Palsgraf vs. Long Island Railroad Company
Erica Nunez, Vince Karlen, Aaron Jacobs
Economic Analysis of Law
November 6, 2007
This case involves the injury of the plaintiff, Mrs. Helen Palsgraf that took place on Sunday
the 24th of August 1924. The fact that Mrs. Palsgraf was injured on this date, and the extent of these
injuries, are not under consideration in this case. The question looking to be answered through the
judicial opinion of this case is whether our client, Long Island Railroad Company, was negligent and
therefore played a part in the events that took place before the plaintiff was injured. The plaintiff
claims that it was the negligence of the defendant that caused her injuries while waiting for her train
to Rockaway Beach. The plaintiff states seven different claims, all of which purport to show the
validity of the assertions regarding the guilt of the defendant. The main claim is that the defendant
did not provide a sufficient number of employees to control the large crowd known by the
defendant to congregate at the East New York Station during the specific time of the incident.
Consequently, by not providing sufficient staff for crowd control and by allowing the entrance of
such packages containing explosives, the defendant allegedly caused the injuries of said plaintiff.
The defense acknowledges the injuries of the plaintiff and does agree that it is the
responsibility of the defendant to provide a safe environment in said train stations to the extent that
the costs pertaining to such precautions affording a safe environment are less than or equal to the
damage prevented by these precautions. That said, the defense took and continues to take all
necessary cost-justified precautions to prevent injuries such as those experienced by the plaintiff,
thus negating the claim of negligence and illustrating the illegitimacy of such a claim.
Although the defendant is taking all cost justified means to ensure the safety of their
passengers, the safeguard of checking each package, or valise, being brought into the station, as the
plaintiff claims in her fourth assertion should be done, is a ridiculous demand that places a huge
burden on not only the defendant, but all persons using trains as a mode of transportation. As was
heard by many of the plaintiff’s witnesses, the package containing the fireworks was covered in
newspaper and appeared to be a normal package. Hence, there is no evidence that the defendant or
its employees could have foreseen that the package had the potential to harm consumers. On the
day of the accident, the plaintiff and several witnesses to the incident saw that the majority of
passengers in the station at the time had some kind of package or valise. To stop and search every
package would mean that additional employees must be hired to execute such a plan and passengers
must arrive much earlier to the train station in order to compensate for the time consuming search
leading to an even more crowded train station. The overall costs and benefits of such assertions are
highly unbalanced, consequently reducing the overall efficiency of operations where the defendant
would be spending much more on the prevention of incidents that would produce relatively little
damage.
An additional claim made by the prosecution is that the defendant failed to provide
sufficient guidance to its employees to control the crowd during periods of high traffic within the
station. Allegedly, such a precaution could have prevented the incident and consequently the injuries
of the plaintiff. We the defense fully denounce this claim seeing as the plaintiff had full knowledge
or could easily find out if the station was going to be crowded, thus being able to make her own
decision on whether or not to ride the train. The purchase of a ticket to ride nullifies the claim that
the plaintiff was “negligently and carelessly invited, directed, permitted, and allowed to enter upon
the said platform”1 thus demonstrating that the plaintiff valued the transportation provided by the
station enough to continue to ride. The plaintiff’s value of the transportation to Rockaway Beach
was sufficient to get her to enter the East New York station. All events that occurred after her
entrance to the station was in part due to her deciding to enter the station.
The permanent injury resulting from the incident as was declared by said plaintiff is in
actuality a temporary injury that the plaintiff continues to force upon herself through increasing
Palsgraf V. Long Island Railroad Co. No. 248 N.Y. 339. COURT OF APPEALS OF NEW
YORK. 1924. p. 1065.
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stress from proceeding litigations. According to key testimony given by Dr. Graeme M. Hammond,
the plaintiff’s injury although still persistent three years after the incident, would be completely gone
within three years if said plaintiff was not under stress from this pending litigation. In filing this
claim, the plaintiff is sustaining her injuries by increasing the stress put upon her though trial
proceedings. Had the plaintiff not filed this claim against said defendant, her injuries would have
been non-existent at this time and thus there would be no injury to argue for damages. As a result of
this expert testimony of the neurologist, the plaintiff’s claim to additional damages for the
permanent injury that will indefinitely prolong her absence from work further invalidates the
plaintiff’s allegations.
