In contrast to corrective justice, which provides a coherent account of the form of negligence law and of the wrongdoing at its core, consequentialist accounts are unable to provide a coherent theoretical foundation. Since they are distributive in nature they cannot be achieved through the bipolar structure of a negligence action. Moreover, pluralist consequentialist theories, such as the idea that negligence pursues the twin goals of compensation of victims and deterrence of wrongdoers, suffer from ‘a surfeit of reasons and norms’,51 which pose artificial limits on one
another. This means that if negligence doctrines are developed in pursuit of consequentialist goals the law of negligence will become incoherent. Subsequent criticism of negligence law for being ineffective or inefficient as a system of compensation or deterrence stems from the fact that these are distributive goals so are necessarily precluded from being effectively achieved through the structure of negligence.
Wright explains that compensation and deterrence cannot provide a sound basis for negligence law because ‘compensation and deterrence of all losses is normatively insupportable, descriptively implausible, and analytically impossible’.52 He goes on to explain that it is
normatively insupportable because there is ‘no plausible moral argument for requiring others to compensate every person for every loss no matter how it occurred’.53 It is also impossible
because compensation does not eradicate loss but shifts the loss to others, and because it is neither possible nor desirable to deter all risky conduct. The bipolar structure of negligence liability prevents each goal from being fully attained:
The fundamental reason why these criteria are inconsistent with tort law’s correlative structure is that there is no reason to limit the search for the deepest pocket, or the best
51 ibid 160.
52 ibid 159. 53 ibid 159.
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loss-spreader, or the cheapest cost-avoider, to the two parties to the tort claim – the harm-doer and the harm-sufferer.54
Additionally the different distributive criteria impose artificial limits on one another:
When juxtaposed within the tort relationship, compensation and deterrence are mutually truncating. What limits compensation is not the boundary to which its justificatory authority entitles it, but the competing presence of deterrence in the same legal relationship. Thus, tort law compensates victims only when damages serve the purpose of deterrence. In the same way, tort law artificially restricts deterrence by tying deterrence not to what is needed to deter wrongdoers, but to what is needed to compensate victims. In this mixing of justifications, neither goal occupies the entire area to which it applies. Accordingly, neither in fact functions as a justification.55
Perry objects that compensation and deterrence could be combined in a way that is not mutually truncating in a system such as compulsory first-party insurance where compensation would be achieved through insurance payouts and deterrence would be achieved through the setting of premium levels.56 It is clear, however, that this example is premised on a different institutional
structure, insurance, where a harm-sufferer would be compensated independently of the insurance premium imposed on the harm-doer. The structure is distributive and matched to the distributive functions it seeks to achieve. So although Perry may be right to assert that compensation and deterrence can be combined in a way that is not mutually truncating, it remains the case that this cannot be achieved through the negligence system which links the harm-sufferer to the harm-doer in a bipolar relationship.
This means that criticisms targeted at the inefficiency of negligence law as a system of compensation and/or deterrence ought to be directed at the normative question of whether there ought to be a system of negligence liability. The significance of this choice is thrown into
