Shahar Dillbary, ‘Sharing Externalities: The Surprising Value of Agreements to Commit Torts’

Abstract:
This article focuses on agreements to commit or induce the commission of a tort. Examples include an agreement between factories to use a production process that would pollute a lake, or an agreement where one entices another to publish a false statement by promising to share the cost of the injury. Such agreements are unenforceable under contract law. However, the article reveals that tort law not only enforces such wrongdoings, it encourages them. Tort law picks up where contract law leaves off. Tort law allows the parties who acted on the agreement (the polluting factories and the publisher) to recover expectation damages from the breaching party who behaved carefully (the factory that did not pollute). It also requires the party who commissioned a wrong (the one who enticed the publisher) to pay her share as promised. Tort law even goes a step further and facilitates ‘tort-tracting’ — the act of agreeing, or pre-committing, to engage in or sponsor a wrongdoing. The result is ironic: tort law invites, polices and enforces wrongdoing. The article explains how tort law allows parties to enter into agreements to commit or induce a tort, and how they are enforced. In doing so, the article sheds a new light on some of the most divisive controversies that have preoccupied scholars and paved their way into the Restatements of Torts, and it provides guidance to courts and policymakers.

Dillbary, Shahar, Sharing Externalities: The Surprising Value of Agreements to Commit Torts (February 10, 2017). U of Alabama Legal Studies Research Paper No 2915237.

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