Adv.

Torts Outline
Chapter 1 -Development of Liability Based on Fault
Strict Liability
Definition of Torts p. 1
o Torts comes from a Latin word tortuous which means twisted, and the French
word tort , which means injury or tort. A Tort is a civil wrong, other than a
breach of contract, for which the law provides a remedy.
Policy:
1) Peaceful means for adjusting the rights of the parties who otherwise would take the
law in their hands
2) To deter wrongful conduct
3) To encounter socially responsible behavior
4) To restore the injured parties to their original position, by compensating them for their
conditions
5)* To promote broad distribution of loses among the community
Regular Tort-Review:
o (3)Three basis of Fault(Culpability) that trigger tort liability:
Intentional Torts- knowledge, desire, purpose and substantial certainty.
Negligence- careless, breach of duty; 5 ELEMENTS necessary to
constitute a prima facie case in Negligence (1)D had duty to conform
conduct to a specific standard (2)D breached that duty--failed to conform
to appropriate standard (3)Causation--Ds substandard conduct was: (a)
Cause-in-fact--actual cause of Ps injuries (b) Proximate cause--there was
a foreseeable risk that conduct would cause Ps injuries (4) P must prove
actual damages resulting from the injury (unlike some intentional torts)
Note- Judge decides (1). Jury decides (2), (3a), (3b), and (4).
Strict Liability # absolute liability, liability without fault, imposed
liability that is policy driven. (3) Categories:
Animals
Activity (abnormally dangerous)
Product (defective)
History of Tort Law (fault based system)
o Common law writs (originated):
Trespass form of action for direct and immediate force
Trespass on the case form of action for indirect injury (Ex: log on the
street; Like invasion of privacy, defamation)
Modern Tort law- civil action should be used only used to compensate for the harm
done. This explains the fact that there must be proved of actual damages, except in
intentional torts if harm was done the injured party would still sue in case and recover,
even if no harm was done.
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Strict Liability

Generally: Liability w/o fault; no due care required

o 1. Liability cannot be alleviated by due care
o 2. Relieves of burden of proofonly need to prove causation
o 3. Arises in small category of cases where engaged in valuable, but inherently
dangerous activity.

Useful theory in environmental cases (e.g. ammonia escaping to neighbors)

D must pay damages although D did not act intentionally or did not live up to the
objective standard of reasonable care rooted in negligence.
# than strict product liability b/c fault creeps back into the system

Areas of Strict Liability

Abnormality Dangerous Activities Strict liability all injures proximately caused by
a party conducting of certainly inherently dangerous activities without regards to fault or
negligence. For an activity to be abnormally dangerous not only must it create a
danger of physical harm to others but the danger must be an abnormal one.
Defendant is strictly liable for an abnormally dangerous activity if:
Activity involves serious potential harm;
Activity involves high degree of risk that cannot be made safe; and
Activity is not commonly performed in the community or area.
Ultra-hazardous activity (1st Rest.) or Abnormally Dangerous (2nd Rest.): ( 520/519)
Miller v. Civil Construction
o In determining whether an activity is abnormally dangerous, the following
factors are to be considered:
o A high degree of risk of harm
o Likelihood that any harm will be substantial
o The Exercise of reasonable care
o The commonness of the activity
o The activitys appropriateness for the place where it occurs
o The degree to which the community benefit from the activity outweigh its danger
nd
2 Restatement of Torts 520: Uses the term abnormally dangerous activity and makes the
decision depend on the nature of the location where the activity takes place. Six factors to be
considered in determining whether an activity is ultra-hazardous:
1.
2.
3.
4.

Great probability of harm.

Potentially serious level of harm.
The activity is not a matter of common usage.
Harm cannot be prevented by utmost care.
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5. The activity is inappropriate for the location.

6. The social value of the activity is not sufficient to offset the risks.
The basic purpose behind the ultra-hazardous activity doctrine is to encourage the use of
alternative methods when possible.
NOTES/Comments:
- Analysis evolves around the question of law
- * one factor by itself is not sufficient to establish the abnormally dangerous activity.
- The Rest. talks about the *activity
- Purpose of the activity applies to both business and private
- Value to the community some value could deem
TEST: Based the above restatement (Need to establish Prima Facia Case for Abnormal
Dangerous Activity to analysis using the factors and the comments to the Rest.)
- Note 2 &3 p.708 abnr. dangerous activity
Rylands v. Fletcher - Liability exist b/c non-natural condition (large quantity of water)
# than natural use-no liability; However, the American courts have rejected this
approach and tended to impose liability even for natural use (character of the thing or
the activity into question, place, manner in which is maintained and the relationship to the
surroundings
EX: Fire in a fireplace not dangerous b/c custom dictates its a natural purpose). D is
absolutely liable whenever anything escapes from his control and causes damage later
the rule extended to include most activities that are extremely dangerous.
Rule: A person using his land for a dangerous, non-natural use is strictly liable for
damages to anothers property resulting from such non-natural use.
Notes: Subsequent decisions in England have followed the distinction between natural
and non-natural uses of the land. To determine what is natural, courts have looked not
only to the character of the thing or activity in question, but also to the place and manner
in which it is maintained, and its relation to its surroundings. For example: a car is
dangerous, fatal to thousands annually, but it is held to be natural.
Early US courts rejected the Rylands decision, mainly b/c it was misstated and that
misstatement was rejected. However, recently the US trend has been very much in favor
of approval of the case, and a substantial majority now favors the case.
Miller v. Civil Constructions, Inc A stray bullet injured a man after it ricocheted from a
nearby gravel pit during firearm practice by law enforcement officer. The court applied
520. Rule: The use of gun or firearm is not ultrahzardous activity as required for
strict liability.
Indiana Harbor Belt R.R. Co. v. American Cyanamid Co American Cyanamid (D),
manufacturer of dangerous chemical, was not held strictly liable when a quantity of it
spilled during transportation. Rule: Strict liability will not be imposed against the
manufacturer of a toxic chemical for accident occurring during transportation.
Activities held subject to strict liability:
1. Blasting
2. Toxic chemicals and inflammable liquids transported or stored in quantity in an urban area.
3. Pile driving, setting up excessive vibration.
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4. Crop dusting
5. Poisonous gases.
6. Rockets: Ds testing of rocket fuel held subject to strict liability.
7. Fireworks displays
8. Hazardous waste disposal site
9. Oil wells
10. Water escape
AviationGround Damage: airlines used to be held strictly liable for ground damage in a crash,
but this view is no longer justified with the character of planes and their accident records.
Matter of common usageCars kill and injure more people and damage more property than any
of the activities listed. But just like transmission of electricity and natural gas, cars are seen as a
common usage and no longer are held to strict liability standards.
Policy behind Strict Liability: Is founded upon a policy of the law that imposes upon anyone
who for his own purposes creates an abnormal risk of harm to his neighbors, the responsibility of
relieving against that harm when it does in fact occur.
Conclusion: If you fall into this category will be strictly liable:
Strict Liability:
o Animals
o Abnormally Dangerous Activity
o Product
Limitation on the Strict Liability

Nexus activity injury (Causal link b/w the activity and the injury) or (The
accident must be w/in parameters of the risk that activity creates) scope of
risk the kind of risk that made the activity abnormally dangerous; Strict liability
*injury resulted from the harm of the abnormally dangerous activity and must be
the proximate cause*
Act of God/Not foresseable beyond the capacity of anyone to anticipate (is
enough to relieve D form strict liaabillty)
Contributory Negligence usually not defense BUT in an assumption of risk
(voluntarily and unreasonable) inattentive (Res. 2nd 524 , Comment b.)
Test for Assumption of risk: (unreasonable assumption of risk) bars the P from
recovery if:
o P has to have a knowledge of risk of harm
o P can appreciate the magnitude of risk of harm (exempt. Incapacitated
person or intoxicated)
o Voluntarily put himself in harm
Foster v. Preston Mill Co. (Mink mother, frightened by blast killed her own kittens).
*D cannot be held limitlessly for responsible for every consequences flowing from his
actitons* In Strict liability the line is drawn at those injuries that result from the very thing
that caused an activity to be classified as abnormally dangerous.
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- Limitations on Strict Liability

Facts: PL/res Foster owned a mink farm. D was engaged in a blasting operation 2.25
miles away. Foster provided notice that the blasting operations were causing the mother
mink to kill their kittens. The blasting continued unabated.
Legal Issue(s): Whether the risk that any unusual vibration or noise may cause wild
animals, raised for commercial purposes, to kill their young, are one of the things which
make the activity of blasting ultra hazardous, thereby imposing absolute liability? No
Law or Rule(s): One who carries on an ultra hazardous activity is liable to another whose
person, land or chattels the actor should recognize as likely to be harmed by the
unpreventable miscarriage of the activity for harm resulting thereto from that which
makes the activity ultra hazardous, although the utmost care is exercised to prevent the
harm.
Strict liability is only imposed for those injuries resulting as a natural consequence of
that which makes an activity ultra-hazardous.
Court Rationale: The thing which makes blasting ultra hazardous is the risk that property
or persons may be damaged or injured by coming into direct contact with flying debris, or
by being directly affected by vibrations of the earth or concussions of the air. Moderate
vibration and noise 2.25 miles away was no more than a usual incident of the ordinary
life of the community. It is the exceedingly nervous disposition of mink, rather than the
normal risks inherent in blasting, which must bear the responsibility for the loss here
sustained. The policy of law does not impose the rule of strict liability to protect against
harms incident to the pls extraordinary and unusual use of the land.
Plaintiffs Argument: The D business is classified as a ultra hazardous activity which
caused the injury to the P.
Defendants Argument: The consequences of mother mink killing their kittens as a result
of blasting some distance away do not lie within the extraordinary risk of the activity.
Use of the land is unusual in this case not foressable of blasting (here to cause was so
unexpected and unusual) * Slippery Slope open gate of litigation v. Policing
Rule: Nexus activity b/w injury
Golden v. Amory (1954) Acts of God/ unforeseeable (A hurricane caused floods damaging Ps
land)
Facts: Plaintiffs, real estate owners by the Chicopee River, brought a suit against the
defendants, owners of a hydroelectric plant in Ludlow. The Chicopee River overflowed
and damaged plaintiff's real estate after a hurricane, and they now assert that defendant
was negligence in its maintenance of the Alden Street dike.
Rule: The rule of strict liability for the escape of stored water does not apply where
the injuries results from an ACT OF GOD, which the owner has no reason to
anticipate.
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 The rule that "the person who for his own purposes brings on his lands and collects and
keeps there anything likely to do mischief if it escapes, must keep it in at his peril, and, if
he does not do so, is prima facie answerable for all the damage which is the natural
consequence of its escape," does not apply where the injury results from an act of
God that the owner had no reason to anticipate.
Sandy v. Bushey (1925) Contributory Negligence (not a defense in strict liablity); Horse-kicked
victim
Facts: Plaintiff was kicked by the defendant's horse and seriously injured. Plaintiff brings
this action to recover damages for such injuries.
Rule: The keeper of vicious domestic animal known to be dangerous cannot
interpose contributory negligence as a defense to relieve him of his strict liability as
an insurer.
Rule:"The fact must be established that the injury is attributable, not to the keeping of the
animal but to the injured party's unnecessarily and voluntarily putting himself in a way to
be hurt knowing the probable consequences of his act, so that he may fairly be deemed to
have brought the injury upon himself."
Chapter 15 Product Liability Rest. 3rd of Torts (Governs Product Liability)
Stict liability v. absolute liability (not correct b/c)
*Umbrella term for liability of manufacturer, seller or supplier of chattels, to one who
is not in privity of contract, who suffers physical harm caused by chattel.
Product Liability categories Contract, Negligence, Warranties, *Strict Liability under
Tort law
Strict Liability basis of liability for manufacturers of products, without negligence
and breach of warranty.
Strict liability is not absolute liability
Product liability (Defective)-Plaintiff's theory of recovery is that plaintiff was [injured]
[damaged] by a defect in a product which the defendant [made] [sold] [rented to (insert
lessee)]. In order to recover, plaintiff must establish that it is more likely true than not
true:
o that the product was defective;
o the product was defective when it left the possession of the defendant; and
o a defect in the product was a legal cause of the [injury] [damage].
402A Special Liability of Seller of Product for Physical Harm to User or Consumer
(1) One who sells any product in a defective condition unreasonably dangerous to the user or
consumer or to his property is subject to liability for physical harm thereby caused to the
ultimate user or consumer, or to his property, if
(a) the seller is engaged in the business of selling such a product, and
(b) it is expected to and does reach the user or consumer without substantial change in the
condition in which it is sold.
(2) The rule stated in Subsection (1) applies although
(a) the seller has exercised all possible care in the preparation and sale of his product, and
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(b) the user or consumer has not bought the product from or entered into any contractual
relation with the seller.
STRICT LIABILITY
Prima Facie Case
A. Absolute duty on the part of the defendant to make safe
B. Breach of that duty
C. Actual Cause
D. Proximate Cause
E. Damages
The terms unreasonably dangerous and defective are used interchangeably and
subject to differing definitions by different courts.
Restatement defines three different types of defects: manufacturing, design and
warning defects.
Manufacturing:
Occurs when a product departs from its intended design even though all
possible care was exercised in the preparation and marketing of the
product.
If the product emerges from manufacturing different and more dangerous
than the products made properly, it has manufactured defect.
Design:
Occurs when the foreseeable risks of harm posed by the product could
have been reduced or avoided by the adoption of a reasonable
alternative . . . and the omission of the alternative design renders the
product not reasonably safe.
When all products of a line are the same but have dangerous propensities,
they may be found to have a design defect.
2 WAYS to Prove Defect:
If P can show: 1) the product failed to perform safely as an
ordinary customer would have expected (D must anticipate
reasonable misuse) and
D could have made the product safe without serious impact
on the products price or utility
Scientifically Unforeseeable Risk: D will not be liable for dangerous not foreseeable at
the time of the making.
Unavoidable Unsafe products: Manufactures will not be held liable for some dangerous
products (knife) if the danger is apparent and there is no safer way to make the product.
The defect: must have existed when the product left Ds control. (this will be inferred if
the product moved through normal channels of distribution)
Warning Defects:
A product may be defective because of inadequate warnings or
instructions.
Liability based on foreseeability that proper instructions/labels would have
made the product safe to use.
There is no duty to warn about obvious or commonly known risks.
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Seller must also warn about injury due to product misuse. Key is whether
misuse was foreseeable.
Strict liability
For:
Surrogate Police foe safer products

Against:
Keep the goods of the market
Inhibit product development
Create unreasonable Tort Tax

