harvard journal - uta · harvard journal of law & public policy volume 9, number 2 spring 1986...

HARVARD JOURNAL of

LAW & PUBLIC POLICY

VOLUME 9, NUMBER 2 SPRING 1986

FOREWORD: FOUR SENSES OF THE PUBLIC LAW-PRIVATE LAW DISTINCTION

" , Randy E. Bomt t

THE CRIME VICTIM IN THE PROSECUTORIAL PROCESS Juan Cardenm

THE ETHICS AND ECONOMICS OF RIGHT-TO-FARM STATUTES Keith Burgess-Jackson

COMMENT: THE ETHICS AND ECONOMICS OF

RIGHT-TO-FARM STATUTES Jo Kwong &John Baden e

IL

HARVARD JOURNAL of

LAW & PUBLIC POLICY

VOLUME 9, NUMBER 2 SPRING 1986

The Limits of Public Law A Symposium Sponsored by the Institute for

Humane Studies

FOREWORD: FOUR SENSES OF THE PUBLIC LAW-PRIVATE LAW DISTINCTION

Randy E. Barnett . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 267

Is ANTITRUST ANTICOMPETITIVE? Thomas W. Hazlett . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 277

COMMENT: THE ANTITRUST TRADITION: ENTREPRENEURIAL RESTRAINT

Yale Brozen . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 337

THE CRIME VICTIM IN THE PROSECUTORIAL PROCESS Juan Cardenas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 357

COMMENT: THE LOST VICTIM AND OTHER FAILURES OF

THE PUBLIC LAW EXPERIMENT Bruce L. Benson ................................... 399

RECONCILING FREE SPEECH AND EQUALITY: WHAT JUSTIFIES CENSORSHIP?

James R . Brani t . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 429

COMMENT: ANTI-PORNOGRAPHY LEGISLATION AS

VIEWPOINT-DISCRIMINATION Geo$ry R. Stone . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 1

THE ETHICS AND ECONOMICS OF RIGHT-TO-FARM STATUTES

Keith Burgess-Jackson . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 1

COMMENT: THE ETHICS AND ECONOMICS OF RIGHT-TO- FARM STATUTES

Jo Kwong &f John Bada . . . . . . . . . . . . . . . . . . . . . . . . . . . 525

T H E ETHICS AND ECONOMICS O F RIGHT-TO-FARM STATUTES

(A]lways to award the property right to the prior of two conflicting land uses . . . would be highly ineficient, for the later use will often be the more valuuble.

Richard A. Posner, 1977 ' It is dz&cult to speak with restraint of (the American fanner] or his achievements. He conquered a huge continent of rich soil for civilization. He carried to the frontier an eager desire for education, the demo- cratic impulse, and the fear of the Lord. He has helped jght his country's battles. He has been the bedrock of representative government. His independent spirit, his abundant energy, his high intelli- gence have made him without a peer among the tillers of the soil.

Kenyon L. Butterjeld, 1919

A.B., 1979, The University of Michigan-Flint; M.A., 1983, Wayne State University; J.D., 1983, Wayne State University Law School; M.A., 1985, The University of Arizona; Ph.D. candidate, The University of Arizona, Department of Philosophy. Member of the state bars of Arizona and Michigan. This Article was researched and written during the summer of 1984 while the author was a Leonard P. Cassidy Summer Research Fellow in Law and Philosophy at the University of Arizona. The author would like to thank the Institute for Humane Studies for its generous financial support, Lawrence H. White of New York University for his detailed and helpfill comments on an earlier draft of this Article, Jules L,. Coleman of the Universitv of Arizona for teaching him the fine points of economic analysis of law, the editors of the HARVARD JOURNAL OF LAW & PUBLIC POLICY for helpful editorial advice, and his maternal grandmother, Florence Mae Ed- gett Burgess, for introducing him to life on a farm. Errors, of course, are the author's responsibility.

