Law and Economics Commons^™

Vicarious Windfalls, Justin Sevier

Scholarly Publications

The vicarious liability doctrine, which holds third parties responsible for the legal obligations of their duly authorized agents, was designed in part to ensure that tort victims are not undercompensated by insolvent agent wrongdoers. But many legal scholars are highly critical of the doctrine and suggest that fact finders’ systematic biases-particularly with respect to corporate third parties-cause unworthy tort plaintiffs to be overcompensated at the expense of innocent, deep-pocket corporate defendants. These scholars have offered little empirical evidence for these claims and, in fact, behavioral research suggests that their predictions are incorrect.

This Article introduces the concept of the vicarious …