Torts - Cases, Principles, and Institutions Fifth Edition, 2016a

Witt & Tani, TCPI 4. Negligence Standard
floor on conduct, not a ceiling, and that courts and juries are entitled to insist that actors surpass
statutory safety standards when, under the circumstances, reasonableness so requires. Moreover,
defenders of the common law rule insist that there are good reasons underlying it. Administrative
agencies and legislatures, they contend, are subject to the phenomenon known as “regulatory
capture,” under which regulations serve not the interest of the public, but the interests of the
regulated entity. The basic problem, as influentially identified by political scientist Theodore
Lowi in the late 1960s, is that regulators unavoidably interact with the industries they regulate.
Those industries have ample opportunity and motive to advance their interests with regulators.
The public, by contrast, is diffuse and disorganized and may not press its interests nearly as
forcefully in the regulatory process. The problem grows worse in systems like the United States,
with the so-called “revolving door” between the regulator and the regulated entities. If regulators
are former employees of the firms they regulate—and hope to be employees of such firms once
again in the future—then critics contend that the regulations will almost certainly favor the
regulated entities interests over those of the public in situations where the two diverge.
Critics, however, contend that the absence of a regulatory compliance defense means that
regulated actors face two separate regulatory systems, one statutory and the other common law.
The absence of a such a defense means that they bear the burdens of both but not the benefits.
In the early 1990s, the American Law Institute (publisher of the Restatements) issued a
Reporter’s Study that made recommendations for a revised regulatory compliance defense. The
ALI reporter, Richard B. Steward, proposed that compliance with a safety standard be made a
complete defense to the charge of negligence when: (a) the standard was promulgated by a
specialized administrative agency charged with the power to monitor and assess and regulate the
risk in question; and (b) when the regulated entity seeking to invoke the defense made disclosures
to the agency about the risks in question. In particular, Stewart’s proposal would have required
that:
the defendant must have publicly disclosed to the relevant regulatory agency any
material information in its possession (or of which it has reason to be aware)
concerning the risks posed by the defendant’s activities and/or the means of
controlling them. This requirement would extend to information indicating that
agency standards or tests may be inadequate or inappropriate . . . .
Regulatory Compliance Preclusion of Tort Liability: Limiting the Dual-Track System, 88 GEO.
L.J. 2167 (2000). Is Stewart’s proposal superior to the traditional common law approach to
regulatory compliance? Defenders of the traditional approach often cite the risk of regulatory
capture. Stewart’s public disclosure requirement was designed to ameliorate the capture problem
while preserving the virtues of the risk regulators as against the decisions of lay juries in common
law courts.
In the end, controversy over Stewart’s proposal prevented it from being added to the
Restatement, though the Third Restatement did add a more modest alteration, contending that the
common law reasonableness standard should not require a course of conduct that is forbidden by
some a statutory or administrative standard. See RESTATEMENT (THIRD) OF TORTS: LIABILITY FOR
PHYSICAL AND EMOTIONAL HARM § 16(b):
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