1. ELEMENTS B POWER POINT SLIDES Class #12 (Extendo-Class) Friday, September 18, 2015

2. MUSIC : THE MAMAS & THE PAPAS 16 of Their Greatest Hits (1965-68) OXYGEN Written Brief #1 (Mullett v. Bradley) due Tomorrow @ 8 pm See Instructions for Written Assignments & Case Briefs (IM21-22) KRYPTON Written Brief #1 (Albers) due Thursday @ 10 pm See Instructions for Written Assignments & Case Briefs (IM21-22)

3. Manning v. Mitcherson Introduction: Start of Brief & DQs 1.43-1.44 featuringOXYGEN

4. Manning v. Mitcherson Once Upon a Time in a small town in Georgia there lived Two Canary Birds …

5. Manning v. Mitcherson “ Sweet ” lived with Mrs. Mitcherson [“ Sour ”] lived with Mr. & Mrs. Manning Looked almost identical Same parted crest Both escaped

6. Manning v. Mitcherson “ Sweet ” lived with Mrs. Mitcherson [“ Sour ”] lived with Mr. & Mrs. Manning Both escaped

7. Manning v. Mitcherson One of the escaped Canary Birds flew into Mr. Brown ’ s kitchen. Mr. Brown gave it to the Mannings. The Mannings refused Mrs. Mitcherson ’ s request for the bird. Mrs. Mitcherson sued.

8. OXYGEN Manning v. Mitcherson : DQ 1.43: OXYGEN ( What ’ s at Issue ?) The parties initially disagreed as to whether the bird found in Brown’s kitchen was “Sweet” or “Sour.” Whose version of the facts did the magistrate accept?

9. OXYGEN Manning v. Mitcherson : DQ 1.43: OXYGEN ( What ’ s at Issue ?) Magistrate / Justice of Peace Rules in Favor of Plaintiff Mitcherson. Ga SCt.: “ The answer of the ex - officio justice of the peace in this case, the same being a certiorari and no traverse thereof, must be taken as true,...” “no traverse thereof” Means here?

10. OXYGEN Manning v. Mitcherson : DQ 1.43: OXYGEN ( What ’ s at Issue ?) “ The answer of the ex - officio justice of the peace in this case, the same being a certiorari and no traverse thereof, must be taken as true,...” “ no traverse thereof ”  no objection / rebuttal made Justice ’ s answer must be “ taken as true “ = Factual findings not Q ’ ed. – “ Taken as true ” about facts not law –Ga SCt wouldn ’ t defer to legal holding of magistrate So what are facts for purposes of the case ?

11. OXYGEN Manning v. Mitcherson : DQ 1.43: OXYGEN ( What ’ s at Issue ?) Facts for purposes of the case = – Plaintiff ’ s Version = – Canary in Browns ’ Kitchen was “ Sweet ” So What is Defendant’s Legal Claim on Appeal?

12. OXYGEN Manning v. Mitcherson : DQ 1.43: OXYGEN ( What ’ s at Issue ?) Defendant ’ s Legal Claim Not “It’s My Bird” (No Traverse) Not “It Was Never Her Bird” (Years In Cage) Must Be: “She Lost Property Rights When It Escaped”

13. OXYGEN Manning v. Mitcherson : BRIEF : OXYGEN STATEMENT OF THE CASE : Mitcherson … ? sued Manning, … [theory of case] [remedy requested]

14. OXYGEN Manning v. Mitcherson : BRIEF : OXYGEN STATEMENT OF THE CASE : Mitcherson, original owner (OO) of escaped canary sued Manning, … ? [theory of case] [remedy requested]

15. OXYGEN Manning v. Mitcherson : BRIEF : OXYGEN STATEMENT OF THE CASE : Mitcherson, OO of escaped canary sued Manning, who was given the bird by its finder, [theory of case]? [remedy requested]

16. OXYGEN Manning v. Mitcherson : BRIEF : OXYGEN STATEMENT OF THE CASE : Mitcherson, OO of escaped canary sued Manning, who was given the bird by finder, under a “possessory warrant” = summary action for return of personal property

17. OXYGEN Manning v. Mitcherson : BRIEF : OXYGEN STATEMENT OF THE CASE : Mitcherson, OO of escaped canary sued Manning, who was given the bird by finder, under a possessory warrant – not “conversion” b/c not asking for $$ – not crazy to say “replevin” but poss. warr. appears to be its own cause of action in Ga. [remedy requested]?

