Jeffrey O’Connell and the Market in Tort Claims

Abstract

AbstractThis article examines a transitional period in Jeffrey O’Connell’s long and productive career as an observer and critic of the American civil justice system. By the early 1970’s O’Connell had begun to abandon enterprise liability as a solution to the waste and undercompensation he saw in the tort system. Eventually O’Connell would develop solutions that focused on constraining plaintiffs’ attorneys, and less on no-fault compensation. Before reaching this point, O’Connell proposed a no-fault insurance scheme that would be paid for by fault-based tort litigation. This proposal, which he called “elective first party no-fault insurance” (“EFPI”) is the focus of this article. In EFPI tort suits would not disappear, and damages would not be limited, but litigation would be conducted by insurers who had been assigned their insured’s lawsuits. This article describes how this novel tort reform would work, and explores the theoretical assumptions upon which it is based. One assumption in particular, which is examined, is that a market in tort litigation could be socially efficient if the right sort of plaintiffs’ lawyers were recruited to conduct it. Finally, this article points out that O’Connell called for the repeal of champerty laws at least a decade before many other modern legal academics focused on the potential of a market in litigation.