Returning to the claim of negligence on the part of the defendant, this assertion is void due
to the fact that “negligence is not a tort unless it results in the commission of a wrong”.2 There is no
direct evidence that the defendant personally or physically imposed a wrong upon the plaintiff. In
fact, if any wrong has been done by said defendant, it would be upon the owner of the package for
knocking it out of his arms, as was viewed by several travelers prior to the incident. Economics also
shows no negligence on behalf of the defendant. As Economist David D. Friedman states,
“Economists define negligence as not taking all cost-justified precautions to prevent [an incident]”.3
In providing personal support on the train platform in the form of platform guards, he defendant
did and continues to take all precautions that were valued higher than the damage it would intake,
thus creating the efficient incentives and overall outcome of the incident.
Although the claim of negligence by the defendant that caused the plaintiff’s injuries is void,
it is important to understand that our defendant chose the proper actions to prevent more severe
Palsgraf V. Long Island Railroad Co. No. 248 N.Y. 339. COURT OF APPEALS OF NEW
YORK. 1928. 2 Nov. 2007
<http://faculty.oxy.edu/whitney/xaccess/ec357/cases/tort/palsgraf_v_longislandrr.htm>.
3
Friedman, D.D. Law’s Order. Princeton, NJ: Princeton University Press, 2000. P. 198.
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consequences and damages to society. Specifically, had the guard of the defendant’s station not
aided the owner of the package to get onto the train, the defendant would be facing a much greater
charge with a great possibility that the defense would be found negligible. However, this is not the
case in the current situation. In this particular occurrence, the defense should be found nonnegligent in order to further promote the efficiency of the legal tort system. If found negligent, the
court will be creating a situation in which producer incentives to aid others would severely diminish.
In punishing the defendant, the court would be deterring all companies with similar risks to aid
passengers when in need in order to avoid the possibility of liability in the case that something goes
wrong. In this case in particular, had the defendant’s guard failed to push the passenger onto the
train, the overall outcome could have been much more costly than the actual explosion. According
to this knowledge at the time of the event, the defendant took the necessary actions and thus
precautions to prevent such costly events before the explosion occurred. In doing so, the defendant
has eliminated the possibility of negligence on their part.
An additional negative incentive that would be created if the Court rules for the plaintiff
concerns the encouragement of rent seeking behavior by opportunistic “victims.” Testimony has
shown that the monetary damages incurred by the plaintiff, including medical and lost wages, is not
in excess of $800. Nevertheless, the plaintiff demands judgment against the defendant in the amount
of $50,000 to compensate for past and future lost wages and medical expenses. While the plaintiff
maintains that her damages are permanent, the testimony of a third-party neurologist maintains that
most damages are psychological and will subside upon the conclusion of litigation. We also dispute
the testimony of the plaintiff’s Dr. Parshall, whom is admittedly no expert in neurological matters
and whose complete lack of knowledge regarding the manner was revealed by the contradictory
testimony of Dr. Hammond. We further believe that Dr. Parshall is predisposed to overstate the
severity of the plaintiff’s condition, as he hopes to receive payment for his services upon a successful
verdict for the plaintiff. While we insist that we are not liable for the medical costs incurred, the
sheer magnitude of the damages sought in relation to the injuries suffered illustrates the potential
rent seeking behavior that a liberal interpretation of negligence would encourage. Under such a
precedent, bystanders could go so far as to intentionally injure themselves with the intent of pinning
negligence on an innocent party in the hopes of achieving a large payoff.
In conclusion, it is important to reiterate that the defendant is not negligent in the events
that took place on the 24th of August 1924 that resulted in the injury of the plaintiff.
Also vital to this case is the fact that the supposedly permanent injury suffered by the plaintiff is in
actuality temporary and is being upheld by fault of the plaintiff through this unsubstantiated suit.
Not only did the defendant take all necessary precautions to assist in the prevention and safety of its
passengers, but our client did so in such a cost-efficient way as to promote economic efficiency as
well. To find this defendant negligent is to rid of all necessary incentives for providers to act in a
socially beneficial approach when it comes to fulfilling consumer needs. Therefore, it is in the best
interest of courts to side with economic efficiency and find the defendant non-negligent against the
plaintiff.