*Legislative bodies have become involved in shaping the law

Evolution of Product liability (umbrella term): (can bring a product liability cause of action
under)
Negligence McPherson Case (P Retailer - Buick) P want to sue B (no privity K)
o Ct. stated that privty of K should be lessened and P can sue B, if the product is
defective and reaches the consumer should be remedied.
Warranties Implied or Expressed (Misrepresentation under Tort ), still viable theory
of recovery
Strict liability under Tort *Tested*- Negligence(4 part test) and warranties (is it expressed
or implied do you look the language, issues of notice such as limited time)
problematic - do not address the consumers
_____________________________
Test for Strict Liability Claim:
Public Policy:
Defenses
Warranty form of strict liability in tort action can be maintained for breach of
warranty without proof of either intentional representation or negligence for Expressed
and Implied.
Baxter v. Ford Motor Co., (1932) - (Express Warranty)
Facts: P bought Ford car form the dealer and glass chip hit P in his eye. Ford had claimed that
the glass used will not chip even under the hardest impact. Trial court did not allow advertising
to be admitted in evidence; said there was no privity of contract. P applied. Ford arguing that
since no privity, P cant recover based on breach of express warranty. But court said then when
you advertise the product to the general public, we are not going to let privity excuse you.
So P has to show that there was express warranty by D and P relied on it. P can recover on
breach of express warranty without proving privity.
Rule: Express Warranties: A manufacturer or retailer of a product is responsible in tort for all
representations upon which the consumer must rely, regardless of a contractual relationship b/w
P and D. (does not have to have privity of K). Manufacturer is strictly liable if making a false
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representation, only need to show that the representation was ad and that it was false, dont
need to show negligence.
Notes:
-One who makes a misrepresentation of material fact regarding the quality of goods is liable to
consumer if that consumer has relied on that representation.
-This case generally has been followed for express statements as to quality made in advertising,
on labels, in brochures or other literature accompanying the product, or documents supplied to be
transmitted to the ultimate buyer
-In most courts, the P is required to demonstrate reliance upon the representation, either in
making the purchase or using the product.
Henningsen v. Chrysler Corp. (1960)- (Implied Warranty -product was fit for an ordinary
purpose; not the use for which you purposed it but is w/in the realm of the area)
Facts: Ps husband purchased new car Chrysler from dealer. P was driving and steering wheel
spun in her hands causing her to veer and crash into a highway sign. Cant point to any defect
because car destroyed. P sued Bloomfield Motors, Inc. (defendant) to recover consequential
losses, joining his wife in a suit against Bloomfield and Chrysler theory was based on alleged
breach of an implied warranty of merchantability imposed by the Uniform Sales Act. The D
relied on a disclaimer of the warranty. Court ruled that P can recover based on breach of
implied warranty of merchantability even though she didnt directly K with D. The warranty
runs with the car. Also, the provision included in the purchase K not valid because adhesive K
and unconscionable. Why this case: Remember in Ryan the court said that need privity in order
to sue under breach of implied warranty of merchantability. An express warranty, which limits a
manufacturer's liability to replace defective parts, is void, as it is against public policy. Under the
law, breach of warranty against defective parts or workmanship which caused personal injuries
would entitle a buyer to damages even if due care were used in the manufacturing process.
Public Policy: Warranties to protect the ordinary consumer who cannot be expected to have the
knowledge or capacity or even the opportunity to make adequate inspection of mechanical
instrumentalities, like automobiles, and to decide for himself whether they are reasonably fit for
the designed purpose. The warranty before us is a standardized form designed for mass use
the gross inequality of bargaining position occupied by the consumer in the automobile
industry. The Court conclude that the disclaimer of an implied warranty of merchantability by the
dealer, as well as the attempted elimination of all obligations other than replacement of defective
parts, are violative of public policy and void. Rule: Implied Warranties:
When a manufacturer and a dealer put a new automobile in the stream of trade and promote its
purchase by the public, an implied warranty that is reasonably suitable for use as such
accompanies it into the hands of the ultimate purchaser, despite any contractual provisions to the
contrary.
Types of Implied Warranties to Product Liability:
1. Implied warranty of merchantabilityproduct is suitable for its ordinary (general) use.
The product will pass in ordinary stream of commerce without any objections.
2. Implied warranty of fitness for a particular purposeproduct is suitable for a specific
use designated by the user and put on the market for that use by the manufacturer. The main
distinction b/w fitness and merchantability is that the user must rely upon the makers
expertise with respect to the product being used for a particular purpose.
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Notes: Some states will allow a retailer to disallow the implied warranties of merchantability and
fitness, others do not. Also state legislatures are given three alternatives to choose from when
deciding whom the warranty provisions were intended to apply to:
a. A sellers warranty whether express or implied extends to any natural person who is in the
family or household of his buyer or who is a guest in his home if it is reasonable to expect
that such person may use, consume or be affected by the goods and who is injured in person
by breach of the warranty. May need to prove privity of K in this case.
b. A sellers warranty whether express or implied extends to any natural person who may
reasonably be expected to use, consume or be affected by the goods and who is injured in
person by the breach of warranty. Do not need to prove privity of K in this case.
c. A sellers warranty whether express or implied extends to any person who may reasonably be
expected to use, consume or be affected by the goods and who is injured by the breach of
warranty. Warranty will extend to all users and there is no limitation to just persons but also
to property damages.
Greenman v. Yuba Power Products, Inc. (1963),
Facts: Greenman was injured using a power drill. Plaintiff, Greenman, brought this action for
damages against defendant, Yuba Power Products, Inc, the manufacturer of a Shopsmith, a
combination power tool that could be used as a saw, drill, and wood lathe. After viewing a
demonstration and reading the brochure, Greenman used the lathe tool to create a chalice from a
piece of wood. As he was working the wood "suddenly flew out of the machine and struck him
on the forehead, inflicting serious injuries." He sued on the grounds of negligence and breach
of warranty. Greenman won, but more importantly, the Court reasoned that in the case of
defective products, the liability is not governed by the law of contract warranties, but by the
law of strict liability in torts. This was a radical departure from product liability, and led to the
modern strict liability standard. Restatement of Torts 402A, which said: 1) Sellers are
generally liable for physical injuries to persons or property without the need to prove fault. 2)
Privity rules are abolished; 3) Strict liability is enforced.
Rule: Strict Liability - when an article is placed on the market, knowing that the product will be
used without inspection for defects; the manufacturer will be strictly liable in tort for any injuries
caused by the defect in the product. Purpose of liability is for manufacturers to bear the costs.
Policy: Protection of the powerless P, not making the manufacturer as absolute insurer; p. 735
Test: p. 735 bottom comes later also Rest.2nd 402A (problem: defective
condition); not being superseded by Rest 3rd
o 3rd Rest. : defective condition:
Manufacturing defect Design defect
Warning inadequate instruction or warrning
Products Defects
Restatement 3rd: Product Defectiveness
1 Commercial Sellers Liability for Harm Caused by Defective Products
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a. One engaged in the business of selling products who sells a defective product is
subject to liability for harm to persons or property caused by the product defect.
b. A product is defective only if, at the time of sale, it contains a manufacturing defect,
is defective in design, or is defective b/c of inadequate instructions or warnings.
2 Categories of Product Defects: For purposes of determining liability under 1
a. Manufacturing DefectA product contains a manufacturing defect when the
product departs from its intended design even though all possible care was exercised
in the preparation and marketing of the product. (Strict liability is the standard)
b. Design DefectA product is defective in design when the foreseeable risks of harm
posed by the product could have been reduced by the adoption of a reasonable
alternative design by the seller or a predecessor in the commercial chain of
distribution and the omission of the alternative design renders the product not
reasonable safe. (Negligence is the standard)
c. A product is defective due to inadequate instructions or warnings when the
foreseeable risks of harm posed by the product could have been reduced by the
provision of reasonable instructions or warnings by the seller or a predecessor in the
commercial chain of distribution and the omission of instructions or warnings renders
the product not reasonably safe. (Negligence is the standard).
402A (2nd)

1.
2.
3.
4.

Restatement 3rd (majority)

You can recover if:

Defective product
Was used in a manner intended
P was injured as a result
Mfr had knowledge that the product
was to be used w/o inspection of
defects
Does not make mfr an insurer
Seller of prod in a defective
condition unreasonably dangerous to
seller/consumer is subject to liability
for physical harm to ultimate
user/consumer or his property if:
a. Seller is engaged in the business
of selling a product AND
b. It is expected to and does reach
the consumer w/o subst change
in the cond sold
Rule:
a. Even though seller exercised all
possible care in prep/sale of the
product AND
b. User/consumer didnt buy the
prod or K with seller
Law believes mfr has the ability to
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1Product Defectiveness
liability of commercial seller or
distributor for harm caused by
defective products
a. one engaged in the business of
selling or otherwise distributing
prod who sells or distributes a
defective prod is subj to L to
persons or property caused by
the defect
b. a prod is defective when at the
time of sale or distrib, it
contains a mfr defect, is
defective in design, or is
defective b/c of inadequate
instructions or warnings
2 definition of defects
a. Mfr. Defectprod departs from its
intended design even though all
possible care was exercised in the
preparation and mrktg of the
product
b. Design Defectwhen the 4Cable
risks of harm posed by the prod
could have been reduced or

4C some hazards
The ability to guard against them
The ability to insure against the
risk of injury and spread cost of risk
avoidance to customers

avoided by the adoption of a

reasonable alternative design by
seller, distributor or predecessor in
the commercial chain of
distribution, and the omission of
the alternative design renders the
product not unreasonably safe
c. Defect b/c of inadequate
instruction warningwhen
4Cable risks of harm posed by the
prod could have been reduced or
avoided by providing reasonable
instructions or warnings by the
seller, other distributor, or a
predecessor in the commercial
chain of distribution, and omission
of the instruction or warning
renders the prod unreasonably safe

A. Manufacturing Defects - Manufacturing Defect: A manufacturing defect (from Rix) is

an imperfection of the type that inevitably occurs in products of a given design as a result
of the fallibility of the manufacturing process, where the end result does not match the
design. One product is substantially different than what the design shows it should be
and it is different than all other like products.
Rix v. General Motors (1986) *Vehicle w/t defective breaks* - Strict liability for manf. defect
Facts: Plaintiff, Michael Rix, was injured when his pickup was hit from behind by a General
Motors Corporation two ton chassis-cab, which had been equipped with a water tank after sale
by the General Motors dealer. Rix brought suit against General Motors on a theory of strict
liability. The district court's jury verdict found for General Motors and Rix appeals.
Rule: Manufacturer is strictly liable for manufacturing defects. A manufacturer is strictly
liable if it sells a products in a defective condition, unreasonably dangerous to the consumer and
it causes injury (causal connection b/w injury and product): Prima Facie Case*
1. D has to be the Manufacturing selling the product
2. Product must be defective when sold
3. It must be expected to and actually reach the consumer w/o
substantial change in the defective condition
4. Condition is the proximate cause of the injury
Reasoning: Defects come in 2 types, manufacturing and design The true strict liability exist
only in manufacturing defects. Defective design involves an analysis of possible alternatives
designs and a cost benefit analysis, thus, incorporates elements of negligence.
*Manufacturing defects occurs only in a few products, not the entire line of the product, can look
at the specification, lack of quality inspection, compare product w/t other product of the same
line
* Manf. Defect- p.742 (top)
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*Design defects
* Ct. adapted 402A instructions 10 &11 are mirroring the Restatement
B. Design Defects when the foreseeable risks of harm posed by the product could have
been reduced or avoided by the adoption of a reasonable alternative design by seller,
distributor, or predecessor in the commercial chain of distribution, and the omission of
the alternative design renders the product not unreasonable safe:
b. 3 basics tests for DD:
Consumer Expectation (OBrien)
1. Would the average reasonable consumer using the product be
aware of the risks inherent in the product?
Manufacturer Expectations
1. If the mfr knew of the defect causing harm to P would he have
been reasonable in introducing the prod into the stream of
commerce?
2. D can argue misuse of prod
Risk Utility Analysis
1. Looks like negligence but not quiteproves the cost efficiency
and the knowledge in the industry (making a product safer)
Prentis v. Yale Mfg (1984) (*defectively designed forklift) Pure Negligence
Facts: (P)John Prentis, fractured his hip in an accident while operating a hand-operated forklift
manufactured by defendant, Yale Manufacturing Company. "John Prentis and his wife, Helen,
brought suit alleging both negligence and breach of implied warranty, predicating defendant
manufacturer's liability upon the alleged defective design of the forklift. Although the trial judge
included both negligence and breach of warranty in his statement of plaintiffs' theory of the case
to the jury, he refused to give plaintiffs' requested instructions on breach of implied warranty. A
judgment for the defendant, upon a jury verdict of no cause of action, was reversed by the Court
of Appeals, which held that the trial court's failure to charge the jury as requested was reversible
error, mandating a new trial."
Rule: Liability for a defectively designed product shall be based on a pure negligence
analysis. In products liability actions against manufacturers of products, where liability is
predicated upon defective design, a pure negligence & risk utility test should be used.
Key: when talking about design defects, they should be analyzed by a negligence standard when
the risk of injury outweigh the costs of design
Risk utility test: we should mrkt only reasonably safe products and we determine this by
determining whether the utility outweighs the inherent risks (provided risk had been reduced to
the greatest extent possible).
*1) DESIGN Defect - Bring the principle of fault; 4 part test p. 745 * FOR the Final:
Majority Jurisdiction Reisk-Utility, 2nd most used is consumer expectation and the
Minority View combined both -Consumer-expectation and risk-utility.
Notes:
1, 2, and 5*
OBrien v. Muskin Group (1983) *Injured Diver a pool design defect*
Facts: Mr. Henry bought a Muskin pool and assembled it in his backyard. It was 20 x 24 x 4 ft.
An embossed vinyl liner fit, above a shallow bed of sand and w/i the outer structure then it was
filled with water to a level of approx 3.5 ft. The outer wall bore the manufacturers logo and a
13