1. R. POSNER, ECONOMIC ANAI.YSIS OF L4w 8 3.4. at 39 (2d ed. 1977). 2. K. BUTTERFIELD, THE FARMER ANI) THE NEW DAY 8-9 (1919). l'he theme of the

virtuous, hard-working farmer has ancient roots. Aristotle thought that farmers were the basis of organized society and the fount of democracy. Spr ARISTOTLE, THE POLITICS OF ARISTOTLE 263 (E. Barker trans. 1958) ("'l'he first and best kind of populace is one of farmers. . . . Not possessing the necessities oflife, they stick to their work. and do not covet what does not belong lo them; indeed they find more pleasure in work than they do in politics and government . . . ."); ,set nlso 7%r :ftrtrrirn~t Fn'nlatrr .I Por~rni f , in 3 FR.\NK- L I N FARMER 61 (1839). rpl,ri~rfrrl it, '1.11~ AMERICAN ACRICUI:~IIRAI. PRI.:SS 1819-1860. at 280, 280-81 (A. Demarec ed. 1074) (l 'he farmer "occupies a constant. intimate. and sensible relationship with Heaven."); 1. EI.I .I~I-r , AMERICAN FARMS: I ' H E I R CONI)ITION AND FUTURE I8 (rev. 2d ed. 1800) ("In ;I word, the agriculturists should be valr~ed ;IS

the temperate, the physical, the mental, the religio~~s. the moral. the social, as \~.cll ;IS

the best economic support to our civilization."); KEI~OR'I. 01; THE (:OMMISSION ON (:OLTN- TRY LIFE 17 ( 19 1 1 ) ("Not only in the n~;~terial wealth that they p ~ . o d ~ ~ c e . hr~t in ~ h c supply of i ndepende~~ t and strong citizcr~ship. t l ~ r agric-~~l~ul-;~l pcoplc constit~lte the very foundation of our n;~rional clIicicncy.").

482 Harvard Journal of Law & Public Policy [Vol. 9

In 1974, two married couples began a twenty-five acre hog- farming operation in a rural, residential community of Oregon, an area that had once been predominantly rural and agricultural in character. By 1977, the hog-farming operation had grown to incorporate 400 hogs, two long buildings covering approximately one-quarter of an acre in area, and a two-acre decomposition lagoon for the disposal and treatment of hog excrement. Plans were under way to add another 1200 hogs to the herd. All told, the couples invested more than $100,000 in the hog farm during the first three years of its ~ p e r a t i o n . ~

Within a few years of its inception, the hog farm became the subject of a lawsuit. Nineteen neighboring property owners, all of whom lived within a quarter of a mile of the farm and none of whom was a farmer, filed suit against the couples to enjoin the raising of hogs. The neighbors alleged that odors, noise, and blowflies emanated from the farm and that the emanations substantially and unreasonably interfered with the use and enjoyment of their property. The trial judge, and ultimately the Oregon Supreme Court, agreed, ruling that the hog-farming operation constituted a private nuisance under Oregon law. Despite the fact that the issuance of a permanent injunction would "effectively terminate[] the pig raising enterprise and . . . work a substantial financial hardshipv4 on the defendants, the court ruled that the law of nuisance protected the interests of the neighboring property owners. The hog-farming operation was ordered discontinued.

Today, in all likelihood, the lawsuit brought by the neighboring property owners would not be successful. In 198 1, the Ore- gon Legislature decreed that, thenceforth, no "farming practice shall . . . be declared or held to be a private or public nuisance."Vrovided that the defendants' hog-farming operation was neither negligent nor productive of infested, infected,

3. The events described in the text arc drawn fiom the case of Jewett v . Deerhorn Enters., 281 Or. 469, 575 P.2d 164 (1978). Although the hog-fartning operalion in ques~ion produced a net loss in 1975 and 1976, il was expected lo reap a "subs~an~ial profit" in 1977 and 1978 as a res~rlt of invcsu~~cnl and Pull cmploynlcnl or resources. 281 Or. at 478, 575 P.2d at l(j!?.

4. 28 1 Or. at 478. 575 1'.2d at I(i8. 5. OR. REV. STAT. Q: 30.!)35(l) (1985). I'hc litll citation of' the statute is as li)llo\vs:

Act ofAug. 19, 1981, ch. 716, 198 I Or. Laws 044 (lilcd with Sccre~ary o f S ~ a t c Arrg. 2 I . 198 1); act ofAug. 4, 1983, rh. 730, 5 I . 1983 01.. I.aws 1359 (rodilicd a1 OK. KEY. S.I..\.I.. 59: 30.930 to 30.945 (1985)).

No. 21 Right-to-Farm Statutes 483

or diseased hogs, it would be protected by statute from both private and public nuisance actions, whether brought by other farmers or by nonfarming property ownew6 Statutes such as this, sometimes referred to as "right-to-farm" (RTF) statutes, are of recent but widespread vintage in this country, and are therefore ripe for legal, economic, and philosophical analysis.'