18. OXYGEN Manning v. Mitcherson : BRIEF : OXYGEN STATEMENT OF THE CASE : Mitcherson, OO of escaped canary sued Manning, who was given the bird by finder, under a possessory warrant … For return of the bird. (Sweet!!)

19. OXYGEN Manning v. Mitcherson : BRIEF : OXYGEN PROCEDURAL POSTURE : After a trial, the magistrate awarded possession to the Plaintiff. Need to include “After a trial” to clarify not decided: on pleadings (like Pierson) on Directed Verdict (like Liesner & Shaw)

20. OXYGEN Manning v. Mitcherson : BRIEF : OXYGEN PROCEDURAL POSTURE : After a trial, the magistrate awarded possession to the Plaintiff. Defendant brought a writ of certiorari to Superior Court, which affirmed [by dismissing the writ]. Defendant “excepted” [appealed].

21. OXYGEN Manning v. Mitcherson : DQ 1.44: OXYGEN ( What ’ s at Issue ?) Why Do You Think This Case Got to Georgia Supreme Court ???!!! Why did the Mannings Keep Fighting? Why did Mrs. Mitcherson?

22. Manning v. Mitcherson : Hints about Mrs. Mitcherson Georgia treats husband as relevant party to lawsuit if both spouses alive. –Mr. Manning is the only Plaintiff, even though pretty clearly his wife ’ s bird. –Mr. Mitcherson not a party. Why not ?

23. Manning v. Mitcherson : Hints about Mrs. Mitcherson Mr. Mitcherson not a party. Why not ? Divorce unusual in 1882; likely he ’ s dead. –High probability she ’ s a Civil War widow –If so, husband dead at least 17 years.

24. Manning v. Mitcherson : Hints about Mrs. Mitcherson High probability she ’ s a Civil War widow If so, husband dead at least 17 years. Enter the Captain & the Canary !! QUESTIONS ON MANNING ?

25. STATE v. SHAW DQ1.28: Krypton Can you frame a single rule that makes sense of the results in Pierson, Liesner, and Shaw? We’ll look at two student submissions from prior classes For substance For clear concise writing I’ll go a little quickly b/c you can review slides in more detail later

26. STATE v. SHAW DQ1.28: Krypton STUDENT #1: Property rights to a wild animal occur when a pursuer, who continues to pursue the animal and has no intent of releasing him back into the wild, has substantially rid the animal of his natural liberty as to render escape highly unlikely under normal circumstances.

27. STATE v. SHAW DQ1.28: Krypton STUDENT #1: Property rights to a wild animal occur when a pursuer, [ii] who continues to pursue the animal and has no intent of releasing him back into the wild, [i] has substantially rid the animal of his natural liberty as to render escape highly unlikely under normal circumstances. Note normal chronological sequence.

28. STATE v. SHAW DQ1.28: Krypton Property rights to a wild animal occur when a pursuer …  A pursuer acquires property rights to a wild animal when the pursuer… Eliminating passive voice.

29. STATE v. SHAW DQ1.28: Krypton A pursuer acquires property rights to a wild animal when the pursuer… [i] has substantially rid the animal of his natural liberty as to render escape highly unlikely under normal circumstances.

30. STATE v. SHAW DQ1.28: Krypton A pursuer acquires property rights to a wild animal when the pursuer… [i] (a)has substantially rid the animal of his natural liberty  Need both (a) & (b)??  (b) as to render escape highly unlikely (c) under normal circumstances.

31. STATE v. SHAW DQ1.28: Krypton A pursuer acquires property rights to a wild animal when the pursuer… [i] (a)has rendered escape highly unlikely (Very clever idea) (b) under normal circumstances. (Very clever idea)

32. STATE v. SHAW DQ1.28: Krypton A pursuer acquires property rights to a wild animal when the pursuer [i] has rendered escape highly unlikely under normal circumstances; and [ii] (a) continues to pursue the animal and (b) has no intent of releasing him back into the wild,

33. STATE v. SHAW DQ1.28: Krypton A pursuer acquires property rights to a wild animal when the pursuer [i] has rendered escape highly unlikely under normal circumstances; and [ii] (a)continues to pursue the animal (Do you want to require (a) for traps/nets?) and (b) has no intent of releasing him back into the wild

34. STATE v. SHAW DQ1.28: Krypton A pursuer acquires property rights to a wild animal when the pursuer [i] has rendered escape highly unlikely under normal circumstances; and [ii] (a)continues to pursue the animal and [it] (Do you want test of pure intent w/o actions?) (b) has no intent of releasing him [it] back into the wild (Do you want test of pure intent w/o actions?)