decal that warned DO NOT DIVE in one inch letters. Obrien arrived uninvited and dove into the
pool either from the platform or the adjacent garage roof. His outstretched hands hit the vinyl
lined pool bottom, slid apart, and he struck his head on the bottom of the pool.
Rule: P bears the burden that the prod was defective using a risk utility analysis: *P must show:
1) D must be Manufacture or the seller, retailer or distributor of the product
2) Product was defective (1. Manufacturer compare with other products on the line; 2.
design risk utility and the consumer expectation; 3. Warranties - )
3) Defect was present when product left mfrs hand
4) Defect caused the injury to a reasonably foreseeable user
o Both Actual cause and the legal cause of the injury
o Preponderances of the evidence 51-49% more likely than not
Manufacturer has a duty to warn foreseeable users of the risks inherent, and not placing defect
products on the market.
Rationale: Risk-Utility analysis is appropriate when the product may function satisfactorily
under one set of circumstances, yet b/c of its design present undue risk of injury to the user in
another situation. The existence of a safer and equally efficacious design diminishes the
justification for using a challenged design. It was not necessary for the P to prove the existence
of alternative, safer designs. Even if no other alternative methods of making bottoms for above
ground pools the jury might have found the risk posed by the pool outweighed its utility. To
establish a prima facie case the Pl should adduce sufficient evidence on the R/U factors to
establish a defect. Risk/utility factors: p. 753 TEST one alone is not enough
1. Utility of product to the general public and to the specific user
2. The likelihood it will cause injury
3. Potential for designing a safer product that is functional/rzbly
priced
4. Availability of a safer design
5. P's ability to avoid harm by safer use of the product
6. The degree of awareness of the products danger which can be
attributed to D
7. Feasibility if spreading the loss by setting the price of the product
or carrying liability insurance.
*Mfrs ability to spread cost related improving safety design.
SEE the Notes for the Test
1. risk utility balancing test for design defect
2. consumer expectation test for design defect
3. reasonable alternative design
5. state of the art
6. open and obvious danger
7. applicability to prescription drugs and medical devices reluctant to apply strict liability b/c
of the new product that could be beneficial to the society
8. Applicability of food
C. Warning Defects - defect due to inadequate instruction/warning when the 4Cable
risks of harm posed by the product could have been reduced or avoided by providing
reasonable instructions or warnings by the seller, other distributor, or a predecessor in the
14

commercial chain of distribution, and omission of the instruction or warning renders the
product unrzbly safe.
Manufacturer owns duty to warn (product can be made safe by wirings)
o Knowledge (of the danger) under strict liability law, Cal. Ct. Yes
the knowledge can be actual and constructive (not having a complete
knowledge, but there are some evidence and indications). (Ex: prior
history reveal )
Continues duty to warn (can be ongoing)
State of the art of the evidence to demonstrate level of knowledge or no
knowledge only at the time available
Adequacy and sufficiency of the warning 1) looked at the warring does it get
the user attention ; 2) Does the language of the warning provides the proper notice
what the hazardous; 3) Does the warranty show and provides how to use the
product properly

P wants ct to use a standard which says D should have known the prod was dangerous
and should have warned
o Looks at state of the art
o Says D can prove that a given risk was neither known or knowable by the relevant
scientific knowledge available at the time of mfr/distribpart of the SPL analysis
o WD can be under negligence or PL
o D can argue that risks werent knowable or known at the time

Anderson v. Owens-Corning Fiberglass (1991) *Asbestos exposure failure to warn*

Facts: Anderson (P) claims to have contracted asbestosis and other lung ailments through
exposure to asbestos while working as an electrician. Owens-Corning (D), an asbestos
manufacturer, sought to admit state of the art evidence regarding the knowability of the risks of
asbestos exposure at the time of the distribution.
Rule: Knowability is a required element of strict liability for failure to warn. SL was
adopted to insure that the costs of injuries resulting from defective products were borne by the
manufacturer. However, SL was not intended to make manufacturers absolutely liable for all
injuries. Admission of state of the art evidence regarding the knowability of risks does infuse
neg. concepts into SL cases by focusing on the actions of the manufacturer. In a failure to warn
theory of SL, knowability of the risk according to the state of the art evidence at the time of
distribution is relevant.
Notes: In warnings cases, most courts still apply a fault-based standard by requiring the P to
show that the manu knew or should have known of the risks that injured P.
Often a case involves claims based both on defective design and inadequate warnings.
a. Obvious DangersMost jurisdictions have found no duty to warn of obvious dangers (i.e.
manu of pointed darts not warning that the point could injure an eye). One reason for not
always requiring warnings is that the proliferation of warnings in obvious danger situations
might dilute the impact of necessary warnings.
b. Sophisticated UsersMost jurisdictions employ some form of the sophisticated user defense
in failure to warn cases.
15

c. Presumption that Warning will be read and heededin most jurisdictions, the P is entitled to
a presumption that the user would have read and heeded an adequate warning, but that
presumption is rebuttable.
d. Adequacy of WarningThe determination of whether the warning was adequate is usually
left to the jury who in turn relies on expert testimony. Warning put on a product needs to at
least disclose the risks that are involved with the use. Despite the fact that a warning is on a
package, if advertising minimize the harmful nature of a product, then one might be able to
show that the ads diluted the effectiveness of the label warning and thus the warning is not
enough.
e. Learned Intermediary RuleIn cases involving drugs, a key issue often is whether the
pharmaceutical manufacturer should provide its warnings to the prescribing Dr. or directly to
the patient. Most courts say should be provided to the Dr., who is a learned intermediary
and is the best person to understand the patients needs and assess the risks and benefits of a
particular course of treatment. But many jurisdictions do not apply this rule in cases where
the manu is aware that there will be no medical provider to provide the learned advice or
where the patient is directly responsible for taking an active role in the selection of the
product.///sufficient warnings that must be provided to the doctors this doctrine does not
apply outside of the pharmaceutical industry
The learned intermediary rule also arises in cases involving harm from products used at the
workplace. The manu can escape liability by giving a warning to the employer. Exceptions:

f.

g.
h.
i.

1. If manu knows that employer will not pass the warning along to employees, then must
provide a warning
2. Or if it is known that employer is ignorant to the risks involved, then manu must give
warning to the employees.
3. Goods sold in bulknormally with bulk items, no warning is necessary b/c there is no
place to put the warning, but a distinction is made when bulk items are sold in some form
of packaging.
Factual Adjudication ApproachLook to a case by case basis of the facts to see if liability
should be cut off. Some courts use this approach the learned intermediary rule. Some
conditions include:
1. Seriousness or risk.
2. Magnitude of harm
3. Ease or difficulty of giving warning
4. Probability of giving warning.
Post Sale Duty to WarnIn addition to the duty to provide warnings at the time a product is
marketed, some courts impose a duty on the manu to provide post-sale warnings about risks
that are discovered after the sale.
Presumption that the warning will be read and heeded
Post- Sale Duty to warn and recall

Proof

Circumstantial evidence no product but evidence that could prove what

caused, evidence surrounding the accident
Actual/Direct evidence bring the actual defective product, eye witnesses,
expert witnesses
16

Friedman v. General Motors (1975) * Car ignition system defective*

Facts: Friedman (P) was injured when he started his car and it unexpectedly leapt forward; in an
action against the cars manufacturer, P was unable to present direct evidence that the ignition
system was defectively designed.
Rule: A product defect may be proved by circumstantial evidence, where a preponderance of
that evidence establishes that an accident was caused by a defect and not other possibilities,
although not all other possibilities need be eliminated.
*Five Ways to Prove Defect:
1. P might introduce evidence by an expert based upon an examination of the product in
question following the happening of the damaging event. Expert evidence would be direct
evidence of an identifiable defect.
2. There may simply be evidence of a damaging event occurring in the course of or following
use of a product, whether by the testimony of the user or otherwise.
3. A P may add to #2 with expert evidence that the most likely probable cause was attributable
to a defect in the product being used at the time.
4. In addition to evidence of an accident and the probable cause of such accident, evidence
could be introduced to negate the existence of probable cause no attributable to the maker.
5. In some cases, the physical evidence of the actual condition of the product after the accident
would be such that a layman could infer that it was defective.
Notes: Lay out the elements of product liability.
1.
a.
b.
c.
d.

P must be prepared to show:

That the product that injured him was in fact manufactured by the D.
That the product was the cause in fact of his injury.
That the product was defective and he was injured as a result.
That the defect existed in the product or was incipiently in it when the particular D sold it.

2. Res Ipsa LoquiturStrictly speaking, since negligence is not in question, RIL has no
application to a SL case, but the inferences that are at the core of RIL doctrine are no less
applicable to Strict Liability.
3. Rule on excluding evidence of product improvements to prove defectMost courts preclude
P from introducing this evidence, but some will admit it if the underlying theory of liability is
SL rather than negligence.
4. The most convincing evidence is a direct showing of what went wrong.
5. One of Ps hurdles is tracing the defect back into the hands of the D. Lapse of time and long
continued use will not prevent this if there is clear proof of an original defect. In most
jurisdictions, there is no strict cut off of liability.
6. When the defect arises after purchase, P is confronted with another facet of the problem of
establishing that the product was defective or unreasonably unsafe.
7. Information about public health and safety issues must be developed during discovery.
Defenses
A. Plaintiffs Conduct: Affirmative defenses raised by the D. If not raised, then considered
waived. Also D must plead and prove these facts.
Attack on the Prime Facie Case:
o 1. Technical defenses alteration of 3rd party (not fait to the manufacturer)
17

o 2. Comparative fault- to allow to product liability, only 5 jurisdiction continue to

use the *Contributory Negligence voluntary assumption of risk absolute bar
to recover(knew, able to appreciate the risk, and put himself in harm)
Contributory Negligence:
1% no recovery complete bar for recovery when assumption of risk is
voluntary (knew, able to appreciate the risk, and put himself in harm)
Last clear chance doctrine
Comparative fault (45 jurisdiction adapted this principle) P recovery
reduced to his own fault
o 3. Proper use of the product if is not use as it is designed, foreseeable misuse
Daly v. General Motors Corp (1978) *Door latch defect*
Facts: Daly (P), whose decedent was killed in a car accident, alleged that a defective door latch
caused the death, while GM (D) attributed the death to the drivers failure to use a shoulder
harness and his intoxication.
Rule: A Ps recovery in strict products liability action may be reduced according to the extent
to which his injury resulted from his own lack of reasonable care. This case says that the
principles of comparative negligence can be applicable to actions brought under the theory of
strict product liability.
Categories/Exceptions:
If the Ps act was the failure to discover the defect in the product, then most courts will not
reduce Ps recovery.
a. If Ps alleged negligent act is failure to use safety measuresthis will be sufficient to reduce
Ps recovery (failure to use reasonable care to protect oneself).
b. Intentional Assumption of RiskP voluntarily confronts a known risk or hazard, in many
cases this will either reduce or bar recovery altogether.
c. Misuse of productIf it is foreseeable, then manufacturer of product must take steps to fix
the possibility. If misuse is foreseeable, then manu must take steps to protect against the
misuse.
Ford Motor v. Matthews (1974) *P killed as run over by his tractor*
Facts: Matthews Ford (D) tractor was not supposed to start in gear; while standing alongside it,
Matthews turned on the ignition while the tractor was in gear, it started and ran over Matthews,
killing him. P argued that safety switch was defective and allowed the tractor to start in gear. D
contended on appeal that P standing along the tractor while in gear was a misuse of the product.
Rule: A manufacturer is free from liability for misuse of his product only when such use is not
reasonably foreseeable. Ford could certainly foresee that the tractor may be cranked while in
gear, especially if the victim was aware of the purpose of the safety switch. Ford is strictly
liable. There is in strict liability a clear extension of the trend and willingness to leave the matter
of foreseeable misuse to the jury.
A seller is generally entitled to expect that his clear and understandable directions and
instructions for use will be followed, and when they are not the use becomes an abnormal one.
Notes
-

When P uses a product in a manner unintended by the manufacturer, courts often treat
this as matter of defense.
18

Evidence of misuse or alteration could be use as a defense that the product was not
defective; Also that any defect in the product did not caused the Ps injury (no causation);
Ps conduct should reduce the recovery (affirmative defense of cooperative fault);
Manufacturer is not subject ti liability for unforessable abnormal use of the product;

Application of Comparative FaultA comparative fault principle may be also applied in the
foreseeable misuse cases.
Chapter 21 Misrepresentation
I.
Introduction
Misrepresentation- false statement of facts
Policy design to protect from reliance upon false information (in business contest or
personal)
Misrepresentation in business transactions the classic form is fraud (intentional
misrepresentation)
Misrepresentation is a distinct cause of action, associated with common law action of
deceit.
Classic form of misrepresentation of deceit and fraud
The law of misrepresentation normally protects economic interests and parameters of
liability; intangible pecuniary loss
Misrepresentation is very complex field due to the existence of the numerous
alternative remedies, including:
o Tort action of deceit
o Action for Breach of Contract when the representation is found to be
expressed or implied term of the contract itself.
o Negligence Misrepresentation or misstatement for tangible injuries to the
person or property results, where damages is only financial loss.
o An equity action to rescind the transaction equitable lien or constructive trust
o An action for restitution for P to recover back or unjust enrichment
Prima Facie Case for Misrepresentation TestPublic PolicyDefenses History
Action of deceit has its origin in the old writ of deceit now known as malicious
prosecution later superseded by writ on the case which became general common
law remedy for misrepresentation, whether fraudulent or not, resulted in actual
damages. Entirely used for direct transaction b/w P&D, where tort and contract were not
clearly distinguished.
Caveat emptor let the buyer be aware was the rule. (buyer could garner protection
from the seller)
In the case Pasley v. Freeman misrepresentation to extend to third person and the
action of deceit was recognized as purely tort action. # breach of warranty
contract action.
19

In the 19th century - Deceit was established as the basis for tortuous liability and deceit
required an actual intention to cheat.

