Monday, November 07, 2011

Should We Ever Impose a Good Samaritan Liability?

Good Samaritan liability basically means imposing a legal obligation to a bystander (to the extent he has the capacity to help) to save a person in need of help. Thus, in case the bystander fails to save the person in need, and such person is harmed, the bystander will be liable. This is one of the interesting issues discussed in law and economics of torts. The case that inspires me is the Chinese toddler case (you can read the details here), where a Chinese toddler was being struck by a car, and no one helped her for quite a long time until a second car hit her again. When someone actually helped her, it was already too late, and she died in the hospital. If only the bystanders around the toddler helped her immediately, she might be saved and the story will be a happy ending one. Unfortunately, that's not the case here.

I asked some of my LLM Chinese friends in University of Chicago about this case and they confirmed that there was a case in the Supreme Court of China where a person is being penalized for helping an old woman from an accident. The facts of the case were never clear and people make their own conclusions, one of them is that helping other people may cause problem to you, especially when you don't know whether the people are really in need or they are just trying to put a scam on you (apparently, there are also cases where some swindlers trick people by pretending as accident victims and then blame anyone who nice enough to help them).

This is a serious matter, especially under the basic principle that people respond to incentives. If people can't determine whether their altruism as bystanders would be beneficial to all parties or at least don't cause them into any unwarranted trouble, their best rational choice is actually not to help anyone. And that is really bad to the society because it imposes a huge social costs to people in need. They can be helped with small costs, but because people fear that they will be in trouble if they try to help, these people in need end up with nothing or even bigger losses.

Now I remember that one of the comments that I see in Twitter is why not imposing a Good Samaritan liability? We impose liability to bystanders to help those in need in case those bystanders have the capacity to do so and the costs for doing such action would be low and lesser than the losses imposed to the victim due to the inflicted harm. Example: you're trying to cross the street and suddenly a car in full speed is about to hit you. I can easily save you by holding your hand and thus prevent you from being hit by the car. Doing that will not cause any additional risks to me (the car will not hit me) and if I don't do that minor action you'll die or at least be significantly injured.

Some people argue that liability should be imposed to me in this case based on the least cost avoider principle under the famous Hand's Formula (if you want to know more about Judge Learned Hand, see here). The principle basically says that a person should only be liable for torts in case the costs to avoid such harm (taking precautions) is lower than the loss imposed to the victim multiplied by the probability of the occurrence of such losses. Using standard economic approach, it's difficult to resist the strength of this argument, after all, the costs are lower than the benefits, surely, we should impose such duty to give the correct incentive for people to help other people.

However, I find this kind of approach as simply perverse. Not from morality point of view, but from an advance economic analysis. First of all, there is a problem of causation. It's easier to pinpoint a causation effect from an action rather from omission (as a caveat, I would like to emphasize that it's easier not easy). The standard of proof would be very expensive to prove causation in a case of omission. There is no solid evidence that even when I hold your hand, I can save you from a significant injury, after all it's an "ïf only"case. If you can't impose causation, how can you hold responsibility in economic terms? An easier solution for my hypothetical case is to impose liability to the car driver, because he is the one who hits you. In reality, if you survive, you will most likely sue him. If not, your family will sue him. And that would be easier for all parties. 

Second, if we apply the notion that we are legally obliged to help other people whenever we are the least cost avoider (and there will be sanctions for failure to do so), it would be a disaster. Let us use an extreme case, imagine that there is a hungry child in front of you (you don't know him at all). Without food, he will not survive. You don't help him even though you are able to do so and he died shortly. Should you be liable in this case? My answer is no and it's for good reason. It will impose an enormous costs to everyone to always be aware whether there are people in need around them. Furthermore, the costs for enforcement will also be humongous. People will start to sue other people if they don't get help in case they think that they can be helped by bystanders. It can turn out to be a lucrative business for lawyers, but for great expenses to the society.

One solution to this, which has already been incorporated in our penal code, is to impose liability only to specific people who have clear legal duties to take care of such people in need. Example: duty of care by parents to their child. This can be an efficient rule if the duty is strictly imposed to people who have control over the people in need and therefore are in a better position to understand the need of such people.

Another solution is to protect bystanders from any liability in case they try to help. You don't need to give additional benefits to altruists, after all for these guys, helping other people has already increased their utility. But you may want to protect them from liability imposed by their good intentional action. The problem with this rule is again standard of proof in causation. Like I said above, in case of omission, it is harder to perceive the causation. But once an action has been done, that action can be placed in the causation analysis.

A no liability rule for all helpers might not be efficient in cases where bystanders don't actually help and instead cause additional problems. So another set of rule can be added, i.e. the no liability rule will only be applicable for bystanders who can show good faith in his actions and have the minimum reasonable skills to help. In this case, hopefully, people having no capabilities to help will stay away from helping other people in need and therefore they can avoid unnecessary problems. It's not a perfect system, some people who think that they are reasonably well to help other people may end up liable for reckless help but it is better than creating a system where everyone is not liable and thus there are less incentives to be careful in helping other people.

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