35. STATE v. SHAW DQ1.28: Krypton A pursuer acquires property rights to a wild animal when the pursuer [i] has rendered escape highly unlikely under normal circumstances; and [ii] continues to pursue the animal or to otherwise show he has no intent of releasing it. Takes care of traps & eliminates test based on pure intent.

36. STATE v. SHAW DQ1.28: Krypton STUDENT #2: A wild animal is deemed property of a person pursuing it if he through his actions made escape of the animal highly unlikely and through his actions has substantially decreased the likelihood of escape since the outset of the pursuit.

37. STATE v. SHAW DQ1.28: Krypton STUDENT #2: A wild animal is deemed property of a person pursuing it if he [i] through his actions made escape of the animal highly unlikely and [ii] through his actions has substantially decreased the likelihood of escape since the outset of the pursuit. Pronoun problem plus passive voice.

38. STATE v. SHAW DQ1.28: Krypton A wild animal is deemed property of a person pursuing it if he …  A person acquires property rights in a wild animal if the person … 1.through his actions made escape of the animal highly unlikely and 2.through his actions has substantially decreased the likelihood of escape since the outset of the pursuit. How else would you accomplish these tasks?

39. STATE v. SHAW DQ1.28: Krypton A person acquires property rights in a wild animal if the person … 1.made escape of the animal highly unlikely and 2.has substantially decreased the likelihood of escape since the outset of the pursuit. Interesting idea, BUT Hard to prove Hard to prove Not clear would lead to Pierson result Not clear would lead to Pierson result Not clear how would apply to traps/nets Not clear how would apply to traps/nets

40. STATE v. SHAW DQ1.28: Krypton I’ll do a more extensive write-up of the submissions from this & prior years and put in a future Information Memo. Qs on DQ1.28?

41. LOGISTICS: CLASS #12 DF Today/Monday: Includes More of DQ1.26 (Applying Shaw to Facts of Pierson & Liesner) Tomorrow: I’ll Adjust & Extend Assignment Sheet to Reflect Where We Are & Take You to Break Group Written Assignment #1: – (3) (c) Your work-product will consist of the three arguments listed in part (6) under your sub-assignment, that you should number 1, 2, and 3 respectively. [Means no separate intro, conclusion, transitions; not essay or memo.] – Last Chance for Other Qs.

42. One Month In: Three Things to Think About 1. September Fog 2. Calisthenics 3. A Thousand Words

43. The Rhythm of the First Year Same at Every School Where I’ve Taught Same Every Year But One

44. The Rhythm of the First Year Three Typical Fall Semester Low Points: 1.Mid-September 2.Mid-October 3.Mid-November

45. The Rhythm of the First Year: The Mid-September Crisis You Have Never in Your Life Worked So Hard for a Whole Month Without Feeling on Top of Things!!! Common to Start to Worry That …

46. The Rhythm of the First Year: The Mid-September Crisis I’m the Stupidest Person Here & They Let Me In By Mistake

47. The Rhythm of the First Year: The Mid-September Crisis KEEP IN MIND: We’ve Already Discussed: – You’re Learning New Language by Immersion

48. The Rhythm of the First Year: The Mid-September Crisis KEEP IN MIND: We’ve Already Discussed: – You’re Learning New Language by Immersion – Perception of “Hard” v. “Easy” Questions

49. The Rhythm of the First Year: The Mid-September Crisis KEEP IN MIND: Learning New Language by Immersion Perception of “Hard” v. “Easy” Questions Nature of Socratic Method: Profs Control Discussion & Decide What’s “Relevant”

50. The Rhythm of the First Year: The Mid-September Crisis KEEP IN MIND: Second Year Students (No Secret 1L Graveyard)

51. The Rhythm of the First Year: The Mid-September Crisis So Let Yourself Believe the September Fog is Normal and Nearly Universal

52. The Rhythm of the First Year: The Mid-September Crisis Almost All of You Will be Worried About Something Else in Mid-October!