II.
Concealment and Nondisclosure:
Swinton v. Whitinsville Savings Bank (1942) Fraudulent Concealment (house invested w/t
termites).
Facts: Swinton (P) purchased a house from Bank (D) which was infested with termites. D knew
of the termites and did not disclose this info to P nor were they asked for any such info by P.
Rule: There is no liability for bare nondisclosure.
Reasoning: Court reasoned that if the seller has a duty to disclose info that decreases the value
of property, then the next step would be for the buyer to disclose info of something that increases
the value of the property. These issues can be dealt with in K law rather than tort.
No disclosure There is no duty to disclose one way around this is for the purchaser to inquire about
problems then seller would have a duty to disclose truthful.
Concealment mere failure to reveal smtg not requested no duty to disclose
RULE 1: in an arms-length rship (equal footage), one has no duty to
disclose defects effecting value.
RULE 2: Absent a fiduciary rship b/w the parties to a transaction,
concealment of material facts does not give rise to the tort of misrep.
Fid rship = special rship of trust and confidence b/w the
parties which imposes certain legal duties one to the other.
You always have to establish first that there was a duty to disclose (if so,
nonfeasance)
If you cant show that, then you have to show that there was an active
misrepresentation that caused me to rely (misfeasance).
Notes
1. Rules modifying the harshness of nondisclosure:
a. Ct. liberal attitude when recession of K is sought or other equitable relief
b. D liable for nondisclosure if parties are in a confidential or fiduciary relation to
one another reliance upon good faith and full disclosure is justified.
c. Certain type of Ks suretyship, guaranty, joint venture, or insurance, create
confidential relation require full and fair disclosure of all material facts.
2. Active Concealment may constitute an act sufficient to base liability.
Misrepresentation false statement or concealment of fact
Modern trend in regards to termites or any latent defects on the condition of the property
disclosure is required (esp. that there are aware, but not visible to the buyer). IL Statute
requires disclosure.
Griffith v. Byers Construction (1973) Nondisclosure, Fraud, Implied warranties (landscape
impossible due to high saline soil)
Facts: Purchasers (P) of new homes in tract, sued developer (D) of home sites when they
discovered that their lots, b/c of high saline content, could not be landscaped; the homes had
been bought not from the developer (D), but from the building contractor.
20

Rule: Where a vendor has knowledge of a defect in property which is not within the fair and
reasonable reach of the vendee and which he could not discover by the exercise of reasonable
diligence, the silence and failure of the vendor to disclose the defect in the property constitutes
actionable fraudulent concealment. The concealment here was also material and thus the lack of
strict privity is immaterial.
i. RULE 1: FM doesnt require privity of K b/w represent OR and
represent EE (extending privity); purchases are the intended
beneficiaries
ii. RULE 2: failure to disclose material fact known to ROR, and not
discoverable to REE (makes it latent defect) is sufficient to establish
misrepresentation.
iii.
Seller breached the implied warrantyMisrepresentation Test: Fraudulent or Negligent Misrepresentation
1. A false representation or statement/concealment/ material factis so important your outcome would have been different
2. Made to P or 3rd parties
3. With intent to induce to
4. P relies on the re
5. P relies on his pecuniary(actual economic loss) detriment
*Swinton and Griffith closely related to deceit. With deceit, must show intent.
The majority of courts also hold that there is little corresponding tendency to require the buyer of
property to disclose to the seller special info that he has acquired that enhances its value.
III.

Basis of Liability:
(A)To the Recipient:

Derry v. Peek (1889) Deceit and Fraudulent Misrepresentation (P induced to invest in share in
the company)
Facts: Derry (D) issued a prospectus, representing their company as authorized by the Board of
Trade to use the steam or other mechanical power. Peek (P) had purchased shares in Derrys (D)
tramway company, relying on the statement that further savings will be acquired from this
technological innovation; however, the steam use was refused by the board of trade.
Rule: An action in deceit will not lie for a false representation made with an honest belief in its
truth. For Deceit, must have: Proof of Fraud (intent to deceive) and also have a statement:
1. Made with knowledge of the false statement.
2. Made without belief in its truth
3. Made recklessly, careless whether it is true or false.
Reasoning: Belief in a false statements truth, as D, always defeats an allegation of fraud. The
alleged belief in a false statement can be tested by examining whether the belief had a reasonable
ground. The application of reasonable man standard will permit a way to assess witnesss state
of mind. This is more closely related to negligenceno intent to deceivehad an honest belief
in their representations, even though they were false.
*Deceit is the worse type of misrepresentation but also have negligent misrepresentation. Deceit
will subject one to punitive damages, but not negligence.

21

If the Ds belief is unreasonable, it may be strong evidence that it does not in fact exist, and that
conclusion may be reached by an inference of fact.
Bad motive, as distinguished from intent to mislead, is not essential to the tort of deceit.
Negligent Misrepresentation = Innocent Misrepresentation
Fraudulent Misrepresentation Test
1. Knowledge
2. Scienter aware of the falsity of the statement
3. Made to P or 3rd parties
4. With intent to induce to
5. P relies on the representation
6. P relies on his pecuniary(actual economic loss) detriment

Defense to misrepresentation reasonable standard

Notes
5 Rest. 526 Fraudulent Misrepresentation
International Products v. Erie RR (1927) Negligent Misrepresentation
Facts: International (P), an importer, insured its imported goods, relying on Eries (D)
misinformation that they were located at dock F; the goods were later destroyed by fire at Dock
D and the insurance company would not cover b/c of misdescription.
Rule: An action for damages for neg. misrep will lie where the speaker owes a duty to give
correct info.
The duty stems from the business relationship and thus a duty exists, if one speaks at all, to give
the correct info.
**Note that even if a duty has been breached, P must still prove that, given competent advice, on
the balance of probabilities, he would have secured effective insurance to cover the loss.
To Determine if a Duty Exist, There Must be Knowledge That:
1. The info is desired for a serious purpose.
2. That the person to whom it is given intends to rely and act upon it.
3. That if false or erroneous, he will be injured in person or property.
In cases of personal injury, the courts have been more liberal in allowing recovery for neg.
misrepresentation.
A substantial number of US courts have extended the neg. action from tangible injuries to
pecuniary loss, and have allowed recovery in such an action.
*Negligence Misrepresentation is made in pursuant to a business relationship, in violation of
obligation owed, upon which the P relied on his detriment.
Notes
1. Minority of American Ct. hold that action for deceit itself will lie for negligent
misrepresentation resulting in pecuniary damages. Either fault of negligent D =of D
intend to deceive OR duty to learn that facts = knowledge of their existence.
Notes
English law for misrepresentation only recognized fraudulent misrepresentation
Relationship certain contracts, business relationships, fiduciary relationship
Negligence Misrepresentation
22

1. Duty (negligence accrued or communicated)

Winter v. GP Putnams (1991) Product liability, Negligence and False misrepresentation
(Mushroom eater)
Facts: Winter (P) relied on a book on mushrooms published by Putnam (D) and became
critically ill after eating poisonous mushrooms.
Rule: Strict product liability is not applicable to the expressions contained within a book.
Product liability is geared towards tangible objects. Copyright, libel, and misrepresentation laws
govern the expression of ideas.
Also there is a strong 1st Amd right for exchange of ideas. And the court stated that since the
publisher is not a guarantor of the accuracy of an authors statements, an action for neg.
misrepresentation could not be maintained.
- No duty owed by the publisher : 1) 1st Amendment; 2)
Negligence Misrepresentation
- Failure to warn under strict liability claim the book (product) the court disagreed
- Falsity is required (not in this case)
Notes
1. p. 1039 Rest. 2nd 311 Negligent Misrepresentation Involving Risk of Physical Harm
(1)One who negligently gives false information to another is subject to liability for physical
harm caused by action taken by the other in reasonable reliance upon such information,
where such harm results
(a) to the other, or (b) to such third persons as the actor should expect to be put in peril by the
action taken.
Comment b. The rule is not limited to information given in a business or professional capacity, or
to those engaged in a business or profession. It extends to any person who, in the course of an
activity which is in furtherance of his own interests, undertakes to give information to another,
and knows or should realize that the safety of the person of others may depend upon the accuracy
of the information.
Hanberry v. Hearst Corp. (1969) Negligent Misrepresentation (slipper and unsafe shoes)
Facts: The plaintiff (Hanberry) bought shoes made by Hearst (D) that bore the Good
Housekeeping Seal of Approval and was injured. She sued Hearst (Good Housekeeping) alleging
that the shoes were dangerously slippery and that Hearst had guaranteed the shoes when it
published its approval of them.
Rule: A party, who endorses a product for its own economic gain, and for the purposes of
inducing the public to buy it, may be liable to purchases who, relying on the endorsement,
purchase the product and are injured by it.
Notes
1. Defective shoes
2. Consumer Housekeeping seal implied is that some investigation was done here
failure to inspect properly.
3. Contractual relationship
4. Public Policy benefited from the advertisement

23

RE-Cap
Prima Facie Case for Misrepresentation
1. A False Representation/Concealment material factor
2. Fraud (scienter knowledge NOT INTENT) or Negligence (imposing a duty to
disclose truthfully; fiduciary relationships, certain type of law; The way is
communicated and ascertained) 2 torts Fault
3. To P or 3rd party - to induce
4. P relies
5. To Ps pecuniary detriment
6. Actions are justified?*
Richard v. Waldman and Sons (1967) False Misrepresentation No fraudulent
Misrepresentation
Facts: Real estate developer (D) innocently misrepresented to purchaser of lot that structure on
lot was in accordance with local zoning regulations. At the closing date for a real estate
transaction, Developer (D) prepared a pilot plans and construct a house w/t garage for P. This
plan showed a side yard of 20 feet as required by zoning law. The issued certificate was based on
Ds survey. Later, P had discovered that the actual side yard that he purchased was less than 3
feet away from his neighbor boundary and the house location was in violation of zoning law. D
claimed that a misrepresentation was innocently made. Trial court found that D
representation was false and reckless and P relied on the misrepresentations, which were
mistaken but not innocent. P was awarded the difference b/w the actual value and its valued had
been represented.
Rule: An innocent misrepresentation may be actionable if the declarant has the means of
knowing, ought to know, or has the duty of knowing, the truth. YES This is a minority opinion.
Reasoning: Misrepresentation here was in nature of warranty- entitling the P to recover for
breach of warranty.
Innocent misrepresentation = negligence.
Innocent misrepresentation is analogous to strict liability.
Majority rule: No liability for innocent misrepresentation in a Tort claim, but would still have
one in K law.
Notes:
- Minority view point Note 3. Rest. 552C
- Here, Misrepresentation as a defense to a contract to rescind
- Not on the TEST- innocent misrepresentation

(B)To Third Persons

Credit Alliance Corp. v. Arthur Andersen (1985) Negligence Misrepresentation *Privity is still
required in negligence*
Facts: Andersen (D) contended it could not be found liable for negligently preparing financial
statements relied upon by Credit Alliance (P), as they lacked privity. D the accountant
prepared various finical reports outlining the financial situation of L.B Smith, P Credit Alliance
which lent money to Smith based on such a reports. P sued D contending that the reports were
negligently prepared. On appeal, the Ct. no evidence that D prepared the reports for specific
purpose NO duty of care is owned, and no recovery may be held.
24

Rule: Accountants may be liable to persons not in privity for negligently preparing financial
reports if:
a. The accountants knew that the financial reports were to be used for a particular
purpose or purposes;
b. in furtherance of which a known party of parties was intended to rely; and
c. there was some conduct on the part of the accountants linking them to that party or
parties, which would show that they understood the party or parties reliance. Basically
there must be some type of meeting of parties.
This case uses the approach of near privity (if all the above are met) than there is approaching
privity. This is better than strict privity, but is still narrow in scope.
Notes
-

Ultramares Case Cardozo indefinite liability concerns with opening the gates for a lot
of suits; Traditional View liability of an accounting (privity) or relationships of
approaching privity. * These rules apply to any professional in general*

Citizens Bank v. Timm, Schimidt (1983) WI

Facts: Timm (D) contended that Citizens (P) could not recover from them as accountants b/c no
privity existed when the reports which P relied were negligently prepared. D certified public
accountants, prepared audit reports for Clinton Fire Apparatus, Inc. The report negligently failed
to accurately reflect the CAFs financial position. Prior to discovering the problem P relied upon
the reports in lending CFA money. After, the errors were reviled, CFA went bankrupt. P sue D for
the recovery of the outstanding balance on the CFA debt.
Rule: Accountants may be held liable for the negligent preparation of audit reports to a 3rd party
not in privity who relies on the report. The main issue is that it is reasonably foreseeable that a
3rd party would use reports to gauge a companys financial condition preparatory to lending
money. (Public Policy)
This case uses the Reasonably Foreseeable Test to broaden the scope. Court wants to broaden
the scope to deter bad behavior and hold down the cost of credit to the public.
Reasoning: 3rd party must be able to rely upon financial statements in order to facilitate
commerce. It is reasonably foreseeable that a 3rd party would use the report to find out the
companys finical position before lending. THUS, whether the harm was reasonably
foreseeable was a factual question.
Notes
-

Public Policy anyone who is injured should be able to recover

Ultrameras -Privity Traditional App. Majority View
Rest. 552 (2)(a) approach limited a group of people who can be foreseeable
Moderate App.
WI New rule anyone will be allow to sue + public policy = Minority view

Ultamares Corp v. Touche, Nivens & Co.(1931) Fraud

25

Facts: In reliance upon an audit of Fred Stern prepared by Touche (D), Ultamares (P) made
several loans to Fred Stern. The audit showed Stern to be worth $1M when the company was
actually insolvent.
Rule: Negligent words are not actionable unless they are uttered directly, with knowledge or
notice that they will be acted on, to one to whom the speaker is bound by some relation of duty,
arising out of public calling, K, or otherwise. This case uses straight privity of contract.
Notes: TO 3rd Party:
- Fraud (scienter/knowledge) the accountants were aware that the statements were false.
(Cardozo different view in regards to fraudulent misrepresentation than )
- Reasonable accountant could not have just closed their eyes without investigation
this is gross negligence creating an inference of knowledge thus rises to fraudulent
misrepresentations. When the negligence is bad rises to a level that an inference of
knowledge. (negligence =with inference of knowledge moves into the area of fraud)
Approaches to Liability to 3rd Parties:
1. Near-PrivityMust be knowledge of reliance by a person for a specific purpose. Person =
particular person or small class of persons. Also requires a meeting or some conduct linking
the parties.
2. Restatement Restriction 552(2)aLiability is limited to loss suffered:
By the person or limited group of persons for whose benefit and guidance the actor intends to
supply the info or knows the recipient intends to supply it.
Through reliance upon it in a transaction that the actor intends the info to influence or knows
the recipient so intends or in a substantially similar transaction.
There is no conduct act requirement in the R2d linking the parties.
3. Reasonably Foreseeable Test3rd party must be able to rely upon financial statements in
order to facilitate commerce. Look to the relationship of the parties to determine
foreseeability. The main issue is that it is reasonably foreseeable that a 3rd party would rely
upon a report in making decisions as to the party.
Reliance must be justified and reasonable
Williams v. Rank & Son Buick(1969)
Facts: Williams (P) bought what he thought was an air-conditioned car from Rank (D). He was
allowed to test drive the car for 1- hours. Later, he found it was not air-conditioned.
Rule: A P cannot recover for misrepresentation unless his reliance upon the misrepresentation
was justifiable. Courts will refuse to act for the relief of one claiming to have been misled by
anothers statements, who had opportunity, by the exercise of ordinary observation, to know of
their falsity.
Is there a duty to investigate? Unsure, but the ease of verification in this case led the court to say
no justifiable reliance. Contributory negligence can be used as a defense in misrepresentation
case, but never in a case of deceit.
The court says:
1. P has to rely
2. Reliance has to be justified or reasonable