This Article has three objectives. The first is to place RTF statutes in historical context by showing that they are only the most recent attempt, among many, to deal with a perennial social problem: the conversion of productive farmland from agricultural to nonagricultural uses. Next, I argue that, given certain assumptions about human behavior in bargaining situations and certain facts about the world, RTF statutes are allocatively inefficient; that is, RTF statutes produce misallocations of resources. This conclusion, as I will demonstrate, flies in the face of one commonly stated justification of RTF statutes: that they "result in a general benefit to the . . . welfare of the people of the state."' Finally, I analyze the distributive impact of four legal rules for the resolution of nuisance disputes, concluding that while the traditional law of agricultural nuisance (TLAN) is most favorable to neighboring property owners, RTF statutes are most favorable to farmers. Since both RTF statutes and TLAN are allocatively inefficient in the same way and for the same reason, any preference for one of these rules over an alternative, allocatively eflcient rule (of which there are two, as we shall see) must be grounded in ethics, not economics.

6. So far as the author has been able to determine, no appellate court has construed the Oregon statute. At least one trial court in anotherjurisdiction (Michigan), however, has granted summary judgment to a Sarm family on the grounds that the state's right- to-farm statute protected the t'i~mily's hrni operation. The Michigan statute is similar ro the Oregon statute in all relevant respects. .Set Rowe v. Walker, No. H I 228769 <:H (Oakland County, Mich., <:ir. <;t. lilcd Sept. 3, 1981) (summary judgment granted.Jurie 15, 1983) (construing and applying Mrc:~r. <:OMI.. I.AWS ANN. $9 286.171 to 286.474 (West Supp. 1986)).

7. See, e .g . , Grossman & Fischcr, A.ottrlirrg. thr R~glr t lo I.irrnr: Strrtrrto~~ 1.ir111l.v or1 .Yrti.~rrrrtr '4cliorts A g u i ~ ~ s l /Ire t.ir,n~er, 1!)83 WIS. I.. REV. 95. 1 17-18 ("Right to farni statutes are ;I

relatively recent pheno~nenon. In 1978. thrcc states enacted these statutes. <In]\ live years later, at least thirty-seven states have right to l i~rm statures.") (ti)otnotcs o~nitted). As 01' this writing, forty-seven of the list). States have enacted at lmst one KI'F statute. Thirty- eight of those fi~rty-sevcn states cnactcd their first K-1'1: statute during the 1980s. See irfrn the Appendix.

8. FLA. STAT. ANN. 6 X23.14(2) (M'esr Supp. I!)H(i).

484 HaroardJournal of Law &? Public Policy [Vol. 9

A. The Underlying Problem

In the past several years, there has been a steady movement of people from urban to rural areas in this c ~ u n t r y . ~ Although there is no single, unifying cause of this demographic movement, one overriding impetus appears to be the desirability of living in a pollution-free, noise-free, more relaxed environment.I0 After years of relative neglect, rural living has once again become a social desideratum. But with the change in desires and preferences among the people has come a profound-and to some observers, profoundly disturbing1'- change in the demand for rural land. Land which had once been valued primarily for farming is now becoming more valuable as residential property; and, as rural communities expand and develop, businesses and service industries move in to take advantage of the increased market for goods and services. This change in demand has converted much formerly agricultural land to nonagricultural uses. Between 1967 and 1975 alone, a

9. See, e.g., STAFF OF SENATE COMM. ON AGRICULTURE, NUTRITION, AND FORESTRY, 9 7 ~ ~ GONG., I ST SESS., AGRICULTURAL LAND AVAILABILITY: PAPERS O N THE SUPPLY AND

DEMAND FOR AGRICULTURAL LANDS I N THE UNITED STATES 6 (Comm. Print 1981) ("Ma- jor changes in American settlement patterns have occurred since World War 11. They have been most pronounced in the past 10 to 15 years. For the first time in recent history rural areas are growing faster than urban areas.") [hereinafter cited as AGRICUL- TURAL LAND AVAILABILITY].