54 Peter Cane, ‘Distributive Justice and Tort Law’ [2001] NZ L Rev 401, 419.
55 Ernest Weinrib, ‘The Jurisprudence of Legal Formalism’ (1993) 16 Harv J L & Pub Pol’y 583, 587.
56 Stephen R Perry, ‘Professor Weinrib’s Formalism: The Not-So-Empty Sepulchre’ (1993) 16 Harv. J. L. & Pub.
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sharp relief by the concerns raised by Atiyah who made an important attack on negligence law as a system of compensation in The Damages Lottery. The need for financial support clearly extends beyond those injured by others’ wrongdoing to those suffering due to an accident or natural causes. As a system for compensation based on need, the negligence system is obviously unjust:
Of all the disabled or handicapped people in society about ten percent suffer from birth defects, about another ten percent have been injured in accidents, and the remaining eighty percent are suffering from illnesses and conditions of natural origin. Of the total number, only about one and a half percent apparently obtain any damages at all. How is this tiny group selected for preferential treatment?57
But this is a distributive injustice because it is giving preferential treatment to people injured through someone else’s wrongdoing in a distributive model where the criterion of merit is need. The assertion is therefore that the negligence system introduces a second, unjustified criterion of merit according a special status to injury caused by wrongdoing and this has resulted in an unjust distribution of goods. Arguably Atiyah is criticising negligence unfairly because a system that takes the form of corrective justice cannot be expected to achieve distributive justice. Atiyah’s criticism is more serious though, because he argues that the rules of negligence law have been ‘stretched’ by the courts in order to promote compensation.58 In other words, the courts treat
negligence law as a means of achieving compensation so they are adapting the legal rules to try to achieve compensation in more cases.
As an interpretive theory, Atiyah’s explanation of negligence as a system of compensation is therefore based more strongly on ‘fit’ and ‘transparency’. As he sees it, the courts reason in terms of promoting compensation and have shaped the law to compensate more victims of harm. And the logical conclusion at which he arrives, given that compensation is a distributive model, is that the negligence system should be abandoned in favour of a fairer compensatory system. It is important that negligence law adheres to principles of corrective justice to avoid this claim.
57 P S Atiyah, The Damages Lottery (Hart Publishing 1997) 143-44. 58 ibid 32-95.
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Weinrib warns that ‘a functionalist might regard causation as an indirect way of achieving market deterrence or some other extrinsic goal, an internal account treats causation as causation, that is, as a concept that represents the unidirectional sequence from action to effect’.59 Coherence will
be lost if the courts ‘stretch’ the concept of causation in order to promote compensation and deterrence.
It is important to note that proponents of corrective justice theories of negligence such as Weinrib and Beever do not generally claim that their theories are normative in the sense that the law has to have a system of corrective justice-based responsibility. Their theories are interpretive and therefore compatible with claims that the law of negligence could be abandoned and replaced with distributive systems of compensation (such as no-fault compensation or insurance) and of deterrence (such as fines or insurance premiums). Weinrib explains:
To take a modern example, the legal regime of personal injuries can be organized either correctively or distributively. Correctively, my striking you is a tort committed by me against you, and my payment to you of damages will restore the equality disturbed by my wrong. Distributively, the same incident activates a compensation scheme that shifts resources among members of a pool of contributors and recipients in accordance with a distributive criterion. From the standpoint of Aristotle’s analysis, nothing about a personal injury as such consigns it to the domain of a particular form of justice. The differentiation between the corrective and distributive justice lies not in the different subject matters to which they apply, but in the differently structured operation that each performs on a subject matter available to both.60
Their theories do, however, have normative force in that if there is to be a legal system of negligence liability, in other words a bipolar system where the victim is compensated by the person whose wrongdoing caused his loss, then the system ought to conform to corrective justice. Cane explains, ‘it seems clear that Weinrib’s theory is meant to have normative force to the
59 Weinrib, The Idea of Private Law (n37) 11-12. 60 Weinrib, ‘Corrective Justice’ (n27) 415.
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extent that in his view, if a society chooses to organize some aspect of its life in accordance with the demands of corrective justice, it should do so consistently’.61 Since the negligence system
takes the form of corrective justice then the content of the legal rules that flesh it out must also reflect corrective justice, otherwise the system will become incoherent and unjustifiable.
It is therefore clear that Atiyah and Weinrib’s positions can be reconciled since both insist on the impossibility of achieving distributive justice through a corrective justice structure. The difference lies in where they proceed from this basis: Weinrib argues that the law should be matched to the structure, so the rules of negligence law ought to reflect corrective justice; Atiyah argues that the structure should be matched to the law’s objective, so negligence law ought to be replaced with a fairer compensation scheme. The problem with Atiyah’s analysis is that it fails to measure negligence law in its own terms.
It is one thing to acknowledge, as the next section will, that negligence liability has compensatory and deterrent effects, but it is another thing to say that it has compensatory and deterrent goals and to measure its success against those goals. As a system of compensation or deterrence it has been shown that negligence will necessarily be a failure because the goals are mutually truncating and incompatible with the correlative structure of the negligence action.