26

Notes: A sellers assurance of repair reasonably precludes the necessity for an independent
inspection.
*MaterialityA statement must be material to a reasonable person unless D knows of a certain
idiosyncratic tendency of the P.
*Majority rule is that the P has no duty to investigate or inquire as to the truth of an apparently
reliable statement made to him.
Reliance must be reasonable/justified
- Obvious false representation
- Opinion
Opinion
Saxby v. Southern Land(1909) Statement of opinion
Facts: Saxby (P) contended that Southern (D) misrepresented the acreage of the farm he bought.
P stated that the 150acres of pine timber, 20 were burned, but it turn out that 60 were burned.
Rule: Actionable misrepresentation must be of an existing fact, not a statement of opinion.
Opinion is not substantial enough for one to reasonably rely upon. Only statements of fact will
induce a reasonable person to rely, and, thus, only misstatements of fact are actionable. Look to
p. 1056 #2 for some examples.
Notes
- Facts dont have to be proven, belief , loose, vague and general, indefiniteness
- If an opinion is unreasonable to relined on it.
- Professional or experts opinions (specialized knowledge) is reasonable to rely on this
- Future predictions not reliable either
Vulcan Metals v. Simmons(1918)
Facts: Simmons (D) sold vacuum cleaner manufacturing machines to Vulcan (P) claiming that
they were perfect and that the vacuum cleaners had never been marketed before. D contended
that his stalemates were mere opinion.
Rule: There is a certain amount of puffing up allowed. This is the statement that the cleaners
were perfectalso called dealers talk, trying to make a sell and no sensible man will take
comment seriously.
The more specific the allegation, the more likely that it will be relied on the thus be actionable
for negligent misrepresentation. Expression that cleaners had never been on market was relied
upon and a matter of fact, so it is actionable.
Notes
- Specific type of opinion trade talk or puffing- that are part of our culture
- The parties in this case on the same grounds business people
Law
Sorenson v. Gardner(1959) matter of law or opinion
Facts: Gardner (D) made false representations about the code violation status of a house which
Sorenson (P) was buying. D presented to P that the house met all code requirements, with rep. to
27

electric wiring, plumbing septic tanks, and sewage disposal provided to be false. D contended
that these statements were matter of law or opinion
Rule: If a representation as to a matter of law is a representation of fact, the recipient is entitled
to rely upon it to the same extent as if it were a representation of any other fact; and, an action
for deceit will lie if it proves to be false. D has knowledge of underlying facts concerning
electricity, plumbing, etc. and so his misrepresentation should be actionable. Would not be
actionable if he did not have the underlying knowledge.
*Also, representations as to the law of another state are treated as statements of fact, upon which
the P may justifiably rely.
Reasoning: Misrepresentation based upon law made by a lay person is unreliable # in case of
professionals (attorney only in this case/ builder layperson): two rationales: 1. everyone knows
about the law or 2. no one knows the law
Prediction and Intention
McElrath v. Electric Investment(1911) future facts
Facts: Electric (D) induced McElrath (P) to lease property on assurances that an electric car line
would be constructed on it.
Rule: Negligent misrepresentation or deceit must be based on an existing (present or past)
fact, not on a prediction of a future fact. However, if one can show that D intended to create the
impression that the intended future act is a present fact in the mind of some party then it is
actionable.
Notes:
-

Burgdorfer v. Thielemann(1936)
Facts: Thielemann (D) induced Burgdorfer (P) to transfer a lot upon which there was a mortgage
to him, partially on the promise to pay off that mortgage.
Rule: Deceit requires a misstatement of an existing fact, but the promise to do something, with
the present intent to do the contrary is as clear a case of misrepresentation or fraud as can be
made, and the proof of such fraud will not be precluded by the SOF.
*There must be a misstatement of an existing fact; but the state of a mans mind is as much a fact
as the state of his digestion. A misrepresentation as to the state of a mans mind is, therefore, a
misstatement of fact.
Notes:
-the intent or the state of the persons mind can be a fact in case of misrepresentation
Possible Advantages of the Action in Deceit over a Contract Action for Breach of the Promise
Itself:
1.
Deceit action may avoid the statute of frauds.
2.
It may avoid the difficulties of the parol evidence rule, preventing any promise not
integrated into a written K from being regarded as a part of the K.
3.
It may avoid the defense that the promise was without consideration.
4.
It may avoid the defense that the K was an illegal one.

28

5.

It may avoid the defense of the statute of limitations, since a longer period may be
applicable in the deceit action, or the statute may run only from the Ps discovery of the
fraud.
It may avoid a limitation of liability contained in the K itself.
It may avoid a defense against the K action, such as infancy.
It may avoid the necessity of joining parties to a joint K in one action.

6.
7.
8.

Damages must suffer pecuniary loss

Hinkle v. Rockville Motors(1971) breach of warranty and misrepresentation
Facts: Rockville (D) sold, as a new car, a vehicle which had been previously wrecked.
Rule: A defrauded P should be allowed to claim out-of-pocket expenses. P may also be able to
sue for benefit of his bargain.
Two Element of Damages for Misrepresentation:
Tort Recovery Out of Pocket Expenses = What paid for the item Value of what received.
Contract Law Benefit of Bargain Loss = Value of what promised Value of what received.
Notes:
- Tangible evidence to establish the amount
- Witnesses (Experts)
- P has the burden to demonstrate damage
- Differential = the
- Benefit of the Bargain Rule under K. Law is available under fraud representation
- Value of
- Price Actually Paid Actual Value = Out of Pocket Expenses
- Value Represented Actual Value =Benefit of the Bargain Rule (7000 3000 = 4000)will yield more $$ than Out of Pocket
Chapter 17 Defamation
Defamation Test:
1. False Statement (cannot be true)
2. False Statement Of the P or concerning P
3. Publication to communicated to somebody other than the P
4. Damage- injury to reputation*importation* (loss of esteem in the eyes of the public)

Defamation is a matter of fact (Mainly)

Protected Interest of Reputation Loss v. Pecuniary Loss
Classic Forms of Defamation:
o Oral Slander
o Written Libel
History
At Common Law:
-Libel per se its a presumed the injured occurred (actionable without proof of damages and
injury)
-Slander special monetary damages must be shown (b/c of the potential of future harm)
29

Nature of a Defamatory Communication:

Belli v. Orlando Daily Newspapers (1967) Label (orally) and Slander (false or malicious
publication that is injurious to someones reputation)
Facts: A newspaper printed a false story that Belli (P) had charged to his hotel bill and that this
had to be paid for by the local bar association. This is an action for libel and slander. P -wellknown attorney, agreed to aid a local bar association in exchange for his hotel bills. 9 years later,
this story was relayed to a local gossip columnist. It was embellished to include allegations that
P had charged numerous items of clothing to his hotel bill and had taken the local bar association
which had to pay the entire bill. This info was false but it was published by newspaper (D),
which failed to verify the story. The Ct. dismissed on the basis that had not diminished Ps
reputation and was not defamatory.
Rule: If a statement may be interpreted in defamatory and non-defamatory manner, it is the
province of the jury to determine which one the general public would have taken.
Reasoning: The question should have been submitted to the jury b/c the statements were
susceptible to two different interpretations.
Things to get from this case:
1. Court makes the initial decision as to whether the statement is defamatory.
2. If it is legally nondefamatory, the court removes it from the jury.
3. If it is susceptible to two meanings, one defamatory and one not, the jury must decide the
issue.
4. The statement must be false.
5. The person must have no right to make the statement.
6. The statement must injure either the persons reputation or business.
Libel: A false and unprivileged publication (written statement) by letter or otherwise 1) which
exposes a person to distrust, hatred, contempt, or ridicule or 2) which has a tendency to injure
such person in his office, occupation, business or employment.
Libel per seone does not have to show special damages, it will be assumed.
Notes
-

Two different minings of words or content of the: defamatory and no defamatory

nature (loss of esteem in the eyes in the public) or (unambiguous on its face and its
not defamatory, the Ct. can dismiss it as a matter of law).
There is a roll for both Judge (Gate keeper look at the statement (on its face) to
determine if he finds it damnatory, as matter of law but if the statement has a dual
meaning then it must go to the jury) and Jury (must determine whether is
defamatory).

Grant v. Readers Digest Assn (1945) Libel

Facts: Readers Digest (D) printed in its publication an article which made reference to the fact
that Grant (P)-lawyer had been a legislative representative for the MA Communist Party. This is
a suit for libel. The digest was mainly red by judges and lawyers, and accused the P was has been
hired by a M. Communist party to act as its legislative agent.
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Rule: Libel consists of utterances that arouse hatred, contempt, scorn, obloquy, or shame in the
minds of the people whether or not those persons are right thinking people. It is defamatory as
a matter of law to say that a person is an agent of the communist party.
Reasoning: This case brings out the distinction between right thinking (political correct or law
abiding) and wrong thinking (politically correct or unlawful) persons. The libelous statement
does not have to bring out contempt in only right thinking persons (or even a majority of
persons), only that some people feel hatred or contempt towards the P because of the statement.
Liability is not a question of majority vote.
The issue is embedded in time, place and culture.
There must be an element of discredit or disgrace, even in the eyes of the particular segment of
the community.
Notes
-

Reasonable standard peers(jury)

Does not matter whether right or wrong thinking group (as long some people feel
hatred or thinks differently about you) *There must be an element of discredit or
disgrace even in the eyes of a particular community (Democrat v. Republican)
TEST: Pleading Defamation: When the meaning that defames the P is clear upon the face
of the words uttered, the cause of action is made out by pleading, and proving, the words
themselves and their communication to a third person. If the meaning is not clear upon the
face of the words, the task of the P is more difficult. In such a case the P must plead:

Prime Facie Case:

False Statement must be answered or The defamatory words. Ex: He burned down
his own barn
Of and Concern of P
o Colloquium -A formal allegation that the words were spoken of and
concerning P. (often obvious but also not) EX: He
Publication: communication of the words to a third person. (action word to
communicate false statement)
Injury to reputation
o The Inducementextrinsic facts, b/c of which the words were reasonably
understood to convey a meaning defaming the P. (EX: Insurance policy)
o The InnuendoAn allegation of the particular defamatory meaning conveyed by
the words. (An additional paragraph to tie it to the extrinsic facts, as an
explanation of this facts) EX: (Insurance Fraud). Connecting the dots. If it is not
defamatory on its face.
o Special damages when they are necessary to the cause of action.
1.
Both the colloquium and the innuendo must be reasonable in the light of the words
spoken and the facts pleaded in the inducement.
2.
At common law there has been general agreement that an action of defamation will lie
only if the statement is both defamatory and false. Even where true and thus not
actionable as defamation, a statement may support a cause of action for invasion of
privacy.
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Common law presumption of falsity (D at common law has the burden of proof the
statement is false until proven true).
Killian v. Doubleday & Co. (1951) Libel (print)
Facts: A book was published by Doubleday (D) which contained an article which claimed that
Killian (P), as commander of an army camp and hospital, had mistreated patients. The article
alleges that P has mastered patients and the P has been reprimanded and fined for his actions.
At trial, it was shown that the author was never at the hospital, but he was merely relating stories
he had heard. P won the suit b/c the specific statements were not substantially true.
Rule: To claim truth as a defense, it must be shown that the statements in the article were
substantially true, not that the other acts of a different nature occurred. It must be proven that
specific allegations that were made are substantially true. Other serious, but different, offenses
that occurred are not enough.
Notes:
-*Truth is an affirmative defense in a defamation suit. (P has to proof has failed the truth of
the statement )/Affirmative defense that has to be raised by the Defense otherwise will be lost.
-Repeating a story someone else has told you that is false can give an action for defamation.
-If a statement is accurate but intentionally misleading (as in a headline) an action for defamation
may lie.
-A P being libel proof (reputation so bad that he is not able to show that a statement worsened
his reputation) is no longer an applicable defense. It does not matter how bad the Ps reputation
is.
Notes
- Raises the 1st Defense is truth (if true not defamation, it could be privacy)
- 1. False Statement P must proof and Defense can raise Truth as Affirmative Defense
- 2. Of and concerning P colloquium
- 3. Publication - book
- 4. Injury to Reputation inducement and innuendo
- Substantial truth substantially similar one to occur (not 100% accuracy)
- Burdon of proof is on the D (must demonstrate truth) Defenses
-

Neiman-Marcus v. Lait (1952) Of and concerning the P

Facts: Lait (D) published a book in which he referred to NM models (P) and saleswomen (P) as
being call girls and which referred to NM salesmen (P) as fairies. There are 382 saleswomen, 25
salesmen and 9 models.
Rule: the size of the group matters since a statement about a large group would not give any
individual an action for libel. Where a group disparaged is a large one, absent circumstances
pointing to a particular P as the person defamed no individual member of the group has a cause
of action. Thus the saleswomen had no cause of action. However, where the group or class
libeled is small, and each and every member of the group or class is referred to, then any
individual member can sue. Thus the salesmen and models can sue individually.
Restatement of Torts 564 Applicability of Defamatory Communication to Plaintiff
A defamatory communication is made concerning the person to whom its recipient
correctly, or mistakenly but reasonably, understands that it was intended to refer.
There are exceptions to the large group theory. If can show that there is something
about the activities of the group that would make an allegation about the group seem true
(such as an allegation that all members of a football team take steroids) then an individual
32

in that group would have a cause of action. Also if there are extrinsic facts known by
the hearer of an allegations and that statement impunes the whole group, then may be
an action for an individual in that group.
**Some legislation was passed after WWII focused on group defamation directed at Jews,
African-Americans and Catholics among others. 1st Amend. jurisprudence has since undermined
the validity of such legislation.
**Any living person can be defamed (including child), no actionable defamation of the dead.
However if the defamation of the dead defames the living it may be actionable.
**Corporations can have no reputation in a personal sense and cannot be defamed. But a
corporation can maintain an action for defamation that casts an aspersion upon its honesty, credit,
efficiency, or other business character.
Notes
-2. Of and concern of P who allegation (colloquium) the larger the group- the harder is to
sue for defamation (not impossible, if you can tie it back to you); the smaller the group- can sue;
-# is important; Issues of Colloquium Of and the Concerning of P (must connect to P)
- LOOK at Note 3, 4, 5, 6 (only alive person can be defamed), 7 (corporation can be defamed its
reputation or good will)
- 25 people or less P able to prevail in defamation cases for groups (continues to be applied
today).
Bindrim v. Mitchell (1979) P Group Therapist & D Author, novelist
Facts: (P) alleged that he was defamed in a book written by Mitchell (D) even though Ds book
is a work of fiction and the character does not physically resemble the P. D- enrolled in a nude
therapy group, run by P and D claimed that she was only enrolled for therapeutic reasons, but
shortly after D published a book on the class. P sued for label, false reorientations of the P
Rule: The test of identification in a libel action is whether a reasonable person, viewing the
work, would identify the fictional character described as the P. Does not have to be the general
public, only needs to be someone who would know that the character was the P and only has to
be one person.
*A statement that says that this is a work of fiction and any similarity to existing persons was
unintended would not exonerate the D.
Reasoning: D set her defense that there were several distinctions b/w the character in her novel
and P; namely a physical appearance and professional degree held. The Ct. said that the test is
one of reasonable person would have indented that fictional character as that of the plaintiff.
Notes
-Of and concerning the P (Colloquium) - Reasonable people in the community think loose level of esteem injuries to reputation
(important)
Libel and Slander:

