Environmental Regulation and Civil Liability Under Causal Uncertainty: An Empirical Study of the French Legal System
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Pierre Bentata
Abstract
The key question in this article is to determine whether regulation and regulator information can help to solve causal uncertainty problems in liability. A widely held view among Law and Economics scholars is that civil liability alone is not well-suited to cope with environmental accidents, especially where causation is uncertain or costly to establish. Instead of a simple civil liability rule, it is therefore advocated that a regulatory system be implemented combined with a public insurance scheme, or, alternatively, to institute a mix of regulation and civil liability. Such a mix of regulation and civil liability prevails in French law, and this article presents an original analysis of French court decisions concerning cases of environmental accidents for which causation was uncertain and in which regulators were not able to control for levels of organizational and human care. The dataset covers more than 50 years of trial outcomes from the highest civil and criminal court in France – Cour de Cassation. Our results seem to provide evidence that regulation provides a new way to address causal uncertainty at the liability stage. This may be due to a transfer of information from regulators to judges and to the adoption by judges of a probabilistic approach to causation.
Appendix
Cases by year
References
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- 1
According to Sintez (2011), under certain circumstances, risk exposure is considered to be a moral prejudice and can be compensated. He explains that the owner of an oil tank situated in a residential area has been sentenced to award damages to local residents because his installation increased the scope of the damage in case of a potential fire. Cass. Civ. 2nd, 07/16/1982.
- 2
Loi relative aux Installations Classées pour la Protection de l’Environnement (ICPE).
- 3
Among ICPE facilities subject to authorization, we find the riskiest facilities – quarries, nuclear plants – also classified as Seveso (high-risk) facilities and IPPC (most polluting) facilities. See The Inspectorate of Classified Installations. http://www.installationsclassees.developpement-durable.gouv.fr/
- 4
Indeed, optimal regulation has to take into account the abatement costs heterogeneity of the regulated facilities and therefore the regulator needs to cooperate with facility owners to acquire private information from the regulated industry. See Ogus (2004), Viscusi et al. (1995) and Richardson et al. (1982).
- 5
Bureau de Recherche Géologique et Minière (Bureau of Geological and Mining Research).
- 6
Institut National de l’Environnement Industriel et des Risques (National Institute for Industrial Environment and Risks).
- 7
Regional Departments of the Environment, Planning and Housing.
- 8
Lamyline and Dalloz, www.lamyline.fr; www.dalloz.fr.
- 9
Before the 1970s, very few cases were found. They have been selected with the keyword trouble de voisinage. It seems obvious because of the relatively recent use of the word environment.
- 10
Most of the 3,206 cases were not directly related to environmental accidents, although they contained one or more keywords. For instance, more than 300 cases were concerned with environmental taxation and more than 1000 cases were concerned with trouble de voisinage where pollution was not an issue.
- 11
Cases concerning causal uncertainty are also more accepted by courts today than in 1956. See Appendix.
- 12
For instance, during year 1992, the victims won 50% of their trials, they invoked careless organization in 17% of the cases and in 25% of the cases scientific environmental reports were available. 17% of the cases concerned suspected injurers who did not comply with regulation and an ICPE facility was suspected in 14% of the cases.
- 13
We use a Prais–Winsten regression. Tests are computed on Stata 10 and SPSS. Results are the same with both software.
- 14
07/19/1976: entry into force of the ICPE Act.
- 15
From an econometric point of view, the year 1986 appears to introduce a structural change so we created a dummy variable (noted “1” after 1986 and “0” before) that we combine with the variables ORGA and EXPERT. See Gujarati & Porter (2009:285-288).
- 16
Ministère de l’Ecologie du Développement Durable du Transport et du Logement. Répartition des sites ICPE et Seveso. http://www.statistiques.developpement-durable.gouv.fr/lessentiel/article/333/1200/repartition-spatiale-installations-classees-soumises.html
- 17
See Section 4.2.3.
- 18
This result is in line with the concept of “cheapest evidence avoider” put forward by Porat and Stein (1997).
©2013 by Walter de Gruyter Berlin / Boston
Articles in the same Issue
- Frontmatter
- The Problem with the Holdout Problem
- Do Warrants Matter?
- Shop Crime and Deterrence: Evidence on Shoplifting among Young People in the Youth Lifestyle Survey (YLS)
- Environmental Regulation and Civil Liability Under Causal Uncertainty: An Empirical Study of the French Legal System
- Equilibrium and Welfare in a Model of Torts with Industry Reputation Effects
Articles in the same Issue
- Frontmatter
- The Problem with the Holdout Problem
- Do Warrants Matter?
- Shop Crime and Deterrence: Evidence on Shoplifting among Young People in the Youth Lifestyle Survey (YLS)
- Environmental Regulation and Civil Liability Under Causal Uncertainty: An Empirical Study of the French Legal System
- Equilibrium and Welfare in a Model of Torts with Industry Reputation Effects
