You have probably heard the words “tort reform” in recent years. Politicians ask us to vote for it election after election. Tort reform is a topic discussed among Personal injury attorneys often.
So what is a tort? And what is tort reform?
The interpersonal transactions of life can for legal purposes be divided into two very basic categories:
1) those transactions we enter into voluntarily, and
2) those transactions that occur without our consent.
Transactions entered into voluntarily are considered “contracts”, and the law of contracts governs these transactions. For example, an agreement for the sale of a house that is broken by one party who refuses to perform its contractual duties can give rise to a legal action for “breach of contract”.
A tort (derived from the French word for “wrong”), is an interpersonal transaction that occurs to which we have not consented that causes us injury or damage. One example is the transaction of being struck and injured in an automobile accident by another person who has violated the rules of the road. Another would be a child being bitten by a pit bull that was not properly restrained by its owner. The law of torts governs these involuntary and damaging transactions we are helpless to avoid, and usually personal injury attorneys are involved to represent those injured or damaged in the court of law.
History of Tort Law
The theories of “tort” law can be traced to the English common law and have developed over time in our American legal system. The main goal of tort law is to see that persons who have been injured by the negligence or carelessness of others are fully and fairly compensated for the damages they have suffered. A second very important goal of tort law is to deter conduct that clearly goes beyond mere carelessness – recklessly dangerous or even intentionally harmful behavior causing injury. Juries are empowered in such limited instances to deter bad behavior by entering punitive damage awards against defendants in addition to basic compensation for the victim.
So What can/will be Reformed?
So what needs to be reformed? The answer to that question comes from the insurance industry, not a personal injury lawyer. Liability insurance is insurance that compensates victims of torts committed by policyholders. When the damage caused by a negligent person is grave, a lot of compensation can be in order. A child severely and permanently injured by negligent medical care is an example. Insurance company payments to some victims can be quite high when the damage is so serious.
“Tort reform” efforts attempt to game the legal system so that the insurers of those who have committed careless, reckless or even intentional torts, bear only limited responsibility for the consequences of their bad behavior. In Virginia for example, a doctor or hospital causing a lifetime of damage due to the careless medical treatment of a child will never be required to pay more than about two million dollars to the victim, even though medical expenses alone, necessitated by years of future care, will far exceed that amount. This is the same for accident and injury cases and class action lawsuits, somebody else (often the taxpaying public) will have to pay the rest.
Current Tort Reform Laws on the Books
Another tort reform measure passed into law a number of years ago establishes a maximum cap on punitive damages under Virginia law in the amount of $350,000, regardless of the conduct at issue or parties involved. If the intoxicated captain of the Exxon Valdez oil tanker had run his ship aground and coated the coastline with crude oil in the Chesapeake Bay, the most the corporate giant could have been held liable to pay in punitive damages awarded by a Virginia jury would have been $350,000. That amount would be such a small fraction of revenue for a large oil company like Exxon, it would have been akin to requiring the corporate giant to toss a few coins in a parking meter. There is no deterrent effect against future bad behavior.
Recently we have heard about an automobile manufacturer that appears to have intentionally hidden a known product defect from the general public, based on the financial calculation that – if it ever got caught – compensating the resulting dead and injured persons would be cheaper than fixing the problem? Virginia juries, thanks to tort reform, can’t have much impact in stopping corporate behavior like this. Instead, we have only the very politicians who gave us tort reform to protect us from insurance and corporate interests.
So when you hear the term “tort reform”, keep in mind that it is usually an effort by those who wish to limit the rights of people injured by negligent, reckless or intentionally harmful behavior of others. None of us wants to be the victim of such wrongful conduct but if we are, do we really want the insurance industry and other huge international corporations dictating our legal rights? These are the issues involved in so-called “tort reform”, and the reasons why ordinary citizens should be skeptical of such efforts.