Final Examination
Law 651: Economics and the Law
Prof. Avery Katz
University of Michigan Law School
Fall 1989
DIRECTIONS
1. This exam is due at the take-home proctor's desk at or before the conclusion of the examination period, at
5 PM on Friday, December 22. Please type your exam. (If you use a word processor, you are expected to take precautions,
sufficient to allow you to meet the end-of-period deadline, against mechanical failure, accidental erasure, and
similar misfortunes.)
2. The exam is open-book; you are free to consult any written materials, and you are strongly encouraged to have
available for your use the assigned course materials and readings.
3. Until the examination period is completed at 5 PM on the 22nd, you may not communicate with any person about
the contents of the exam or about course material relating to the exam, regardless of whether you have already
turned it in.
4. There are two questions having equal weight in determining your grade. Each question has a 1500-word length
limit. You may not use any leftover space from one question in answering the other. Answers exceeding the length
limit will be penalized by reducing their score in proportion to the extent of the excess. I will assume for purposes
of administering the limit that a typical double-spaced typed page with 1-inch margins contains about 300 standard
English words when using 12-pitch type (12 words per line times 25 lines per page), or about 250 words when using
10-pitch type. Any attempts to use shorthand or nonstandard abbreviations, however, will be counted as if full
words were used.
5. Please begin each essay question on a new sheet of paper. Please write your exam ticket number at the top
of each separate essay.
Good luck on the exam, happy holidays, and for those of you graduating at the end of the term, best wishes.
Since the dialogue form may seem to some of you as overly artificial, let me offer the following suggestions:
For the purposes of this essay, the best dialogue will be a cooperative one, that provides intellectual exchange
and deepened mutual understanding between the participants. An antagonistic debate in which the participants
merely argue past each other will be less well received. There is no need for the parties to reach consensus,
or for one side to win out over the other at the end of the conversation, though there is no prohibition against
this outcome either.
ARTHUR WAGNER, Appellant, v. INTERNATIONAL RAILWAY COMPANY, Respondent.
Court of Appeals of New York
232 N.Y. 176; 133 N.E. 437
OPINION: CARDOZO, J.
The defendant operates an electric railway between Buffalo and Niagara Falls. There is a point on its line where
an overhead crossing carries its tracks above those of the New York Central and the Erie. A gradual incline upwards
over a trestle raises the tracks to a height of twenty-five feet. A turn is then made to the left at an angle
of from sixty-four to eighty-four degrees. After making this turn, the line passes over a bridge, which is about
one hundred and fifty-eight feet long from one abutment to the other. Then comes a turn to the right at about
the same angle down the same kind of an incline to grade. Above the trestles, the tracks are laid on ties, unguarded
at the ends. There is thus an overhang of the cars, which is accentuated at curves. On the bridge, a narrow footpath
runs between the tracks, and beyond the line of overhang there are tie rods and a protecting rail.
Plaintiff and his cousin Herbert boarded a car at a station near the bottom of one of the trestles. Other passengers,
entering at the same time, filled the platform, and blocked admission to the aisle. The platform was provided
with doors, but the conductor did not close them. Moving at from six to eight miles an hour, the car, without
slackening, turned the curve. There was a violent lurch, and Herbert Wagner was thrown out, near the point where
the trestle changes to a bridge. The cry was raised, "Man overboard." The car went on across the bridge,
and stopped near the foot of the incline. Night and darkness had come on. Plaintiff walked along the trestle,
a distance of four hundred and forty-five feet, until he arrived at the bridge, where he thought to find his cousin's
body. He says that he was asked to go there by the conductor. He says, too, that the conductor followed with
a lantern. Both these statements the conductor denies. Several other persons, instead of ascending the trestle,
went beneath it, and discovered under the bridge the body they were seeking. As they stood there, the plaintiff's
body struck the ground beside them. Reaching the bridge, he had found upon a beam his cousin's hat, but nothing
else. About him, there was darkness. He missed his footing, and fell.
The trial judge held that negligence toward Herbert Wagner would not charge the defendant with liability for injuries
suffered by the plaintiff unless two other facts were found: First, that the plaintiff had been invited by the
conductor to go upon the bridge; and second, that the conductor had followed with a light. Thus limited, the jury
found in favor of the defendant. Whether the limitation may be upheld, is the question to be answered.