53. The Rhythm of the First Year The Mid-September Crisis U ranium R adium O xygen K rypton

54. One Month In: Three Things to Think About 1. September Fog 2. Calisthenics 3. A Thousand Words

55. The Rhythm of the First Year & Elements Common Mid-September Concern: This class is fun and all, but does any of this really matter?

56. The Rhythm of the First Year Same at Every School Where I’ve Taught Same Every Year But One

57. FALL 2001

58. Pierson v. Al-Qaeda????

59. The Rhythm of the First Year & Elements Analogy to Calisthenics

60. The Rhythm of the First Year & Elements Analogy to Calisthenics Apply Language of Case to New Facts Compare Facts of Case to New Facts Apply Policy Concerns to New Facts Identify Key Similarities & Differences

61. The Rhythm of the First Year: The Mid-September Crisis KEEP IN MIND: Analogy to Calisthenics: You Are Starting to Use New Muscles, So You’ll Be a Little Sore

62. One Month In: Three Things to Think About 1. September Fog 2. Calisthenics 3. A Thousand Words

63. The Rhythm of the First Year Staying Motivated

64. The Rhythm of the First Year Staying Motivated The Elevator Videotape & The Failure of Words

65. The Rhythm of the First Year Staying Motivated Storytelling Will Be Your Responsibility

66. The Rhythm of the First Year Staying Motivated Storytelling Will Be Your Responsibility Development Project

67. The Rhythm of the First Year Staying Motivated Storytelling Will Be Your Responsibility Development Project Parental Rights

68. The Rhythm of the First Year Staying Motivated Storytelling Will Be Your Responsibility Development Project Parental Rights Environmental Partnership

69. The Rhythm of the First Year Staying Motivated Storytelling Will Be Your Responsibility Development Project Parental Rights Environmental Partnership Less Visible Assault

70. The Rhythm of the First Year Staying Motivated Storytelling Will Be Your Responsibility Development Project Parental Rights Environmental Partnership Less Visible Assault Remember the Client Who is Waiting for You

71. Back to Work!!

72. Shaw  Demsetz: Introduction to Externalities RADIUM DQs 1.29 & 1.31

73. Radium STATE v. SHAW DQ1.29(a): Radium Assume net-owners have no enforceable rights in fish caught in their nets until they physically remove the fish from the nets. Thomas chooses to take fish from the owners’ nets. Who might be affected by this decision?

74. Radium STATE v. SHAW DQ1.29(a): Radium Assume net-owners have no enforceable rights in fish caught in their nets until they physically remove the fish from the nets. Thomas chooses to take fish from the owners’ nets. Who is affected by this decision? Which of these effects is Thomas likely to take into account when deciding whether to take the fish?

75. Radium STATE v. SHAW DQ1.29(a): Radium Thomas Likely to Consider Own Exertions/Cost of Equipment, etc. Benefits to Dependents Benefits to Likely Purchasers Likely Externalities Costs to Net-Owners, Their Dependents, Their Purchasers Costs to Net Manufacturers Effect on Ecosystem (note might be benefits if “theft” discourages use of big nets)

76. EXTERNALITIES Costs or benefits external to a decision- making process – Must be with reference to particular decision or activity. – Helpful to start by identifying decision-maker

77. EXTERNALITIES Costs or benefits external to a decision-making process – Must be with reference to particular decision/activity – Helpful to start by identifying decision-maker If decision-maker considers a cost, but chooses to absorb it, not an externality – E.g., Thomas considers own exertion necessary to take from nets, may decide to take anyway

78. EXTERNALITIES Costs or benefits external to a decision-making process – Must be with reference to particular decision or activity – Helpful to start by identifying decision-maker Examples from outside this problem? – Me not trimming my tree – Volunteers with other examples?

79. Radium STATE v. SHAW DQ1.29(a) Radium Questions on DQ1.29(a) or Externalities?

80. STATE v. SHAW DQ1.29(b) Assume Net-Owners have no enforceable property rights in fish caught in their nets: If the fish are worth more to the net-owners than to Thomas, presumably there is some amount of money they could contract to pay him to leave the fish alone that would leave all parties better off than before the contract.

81. STATE v. SHAW DQ1.29(b) What obstacles stand in the way of the parties entering contract where T promises not to take fish from nets? Assume cost to net-owner is $500/wk & benefit to Thomas is $300/wk. Assume One-on-One Negotiation.