33

Libelconsists of the publication of defamatory matter by written or printed words, or by its

embodiment in physical form, or by any other form of communication which has the potentially
harmful qualities characteristic of written or printed words (like TV or radio programs).
Slanderconsists of the publication of defamatory matter by spoken words, transitory gestures,
or by any form of communication other than those stated above in libel.
The area of dissemination, the deliberate and premeditated character of its publication, and the
persistence of the defamation are factors to be considered in determining whether a publication is
libel rather than a slander.
p. 851 NB!
Shor v. Billingsley (1958) P defamed restaurateur & D Master of ceremonies
Billingsley (D), while acting as the master of ceremonies of a telecast show, made reference to
Shor (P) as being heavily in debt to everyone; this statement was made while the show was on
the air. These statements, along with pictures of P were telecasted. P sue for defamatory
statements
Rule: Defamation through the media of motion pictures, TV, or radio is considered libel, not
slander. (Although traditionally slander is tried like a liable); B/C the oral statement has the
potential to have a great effect (vast audience), thus it must be treated slander.
This rule of law is still good law, but it has been changed in most states by statute. Most of the
statutes, enacted under lobbying from broadcasting companies, provide that any broadcast
defamation is to be treated as slander, whether there is a script or not. This was done b/c in
slander the P has to prove damages.
Notes
-Defama Cast Statutes- over the airways or TV this rule is not longer applied (whether there
is a script or not) if treated as slander easer for the P; BUT state has chose and in their
statutes they made it harder for the plaintiff making it label. Majority of the States have
statutes is still good approach.
Terwilliger v. Wands (1858) Slander (special damages) injury to reputation
Facts: Wands (D) said that Terwilliger (P) was having sexual intercourse with a married woman.
P claims to have become ill and was unable to work after hearing of the reports circulated by D.
D told 3rd person that P was having sexual intercourse with married women, and that P would do
all he could to keep her husband at penitentiary, so that he could have access.
Rule: Words (Slander) which claim that a man is having extra-marital intercourse are not
actionable without a demonstration of special damages, since they do not disparage the mans
character or reputation.
Notes:
*When special damages must be pleaded and proved to make out a cause of action for slander,
the common law rule developed that the damages must be of a pecuniary character.
*When the cause of action is once made out, either as libel or slander per se or by proof of
special damages of a pecuniary nature, P may recover additional damages for his mental distress,
wounded feelings or humiliation.
*The original publisher is liable for damages due to a repetition that might have reasonably been
anticipated.
34

*The party repeating the defamation is himself liable for its publication, even though he states
the source.
* getting divorce and loss of job special (pecuniary damages)
- Special =$ Damages connection b/w injuries and actual pecuniary result of the false
statement Slander proof of special damages are required:
EXEPTION: Slander per seFour Categories: Are exceptions to the common rule and are
actionable w/o proof of special damages
1. Imputations of Major CrimesNo distinctions between the categories of felony or
misdemeanor; any crime involving moral turpitude conduct that is considered contrary to
the moral value.
2. Loathsome DiseaseThis is not extended and not used much in modern society. HIV falls
under; Herpes properly no (not fatal) does not have the same connotation. Excommunicated
by the society.
3. Business, Trade, Profession or OfficeIf the spoken words are likely to affect the P in his
business, trade, etc., the probability of some temporal damage is sufficiently obvious. The
exception was limited to defamation of a kind incompatible with the proper conduct of the
business itself.
4. Serious Sexual MisconductPrinciple application of this to date has been a charge
imputing unchastity to a woman (Common Law still in place) Did not apply to a man. BUT
Now 14th Amendment man can sue too. (equal opportunity).
Libel per se: A statement is defamatory on its face and the established rule at common law was
that it is not necessary to prove special damages in order to maintain an action for libel. Some
courts deviate from this rule, and many courts believe that all libel is libel per se.
(Presumed/without proof special damages).
Libel per quod: Some courts broke away from the above rule and assumed that if the statement
was not defamatory on its face, that they must be aware of the extrinsic or unstated facts and the
P must prove special damages and those extrinsic facts in order to have a cause of action. /On the
face are not injures to the reputation, but it requires extrinsic facts to prove.
Publication: to communicate the false statement to 3rd
a. Publication is a word of art in defamation cases. It does not mean printing, writing, or even
publicity, but merely communication of the defamatory words to some one other than the
person defamed.
b. Sometimes the court presumes that someone has read and understood the defamatory words.
c. Most courts have held that there is publication, although it may be privileged (such as
dictation to a stenographer); and when the words are in fact taken down, there is publication
of a libel. Some courts hold the opposite and say there is no publication when it is
privileged.
35

d. Most courts have held that there is publication when the communication is from one officer,
agent, or office on an organization to another.
e. For a communication to a 3rd party to be a publication, it must have been done intentionally
or by a negligent act.
f. If the defamatory matter is sent by D to P himself in a sealed letter, which is unexpectedly
opened and read by a 3rd person, there is no publication.
g. The postal service does not make a publication when it delivers a letter. However, there is a
publication when a telegraph company transmits a message or a 3rd party orally repeats a
message.
Economopoulos v. AG Pollard (1914)
Facts: P was told by agents of D that he had stolen a handkerchief. P was told this by the clerk
in English and it was later repeated to the P in Greek. There was no evidence that a 3rd party
heard the English conversation or understood the Greek conversation.
Rule: For a cause of defamation to lie there must be publication to 3rd parties of the defamatory
statement in such a manner so as to be understood by those hearing the statement. Person
hearing it it must be understand it.
Notes
- Someone other than the P has to understand it and no 3rd person communication (here only
an agent of the employer (floor manager)
- Statement repeated but no one heard it.
-

Carafano v. Metrosplash.com (2003)

Facts: Unknown person pretended to be an established actress and without her concetn, posted
sexually suggestive information to an online dating service under her identity on bogus
matchmaking profile for Masterson on Matchmaker.com, an online dating service. In the profile
the name Chase was used, along with her photograph and home address (even though home
addresses are not allowed under Matchmaker.com policies). The man also used a Yahoo! email
autoresponder in the profile to provide her physical address and telephone number in response to
queries. As a result, Masterson received several sexually harassing voice mail messages and a fax
which she found "highly threatening and sexually explicit" and "that also threatened her son." To
protect herself, Masterson fled her home, living in hotels and traveling with her son for several
months.
Rule: The immunity provision of the Communications Decency Act, 47 U.S.C. 230(c)(1)(CDA),
immunizes an interactive computer service (ICS) from liability for publishing false or
defamatory material if another part besides the ICS provides the objectable material.
Ogden v. Assn. of the US Army (1959)
Facts: this is an application of the Single Publication Rule. Book was originally published in
Nov. 1955, but the suit arises from a reprinting of the book in 1959. Issue is whether the
defamation occurred in 1955 or 1959 (b/c of the statute of limitations).
Rule: The publication of a book, periodical, or newspaper containing defamatory matter gives
rise to but one cause of action for libel, which accrues at the time of the original publication,
and the SOL runs from that date. BUT You can republish (then the Statute of Limitation starts run
from the republication).
Notes
36

Statute of Limitation one year, exertion toll the statue (mental incapacity, minor,
medical cases- no aware of medical condition.)
When the Injuries occur when the book is published but once republished the clock
starts again
Only one cause of action when one story published multiple times, BUT if you publish
a book or repeated that has the same content but with different title (multiple cause of
actions)

Basis of Liability
Theres a difference between primary publishers and secondary publishers. Even though
Grishams publisher did not write the words Grisham wrote, they are liable for the words that are
printed in his books.
Primary publishers are liable for the defamation in the book. Secondary publishers, like Square
books, are not liable unless a P can show they knew the content was false. All they did was sell
the book.
1. Early Law imposed strict liability for defamation; Later P had to prove not only that
it was defamed but that it was inspired by malice (ill will or desire to harm)
2. Newspaper or Book Publisher- does not qualify as a secondary publisher and it is subject
to strict liability even though it innocently took the defamatory materials from someone
else.
3. Communication Decency Act granted Immunity to ISPs computer serves only a
forum(for the most part, when they start putting themselves information on their website
then they are treated differently as info contentment provider and it is becoming a
publisher) secondary publishers. The fact that the publisher has no actual intention to
defame a particular individual or to injure anyone does not prevent recovery of
compensatory damages by one who connects him with the publication. Internet Site
prior to the Community Decency Act were not treated as secondary), POLYCY design
to promote the internet growth;
a. Yahoo.com , AOL Put the information on the on the web Then No more
immunity (and secondary publisher)
4. Secondary Publishersthere was one important exception (Only if they have
knowledge). A vendor or distributor of a newspaper, magazine or book is called a
secondary publisher and is not liable if he had no knowledge of libelous matter in the
publication and had no reason to be put on guard. /Vendors
5. Primary Publisher can be held liable
First Amendment Cause of Action
1. We cannot use only common law analysis:
a. Common Law Analysis
b. Constitution al Analysis: 1st Amendment Concern
i. P=Public Figure or Public Official
ii. D=Media (newspapers, magazines, internet)
iii. Matter of Public Concerns
37

1st Amd. Policies:

1. Promote Robust discussion running of Public Figure
2. Self Censorship
3. Breathing Space
NOTES:
U.S Constitution:
- Supremacy Clause Article VI, cl.2 if there is a dispute b/w state and the fed.
state stapes aside
- 1st Amendment freedom of speech
- 10th Amendment state powers, what is not stated in the Constitution is reserved to
the States, unless Congress enacts legislation
1St Amd. Analysis:
1. P public official or public figure & private person
2. D member of the media (1st Amd. Protection of the press) (TV, publishers,
broadcast, papers, magazines, internet, and radio station).
3. Does speech concern a matter of public concern (meaning)
New York Times v. Sullivan (1964) Public Official
Fact: New York Times (D) published a full-page ad critical of the manner which the
Montgomery, AL police, under Commissioner Sullivan (P), responded to civil rights
demonstrations. The ad contained several factual errors. P and 4 Ds and D media
Rule: A public official may not recover damages for a defamatory falsehood concerning his
official conduct unless he can prove that the statement was made with actual malice. The
Constriction requires actual malice. (Publisher knowing that it was false or with reckless
disregard of whether it was false or not).
Actual malice standard is used when: Public official is criticized about matter of public conduct.
Reasoning: wanted to combat the fear and timidity imposed upon those who would give voice to
pure criticism by any rule that would compel such a critic of official conduct to guarantee the
truth of all his factual assertions. Basically, the court is saying that a certain amount of falsehood
will be tolerated b/c of the actual malice rule in order for there to be 1st Amd. Rights and freedom
of the press. If criticism of a public official without actual malice without knowledge that is was
false and without reckless disregard of whether or not it was false it is protected by the
constitutional right of freedom of speech and press. This qualified privilege to publish
defamation of a public officer is not limited to comment or opinion, but extends as well to false
statement of a fact, providing that there is no actual malice.
NOTES
- Mater of Public concerns civil rights
- Colloquium problem (P was not specifically named in the NY article) can bring
inducements and extrinsic facts to tie the Police Department back to him.
- Public Official election, position has a prominent position in government,
substantial responsibility with control over the governmental affairs, policy making
positions
- Medial D NY newspaper
- Matters of Public Concern crimes, speech dealing with judicial proceedings,
upmost importance of public concern
38

Actual Malice
o 1st Amd. Policies:
- 1. Uninhibited robust and wide-opened debate on public issues (NY Times Case)
- 2. Self-Censorship (Gertz)
- 3. Breathing space essential for the fruitful exercise of speech (breathing space for
true speech on matter of public concern) (Gertz)
-1st Amd. Prohibits a public official from recovering damages for a defamation of false in
order to recover actual malice is required: false statement was made with reckless
disregard or with knowledge/ faulty/capable. (Sup. Ct. thinks that that this is sufficient to
police for the general public interest and protect the breathing space)
-Note # 6.
**The Plaintiff can only receive presumed damages (Ex. It was a restaurant owner and they
lost customers). You cant prove them, the P just alleges it.
-

Actual Malice, Burdens of Proof, and the Press:

St. Amant v. Thompson (1968) Reckless Disregard
Facts: In a televised political speech, St. Amant (D) read statements falsely charging Thompson
(P), a deputy sheriff, with criminal conduct relating to a union dispute.
Rule: There must be sufficient evidence to permit the conclusion that the D in fact entertained
serious doubts as to the truth of his publication. Publishing with such doubts shows reckless
disregard for truth or falsity and demonstrates actual malice.
Also the finder of fact must determine whether the publication was made in good faith. Bad faith
factors include:
1. Where a story is fabricated by the D.
2. Story is a product of his imagination.
3. Story is based wholly on an unverified anonymous telephone call.
4. Publishers allegations are so inherently improbable that only a reckless man would have put
them in circulation.
5. Recklessness can be found when there are obvious reasons to doubt the veracity of the
informant or the accuracy of his reports.
**Also, Reckless disregard is a subjective standardlook to what a person actually knew and
how they felt about the story, but it may also depend on what the facts are.
-This case added that actual malice has to be proved by clear and convincing evidence.
Notes:
-Reckless Disregard # than the Common law interoperation
-4 Elements: .
- Definition of Reckless Disregard - Entertains serious doubts of the falsity of the statements
Harte -Hanks Communications, Inc. v. Connaughton (1989)
Facts: During an election campaign, a newspaper ran a front-page story against candidate the
newspaper opposed. The story quoted a grant-jury witnesss testimony that one candidate tried to
bribe her and her sister to testify against a former official in the incumbent candidate.
39

