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Journal of Forensic Economics 19(2), 2006, pp. 185-205
2007 by the National Association of Forensic Economics
Ralph R. Frasca*
I. Introduction
185
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186 JOURNAL OF FORENSIC ECONOMICS
2See Cooter and Ulen (2004), p. 245. for a discussion of perfect compensation.
3Tort reforms may also affect damages in these cases. The specific impact of tort reforms is not
dealt with in this paper. Some reforms, such as damage caps, are applied after the jury has deter-
mined damages. Consequently, they would have no impact on the calculation of economic damages
by the economist. See United States Congressional Budget Office, "Limiting Tort Liability for
Medical Malpractice," January 8, 2004.
4The definitions applied in this paper are used in current court decisions and are generally ac-
cepted. It took the courts at least two decades to arrive at this consensus. In the past, especially in
early decisions on wrongful birth, definitions were not consistently applied. The definitions as ap-
plied here can be found in Mogill (1996), Burns (2003) and Strasser (1999).
5If the parents were seeking sterilization for economic reasons and then gave birth to an impaired
child, it is not clear whether the courts would view this as a wrongful conception or a wrongful
birth. See Mark Strasser (2003), p. 826.
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Frasca 187
6Cooter and Ulen (2004), p. 311, discuss the three elements that must be present under the tradi-
tional theory of torts: harm, cause and the breach of a duty.
7An additional reason for not awarding damages is that they were not foreseeable. The legal ques-
tion of forseeability is not discussed in this paper. See Cooter and Ulen (2004), p. 265, for a discus-
sion on forseeability and damages. Consider two types of medical negligence; a negligent steriliza-
tion and a misdiagnosed heredity. Assume that in both cases a child is born with a birth defect. In
the first case, the birth defect may be an unforeseen event. In the second, of course, it is a notewor-
thy probability. The prospective parents are obtaining genetic counseling to avoid this event.
^his may be still brought as a breach of contract case for non-performance.
9See Alvarez (2000).
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188 JOURNAL OF FORENSIC ECONOMICS
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Frasca 189
child rearing. Ev
Therefore, in all
thetically limit da
Figure 1
Figure 2
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190 JOURNAL OF FORENSIC ECONOMICS
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Frasca 191
Had the child not been born, all of the mental and monetary costs associ-
ated with the birth of the child and the subsequent care of the child would be
absent. Assuming there was a permanent desire not to have a child; these in-
clude all foreseeable economic costs imposed on the victim. The cost calculation
is more complicated if the parents did not want a child now, but did want a
child in the future. In the case of a prematurely timed offspring, child rearing
cost would have been delayed but not eliminated if the negligent birth had
been avoided. Thus, the economic cost may be limited to the time value of
money that would have been gained by delaying anticipated expenditures plus
any additional expenditure or implicit opportunity cost that is uniquely associ-
ated with the early birth.
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192 JOURNAL OF FORENSIC ECONOMICS
No recovery
Limited recovery
o Limited to birth and prenatal expense
emotional benefits
Net recovery (Benefits rule)
o Trier of fact weighs the full cost of rearing a child and
reduces damages by the expected benefit of a healthy
child
Full recovery
o The cost of pregnancy, childbirth and rearing is not
offset by non-pecuniary benefits of child
Most courts (32) apply the limited recovery rule.24 These courts implicitly
take benefits into consideration by limiting damages to the costs incurred
during the pre-natal period and childbirth. There is no need to take the benefit
of the child into consideration, because all cost and benefits that occur after the
birth of the child are excluded from consideration. Under the limited recovery
rule, damages usually include reimbursement for the failed medical procedure
and the cost of prenatal care and delivery. Many jurisdictions also include
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Frasca 193
Damages for pain and suffering are not diminished by showing that
the earning capacity of the plaintiff has been increased by the defen-
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194 JOURNAL OF FORENSIC ECONOMICS
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Frasca 195
In net recovery a
restricted to the c
ing expenses. In
stated:
Wrongful life and wrongful birth actions presuppose the birth of a child
with a defect or impairment. Being born into a poor family is not an adequate
rationale for a wrongful life or birth action. If the birth defect were directly
caused by the malpractice, this would be no different from other torts. In negli-
gent birth cases, however, the birth defect was caused by factors that are inde-
pendent of the malpractice. The malpractice does not affect the probability of
the given child having a birth defect. The malpractice results in the birth, not
the defect. The injury in a wrongful birth or wrongful life suit is the denial of a
choice that would have resulted in an abortion. Had the malpractice not oc-
curred, the child would not have been born. An abortion is the foregone desired
outcome.