10. Among the factors usually cited to account for the demographic movement are "an increase in rural employment opportunities," the lack of adequate housing in urban areas, improved con~munication and transportation facilities in rural areas, and the development of such amenities as "electrification" and "telephone ser\ice." Id. ("These demographic shifts [from urban to rural areas] reflect both an increased preference for rural and semirural living and an increase in rural employment opportunities. . . . Aversion to urban pollution, increased city tax burdens, and a dissatisfaction with urban conditions have added to the lure of'the countryside."). B~t t cj. ECONOM~C RESEARCH SERVICE, U.S. DEP'T OF AGRICULTIIRE, SENATE COMM. O N AGRICIILTURE, NIT- 'TRITION, A N D FORESTRY. 9 7 ~ ~ (;oNc.. 1~1 . SESS., STATIIS OF THE FAMILY FARM: FARM ORGANIZATION AND PERFORMAN(:E I N Tkle 1070's, at x (Comm. Print 1982) ("The quality of rural living was upgraded in the [nineteen] seventies by the dispersion of industn into rural areas, by modern telccommunications. and by improved transportation.").

11. One commentator has said this ahout the chance in demand for rural land: lI]f country people arc l0rccd t o move into the city, that is made up for, according to Mr. Billard la writer li)r .\'~~tiorrrtl ( ;uogr~hic ] . by the movement of city people, and the city itsell; into thc country. But that only looks like a bal- anced equation. The pcoplc \r.ho ~llovc into the city and those \rho move o ~ ~ t into the countrv arc hardly the s;~lilc pcoplc. 'l'he coul1tl.y comnlunity . . . is broken up. to bc replaced Oy 2111 inllux oL'urba11 pcoplc \vho . . . ha\,e no cco- nomic or cultural ties t o ~ h c la~ltl and arc 1101 a co~nnlunit).. 111 this excha~>gc we lose countrv ~ ~ c o p l c , \re Iosc conl~nunity, a~lcl 1r.c lose land.

W. BERRY, -1'11k: UNSKITI.IN(; 01: AMEKI(;.\: (;t~~:i.t,nk: . \ N I ) .A(;RIC:~~I:IT~RF. tX5-64 (1977) (italics in original).


period of only eight years, some 23.3 million acres of agricultural land were converted to nonagricultural uses.12

One consequence of the rapid demographic movement has been an increase in the number of land-use conflicts between farming and nonfarming property owners, such as that de- picted in Section I . I 3 People who move from cities and suburbs to the countryside are often surprised, not to mention disap- pointed and upset, to learn that their new neighbors-farmers-are engaged in a noisy, dusty, smelly, or unsightly occupation.14 This has led more than a few such property owners to file agricultural nuisance suits, some of which (as we have seen) have been successful. Occasionally, when a court orders that a farm operation be permitted to continue, it will order that the farmer compensate the neighboring property owner in monetary damages for the injury inflicted by the farming operation. This remedy, like that of the equitable injunction, may put a farmer out of business, and when farmers are put out of business and replaced by nonfarming property owners or en- trepreneurs, productive farmland is lost to nonagricultural uses. This compounds the underlying problem.

The primary tool with which homeowners have pried farmers

12. AGRICULTURAL LAND AVAILABILITY, sr~pra note 9, at 5. Annually, between two and three million acres of land are converted from agricultural to nonagricultural uses. HOUSE COMM. ON AGRICULTURE, AGRICULTURAL LAND RETENTION ACT, H.R. REP. NO. 1400, 95th Cong., 2d Sess. 10 (1978). This annual figure translates (roughly) into 35,000 acres per week-enough, it has been said, "to feed 100,000 Latin Americans, Africans, or Asians for an entire year." Id. at 7. See also Note, ..lgricultural Law: Srtbrrl.bnrr SPTRUII and the Right to Fara , 22 U'ASHBURN L. J. 448. 448 n.2 (1983) (describing the loss of farmland in Kansas in the 1980s); Comment. "Right to Fatnr " Stattrtes-Thr .\brcrest Tool in Agrirrtltrtr~l Land Presn~~ntiotr, I0 FLA. ST. U.L. REV. 4 15, 415 (1982)(noting that from 1970 to 1981, Florida has lost more than 110,000 acres of citrus); Grossman 8c Fischer,

supra note 7, at 99 ("[Ilf current rates of farmland conversion continue, [cropland] reserves could be depleted in scarcely a decade."). CJ Tlre Pre.set.r~ntiorr nrrd Co~rtrol o/ Farmland: Hearing Be/ore the Serrate Selrrl Corrrar. on Srrrnll Brtsirre.~.~, 96th Cong., I st Sess. 10 (1979) (statement of M. Rupert Cutler, Ass't Sec'y for Conservation. Research, & Edu- cation. U.S. Dep't of Agriculture) ("This adds up to a total of nearly 10.000 acres each day that is taken out of the producing and potential agricultural land base."). Note the discrepancy in the figures.

