Bundaberg and beyond: duty to disclose adverse events to patients

Although much excellent work has been done in Australia and elsewhere to improve the safety and quality of health care provision, the practice of medicine is inherently risky--adverse events sometimes occur. In Australia, practical guidelines for the open disclosure of adverse events to patients have been developed and are being implemented. State and Territory medical boards have recently adopted Codes of Conduct which include disclosure provisions, although the Australian Medical Association's Code of Ethics does not yet contain express patient disclosure provisions. There is a dearth of authority concerning legal obligations to disclose known or suspected adverse events. Although many Australian jurisdictions have introduced statutory protection for those who apologise or express regret to patients following an adverse event, there is no corresponding express statutory disclosure obligation, unlike in some parts of the United States. The Bundaberg experience illustrates the complex ethical, practical and legal issues which arise in this area.     

You've been warned: Consumer liability in Internet banking fraud

This contribution provides a critical analysis of the treatment of consumer liability in cases of Internet banking fraud. Whereas generally banks refund the financial losses associated with Internet banking fraud to the individual victim, exceptions do occur, at least in certain EU jurisdictions. These, however, are rarely spoken about, but do indicate a number of (legal) problems. The main problems are lack of clarity and lack of consistency as to when a consumer can be held liable. These problems also maintain potential negative consequences such as increase in perceived risk, loss of trust and demands for better security, which may be suboptimal from an economical perspective. This article concludes by reflecting on the potential benefits of the introduction of zero liability as an alternative.     

Environmental liability under uncertain causation

Recently, the European Commission has issued the “Directive 2004/35/CE on environmental liability with regard to the prevention and remedying of environmental liability”. The Directive extends liability that usually refers to personal injuries and private property to harm where private property does not exist (e.g. biodiversity and endangered species). In these cases, problems with multiple causation and uncertain causation tend to be even more severe than for cases where solely private property is affected. Nevertheless, the otherwise very ambitious Directive remains silent about how to deal with these problems. We focus on uncertain causation and analyze second best optimal standards of proof in a model where benefits of risky activities are private information, and where the firm’s care level chosen to avoid the damage is only imperfectly observable. We derive three results: first, we characterize the factors determining the second best standards. Second, and conversely to the previous literature, high standards of proof such as proof beyond reasonable doubt can be second best optimal even though they lead to inefficiently low care levels. Third, legislators should leave discretionary power to courts which allows them to choose the standard of proof conditional on factors such as the degree of uncertainty over causation or the information quality about care levels as taken by injurers.     

Orphan drugs: the question of products liability

Orphan drugs, essential for the treatment of persons with rare diseases, generally are unprofitable for manufacturers to develop and market. While congressional and administrative efforts to promote the development of orphan drugs have met with modest success, application of products liability doctrine to orphan drug sponsors could subvert those efforts. This Note describes the provisions of the Orphan Drug Act and analyzes products liability law with respect to orphan drug litigation. It argues that the goals of tort law support the imposition of liability for design defect, failure to warn and negligence in testing. Finally, the Note acknowledges that liability costs create disincentives for orphan drug development and suggests mechanisms for reducing manufacturers' liability concerns.     

Contractor selection problem under extended liability

This paper solves the problem of a principal firm's choice of contracting agents under extended liability, where agents have the possibility of causing an accident and also are at risk of becoming insolvent. The analysis shows that the negligence rule for contracting agents enhances the price competitiveness of the agent who takes proper precautions and thus that the liability rule consisting of the negligence rule on contracting agents that extends liability to the principal firm is superior to other types of liability rules.