It may be that the physician or health care provider failed to diagnose
discover a genetic defect through prenatal testing or counseling in time for th
parents to avoid or terminate a pregnancy. The mother may have intended
pregnancy; but, if she had the correct information, she would have chosen
to carry the fetus to term. The injury, the birth, is the same in wrongful birt
and wrongful life suits.
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196 JOURNAL OF FORENSIC ECONOMICS
While it thus seems doubtful that a child's claim for general dam-
ages should properly be denied on the rationale that the value of im-
paired life, as a matter of law, always exceeds the value of nonlife, we
believe that the out-of-state decisions are on sounder grounds in hold-
ing that- with respect to the child's claim for pain and suffering or
other general damages- recovery should be denied because (1) it is
simply impossible to determine in any rational or reasoned fashion
whether the plaintiff has in fact suffered an injury in being born im-
paired rather than not being born, and (2) even if it were possible to
overcome the first hurdle, it would be impossible to assess general
damages in any fair, nonspeculative manner. ( Andaln v . Superior
Court , at 614, 1984)
36Berenson (1990).
^See Andaln v. Superior Court (CA 1984); Procanik v. Cillo (NJ 1984); and Harbeson v. Parke -
Davis , (WA 1983). The statue in Maine is P.L 1985, ch. 804, 22 which is part of Maine's Health
Security Act.
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Frasca 197
Since life is the wrong, the perverse result is that a plaintiff with a longer
life expectancy should receive greater compensation. Damages in a wrongful
life case ideally are presented by a life care planner and an economist. The life
care planner sets out extraordinary expenditures from the age of majority on-
ward. These would include all extraordinary medical, living and educational
expenses. It is the economist's role to calculate the present value of the ex-
traordinary life care expenditures and to ensure that there has been a proper
deduction of offsets. There has been an ongoing conversation in the forensic
literature as to whether expenditures for food and lodging should be deducted
from nursing home costs when estimating damages in personal injury.37 For
the current discussion this seems moot in light of clear statements in the juris-
dictions that approve wrongful life actions that only extraordinary expenses be
included. Consequently, any expenditure in the life care plan for ordinary
medical or personal maintenance expenses should be eliminated by the econo-
mist.
37See Feldman and Egge (1995), Slesnick (1990) and Barrett (2001).
38The relevant court cases are Wilbur v. Kerr (AR 1982); Atlanta Obstetrics & Gynecology Group v.
Abelson (GA 1990); Grubbs v. Barbourville Family Health Ctr . (KY 2003); Azzolino v. Dingfelder
(NC 1985). The relevant statutes are Idaho Code 5-334 (Supp. 1986); Mich. Comp. Laws Ann.
600.2971 (West 2001); Minn. Stat. 145.424 (West 1998); Mo. Ann. Stat. 188.130 (West 1996); 42 Pa.
Cons. Stat. Ann. 8305 (West 1998); S.D. Codified Laws 21-55-2 (Michie 1987); Utah Code Ann. 78-
11-24 (1996).
39The cases and a statute in which wrongful birth has been recognized are as follows: Keel v. Ba-
nach (Al. 1993); University of Arizona Health Sciences Center v . Superior Court (AZ 1983); Turpin
v. Sortini , (CA 1982); Lininger v. Eisenbaum , (CO 1988); Woodruff v. Hoffman (CT 1983); Garrison
v. Medical Center of Delaware (DE 1989); Haymon v. Wilkerson (DC 1987); Kush v. Lloyd (FL
1992); Siemieniec v. Lutheran Gen. Hosp. (IL 1987); Bader v. Johnson (IN 2000); Arche v. United
States (KS 1990); Maine Health Security Act 2931; Reed v. Campagnolo (MD 1993); Burke v . Rivo
(MA 1990); Greco v. United States (NV 1995); Smith v. Cote (NH 1986); Berman v. Allan (NJ 1979),
Howard v. Lecher (NY 1976); Schirmer v. Mt. Auburn Obstetrics & Gynecologic Assoes. (OH 2003);
Schloss v Miriam Hospital (RI 1999); Jacobs v. Theimer (TX 1975); Naccash v. Burger (VA 1982);
James G. v. Caserta (WV 1985), Dumer v. St. Michael's Hospital (WI 1975).
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198 JOURNAL OF FORENSIC ECONOMICS
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Frasca 199
the calculation is
cluded, but incre
VII. Conclusion
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200 JOURNAL OF FORENSIC ECONOMICS
References
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Cases," Boston College Law Review , May 2000, 41, 585-626.
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Frasca 201
Court Cases
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Frasca 203
Appendix
Table 1
Actions for Negligent Beginnings by State
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Frasca 205
* No case law
** Breach of contract permitted
*** No explicit statement on recovery rule
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