Wednesday, October 28, 2015

Shredded Hand Formula

As opined by the jurist Learned Hand and his famous ‘Hand Formula’ on negligence, concerning any reasonable burden of legal duty imposed by society on a party to act reasonably or with precautions to prevent any negligent loss/injury that may result from the activity, with that Burden (B) being proportional to the product of the Probability (P) of the loss and the value of the Loss (L),*   I ask:  Would this not essentially amount to no burden being imposed if the probability of the loss was one-hundred percent (100%)?  Because, at such a point, the proportionality would default to the burden being essentially equal to the loss.  

That is, if the venture was nearly certain not to succeed without some amount of negligent loss/injury but was pursued despite any unfavorable risk-to-utility type of analysis, nevertheless, for whatever the reason.  And, as predicted, the undertaking did fail with some amount of loss/injury due to negligence of the acting party.  Why would that party or anyone else have any burden to prevent the predicted loss?  Rather, it would seem to make more sense to merely pay the loss when it happens, for instance.  Again, as the burden imposed then would equate to the loss, anyhow.  Otherwise, as the formula would seem to suggest, the cost of the burden could well outpace the value of any loss whenever such a loss might occur.  Of a sorts, maybe the matter can be likened to purchasing insurance.  Looking at the matter from a cost-to-benefit viewpoint, rather than pay premiums/costs over time, just pay when any actual loss transpires.  For the sake of the argument, I am ignoring any defenses such as assumption of the risk and the like.  

So in actuality, does not the Hand Formula suggest no burden of duty in either extreme of probability of loss/injury from negligence (0% or 100%)?  Is the logic herein flawed or is it a flaw in the Hand Formula?  Does the proportionality of the Formula breakdown at its upper limit as is argued in this blog entry?  Or, did Judge Hand merely intend his formula to be as a reasonable guide and not a mathematical theory?  Let me know your thoughts, should you be so motivated.
AVT  (October, 2015) 

* The ‘Hand Formula’:  B < P · L.    See:  United States v. Carroll Towing, 159 F.2d 169 (C.C.A.2, 1947).

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