Book contents
- Frontmatter
- Contents
- List of Contributors
- Preface
- Acknowledgment
- I THE CASE FOR STRICT LIABILITY
- II THE CASE FOR FAULT
- III BETWEEN STRICT LIABILITY AND FAULT
- 7 Fault at the Contract-Tort Interface
- 8 The Many Faces of Fault in Contract Law: Or How to Do Economics Right, Without Really Trying
- 9 The Productive Tension Between Official and Unofficial Stories of Fault in Contract Law
- IV WILLFUL BREACH
- V COMPARATIVE FAULT
- VI THE MORALITY OF BREACH
- Case Index
- Subject Index
- References
8 - The Many Faces of Fault in Contract Law: Or How to Do Economics Right, Without Really Trying
Published online by Cambridge University Press: 10 November 2010
- Frontmatter
- Contents
- List of Contributors
- Preface
- Acknowledgment
- I THE CASE FOR STRICT LIABILITY
- II THE CASE FOR FAULT
- III BETWEEN STRICT LIABILITY AND FAULT
- 7 Fault at the Contract-Tort Interface
- 8 The Many Faces of Fault in Contract Law: Or How to Do Economics Right, Without Really Trying
- 9 The Productive Tension Between Official and Unofficial Stories of Fault in Contract Law
- IV WILLFUL BREACH
- V COMPARATIVE FAULT
- VI THE MORALITY OF BREACH
- Case Index
- Subject Index
- References
Summary
Modern law often assumes that a uniform cost-benefit formula is the proper way to determine fault in ordinary contract disputes. This chapter disputes that vision by defending the view that different standards of fault are appropriate in different contexts, in line with Roman law classifications adopted in Coggs v. Bernard in 1703. Typically, parties in gratuitous transactions should be held only to the standard of care that they bring to their own affairs. The higher objective standard of ordinary care governs in commercial transactions. That bifurcation leads to efficient searches. Persons who hold themselves out as merchants or experts warrant their ability to achieve uniform standards, while individuals who seek favors from their friends are incentivized to choose them carefully. The basic principle has surprising durability in dealing with agency, medical malpractice, occupier liability, guest statute, and frustration cases. Often the efficient analysis of fault is given only to those who do economics without really trying.
Introduction: From Fault to Negligence – and Back
The concept of fault plays a dominant role not only in contract but also in tort. Often “fault” is the equivalent of the term “negligence.” Commonly, its definition is said to track the Hand formula, which compares the burden of precaution (B) with the expected losses, equal to the probability of loss (P) multiplied by the expected severity of the loss (L). Hand's earlier discussion of custom in The T.J. Hooper is often ignored.
- Type
- Chapter
- Information
- Fault in American Contract Law , pp. 118 - 131Publisher: Cambridge University PressPrint publication year: 2010
References
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