82. STATE v. SHAW DQ1.29(b) Costs of One-on-One Negotiation Include: Investigation Costs (e.g., find relevant parties; determine relevant costs/values; legal research) Bargaining Costs (e.g., time, representation) Strategic Behavior (negotiating postures) Enforcement Costs

83. STATE v. SHAW DQ1.29(b) What obstacles stand in the way of the parties entering contract where T promises not to take fish from nets? Assume cost to net-owner is $500/wk & benefit to Thomas is $300/wk. Additional Obstacles if Multi-Party Negotiation (multiple net-owners; multiple fish-takers)?

84. STATE v. SHAW DQ1.29(b) Additional Costs of Multi-Party Negotiation Include: Free-Riding Holdouts Organization/Management Costs Compare Agreement on Restaurant & Movie: Two People? Four People? Your Parents, Your Siblings, Everyone’s Spouses & Kids??

85. STATE v. SHAW DQ1.29(b) Collectively: “Transaction Costs” Investigation Costs Bargaining Costs Strategic Behavior Enforcement Costs Free-Riding Holdouts Organization/Management Costs

86. Transaction Costs Costs of Reaching Agreements Can Prevent Parties from Reaching Bargains that are “Efficient” (i.e., Would Make Everyone Better Off)

87. STATE v. SHAW DQ1.29(b) Questions on DQ1.29(b) or Transaction Costs?

88. INTERNALIZING EXTERNALITIES Changing Rules, Laws or Circumstances to Force Decision-Maker to Take External Costs or Benefits Into Account – Generally Imposed from Outside; Not Done by Decision-Maker (Contrast “Internalizing” in Psychology)

89. INTERNALIZING EXTERNALITIES Changing Rules, Laws or Circumstances to Force Decision-Maker to Take External Costs or Benefits Into Account. Generally Imposed from Outside. Beneficial Because Means Price of Activities Will Better Reflect Real Costs & Benefits – Pollution costs  Damages & Regulation – Charitable services  Subsidies/Gov’t Operation

90. INTERNALIZING EXTERNALITIES Several Ways to Do: Changing Rules, Laws or Circumstances to Force Decision-Maker to Take External Costs or Benefits Into Account; Generally Imposed from Outside. Several Ways to Do: – Require Payment of Damages or Fees (or Subsidize) – Regulate Activity: Criminalize or Limit (or Require) – Private Negotiation (Bribes to Do or Not Do Activity) (BUT Limited by Transaction Costs)

91. Radium DEMSETZ ARTICLE DQ1.31: Radium Examples of internalizing externalities from outside the reading?

92. KRYPTON DEMSETZ FIRST THESIS ME: DQs1.32-1.33 KRYPTON: DQs 1.34-1.36

93. DEMSETZ FIRST THESIS New property rights tend to develop “when the gains of internalization become larger than the cost of internalization.”

94. DEMSETZ FIRST THESIS: DQ1.33 gains of internalization New property rights tend to develop “when the gains of internalization become larger than the cost of internalization.” Gains Gains = Having more effects considered by decision-maker, presumably leading to: Reduction in harmful effects AND/OR Increase in beneficial effects Maximum Potential Gain Maximum Potential Gain = Total elimination of externalities (unlikely)

95. DEMSETZ FIRST THESIS: DQ1.33 New property rights tend to develop “when the gains of internalization become larger than the cost of internalization.” What are relevant “costs”? costs of bargaining privately costs of collectively creating new rules (can be very expensive) multi-party negotiation legislation

96. DEMSETZ FIRST THESIS New property rights tend to develop “when the gains of internalization become larger than the cost of internalization.” If harm from externalities > cost of change  change in rule

97. DEMSETZ FIRST THESIS New property rights tend to develop “when the gains of internalization become larger than the cost of internalization.” If cost of externalities > cost of change  change in rule Rough Approximation (Not Precise Math)

98. DEMSETZ FIRST THESIS New property rights tend to develop “when the gains of internalization become larger than the cost of internalization.” If cost of externalities > cost of change  change in rule Rough Approximation (Not Precise Math) Resulting Change in Rule Unpredictable

99. DEMSETZ FIRST THESIS DQ1.32 Why does the author believe that new property rights tend to arise from “the emergence of new or different beneficial and harmful effects”? (p.31) Increase in (perceived) cost of status quo needed to overcome inertia stemming from cost of change.

