The legal literature generally assumes that an aggregate-risk-utility
test is employed to determine whether conduct was reasonable or
negligent. However this test is infrequently mentioned by the courts
and almost never explains their decisions. Instead, they apply, explicitly
or implicitly, various justice-based standards that take into account
the rights and relationships among the parties.
This is true even for the two judges most closely identified with the
aggregate-risk-utility test: Learned Hand and Richard Posner. During
the five decades (1909-1961) that Hand served as a federal judge,
he mentioned the test in only eleven opinions, between 1938 and
1949, and in none of those opinions did he actually apply the test to
resolve the negligence issue. In his last reference to the test, in 1949,
he essentially abandoned it. None of his fellow circuit judges ever
mentioned the test.
Posner claims that the Hand formula expresses an economic
efficiency interpretation of negligence that has long been implicit
in judicial opinions. However, Posner's arguments are based on
speculative and implausible assumptions, overbroad generalizations,
selective quotations, and superficial descriptions of cases that misstate
or ignore facts, language, rationales, and holdings that are inconsistent
with his argument. The same flaws are apparent in Posner's attempts
to apply the Hand formula in his own judicial opinions. Neither he
nor his like-minded colleague, Frank Easterbrook, has been able to
employ the Hand formula to resolve the negligence issue in any case,
and none of their fellow circuit judges has attempted to do so.