1. Please read the Wall Street Journal arele titled \"Businesses Find Suits on Security Hard to Defend\" (housed in Modules) before answering the questions given below. (16 points) In its ruling against Vic Regnier Builders, the Kansas Supreme Court implied that businesses \"must take all economically feasible steps to provide a reasonable level of security\" but attorneys representing businesses are bothered by the ruling because \"it's almost impossible to knowjust how much more security is \"reasonable. a) a\" How can economic analysis be used to determine what constitutes \"reasonable\" security measures? Graphical analysis is recommended but not absolutely required to explainfdemonstrate what constitutes \"negligence\" in this case from an economic perspective. Consider the following hypothetical ruling by Justice I. M. W in this case: \"I find Vic Regnier Builders guilty of negligence. A violent crime occurred on the defendant's property because the defendant did not take reasonable measures to prevent the accident. The annual cost of installing and maintaining new lighting in the garage was $5,000 and adding a night security guard would have cost an additional $12,000 per year. If these investments had been undertaken, then the probability of a violent crime occurring to visitors would have been reduced from 3% to 2% each year." {1) If the average damage from a violent crime is $2 million dollars, explain whether you agree with the economic logic of Judge W ruling. {2) How might you employ the ideas of comparative or contributory negligence to create a dissenting opinion to Judge W ruling? LAW Businesses Findg Suits on Security Hard to Defend By Judy Woo Smkapaier ofng Weft Slrechoirer It's getting tougher for business to detend themselves against lawsuits accusing them or shoddy security. The suits are typically led by victims of violent crimes committed on business premises. Now courts are applying a new legal standard that allows jurors to consider a multitude of safety issues and makes it easier for victims to win suits. And theirs winning big An eightyear study by Liability Consultants Inc. found the aver- age jury verdict for a rape on a business premises to be $13 million. For a death. jurors awarded $2.2 million. The Framingham. Mass. secunty- consulting company compiled the survey results from verdicts voluntarily reported by attorneys to a national group of plaintiffs\" lawyers. \"Some of the biggest verdicts are coming in this area.' said F Robert Racial II. a Tampa. Fla. lawyer who delends businesses \"The cases are becoming more and more frequent, and the standards are becoming more and more liberal.' Under older standards. still used in same states including New York. companies are liable for crimes that are similar to previous crimes committed on their property. For instance. an apartment oivner would Iikety be held liabta tor a rape if two previous rapes took place on his property. Evidence of dissimilar crimes would be excluded. Under the new and more popular standard. most recently adopted by the Kansas Supreme Court this summer. evidence of all previous crimes can go before a iury And additionat factors. such as lighting and other safety features. can also be considered by jurors. California. Florida. Loursrana and South Dakota. among other states. also now use broad standards. which in the past several years have been embraced by most courts that have taken up the issue. In the Kansas case. for instance, a woman was shot by a robber In. an underground shoppng-oentor garage owned by Vic Regnier Buildings Inc. in Overland Park. Kan Because her attorney offered no evidence of previous crimes there. a lower court dismissed the case betore trial. But the Kansas Supreme Court reinstated the laws\" and sent it back to 8 Iowa court. A nearby parking lot had been the site of a robbery, car breakIn. and two toiled robbery atternpts. the high court noted. In addition, the garage itsetf was poorly lit. The State Supreme Court ruled that victims' attorneys should be allowed to present evidence of such incidents to juries. 'One should not be able to open an all night. poorty lit parting lot in a dangerws high crime area of an inner city With no security and have no legal foreseeability until alter a substantial number of one's M patrons have fallen victim to violent crimes.\" the court said in its decision Businesses don't have to guarantee patrons' safety. the court added. But they must latte all economically leasible steps to provide a reasonable tevel of security. 'Thts is a great ruling for victims of violent crime, but a difficult one for property owners.' said Scott Jacobs, editor of Moaters Litigation Report: Premises Liability. a Wayne. Pa. newsletter that tracks such cases The dectston outs property owners in a sticky posrtion. because they may have to beef up security and because it's almost impossible to know lust how much more security is 'reasonable ' Attorneys say what is reasonable varies case by case. depending on industry and local norms. \"It's very hard to business owners to apply.\" said David w. Hauber. the Kansas City. Kan. attorney for the parkinggarage owner 'Our experts indicated that this was a low-crime area.' Property airliners lace an extra headache if their state has a consumer-protection act A growing number of attorneys for crime victims are suing under such acts because victims can recover more than they would if they just sued for negligence For example. a tenant of Berry Property Management inc. of Corpus Christi. Texas. accused the company of negligence and violating the state's deceptive trade practices act after she was raped by an intruder She had asked for an extra door rock. but was told by the company. which is under new management. that her lease didn't allow it. In fact. however. Texas landlords must install a night latch it a tenant wants one. The woman won 516 million in state court last year, and a stale appeals court upheld the verdict. Berry Property Management has asked the Texas Supreme Cowl to review the case. 'The courts and the juries are really. in our opinion. making some outrageous liability claims for Continental Insurance Co. a large commercial insurer and a unit of Continental Corp. New York. 'I guess the position most people onJurles are tailing is that all crime is loreseeable. It's because we live in such a violent society It's terrible