100. DEMSETZ FIRST THESIS New property rights tend to develop “when the gains of internalization become larger than the cost of internalization.” If cost of externalities > cost of change  change in rule Often Results from Social/Cultural Change  New Social Habits  Value Change  Scarcity  New Science/Technology  Scarcity or Better Monitoring

101. DEMSETZ FIRST THESIS: Basic Analysis Identify decision at issue Identify old rule Identifyneg. externalities under old rule Identify change in circumstances Does change increase neg. externalities? If cost of externalities > cost of change  change in rule

102. DEMSETZ FIRST THESIS: Basic Analysis: State v. Shaw Identify decision at issue: Thomas: Do I take fish? Identify old rule Identifyneg. externalities under old rule Identify change in circumstances Does change increase neg. externalities? If cost of externalities > cost of change  change in rule

103. KRYPTON DEMSETZ FIRST THESIS DQ1.34(a) (MONTAGNE) : KRYPTON Identify decision/activity at issue: Whether to kill beavers. Identify old rule Identify neg. externalities under old rule Identify change in circumstances Does change increase neg. externalities? If cost of externalities > cost of change  change in rule

104. KRYPTON DEMSETZ FIRST THESIS DQ1.34(a) (MONTAGNE) : KRYPTON Tribe-members killing beavers; RULE = no limits except First-in-Time Identify neg. externalities under old rule Identify change in circumstances Does change increase neg. externalities? If cost of externalities > cost of change  change in rule

105. KRYPTON DEMSETZ FIRST THESIS DQ1.34(b) (MONTAGNE) : KRYPTON Tribe-members killing beavers; RULE = no limits except First-in-Time Neg. Ext. = Possibility of Overhunting (Slim) Identify change in circumstances Does change increase neg. externalities? If cost of externalities > cost of change  change in rule

106. KRYPTON DEMSETZ FIRST THESIS DQ1.34(b) (MONTAGNE) : KRYPTON Tribe-members killing beavers; RULE = no limits except First-in-Time; Neg. Ext. = Possibility of Overhunting (Slim) French Arrive; Price of Pelts Increases; Hunting Increases How does change increase neg. externalities? If cost of externalities > cost of change  change in rule

107. KRYPTON DEMSETZ FIRST THESIS DQ1.34(c) (MONTAGNE) : KRYPTON Tribe-members killing beavers; RULE = no limits except First-in-Time; Neg. Ext. = Possibility of Overhunting (Slim) French Arrive; Price of Pelts Rises  Both Cost & Likelihood of Overhunting Increase What happens next? If cost of externalities > cost of change  change in rule

108. KRYPTON DEMSETZ FIRST THESIS DQ1.34(c) (MONTAGNE) : KRYPTON French Arrive; Price of Pelts Rises  Both Cost & Likelihood of Overhunting Increase Tribe Develops Property Rights System Must have invoked decision-making system Decided on new rules & mechanisms to implement [Incurring Transaction Costs associated with change] If cost of externalities > cost of change  change in rule

109. KRYPTON DEMSETZ FIRST THESIS DQ1.34(c) (MONTAGNE) : KRYPTON Tribe Develops Property Rights System Incurring Transaction Costs Associated with Change Can Explain Under Demsetz First Thesis: Big Change in Value of Pelts Perceived Costs of Potential Overkilling Increase Become Greater than Costs of Change Leading to Change in Rule

110. KRYPTON DEMSETZ FIRST THESIS DQ1.35: KRYPTON Why does the author believe that the tribes of the Southwestern U.S. did not adopt a system for rights to Buffalo similar to the one the Montagne for rights to beavers?

111. KRYPTON DEMSETZ FIRST THESIS DQ1.35: KRYPTON Why does the author believe that the tribes of the Southwestern U.S. did not adopt a system similar to that of the Montagne? No Scarcity Issue (Little Value to Outsiders) Beavers Dam BUT Buffalo “Roam” (Harder/More Expensive to Create Exclusive Property Rights)

112. DEMSETZ FIRST THESIS: DQ1.36(a) (Pollution Controls) Decision/activity at issue: Manufacturing process that pollutes air or water Old rule: No Liability Externalities: Costs to Environment & Human Health Change in circumstances: New technology allows better measurement of pollution & effects; maybe more instances. Does change increase neg. externalities? At least perception of harm If cost of externalities > cost of change  change in rule (tort law & anti-pollution regulation) WE EFFECTIVELY DID IN CLASS WHEN DISCUSSING INTERNALIZATION