how economists examine certain labor market and consumer transactions where there is economic information about a tradeoff between money and life. Analysis then infers how we as a society value life itself.
I Think, Therefore I Am; I Feel, Therefore I Am Taxed: Dscartes, Tort Reform, and The Civil Rights Tax Relief Act
Laura Spitz
In the last twenty-five years, feminists and critical race scholars have begun to document the normative, class-based, racialized and gendered nature of U.S. tort law, especially so-called “tort reform.” Their analyses reveal that initiatives with adverse consequences for women, children, people living in poverty, people of color, and other minorities include caps for non-economic loss and punitive damages, the legislative extension of immunities for what would otherwise be tortious conduct, proposed rule revisions on class-action lawsuits, the judicial (re)interpretation of causation in the context of toxic torts, and the Bush Administration’s near-hysterical campaign to convince voters that the high cost of medical malpractice insurance premiums can be visited on frivolous claims, unethical lawyers, and out-of-control juries, rather than some combination of a hard insurance market, inflation, and the number of tortfeasors.