13. See AGRICULTURAI. LAND AVAILAHII.ITY, .orp)n notc 9 , at 4 ("Conflicts about land use and between urban and agrarian \,slues frequently accompany rapid growth in lru- ral] areas."); 13 N. HAKI., A~;KI(:III:I.IIKAI. I.A\v 5 124.01 (1984) ("As the popula~ion of the nation grows and is dispersed into tradi~iotlally rural areas. the potential for lilnd- use conflicts is greatly increased.").

14. See Note, s ~ r p ~ a notc 12, at 448; : ! ~ J . J I I ~ K ~ : ~ ; . N s M ~ Y E K & I . M'AI)I.KY. AGKICIII.TI.K.~I. LAW 5 25. I, at 3-4 (1982); A~;KI~:III:I.CIKAI. I.,\NI) AVAIL,\HII.ITY. s ~ ~ / ) r a notc !I, a t (i ("1:arnl- ing activity that involves chemicals, had s~nclls, noise at odd hours, and slo\\- ~noving vehicles can conflict with the prefcrcnccs ol'nonli~rnlrrs."). Not all Ilirnls, ol'coursr. arc noisy, dusty, smelly, or unsigh~ly.

Haroard Journal of Law L% Public Policy

away from their land is TLAN.15 Nuisance law, like the law of trespass, is designed to protect one o r more of the incidents of property ownership. It differs from the law of trespass, however, in at least one important respect.'" While the law of trespass protects a property owner's interest in the exclusive possession of land," the law of nuisance protects a property owner's interest in the use and enjoyment of land.18 One implica- tion of this distinction is that, in order to prevail in a nuisance suit, it is unnecessary (as in the case of trespass) to establish an actual physical invasion of the plaintiff's premises. It is sufficient, in most cases, for there to be an off-premises cause of the plaintiff's injury.'" This is why phenomena such as noise, dust, odor, and even unsightliness-all, at least commonsensically, nonphysical invasions-are in principle sufficient to establish a n~ i sance .~ '

15. See 2 J. JUERCENSMEYER & J. WADLEY, supra note 14, 5 25.1, at 4: Regardless of the reason why two potentially incompatible land uses are al- lowed to locate next to each other, the farm operation is often the use that is forced to withdraw and relocate, and often the legal basis for such action is that the farm activity is deemed to be a nuisance.

(Footnotes omitted). The reader may, without loss of argument, skip the discussion of nuisance law and

proceed directly to Section II(B). 16. See Carpenter v. Double R Cattle Co., 105 Idaho 320, 323, 669 P.2d 643, 646

(1983). B/L/ 4. 2 2. JUERCENSMEYER &J. WADLEY, supra note 14, 5 5 25.3, 25.3.1, at 8-9 (explaining that nuisance law differs from trespass law in /wo respects: First, nuisance requires only an indirect infringement of a property right (rather than a direct infringement); and second, nuisance consists of an invasion of the interest in use and enjoyment of property (rather than the interest in exclusive possession of property)).

17. See Carpenter v. Double R Cattle Co., 105 Idaho 320, 323, 669 P.2d 643, 646 (1983); 2 J. JUERCENSMEYER & J. WADI.EY, supin note 14, 5 25.3.1, at 9; RESTATEMENT (SECOND) OF TORTS 5 821D comment d (1977) ("A trespass is an invasion of the interest in the exclusive possession of land, as bv entry upon it. A nuisance is an interference with the interest in the private use and enjoyment of the land, and does not require interference with the possession.") (cross-reference omitted).

18. See Carpenter v. Double R <;attic Go. , 105 Idaho 320. 323. 669 P.2d 643, 646 (1983); 2 J. JUERCENSMEYER & J. WADLEY, ,s11prn note 14, 3 25.3.1, at 9. According to Blackstone, "Nusance [sic], ~~orrrrrr~~r/rtrrr. or annoyance, signifies any thing that worketh hurt, inconvenience, o r damage." 3 W. BLACKSTONE, COMMENTARIES *216 (italics in original). The Res/aleaerr/ (Serorrd) 1~/'7'ottr defines private nuisance as "a nontrespassor!. invasion of another's interest in the private use and enjoyment of land." RESTATEMENT (SECOND) OF TORTS 5 82111 (1077).