Rule: In a defamation suit filed by a public figure, an appellate court must conduct a plenary
review of the entire record to confirm whether the plaintiff has shown that alleged defamatory
statements were made with a reckless disregard for the truth.
Notes
-p.886 The standard is subjective one reckless disregard high degree of awareness of falsity
of the statements
Evidence Required in Establishing Actual Malice:
- Common Law malice (is ill will, bad will) # that the 1st Amd.
- Malice is a to the judge and the court, not the jury - from preponderance of evidence it moves
to higher degree of clear and convicting evidence
- Newspapers motive for profit or to promote an opponents candidacy insufficient
Statements must be made with 1) knowledge of their falsity or reckless disregard for the truth
(e.g. entreating serious doubts; high degree of awareness of probable falsity)
-Question of actual malice is a question of law and the Standard of Review is de novo
- Clear and convincing evidence is required 75%
-Look the Chart to see whether the 1st Amd.
- NOTE 3 -Public Official - p.878 and 914 (down) who have or appear to have substantial
responsibility for or control over the conduct of governmental affairs
-No (Presumed Damagesactionable per se and no evidence were required for falsity) or
Punitive b/c potential of creating censorship (against 1st Adm.)
-Under Actual Malice Damages can be recovered Actual & Compensatory, Punitive
Damages
Re-Cap
- NY: 1st Amendment Actual Malice (knowledge or reckless of disregard = high
degree of awareness of falsity)
- 1. P =Public Official or Figure
- 2. D = media
- 3. Public Metter Concerns

Private Plaintiffs:
Gertz v. Robert Welch, Inc. (1974)
Facts: Robert Welch (D) published an article accusing Gertz (P) of being a communist in a
conspiracy against the police.
Rule: The standard of liability for a defamation which a publisher or broadcaster publishes about
a private individual is set by the states. The private defamation P must prove falsity or reckless
disregard for the truth to recover any damages other than compensation for actual injury. Fault
can be anything state sets up other than strict liability.
NOTES:
-Private Figure 1) should be treated different than public figures , not voluntary injected into
the public life; 2) private figure do not have the avenue to publicly defend themselves 3) need
more protection
- Public Figure 2 categories Universal (for all practical are universal
actresses, athletes, prominent families or household names) and Limited (the most popular):
40

Voluntary thrust voluntarily oneself in public controversy and with the goal to changing the
outcome and Involuntary- caught up in the mist of controversy;
- Public Controversy see the notes on p. 900
-Lower standard moves from fault negligence
- New York - Actual Malice (Higher Standard) OR Negligence (Lower Standard) Gertz (only 2
standards)
-Mere Failure to verify the sources, or witnesses back ground (may be able to establish
negligence but not enough actual malice
- Objective Standard (reasonable person)
-State Interest to protect its citizens (not public person)
-Criminal/Judicial (trial) is a matter of Public Concern
- Entertain Serious Doubts -???
-Punitive Damages are recoverable, only if actual malice Public Figure
- Private Figure, can only recover punitive if actual knowledge and reckless disregard is
proven
- Note 2 p. 900 Private P some level of fault is required (at least negligence and the state
can go beyond; the gov. can give more but cannot go lower )
- LOOK NOTES after Gertz
Public Figures and Public Officials:
Public OfficialsPersons who have, or appear to the public to have, substantial responsibility
for or control over the conduct of govt affairs.
Public FiguresCan be either limited figures or universal (unlimited) figures.
**The NY Times rule for public officials has been extended to apply to public figures and also
to any matter of public or general interest. Public Figure includes:
UniversalAn individual who may achieve such pervasive fame or notoriety that he becomes
public figure for all purposes.
LimitedIndividual voluntarily injects himself or is drawn into a particular public controversy
and thereby becomes a public figure for a limited range of issues.
Public ControversyMere public interest is not enough. The issue must be one publicly
debated with foreseeable and substantial ramifications for nonparticipants. Then the issue is to
identify whether the Ps role is such that he is a limited public figure in the context of that
controversy.
Why Different Standards for Public v. Private Figures?
Private individuals dont have the same access to the media to defend themselves.
Public figure has but themselves in the position and can expect some mistruth to be said about
them.
Private individual deserves more protection from the states.
Gertz seems to indicate that strict liability for defamation is unconstitutional.
The NY Times standard is not strictly limited to suits brought against media defendants.
DamagesActual damages can include impairment of reputation and standing in the
community; personal humiliation; mental anguish; and pain & suffering.
41

Burden of Proof: P must show actual malice by clear and convincing evidence so that a
reasonable man will come to a conclusion right away. This is a higher burden that is close to
beyond a reasonable doubt and is much higher than just preponderance of the evidence.
What happens on Summary Judgment? If clear and convincing evidence is the burden of proof
at the trial, then it is also the burden at the summary judgment stage.
Moving Party (usually the D in a defamation case) asks to dismiss b/c a) statement is true, b) no
actual malice, or c) no actual injuries occurred.
No genuine issue of material fact.
P then counters:
There is a genuine issue of fact b/c there are disputes as to what was said or what the facts are.
Rebut allegation that D is entitled to JML by showing that if jury were to believe Ps witnesses
regarding the evidence and construe the evidence in light most favorable to the P, then rational
persons could differ and the case should go to the jury.
Private Information:
Dun & Bradstreet v. Greenmoss Builders (1985)
Facts: Dun (D) contended that Greenmoss (P) could not recover for libel without a showing of
actual malice. D mistakenly sent a false credit report about P out to some creditors, they later
fixed the problem and sent out a retraction.
Rule: Recovery may be obtained for libel without a showing of actual malice when the
statements do not involve a matter of public concern. Fault can be either negligence or strict
liability.
Falsity: If falsity is an element of Ps case Burden of Proof is on P to show that the statement
is false.
Notes
-

Private P
Non Media D
Private Metter

The Ct. does not

care for actual
actual

Notes
-Private P, No Media D, and No Public concern NO 1st Amendment Concern
- No Const. Matter not ???
- Matter of Public Concern whether speech addresses a matter if public concern must
determine by the expression content form and context . Test
Content the nature/ subject matter (credit report of private report)
Form credit report generally private document
Context who is the speech directed to (# of people recipient of the speech,
commercial v. non-commercial speech)
Falsity
42

Philadelphia Newspapers v. Hepps (1986)

Facts: The TC held that the burden of proving the truth of allegations that Hepps (P) was
connected to the Mafia fell on Philadelphia (D).
Rule: A P may not recover damages for defamation w/o showing the statements are false.
Since the statements made were of public concern the court says that the B of P should fall on P.
Notes
- Private P, Media D (get some 1st Amd protection), Public Concern
Opinion: whether it gets its own category (NO SUFFCIENT separate Category) OR it
should fall already itself ?
Milkovich v. Lorain Journal Co. (1990)
Facts: Diadiun (D) wrote a sports column implying that Milkovich (P), a wrestling coach, had
lied under oath at a judicial hearing.
Rule: Expressions of opinion that imply an assertion of objective fact may be the basis of a libel
action. There is no exception for opinioncan still sue for defamation even though it was
professed as an opinion. Must look to see if there are enough facts, and if there are, one can sue
for defamation if the statements were false.
But, if the statement is false, but so outrageous that no one will believe it, then there is no action
for defamation.
Fair CommentAffords legal immunity for the honest expression of opinion on matters of
legitimate public interest when based upon a true or privileged statement of fact.
Notes
-Option can assert facts (sufficient as defense to defamation)
- Public Figure (wrestling coach that has risen)
Privileges:
Privilege to make false statements about someone that are defamatory and that may be
made with ill will or malice and not be held liable for the statements

A. Absolute Privilege:
1. Judicial PrivilegeJudge and attorneys have absolute immunity for defamatory words
published in the course of judicial proceedings. But statement must be related to the
subject matter being discussed. Pleadings and witnesses are also protected.
2. Legislative ProceedingsSimilar privilege is applied to members of Congress and state
legislatures in the performance of their legislative functions. But statement must be
related to the business of the legislature. Also applies to hearings of the leg. body and to
witnesses testifying at those hearings.
3. Federal Public OfficialsAbsolute immunity from suit for defamation as long as
publication took place within the scope of the officials office or employment.
4. State Public OfficialsAlso have absolute immunity in the discharge of their official
duties.
43

B. Conditional or Qualified Privilege: A person can lose privilege if they go outside of the
scope of their immunity.
Defenses:
1. Truth - sustainable truth ()
2Opinion (exception if are assertion of fact)Milkovish (opinion can be rooted in facts, but
generally it would not be considered deformation; NO 1st Amendment protection of opinionso not separate category)
3Privilege policy decision made by jurisdiction for protection for higher societal goal
(allow you to make defamatory statement for the common societal benefit):
a. Absolute Pass cannot be sued (judicial proceedings (except when is directly
related to the judicial/Judicila preceding) and legislative matters)see abovespeech must have some reasonable bearing upon or related to the subject of
inquiry; defamation must be related to the subject matter
b. Conditional as long as does not abuse the privilege (EX: employer reference)
c. occasions - warn certain type of protection
SEE NOTES after NY Common Law
1. Fair Comment: at C/L prior to NY the court had developed (without refrence tot the
constitution ) p.877
2.
Reporter Privilege: a privilege that exempted a defendant from liability if his/her report
was verbatim or fair .
Notes p. 923/924
1. Legislative Privileges
2. Privileges of witnesses
3. Administrative Agency Privileges
4. Legislative Privileges

Sindorf v. Jacron Sales Co. (1975)

Facts: An officer of Jacron Sales (D) called Sindorfs (P) new employer and advised them that P
might be a thief.
Rule: A conditional privilege may be lost where the person who utters the defamation acts with
malice or in utter disregard of the truth.
Rule: p. 927/928 Ds immunity for false statement is absolute, without to his purpose or motive,
or the reasonable of his conduct.
Rule: The condition attached to all such qualified is that they must be exercises in a reasonable
manner and for a proper purpose.
Rule: Because a conditional or qualified privilege is conditional in a reasonable manner and for a
proper purpose to communicate, it is defensible.
Rule: Abuse of privilege all circumstance are admissible, including the Ds reasonable belief in
the truth of his statement, excessive nature of the language used, whether the disclosures were

44

unsolicited, and whether the communication was made in a proper manner and only to proper
parties.
Look Note 8 p. 931-D cannot claim a qualified privilege if he knows that his defamation
statement is false or does not believe it to be true.
Forms:
1. Communications between an ex-employer and the new one are conditionally privileged if
conducted for a legitimate business or social purpose. In determining whether privilege
should be granted, weight is given to the question of whether the info was requested by the
recipient or was volunteered.
2. A person has a qualified privilege to make defamatory statements in a reasonable effort to
recover goods stolen from him, to collect money due him, to protest against the
mismanagement of a concern in which he has financial interest, to protect his own business
against unfair competition, or to defend any other legitimate interest.
3. The existence of a common interest between the publisher and the recipient gives rise to a
privilege to speak regarding the common interest.
4. Commercial credit agencies (Dun & Bradstreet) are sometimes denied any privilege at all.
5. Courts agree that a D cannot claim a qualified privilege if he knows that his defamatory
statement is false or does not believe it to be true.
6. A D may successfully rely on the privilege even though he was aware that the statement was
false and the privilege is controlled by these restrictions:
a. Reporters PrivilegeThis privilege is to report public proceedings, public records and
official acts. The restriction is that the report must be accurate and fair or disinterested.
b. Privilege to Provide Means of PublicationWhen the author of the defamatory utterance
is in fact privileged to publish it, those who provide him with the appropriate means of
publication are likewise privileged.
c. Fair CommentAllows the publisher to offer criticism on matters of public concern
including activities of public officials and figures and on subjects scientific, artistic,
literary, and dramatic.
Remedies:
Common LawLibel does not have to show special damages. You do for slander except slander
per se.
1. DamagesCan get damages if show the standard that applies, i.e. reckless or negligent (NY
Times and Gertz).
See Chart AbovePunitive Damages = Actual Malice; Actual Injuries = Negligence standard
from Gertz.
Common Law
2. MitigationProvocation by the P is regarded as admissible for the purpose of mitigating
punitive damages. The reputation of the D can mitigate damages (libel proof). Incremental
Harm is similar to being libel proof, but may states and the SC do not follow this theory.
Nominal DamagesGertz held that P cannot recover unless he proves actual injury. If he
proves statement is both defamatory and false but does not prove actual injury, may courts
are allowing the recover of nominal damages to vindicate his name.
3. Libel- Proof Plaintiff
45

4. Ps Bad Reputation (reduction of recovery)

5. Nominal Damages sufficient
6. Declaratory ReliefPurpose is to obtain a judicial determination that the statement about
the P is false, and thus to vindicate his reputation and to make him whole as far as the law
can.
7. Self Help1st line of defense is to go to the press. Also use available opportunities to
contradict the lie or correct the error and thereby minimize its adverse impact or reputation.
8. Right of Response StatutesSeveral states have passed these which state that the media
must give a right of response to a person who claims that he has been defamed by the media.
Retraction StatutesThe retraction by the media must be unequivocal and not partial or
hesitant and hypothetical. If the media retracts in this manner, then there can be no claim for
punitive damages, but there may be a claim for actual injury. Self-help (not always available
to private citizens v. public figure)
9. Injunctive ReliefPrior restraint of a publication runs afoul of the 1st Amd. However,
injunctive relief may become a suitable supplement to other relief when the court determines
that a statement is both defamatory and false, and the D persists in continuing to publish it.
10. RestitutionIn a sense, this makes the media give you the profits that are made from the
false publication.
Chapter 18: Privacy:
Basically privacy differs from defamation in that it is designed to protect ones right to be left
alone (rather than designed to protect ones reputation).
Right to Privacy:
-protection against interferences with ones right to be let alone
Four Types of Invasion of Privacy: (## Const. Law of Privacy is different)
1. Commercial Appropriation of Ones Name or Likeness (right of publicity)
2. Intrusion into Ones Seclusion
3. Public Disclosure about Private Facts that Are Highly Offensive to a Reasonable Person
and Are not of Legitimate Concern to the Public. (offensive act)
4. False Light Invasion of Privacy (publicity that places another in false light)
4 Types of Privacy:
1.
2.
3.
4.

