Personal Injury Law

The BP oil spill demonstrates that caps are wrong

By Pete Burns

Transocean it will rely upon a law that makes the owner of a sunken vessel liable only for its value after the accident. Transocean says there was $27 million worth of oil being held on the rig when it exploded so that is the extent of its responsibility. This is a good example of caps at work.

The term "caps" refers to a relatively recent change in the personal responsibility model by providing that regardless of how wrongful or how much harm an activity caused the culpable party would pay no more than the 'cap'. This is a departure from the most basic principal of American civil justice: the person or corporation who caused the injury is responsible for the resulting damages.

Historically, personal responsibility has been a bedrock of our judicial system. In olden days if I accidentally poisoned the river and it killed your cow I would owe you for a cow. Similarly, if I killed your entire herd I owed you for the herd. Diluting that rule results in third parties – tax payers or downstream ranchers – paying part of the damages. So if the cap for accidentally poisoning a river is ten cows but your 20?head herd perishes half of the economic consequence from my activity falls on you or tax payers.

Fishermen, condo owners, seafood houses and marinas are among those who will lose billions of dollars because of the BP spill. Any law that caps the obligation of those responsible shifts the burden to the fishermen and others who had nothing to do with the cause of this disaster. That is wrong.

I note with approval that BP's chief executive Tony Hayward has said unequivocally that BP will pay the cost of fully compensating all who have been damaged by this tragedy. I would feel more comfortable if that were the law rather than a promise. We should oppose all caps in favor of personal responsibility.

Full post as published by Mobile Personal Injury Lawyer on May 14, 2010 (boomark / email).