19. See ~J.JUERCENSMEYER & . I . WAI)I.EI.. .slt/)r/l note 14, 3 '15.3.1, at 9: KES.L\'~EMEN.I. (SECOND) OF TORTS 5 833 (1977). 'I'he R P . V / ~ / P I I ~ P I I / rule of private nuisance is as folio\\-s:

One is subject to liahilit!. l0r a private ~luisance il', but onl\ if, his conduct is a legal cause of an invasion o l ' a ~ ~ o ~ h c r ' s interest in the private use and enjo\- ment of land, and the invasion is citl~er (a) intentional and unreasonahlc, or (b) unintentional and otherwise actioni~ble under the rules controlling liability for negligent or rccklcss conduct. or Li)r abnormally dangerous conditious o r activities.

20. For noise, see Note, stt/)ro 11otc I!!, at 448. For tlust. see .innot.. '14 A.I..K. I'd 194


Within the law of nuisance, there are at least two important distinctions to be drawn. The first is between public and-private nuisances. Public nuisances are interference; with the use and enjoyment of land which affect large numbers of people and produce a common injury, while private nuisances are interferences with the use and enjoyment of land which affect individual or small numbers of people and produce individual injuries." Since RTF statutes are designed, for the most part, to prevent lawsuits by individual property owners against other individual property owners, this Article will concern itself exclusively with private nuisances-those nuisances that offer at least an opportunity for private bargaining and resolution. Hence, I will not address the special problems raised by public nuisances, although public nuisance actions, no less than private nuisance actions, have the potential to convert agricultural land to nonagricultural uses.

The second distinction is between activities which constitute a nuisance at all times and all places (nuisances per se) and activities which constitute a nuisance only under certain factual conditions (nuisances per accidens)." This distinction is best viewed as one between nuisance in law and nuisance in fact. Practically speaking, the difference is this. If an activity is determined by a court or legislature to be a nuisance in law, and the plaintiff alleges and establishes that fact, no proof of unreasonableness, substantiality, or injury is required. However, if an activity is determined to be a nuisance in fact, both the existence of the nuisance and the fact of injury must be established by the plain-

(1952). For odor, see Annot., 50 A.L.R. 101 7 (1927) (piggery); Annot., 2 A.L.R. 3d 931 (1965) (piggery); 3 W. BLACKSTONE, COMMENTARIES *217 ("[Ilf a person keeps his hogs, or other noisome animals, so near the house of another, that the stench of them incommodes him and makes the air unwholesome. this is an iniurious nusance Isicl. as >.

it tends to deprive him of the use and benefit of his house.") (footnotes omitted). For unsightliness, see 2 J. JUERCENSMEYER & J. WADLEY, st~pra note 14, $ 25.1, at 4 ("[S]ome types of farming operations . . . involve machinery or structures that could never be described as scenic.").

One might conceive of dust, no less than dirt, rocks, or garbage, as constituting a physical invasion of property, and thus as falling under the law of trespass rather than the law of nuisance. Indeed, Richard Epstein has argued that ON nuisance invasions are physical in nature. See Epstein, L\rt~i~nnce Law: Corrective Justice nrid Its 1 'tililnrinrt Cotr- slrainfs, 8 J. LEGAL STUD. 49 (1979). However, there are commonsensc differences between dust and, say, rocks. Rocks are medium-sized, everyday objects that occupy physical space and can do great harm, while dust is transient, hard to detect, and seem- ingly less destructive. Most people make this distinction, as does the common law.

21. See ~ ~ . J U E R C E N S M E Y E R &J. WADLEY, Stl/)rO note 14, $ 25.4, at 11, $ 25.4.1, at 12. $ 25.4.2, at 13.

22. See id. , $ 25.5, at 15, $ 25.5.1, at 15, $25.5.2, at 16.

488 HarvardJournal of Law €9 Public Policy [Vol. 9

tiff in order to prevail. Most farming activities, to the extent that they are nuisances at all, are nuisances in fact; conse- quently, when I speak of agricultural nuisances in this Article, I will be referring to nuisances per accidens.

