Tort Liability and Civil
Engineering
Professional Duties
Litigation Risk Management
Tort Reform
Service Liability
Malpractice
– Prevailing local standards of practice
– Established by expert witnesses
– GAAP, GAAS, Codes of Conduct
Tort vs. Contract Liability
Regulatory Liability of Professionals
– SEC, NASD, State Bar Assns, Medical & CPA
Societies
Service Liability
Malpractice
– Prevailing local standards of practice
– Established by expert witnesses
– Codes of Conduct
Tort vs. Contract Liability
Regulatory Liability of Professionals
– Professional Conduct Standards
Risk Management Methods
Remain Current in Tort Developments
Tort Data Analyses
– PennDOT’s Experience
– The National Highway Tort Database Project
– New York’s Current Experience
Black Box Data as Evidence
Estimation of Damage Awards
Sharing the Increased Liability from ITS
Reducing Risk Factors
Standard Setting, Testing & Design Cert
System Testing & Certification
Systems Safety Engineering
Laboratory & Human Factors Testing
Continuous Field Testing
– Design revision, warnings, recall
Speculative Analysis of Incident Risks
Tort & Product Liability Litigation
Crisis
Casualty Insurance Availability
– 1980s Destructive Price Competition
– Collusion Alleged
– Highly Effective Publicity Campaign
Refine the Proof of Scientific Facts
– Litigation: US v. Daubert (reasonable basis
in scientific evidence required)
– Regulation: regulatory reforms
– Legislation: only political controls
Targeted Methods to Reduce
Liability Risks
Safety & Environmental Regulations
Contractual & Negotiated Disclaimers
– Automobile & system purchase
– Subscription to services
– Suppliers & subcontractors
Federal Preemption
Specific Liability Waivers, Exceptions,
Exemptions & Limitations
Specific Liability Exemptions or
Limitations
Swine Flu Act
– Federal liability substituted for drug mfg
Statutes of Repose
– General products liability - 10 to 15 yr.
– Gen.Aviation Revitalization Act ‘94 - 18 yr.
Warsaw Conv. (aircrash liability limit)
Price-Anderson (nuclear pwr. limit)
Jones Act (expands maritime remedy)
Mandatory Risk Pooling/
Spreading Techniques
Workers Compensation
Unemployment Compensation
Federal Flood Insurance
– Subsidized premiums
– Non-market solutions
Assigned Risk Pools
Traditional Civil Engineering
Conservatism
Redundancy of Safety & Failsafes
Exhaustive Testing
Certification for Permanent Deployment
Demonstration Projects
Affords Time to Assess Sources & Costs
of Risks
The “Onion” Layers of Liability
Lessons from Other Industries
Crisis Preceeds Major Reforms
– Can ITS community convince public &
policymakers that needs are crisis-level
Lessons from Federalism
– Will inconsistency be perceived between
deployment by regional experimentation & an
“imperative” for national uniformity
Demand Pull vs. Cost Push
General Requirements
to Prove Negligence
Duty of care
– Regional & Professional Practice Influential
Breach of duty
Actual & Proximate cause
Injury or Damages
Negligence per se
– Violation of statute or regulation
Defenses to Negligence
Contributory negligence
Comparative negligence
Assumption of risk
Counter Proof of Negligence
Pressures to Reform the Tort &
Product Liability
Direct Costs:
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Deep pocket theory
Insurance pricing & profitability
Jury awards allegedly rising
Apparent crush of punitive damages
Indirect Costs:
– Opportunity costs: time, investment
– Lost products
– International competitiveness
The Reform Movement
Reformers:
– Trade associations
– Insurers
Reform Efforts:
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Publicity campaign in the 1980s
Lobbying individual state legislatures
Guidance given in key cases
Recent refocus on lobbying Congress
Political party platforms
General Tort Law Reforms
Joint & Several Liability
Damage Caps
– Economic &non-economic damages
– Punitive damage reforms
“English Rule,” Litig. Cost Shift, Atty. Fees
Jury Reform
Social Insurance System (Workers Comp)
Preventative: Safety Regulatory Programs
Joint and Several Liability
Satisfy Damages from any/all defendants
– Potentially pay all ignoring degree of fault
– Solvent pay insolvent defendant’s share(s)
Incentive to Sue Deep Pocket Defendant
Several Liability
– A form of proportionate liability
– Judge/jury assigns % negligence
– Private Securities Litigation Reform Act of 1995
Reform of Damages
Classification of Damages
– Compensatory Damages
– Economic Damages
– Non-Economic Damages
– Hedonic Damages
– Punitive Damages
Taxation of Damage Awards
Distinguish Civil vs. Criminal Fines
Reform of the Damage Award
Process
Structured Payments Rules & Practice
– Structured settlements encouraged
The Periodic Payment Method
Reduce Future Loss Projections to PV
– Future income stream adjusted for life maintenance
costs, inflation
Prejudgment & Postjudgment Interest
Bifurcated Trials
Accident Cost Valuation
Discounted Cash Flow Techniques of
Financial Economics
Key Variables
– Earning Power
– Discount Rate on “Safe Investments”
– Work Life Expectancy
Adjust by Rates of Failure
– Analogs: Aircraft & Prescription Drugs
Damage Caps
Maximum Upper Limit on Damage Awards
Constitutional Limitations
– Excessive fines, due process deprivation
– Remittitur on appeal
– the BMW paintjob
Defendant’s Wealth Inadmissible
Collateral Source Rule Modifications
– Evidence increasingly admissible
– Mandatory setoff
Time Limitations on Tort Suits
Statute of Limitations
– Time limitation for filing suit after wrong
– Accrual: upon sale or discovery
Statutes of Repose
– Time limitation after sale: limit on product’s
useful life
– Six to fifteen year
– Civil aviation: 10 years
Reforms Aimed at Plaintiff’s
Counsel
Plaintiff’s Counsel Compensation
– Contingency fee limitations, reviews
– Incentive: settle for nuisance value
– Limits financially disadvantaged’s access to justice
Discipline Attorney: Litigation Unfounded
English Rule: Loser Pays
– Attorney fees & costs, but many exceptions
American Rule
– Each party pays own fees, w/ some exceptions
Reforms Specific to Product
Liability
Traditional Tort Reforms
Particular Defenses (e.g., state of the art)
Limit Growth of Product Liability Theories
Junk Science & Admissibility of Experts
Federal or Uniform Product Liability Laws
Comprehensive Product Liability Reform
– IL, LA, MI, NJ, OH, UT
National Product Liability Insurance
Setbacks To Reform
Federalism vs. States Rights
– Usurping local prerogative
Over 1/2 States Courts Invalidate Some
Reforms
State & Federal Constitutional Bases:
– Right to remedy, open court
– Due process, equal protection
Most Vulnerable Reforms:
– Damage caps, statutes of repose, collateral
source rule, specific industry exemptions