Reference no: EM133458690

Tort Damages in Other Nations

In contrast to U.S. courts, courts in Europe generally limit damages to compensatory damages; punitive damages are virtually unheard of in European countries. Even when plaintiffs do win compensatory damages, they generally receive much less than would be awarded in a similar case brought in the United States. In part, this is because citizens of European countries usually receive government-provided health care and relatively generous social security benefits. Another reason, though, is that European courts tend to view the duty of care and the concept of risk differently than U.S. courts do. In the United States, if a swimmer falls off a high diving board and is injured, a court may decide that the pool owner should be held liable, given that such a fall is a foreseeable risk. If punitive damages are awarded, they could total millions of dollars. In a similar situation in Europe, a court might hold that the plaintiff, not the pool owner, was responsible for the injury..

Tort laws in other nations also differ in the way damages are calculated. For example, under Swiss law and Turkish law, a court is permitted to reduce the amount of damages if an award of full damages would cause undue hardship for the party who was found negligent. In the United States, in contrast, the courts normally do not take a party's economic circumstances into consideration.

For Critical Analysis

1. What impact might the typically greater damages awards in the United States have on a businessperson's decision about whether to keep the firm's operations in the United States or move them to another country?

2. Does the potential cost of paying damages encourage large corporations to outsource jobs to other nations? Why or why not?