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Unformatted text preview: ration of future losses. Use of resources in the court system is constrained by the same scarcity as the use of resources in any commercial enterprise. In short, the search for exact truth cannot last forever in
It is an old maxim of wide influence throughout the law that it is vital to society that litigation
should not be interminable, lest (as an old judge said on civilian authority . . suits be immortal
when the litigants are only mortal.) If courts insisted upon exploring every conceivable avenue of 71 Perre v Apand Pty. Ltd.  H C A 3 6, (unreported), 12 August 1999, High Court of Australia. 72  Q. L. Rep. 14. 293 ascertaining the true facts involved in the cases before them, the entire administration of justice
would come to a standstill immediately.73 Efficiency is e nhanced b y the use of 'rules' to dispose o f cases to alleviate the need for
the principles of each judgment to be tediously explored and justified. The doctrine of
precedent also fills this function, being a shorthand way for the bench to come to a
conclusion respecting formerly decided cases and avoiding detailed philosophical
argument in each case. There are writers who assert that the common law has always
relied on this underlying public policy in disposing of cases. The recent rise in the
amount of literature available on the economic analysis of law supports the presence of
this underlying policy and asserts even further that judges should use principles of efficiency to adjudicate between parties, seeking the most efficient outcome of a dispute,
measured in terms of social wealth. Since the 1960's the works of Coase,74 Becker,75
Calabresi,76 Posner,77 and Priest,78 among others, have highlighted the economic analysis
of law. These writers are not, however, asserting that the courts have been recently
motivated by economics, only that there is a more overt recognition of considerations of
economic analysis. According to Hovencamp "[i]n common law subjects such as torts,
contracts, and the law of property interests judges have not incorporated much explicit
79 e conomic analysis until recently, although they often did so implicitly." 73 Stone and Wells, 1991, p. 61.
Coase, R. H. 1960, " The Problem of Social Cost" (1960) 3 Journal of Law and Economics 1.
Becker, G . S. 1976, The Economic Approach to Human Behaviour, University of Chicago Press.
Calabresi, G . 1961, " Some Thoughts on Risk Distribution and the L a w of Torts", 70 Yale Law Journal
Posner, R. A. 1992, The Economic Analysis of Law, 4th edition, Littleton, B rown & Co.
Priest, G . L. 1977, " The C o m m o n L a w Process and the Selection of Efficient Rules",  6 Journal of
Legal Studies 65-82.
H ovencamp, H. 1990b, "The First Great L a w & Economics Movement", 42 Stanford Law Review 993 at
993-4. 294 T here are t w o relevant considerations w ith respect to efficiency. T h efirstis the use of the
court's time. This influences the time allotted to the disposition of each case, and rules of
procedure which deal with the posture courts should assume when being challenged in
principle over tedious and minute details, the relevance of which are questionable. An
objection to issues on the ground of relevance reflects that courts assume time is to be
used to attain a high standard of efficiency without compromising the core issues of
• .- 80 justice. Judges who have objected to the introduction of evidence which would focus argument
on hypothetical issues such as 'what would have been' have generally appealed to the
need for efficiency to justify their position. Opportunity cost falls directly within this
category of damages and the reluctance of courts to initiate deep discussion upon an issue
regarded as intangible, hypothetical, and open to criticism, manifests clearly the tension
between tedious scrutiny of cases to avoid injustice, and the processing of cases to
maintain case disposition throughput. Court delays frustrate litigants who would
generally wish for their case to be heard in an expeditious manner. Added to this is the
consideration that court rulings apply to other cases through the use of precedent, and
where one case introduces approving consideration of a probability, then consideration of
probability can be used in other cases. This, in the court's eyes, would open up the court
to interminable wrangling:
If [the appellant's] argument on appeal that other events would have occurred which would have
caused [the plaintiffs] the same loss is unlimited, every action for damages will be subject to a
range of speculation that would, if nothing else, lengthen cases immeasurably and m ake the
assessment of damages inconsistent and unpredictable. Statistics might be produced to show the
victims of motor vehicle accidents had a reasonable chance of being injured anyway, even perhaps
some more than others. Compensation to relatives cases would admit evidence of the chances that 80 The requirement that all adduced evidence at trial be strictly relevant i...
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