Danger invites rescue. The cry of distress is the summons to relief. The law does not ignore these reactions
of the mind in tracing conduct to its consequences. It recognizes them as normal. It places their effects within
the range of the natural and probable. The wrong that imperils life is a wrong to the imperilled victim; it is
a wrong also to his rescuer. The state that leaves an opening in a bridge is liable to the child that falls into
the stream, but liable also to the parent who plunges to its aid (Gibney v. State of N.Y., 137 N.Y. 1). The railroad
company whose train approaches without signal is a wrongdoer toward the traveler surprised between the rails, but
a wrongdoer also to the bystander who drags him from the path (Eckert v. L.I.R.R. Co., 43 N.Y. 502. Cf. Matter
of Waters v. Taylor Co., 218 N.Y. 248). The rule is the same in other jurisdictions (Dixon v. N.Y., N.H. &
H.R.R. Co., 207 Mass. 126, 130, and Bond v. B. & O.R.R. Co., 82 W. Va. 557, with cases there cited. Cf. 1
Beven on Negligence, 157, 158). The risk of rescue, if only it be not wanton, is born of the occasion. The emergency
begets the man. The wrongdoer may not have foreseen the coming of a deliverer. He is accountable as if he had
(Ehrgott v. Mayor, etc., of N.Y., 96 N.Y. 264, 280, 281).
The defendant says that we must stop, in following the chain of causes, when action ceases to be "instinctive."
By this, is meant, it seems, that rescue is at the peril of the rescuer, unless spontaneous and immediate. If
there has been time to deliberate, if impulse has given way to judgment, one cause, it is said, has spent its force,
and another has intervened. In this case, the plaintiff walked more than four hundred feet in going to Herbert's
aid. He had time to reflect and weigh; impulse had been followed by choice; and choice, in the defendant's view,
intercepts and breaks the sequence. We find no warrant for thus shortening the chain of jural causes. We may
assume, though we are not required to decide, that peril and rescue must be in substance one transaction; that
the sight of the one must have aroused the impulse to the other; in short, that there must be unbroken continuity
between the commission of the wrong and the effort to avert its consequences. If all this be assumed, the defendant
is not aided. Continuity in such circumstances is not broken by the exercise of volition (Twomley v. C.P., N.
& E.R.R.R. Co., 69 N.Y. 158; Donnelly v. Piercy Contracting Co., 222 N.Y. 210; Bird v. St. Paul F. & M.
Ins. Co., 224 N.Y. 47, 54). So sweeping an exception, if recognized, would leave little of the rule. "The
human mind," as we have said (People v. Majone, 91 N.Y. 211, 212), "acts with celerity which it is sometimes
impossible to measure." The law does not discriminate between the rescuer oblivious of peril and the one who
counts the cost. It is enough that the act, whether impulsive or deliberate, is the child of the occasion.
The defendant finds another obstacle, however, in the futility of the plaintiff's sacrifice. He should have gone,
it is said, below the trestle with the others; he should have known, in view of the overhang of the cars, that
the body would not be found above; his conduct was not responsive to the call of the emergency; it was a wanton
exposure to a danger that was useless (Miller v. Union Ry. Co. of N.Y. City, 191 N.Y. 77, 80). We think the quality
of his acts in the situation that confronted him was to be determined by the jury. Certainly he believed that good
would come of his search upon the bridge. He was not going there to view the landscape. The law cannot say of
his belief that a reasonable man would have been unable to share it. He could not know the precise point at which
his cousin had fallen from the car. If the fall was from the bridge, there was no reason why the body, caught
by some projection, might not be hanging on high, athwart the tie rods or the beams. Certainly no such reason was
then apparent to the plaintiff, or so a jury might have found. Indeed, his judgment was confirmed by the finding
of the hat. There was little time for delay, if the facts were as he states them. Another car was due, and the
body, if not removed, might be ground beneath the wheels. The plaintiff had to choose at once, in agitation and
with imperfect knowledge. He had seen his kinsman and companion thrown out into the darkness. Rescue could not
charge the company with liability if rescue was condemned by reason. "Errors of judgment," however, would
not count against him, if they resulted "from the excitement and confusion of the moment" (Corbin v.
Philadelphia, 195 Penn. St. 461, 472). The reason that was exacted of him was not the reason of the morrow. It
was reason fitted and proportioned to the time and the event.
Whether Herbert Wagner's fall was due to the defendant's negligence, and whether plaintiff in going to the rescue,
as he did, was foolhardy or reasonable in the light of the emergency confronting him, were questions for the jury.
The judgment of the Appellate Division and that of the Trial Term should be reversed, and a new trial granted,
with costs to abide the event.
HISCOCK, Ch. J., HOGAN, POUND, MCLAUGHLIN, CRANE and ANDREWS, JJ., concur.