Document Type

Article

Publication Title

California Law Review

Abstract

Consider an individual acting on behalf of an enterprise such as a private business or a public agency. During the course of his duties, the individual may injure a third party who bears no contractual relation to the enterprise. Tort law must then allocate the accident cost among three parties: the enterprise, actor and victim. In this Article, I shall assume that while the law has decided to shift the costs from the victim, it must choose between assigning the costs to the enterprise or to the individual. This Article examines a single, important factor relevant to the choice between the legal regimes: the degree of care exercised by the enterprise and agent. Under one regime, called "agent liability," the individual who acts is liable but the enterprise is not. Under the other regime, called "enterprise liability," the enterprise is liable while the agent is not. After identifying those conditions under which agent and enterprise liability produce the same levels of care and those under which they produce different care levels, I then argue that the model presented suggests enterprise liability produces greater care in the private sector. In the public sector, however, the crucial question is not on whom to assign liability but whether to impose liability on either the public enterprise or public servant at all.

First Page

1345

DOI

https://doi.org/10.15779/Z38C16P

Volume

70

Publication Date

1982

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