. “at the cutting edge” of tort law scholarship. (2003)
In two distinct and independent areas of law it is a core element in the debate. In relation to mental illness, particularly post-traumatic stress disorder in the wake of the U.K.s involvement in both Iraq and Afghanistan questions of the scope of liability have arisen with energy and imperative.
On another level, pure economic loss arguments seeking to extend the potential range of damages have also encountered push back from a floodgates school of legal thought. “How far can tort liability expand without imposing excessive burdens upon individual activity (or, as some may wish, to what extent should tort rules be compatible with the market orientation of the legal system)?” is a key issue in questions of pure economic loss according to Bussani and Parker. (2003)
The following brief discussion will focus briefly on the historical development of this argument. However, the majority of the discussion will focus on the dynamic of the concept in current legal debate and decisions.
The story begins with Cardozo in Ultramares Corporation v Touche 174 NE 441 at 444 (1931). With less panache than Prosser his decision 8 years earlier is arguably even more widely quoted, than Prossers introductory quotation: He raised the spectre of the unattractive proposition of exposing defendants to a potential liability "in an indeterminate amount for an indeterminate time to an indeterminate class"
IN 1998 the U.K. Law Commission acknowledged that floodgates arguments arise from “the concern that such a proliferation of claims would clog the court system.” (Law Commission, 1998) Today, particularly in the U.K., Bussani and Parker conclude the floodgate argument to limit liability is “not only pervasive, but has proved persuasive.” (2003)
They provide a valuable typology for pure economic loss in the context of tort liability. They identify transferred loss, Ricochet