Traditionally, there were two remedies for private nuisance: monetary damages and injunctive relief. In many cases of nuisance, the plaintiff's injuries are compensable monetarily, and this is the preferred judicial remedy.23 Where monetary damages are capable of being assessed and awarded, and the nuisance is permanent in nature, the amount of damages is determined by subtracting the value of the property after inception of the nuisance from its value immediately before. Where the nuisance is temporary in nature, the amount of damages is determined by subtracting the rental value of the property after inception of the nuisance from its rental value immediately b e f ~ r e . " ~ The objective in both cases is that of tort law generally: to put the plaintiff in as good a position as he or she was before the onset of the defendant's injurious a~tivity. '~ Where this objective cannot be met, or where the nuisance is continuing in nature, another form of relief is available: the equitable injunction. Although, in theory, equitable injunctions may be either permanent or temporary, courts, in practice, are reluctant to issue permanent injunctions-at least where the activity in question is economically prod~ctive. '~

B. Traditional Approaches to the Problem

The problem of conflicting land uses, as I have said, is at once a symptom and a cause of a much larger problem: that of productive farmland being converted from agricultural to nonagricultural uses. Understandably, policymakers have not sat idly by while this occurred. Convinced that the loss of farmland is an undesirable state of affairs, both socially and economically, policymakers have been at the forefront of efforts to stem

23. See id., 8 25.8, at 27-28; Note, supra note 12, at 456; Comment. supra note 12, at 427.

24. See 2 5. JUERCENSMEYER &J. WADLEY, SUPM note 14, 5 25.8, at 27. 25. This is to be contrasted with, for example, a contract remedy, which is designed

to put the plaintiff in the position he or she would have been had the contract been performed as agreed. See, e .g . , C. FRIED, CONTRACT AS PROMISE: A THEORY OF CONTRAC- TUAL OBLIGATION 21-27, 117-18 (1981).

26. There is, in fact, a principle of law which states: "No in-junction shall issuc if a remedy at law will adequately compensate the injured party." 2 J. JUERGENSMEYER & J. WADLEY, supra note 14, 5 25.8, at 27-28.


the tide of "ruralization" and slow the rate of conversion of farmland in this country. T o highlight the significance of RTF statutes in this land-preservation process, it will be worthwhile to review some of the measures that have been taken by policymakers to preserve the country's farms or farmland.27

One recent strategy developed by policymakers is to require that farm-impact statements be prepared and used before to enactment or implementation of any federal, state, or local statute. Such statements have a dual effect. First, they ensure that agricultural concerns are taken into account in the policymak- ing process; and second, they place the concerns of agriculture into a wider conceptual framework-that of preserving the in- tegrity of the natural environment as a whole.

A second strategy for preserving farmland is more direct. It involves providing farmers with tax incentives to maintain their property as farmland. This objective is achieved in either of two ways: by assessing farmland differentially (for example, by assessing the farmland according to its value as a farm rather than at its most highly-valued use), or by lowering the maximum rate of estate taxation for farmers. Both of these strate- gies have been undertaken at the federal level in recent years."

At the state level, several novel approaches have been taken toward the preservation of farms and farmland. One approach involves the purchase by the state (usually through an adminis- trative agency) of development rights to selected parcels of agricultural land within its borders. A farmer under such an agreement continues to farm his or her land according to past practice, while the state receives a promise from the farmer not to sell or develop the property for a specified period of years. Although state statutes differ considerably in this regard, most farmers who enter into development rights agreements with their states are compensated for the relinquishment of their rights by tax abatements, preferential property assessments, or

27. Policymakers are often not clear about just what they are trying to protect. Stt, t .g . , FLA. STAT. ANN. 5 823.14(2) (West Supp. 1986). This is unfortunate. for there are important conceptual differences among the following: ( I ) preserving farms 9110 farms; (2) protecting farmers; and (3) conserving farmland. In practice, all of these goals may be furthered by the same policy or set of policies, but of course they need not be. For a useful distinction between "conservationist" and "preservationist" attitudes toward environmental protection, see Norton, .fgvirrrllr~vnl Dt~~r In / Iarr~r / rrlrd Errr~irn1111tu11ln1 I'nliry: Cntire/Il~ml Is.vrrt.~, 2 AGRIC. & HUM. VAL.LIES 63, 64-66 (198.5).

