THE ECONOMICS OF ENMITY
Boston University School of Law Working Paper 02-04
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This Article considers whether courts should regard enmity between litigants
as a transaction cost and thus as an argument for awarding damages where
a property right would otherwise be available as a remedy. It begins by
examining the phenomenon of enmity generally, and concludes that enmities
can be both ethically justified and instrumentally useful depending on
their origins and how they are expressed. The Article surveys the treatment
of enmity in various legal contexts and finds it broadly consistent with
that view: the law tends to punish enmity when it motivates out-of-pocket
expenditures to make someone else worse off, but generally not when it
motivates the absorption of opportunity costs for that purpose; and enmity
is not punished at all when it motivates socially beneficial behavior.
Turning to the specific problem of remedies after litigation, the Article
argues that it is very difficult for courts to distinguish in practice
between "good" and "bad" enmities. The hard question
thus is how enmity should be handled when the extent of its reasonableness
is unknown and when it may result in a foregone transaction that otherwise
would have made both parties better off. The Article argues that courts
ordinarily should pay no attention to enmity when fashioning remedies.
Enmity is a complicated type of commodification preference?a preference
about whether and in what circumstances to sell an entitlement; it is
difficult for the law to measure accurately or regulate fruitfully, and
on balance is best handled with a liberal strategy that allows parties
to give effect to such preferences without collective second-guessing.
Exceptions to the rule may be warranted in cases where particular enmities
readily can be identified as offensive to public policy or where they
will create significant costs for courts or innocent third parties. The
Article concludes by defending these views against the claim that enmity
is a variety of emotion and that this justifies awarding damages rather
than property rights in cases where it is likely to be pervasive.
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Ward Farnsworth Contact Information
Boston University School of Law
765 Commonwealth Ave
Boston, MA 02215
Presentation and Publication Information:
Published in 69 University of Chicago Law Review 211 (2002).
Social Science Research Network: http://ssrn.com/abstract_id=314561
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