False Light (publicity that palaces another in a false light)

Appropriation (another name and likeness) Public Disclosure/Private Facts (offensive facts)
Intrusion (unreasonable intrusion upon section of another)

Prima Facie Case for Right of Privacy

1. Ds used the Ps name or likeliness (does the P have to have a values to her name?)
a. Right to Privacy (appropriation)- should be sufficient to protect against
typical 1) tort injuries, compensatory injuries, as well as pecuniary value
46

(such as humiliation, emotional distress and embracement) & 2)

Financial/Monitory Damages
i. Once you die the rights dies with you -Common Law
b. Right to Publicity- (some jurisdiction to add an additional protection to a
really valuable name (athletes ) and enacts specific statutes) Statutory
Cause of Action
i. The rights services after your death if the name has value
ii. Has been broaden to include, also identity (voice)
2. Use of Ps name and likeliness for the Ds own purposes or benefit, commercially
3. P suffered damages
4. Ds cause the damages incurred
Privacy is not absolute can be trump by other rights (1st and 4th amendment)
Dickerson & Associates v. Dittmar Appropriation
Facts: A private investigator published an article about and photograph of a convicted felon in
newsletter the investigator used to promote its service.
p. 948 Public Concern- Commission of crime, prosecution resulting from it, and judicial
proceedings
Rule: A claim for invasion for privacy by appropriation in Colorado does not require proof of the
value of the Ps name and likeness, and appropriation claim will not lie against a self
promotional article on another persons felony conviction where the Ds assert a 1st Amendment
privilege.
Notes
-Rest 652 (of privacy)
- no economic value to the Ps name
- Is common law of appropriation to recover for special damages (may be not fully sufficient to
protect; if your name has no value or the tort appropriation the right expire when you die)BUT
the right to publicity (does not expire after your death the family members can continue to
assert; it could be licensed; and should protect the economic interest) (via statues/ that have
value to their name)
- Defense 1st Amd. Privilege Matter of Public Concern see p. 948 a legitimate defense
(10th Amend. )
-Appropriation tort the protected interest
Prima Facie Case:
1. Ps used the name and likeness
2. D Used Ps name and likeness was used for the Ds own purpose
3. Ps suffered damages (Damages: 1) General Damages pain emotional and 2) Special
Damages -economic damages, value of her name, loss of job )
4. Ds caused the damages incurred.
Notes
3. advertising, . Commercial appropriation
4. Right to Publicity
Sanders v. American Broadcasting Companies, Inc.
47

Intrusion - - into private place, conversation or matter (physical or non-physical); unlawful

entering on to or the taking of possession of anothers property
Facts: A television journalist posed as telepsychic and uses a hidden video camera and
microphone to do an uncovered story on a business that gave psychic reading to people who
called the companys 900 number.
Rule: An employee has a limited expectation of privacy in conversations at his workplace
against reporters secret videotaping even if coworkers could have seen or heard the
conversations.
Elements of Intrusion: 1) intrusion into place, conversation, or matter that is private; 2)
intrusion must highly offence a reasonable person.
p. 955 -Elements of Intrusion
1. Intrusion into a private palace, conversation or matter - is not met when the plaintiff has
merely been observed, or even photographed or recorded, in a public place. (Ibid.) Rather, "the
plaintiff must show the defendant penetrated some zone of physical or sensory privacy
surrounding, or obtained unwanted access to data about, the plaintiff. The tort is proven only if
the plaintiff had an objectively reasonable expectation of seclusion or solitude in the place,
conversation or data source."
NO IF the sphere one in which the P has a reasonable expectation of privacy?
2. In a manner highly offensive to a reasonable person
Note:
-

Expectation of privacy in law of intrusion does not have to be absolute or complete

Expectation of privacy in the work place (cubicals) privacy has to flexible not
complete or absolute;
Intrusion physical or non-physical

Hall v. Post - Public Disclosure/Facts

Facts: A biological mother returned to the county where she had abandoned her daughter
seventy years before. The local newspaper ran stories on the mothers search and on the
subsequent contact b/w the biological mother and the girls adoptive mother.
Rule: A P cannot sue for invasion of privacy by public disclose of private facts in NC.
-see Handout:
Public Disclosure of Private Facts liability will be imposed for publication of private facts
when the matter publicized is of kind that a) would be highly offensive to a reasonable person,
and b) is not of legitimate concern to the public (Sec. 652 D)
1. Private Facts (facts that are not already available to the public (public records,
documents)
2. There must be a publication of the facts
3. Disclosure of the facts must be highly offensive to a reasonable person
4. The private facts must not be of legitimate public concern (criminal activity,
criminal records, judicial proceedings)
Notes: SEE p. 955
- Rest. 2nd Torts: recognizes a tort for public disclosure of private facts has 4 elements:
- 1) publicity not only one or two people need more (as soon as there is intrusion no
need of publication)
48

2) private facts if public (if P tells someone/or if it is publicits not already in the
public record, cannot sue)
3) offensiveness
4) illegitimate public concern

False Light
Protected Interest: protection against publicity that places the P in a false light (negative light)
in the eyes of the public (protection of reputation)
Elements:
1. Statements, comments, implications about of esteem or respect in the eyes of the public
(false or true)
2. Publication (made to public)
3. Placing Plaintiff in a negative light (loss of esteem or respect) in the eyes of the public
4. NY Actual Malice if the matter, the comments, or implications, ect. Pertain to matter of
legitimate public concern
Cantrell v. Forest City Publishing Co.
Fact: D a reporter did a follow-up story on the effects of a bridge collapse on the survivors of
those who had died.
Rule: A reckless disregard of the truth will expose a publisher to liability in an action for
invasion of privacy.
Notes:
Hustler Magazine v. Falwell
Facts: Falwell (P) contended that he could recover for emotional distress caused by Hustler (D)
cartoon, even though actual malice had not been shown.
Rule: Public figures may not recover for inflection of emotional distress due to an alleged
defamatory act unless actual malice is shown. (actual malice an issuance of a publication with
knowedge of its falsity or with reckless disregard as to its truth).
CHAPTER 20: MISUSE OF LEGAL PROCEDURE

Malicious Procession:
Civil action
Criminal Action
Protected Interest: The tort protects against the wrongful prosecution of criminal
proceedings. POLICY:
o Protection of the individual citizen against unjustifiable and oppressive ligation
of criminal charges (which involve not only pecuniary loss, but also distress and
loss of reputation)
o Freedom form unjustifiable litigation balanced against the social interest of
encouragement to use the legal system to resolve disputes

49

B. 653 Elements of a Cause of Action

A private person who initiates or procures the institution of criminal proceedings against
another who is not guilty of the offense charged is subject to liability for malicious
prosecution if:
(a) he initiates or procures the proceedings without probable cause and primarily for a
purpose other than that of bringing an offender to justice, and
(b) the proceedings have terminated in favor of the accused.
Examples:
Store guard had P prosecuted for shoplifting when there is no reasonable evidence to
suggest that the P was guilty
Merchant procreates the P for fraud, simply because the Ps check was dishonored by the
bank (hot check statute)
Employer prosecutes the P in the unjustified belief that P was stealing the employers
goods.
A. Criminal Proceedings
1. The original P (in the) initiates or procures the institution of criminal proceedings
against another who is not guilty of the offense charged; (2 actions someone sue
you and the actions is dismissed; then second law suit for the malicious prosecution)
see 1005
2. There has been a termination of the proceedings in favor of the accused (e.g. P was
not guilty of the crime and suit was terminated in Ps favor)
3. A lack of probable cause (e.g. the P initiates or procures the proceedings without the
probable cause) lack of evidence that would support a reasonable believe
4. The P acts with malice in initiating or procuring the legal proceedings against the D;
Common Law Malice- a little different P actions are based on something other than
to bring the D to justice; process to harass the D
5. The P must have suffered injuries as a result of the wrongful actions (e.g. the
prosecution) D in the original case that is now a P; damages can be presumed
(even if you cannot bring evidence of damages)
B. Civil Proceedings
1. Elements: Elements are the same for both criminal and civil prosecussions. The
major difference involves the element of damages.
2. In malicious civil prosecution actions, damages are not presumed and must be
proven. P must plead and prove special injury.
C. Defenses
1. The facts the P (i.e. person accused is guilty of the crime charged against him is
complete defense against liability for malicious precision)
2. Rationale: the law only protects the innocent, and if guilty, the P deserves the
treatment complaint of. Also, the action is analogous to defamation and the burden of
proof (i.e. not guilty) is on the D.
D. First Amendment Concerns
1. Will the constitutional limitations on speech imposed by the Supreme Ct. in libel
Cases also apply to malicious prosecution claims involving public P and matters of P
concern?
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2. The malicious prosecution claim involves a defamatory communication (e.g. the

charge of crime and injury to reputation)
Theories of Malicious Civil Prosecution:
Negligence on behalf of attorneyattn owes no duty of care to an adverse party. This does not
mean that an attn is free to act negligently towards P, he must have a reasonable belief that there
are facts and law to support a lawsuit.
Malicious Civil Prosecution Elements are similar to Criminal:
a.
b.
c.
d.

Prior proceedings terminated in favor of the present P.

Absence of probable cause for those proceedings.
Malice
Must show Special Injury (English Rule) such as to ones reputation or an arrest and
seizure. Some jurisdictions follow the American rule and do not require showing of
special injury.

Texas Skaggs v. Graves

Facts: Skaggs (D) contended that it was not liable to Graves (P) for malicious prosecution b/c
the criminal charge did not adequately terminate in her favor, there was sufficient probable cause
to bring charges, and no malice was shown. Court found for P.
Rule: In order to establish a charge of action for malicious prosecution, a favorable termination
of the underlying action must be shown, as well as probable cause to rising the action and
malice.
Note
- Note 6. p.1010 damages jury discretion will be given; emotional distress, attorney
fees, and humiliation and other mental damages:
- Civil damages special of special damages will be required $$ loss must be shown
- Criminal damages no actual loss is requires
- Prima Facie Case 5 elements must be proven
- Defense if she is guilty of the crime than she cannot recover, she is guilty of a crime
- Reputation it could be 1st amendment concerns, w/t public official, lack of probable
cause could be sufficient to show actual malice.
Five Elements for a Cause of Action for Malicious Prosecution:
1. A criminal prosecution instituted or continued by the D against the P. Merely turning over
information to the police about a possible criminal act is not grounds for malicious
prosecution unless the info is false. Want to promote the giving of info to the police and let
the state decide whether to prosecute. Can be satisfied by:
a. Indictment; b. issuance of criminal process; or c. arrest on a criminal charge.

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2. Termination of the proceedings in favor of the accused. Cannot settle or compromise. Must
have something along the lines of: winning on the merits, acquittal, dismissal or
abandonment of the case. But, the defense that the P was guilty of the crime, even if
acquitted of the criminal charge, is available to the D in a civil lawsuit.
3. Absence of probable cause for the proceeding.
A. Objective TestDid D have enough evidence to lead a reasonable man to believe that
there was PC? If a mistake regarding the facts is reasonable, the D may have probable
cause even if he was wrong. Also, a person who makes a mistake of law (the supposed
facts do not constitute a crime) may or may not be held to lack probable cause but this
depends on the circumstances.
B. Subjective TestDid the D himself actually believe P was guilty?
C. Discharge of case is indicative of lack of probable cause, as is abandonment of the
proceedings.
4. Malice: Lack of probable cause may give rise to an inference of malice. Proof of malice
need not be direct (hatred, ill will, spite, etc.), but may be inferred from circumstances
surrounding the Ds act. Malice can be any purpose other than bringing the P to justice (like
trying to get P to repay a debt); Malice may be demonstrated by a lack of probable cause
5. Damages: P must have suffered damage from the prosecution. Can be emotional distress or
monetary loss. This tort also leaves open the giving of punitive damages./
Friedman v. Dozorc - Malicious Civil Prosecution
Facts: Woman died during surgery performed by Friedman (P), Dozorc (D) sued and the court
found that there was no negligence by P. P contended that D, the suing attorney, owed a duty of
care not to bring suit until reasonable investigation revealed some basis for liability.
Rule: An attorney owes no actionable duty of care to an adverse party.
Notes
-In Civil Malicious must demonstrate special damages
- Law suit will be allowed even if you dont have enough facts, this is not improper process;
BUT if I bring the suit that there no basis
- p. 1019 note 1
Federal Rules of Civil Procedure: Rule 11Provides for a sanction against a person bringing a
frivolous civil action. The sanction is imposed by the judge in the same action and may cover
litigation expenses, including attn fees.
Abuse of Process
Protected Interest: Freedom from the abuse of Process; Protection of integrity of Judicial
Process: (litigate rite to sue but it is used to abuse the process)
1. It is not the wrongful procurement of legal process or the wrongful initiation of criminal
or civil proceedings, but is the misuse of the process, no matter how properly obtained,
for any purpose other that which it was designed for.

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2. It is immaterial that the process was properly issued; or that it was obtained in the course
of the proceedings that were brought with probable cause, and for a proper purpose.
3. It is immaterial that the proceedings terminated in favor the person instituting or initiating
them. It is the subsequent misuse of the process, through properly obtained, constitutes
that misconduct necessary to trigger liability.
4. A major difference between abuse of process and malicious procession: it does not
require a termination of an action in favor of the accused D.
5. The tort is not available for mere filing of a frivolous action, absent proof that the claim
was filed for a collateral or ulterior motive.
Elements of Abuse of Process:
1. An act in the use of the judicial process which is improper in the regular prosecution
of the proceeding.
2. An Ulterior purpose for instituting the law suit. There must be some ulterior objective
(other than that of the prosecution), not legitimate in the use of the process.
3. Judicial Process: The judicial process, in some manner, must be involved.
Difference b/w Malicious Prosecution and Abuse of Process:
1. Abuse of process. The gist of the tort is not the commencing of an action or causing
process to begin without justification, but the misuse or misapplication of process that is
justified in itself, for an end other than that which the process was designed for.
2. Malicious prosecution requires a termination of the law suit in favor of the accused.
Abuse of process does not require this).
3. Malicious persecution requires a showing of no probable cause to bring the suit. In
abuse of process cases, there is probable cause to use judicial process. However, D uses
the process for an improper motive (i.e. motive other than for what the process is
designed to get at).
4. Malice (improper purpose or motivation for bringing the action)
To recover a P must:
A. Plead and prove an ulterior purpose (must be the primary motive) and
B. An act in the use of process which is improper in the regular prosecution of the proceeding.
For example: if one files a lawsuit to extort money from another, even though one knows
that there is no basis for the lawsuit, then can be sued for malicious prosecution. This
works for both criminal and civil cases. The mere filing of a complaint is not sufficient
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for abuse of process. A of P usually involves some kind of court order: Summons,
subpoena, garnishments, replevin, or an arrest warrant. In an action for abuse of process
do not need lack of probable cause or the termination of the underlying action in favor of
P. Some courts require a further act than the mere action being issued; the mere fact that
the D has an ulterior purpose is not sufficient to find D guilty for abuse of process.
Grainger v. Hill
Facts: Hill (D) contended that Grainger (P) failed to sate a cause of action for abuse of process
because he failed to allege the underling arrest had been terminated
Rule: An action for abuse of process based upon a favorable termination of the underling
proceedings.
Held: An action for abuse of process is not based upon termination of the underling action. The
tort rests the improper invocation of legal process for an ulterior motive. It matters not what or
whether the disposition of the underling was achieved.

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