Subject:
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Re: Corporate vs Individual liability
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Newsgroups:
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lugnet.off-topic.debate
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Date:
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Thu, 27 Jan 2000 19:26:05 GMT
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Viewed:
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416 times
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James Brown wrote in message ...
> Ok. Going from that basis (someone must be responsible) then yes, the CEO • is
> probably a better choice than the owners or stockholders - who, all other
> things being equal, are the ones technically responsible, being the owners.
Well, the owbers or stockholders are responsible also, though in many cases
a stockholder's responsibility is less since he isn't directly running the
company they way the CEO is.
> However, I don't buy the arguement that a company can't be ultimately
> responsible, simply because I can't throw it in jail. If the company • refuses
> to co-operate, there are a huge variety of actions that can be taken, most • of
> which would be far more effective at galvanizing action than throwing the • CEO
> in jail. Freeze accounts, seize assests, prevent movement across borders, • to
> name just a few. What is to prevent a company from firing the CEO that • just
> got tossed in jail?
In many cases, freezing accounts and seizing assets are the most effective
thing to do. I'm not sure what you mean by "prevent movement across
borders". If that means movement of people, well, sometimes that means
jailing the person who you are worried about freeing, obviously jailing the
CEO isn't going to prevent the truck driver who was dumping waste from
leaving the country, so you've got to jail the right person. But if you are
trying to get the company to turn over the truck driver, you may need to
jail the CEO. Also, money can be kept out of the country, and assets can be
hidden (or transferred to other people).
> I guess we're coming up against a philosophical differnence here. You feel
> responsibility must ultimately fall to an individual, while I have no • problems
> with the concept that a group of people can be held responsible for the
> actions of that group.
Well yes, the best is to hold a group of people responsible, but the idea
really is not so much that the CEO is the person who should always be
responsible, but that a PERSON or PERSONS must be able to be held
responsible. The CEO is a good canditate because it is his JOB to be
responsible (if you didn't need a single person at the top to run a company,
you wouldn't have CEOs).
> > > (case study #2)
> > > > Assuming investigations turn up no evidence which was ignored or covered
> > > > up, no fault can be assigned to the corporation, though they could still
> > > > possibly have judgments made against them, but the fact that they were
> > > > proactive in finding out what went wrong is going to help their defence • a
> > > > lot. It might be a good idea for them to go even further, and contribute
> > > > money to charities and research organizations related to cancer.
> > >
> > > We're in agreement here. However, why does this logic apply to a
> > > corporation, and not a CEO?
> >
> > The CEO isn't going to be responsible here either as long as the • corporation
> > cooperates with the investigation (which in this example, they have, to an
> > exemplary level in fact).
>
> Actually, my question was unclear, sorry. More accurately: Why can a
> corporation be excused of responsibility for (something they had no idea • would
> lead to harm) while a CEO can't be?
>
> In case #1, the CEO had NO idea that following accepted business practises
> would lead to a negligent driver, in case #2, the corporation had NO idea
> their product caused cancer.
The reason I see different results of responsibility is because of the
different nature of the actual incident. Case #1, the actual incident was
that someone spilled a known hazardous material. Case #2 we have a material
which is only found to be hazardous long after the cat is out of the bag. In
case #1, someone is obviously negligent, and if the companies practices
aren't sufficient to determine who is negligent, then the company as a whole
is negligent, and as such, if need be, the CEO can be found to be negligent
(now note that if company #1 is as proactive in resolving the incident, then
it is unlikely that the CEO will be found personally negligent, unless
perhaps the investigation eventually turns up a pattern). In case #2, the
company was not negligent, though obviously more research needed to be done
to determine the safety of the product, but you can't do infinite research,
so there has to be a balance of cost vs. risk. Now the corporation does bear
some of the risk, but society does also (for example, while I want to see
the cigarette companies burn, the smokers also bear responsibility, I don't
see how anyone could believe that there was absolutely no harm in a product
which causes people around you to cough etc.).
> > > (case study #3)
> > > > There may not be enough information here. Driver would appear to be at
> > > > least partially at fault, and/or vehicle design may be partially at • fault.
> > > > A tire blowing out should not be the sole cause of a fatal accident.
> > >
> > > (not the main point, but...) Quoting from the study: "Road conditions, • the
> > > driver, the situation and the condition of the rest of the vehicle are • all
> > > investigated and ruled out." Call it the tire and random chance as the • two
> > > causes, then.
> >
> > Is this a real life example or something constructed? I just can not • believe
> > a tire being able to blow in such a way that it would cause a fatal • accident
> > that the driver had NO capability to properly react to, that could not be
> > traced to some problem with the car, or the road, or how the driver was
> > driving (now if you want to throw in that a tree fell at the same time the
> > tire blew, and the skid that the car WILL go into brought the car under • the
> > falling tree, ok, now we have a real "accident").
>
> It's constructed, obviously. <shrug> If a tree is necessary for you to
> accept random chance, then a tree.
This is the danger in constructing examples. It is possible to construct an
example which is so far disconnected from reality as to be useless. In the
example as stated, either one has to decide that whatever happened was just
so freak, that it's an accident, and no one is liable, or that there really
was a defect in the tire, and the company is liable. This is also an example
which is going to be settled by a court (unless one of the two parties
[company or next of kin] accept responsibility). If the next of kin can
convince the court that it is the companies fault, then they will collect
damages. If they can't, the incident will be declared an accident. At the
least, the next of kin will come out with the closure that the driver wasn't
at fault (since the investigation didn't even find a hint of something which
would put the driver at fault).
Now modifying the example to be more realistic, and adding a tree, now puts
it solidly in the realm of an accident. Tires certainly do blow. Though I
think they always blow for reasons which can be tracked to either road
conditions, actions of the driver, or defects in the tire, but again, if the
only factor is a tire blowing, I don't think you can get a fatal accident.
Now that we've added an additional factor, we now have a legitimate accident
(assuming the tree wasn't severely damaged in a hurricane a year ago and the
property owner [or road owner] ignored reccomendations to cut the tree down
before it fell on the road, or the tree wasn't just cut down or whatever -
for the sake of the example, lets assume a high wind just blew a healthy
tree down). Of course now the actual cause of the fatal accident is the tree
more than the tire (the blown tire just happend to put the car under the
tree).
---------
If we get back to why we are debating these examples, I think the reason for
the debate is whether Libertopia (and it's ideal of personal responsibility)
gives us a better system or not. The problem I see with the current system
is that in some of these examples, where responsibility can't be absolutely
pinned, we assign the responsibility to society as a whole (i.e. you and me,
and Larry, etal.). My problem with this is why should I be responsible,
instead of the parties involved in the incident (the companies and victims)?
People have been complaining about making the CEO responsible for something
he didn't have personal control over, well what kind of personal control do
I have over the driver and the tire company, or the chemical company and
it's truck drivers?
Frank
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Message is in Reply To:
 | | Re: Corporate vs Individual liability
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| (...) OK. That makes a *HUGE* difference from the arguements I was seeing earlier. The arguements I was seeing to date lead me to believe you (collective) were arguing "punish the CEO, then the company" <snipppage> (...) Ok. Going from that basis (...) (25 years ago, 27-Jan-00, to lugnet.off-topic.debate)
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