To be awarded damages under the tort of negligence, a claimant ‘must prove that the defendant is at fault for the injuries cited’ (Fenn et al, 2003, p.272), with fault being the operative word here. There are four key areas to consider under a negligence rule, these are: ‘(1) establishment of a duty of care, (2) evidence that the physician’s services did not conform to the appropriate standard of care, (3) a determination that the failure to act in accordance with the duty of care was the cause of the harm, and (4) existence of a physically objective and ascertainable injury’ (Horwitz & Brennan, 1995, p.167). The effect of this is an injurer is only liable for the cost of accidents if they have taken care in an amount less than the established legal standard, as represented below.
Not liable for damages
Liable for damages
This graph represents the private cost function for a potential injurer (the bold line) under a negligence rule. In this case, the privately optimal amount of care taken is equal to the social optimum amount of care. This is because if a potential injurer takes care below the legal standard, and is therefore at fault, they bear the cost of both their own cost of care (x) and the expected cost of damages (P(x)D). However if they take care up to or above the legal standard of care, they are no longer liable to pay the cost of damages under a negligence rule, and so to minimise their total costs, as we assume a rational, self interested person would; a doctor liable under a negligence rule would take care at the legal standard. In the case of medical negligence, the difficulty comes in how a court adjudges the legal duty of care, as they are reliant upon expert advice in order to set a reasonable level. In instances of medical negligence, the Bolam test is applied to determine if a doctor has behaved negligently; and can be taken to mean ‘that a doctor or nurse will not be negligent so long as he/she acts in accordance with the professional practice or opinion’ (Hartwell, 2005, p.294). By this, a court decides the level of care a doctor should have taken based on the opinion of a professional body on the reasonable amount of care expected from an ordinarily skilled doctor practicing in the same field. Hartwell (2005) has suggested that the Bolam test is not without its problems; in that it inhibits courts exercising a restraining influence and argues that judges must not be deterred from interference when justified, solely because actions taken have been approved by a body of medical opinion.
Strong financial incentives under a negligence rule provide deterrence from substandard care by...