28. Set Comment, s~l/ Ira note 12, at 416-17.

490 Hamard Journal of Law & Public Policy [Vol. 9

other favorable tax treatment."' In a variation on this theme of (farmer-state agreements),

farmers transfer development rights to other private individuals, who are then permitted by the state to engage in higher- density development in urban and suburban areas than would otherwise be the case. The objective here is the same: to ensure, to the maximum extent possible, that agricultural lands remain employed in agricultural uses. Many states, in addition, assess farmland differently than other properties, thus giving farmers a direct financial incentive to maintain their property as farmland.30

Still another device designed by policymakers to preserve farmland is the agricultural district. Like development rights agreements, these devices involve contracts between farmers and the state. Unlike development rights agreements, however, agricultural districts generally consist of groups of farmers rather than individual farmers. In both cases, the compensation for the farmer takes the form of tax benefit^.^' Zoning, long a tool of land-use planners in this country, has only recently come to be employed as a method of preserving farmland, and today it is widely used. Some states go so far as to permit local governments to zone portions of rural land as "exclusively agricultural," the effect of which, as one might expect, is to prohibit nonfarm uses on those proper tie^.^'

Finally, at least one state, to date, has amended its constitu- tion to prohibit the acquisition of farmland or ranchland by corporate interests. This constitutional provision, ratified by a vote of the people of the state of Nebraska in 1982, contains an exception for "family farm corporations," defined as those corporations in which "the majority of the voting stock is held by members of a family."33 It should be noted that the Nebraska provision evinces a preference not for farming generally, but for a certain kind of farm-namely, a farm in which the resources are family-owned and managed, and which tends to be smaller than the norm. This is the so-called "family farm.''34

29. See id. at 419-23. The Michigan statute is illustrative in this regard. See MICH. COMP. LAWS ANN. 5 554.703(1) (West Supp. 1986).

30. See Comment, supra note 12, at 420-21. 31. See Grossman & Fischer, s~cpra note 7, at 114-16; id. at 418-19. 32. See Juergensmeyer, Introd~~ction: Slate a ~ ~ d Local Land ('.re P ~ ~ I I I I I I I ~ . a11d Co~lt,vl ill tltr

Ap-imltural Context, 25 S.D.L. REV. 463,472 (1980); Comment, slipra note 12, at 423-24. 33. NEB. CONST. art. XII, 5 8. 34. The familv farm, we are told, "is gradually disappearing" from the An~crican

No. 21 Right-to-Farm Statutes

C . Right-to-Farm Statutes

Viewed in historical context, RTF statutes are only the most recent approach among many to the twin problems of protecting farmers and preserving farmland. In many ways, RTF statutes serve to complement the various other approaches, for they address a cause of agricultural loss (nuisance suits) that was left unaddressed by the other approaches. Actually, RTF statutes are not as novel as I have made them out to be. The first RTF statute in the United States (though not denominated as such) was enacted in 1963, when the Kansas Legislature set out a list of standards for livestock feedlot operations and decreed that compliance with those standards "shall be deemed to be prima facie evidence that a nuisance does not exist."35

landscape. Breimyer & Schertz, Profile of Farming and Rural America, in FOOD-FROM FARM TO TABLE: 1982 YEARBOOK OF AGRICULTURE lo, 12 ( 1982). Not only is the overall farm population decreasing, but farms are decreasing in number and increasing in av- erage size. B. GARDNER, THE GOVERNING OF AGRICULTURE 98 (1981). Many experts, in fact, predict the development of "two classes" of Farms in this country in the near future: "a moderate number of large farms producing most of the output, many small farms producing little, and a few mid-sized farms in transition to one of the other two." ECONOMIC RESEARCH SERVICE, supra note 10, at I 1; see alto Breimyer & Schertz, supra, at 12:

The predominance of family farms in U.S. farming is giving way before a trend toward a dual agriculture. It is being displaced in number by smaller farms, the majority of which are part-time, and in volume of marketings by larger- than-family farms and by large corporate o r agribusiness farms.

Many people, professional and otherwise, are concerned about the trend away from family farms. Paul Barkley, for instance, has argued that family farms are valuable because they "keep[] agriculture resilient" and are able to "absorb" such "adversit[ies]" as "low prices, poor weather, and inferior inputs." Barkley, A Cotilemporary Politiral Ecou- omy of Family Fanning, 48 AM. J . AGRIC. ECON. 812, 816, 818 (1976). Wendell Berry, a passionate defender of "smallness" in a world hellbent for "bigness," finds worth in the "old rural virtues of solvency and thrift." W. BERRY, supra note I I, at 62. Some- times the arguments for family farming take on almost mystical overtones:

One way to preserve the family farm is to make it the object of religious-like veneration among all citizens. . . . Although the small farmer has much in common with the small restauranteur [sic], the independent corner grocer, and the independent fuel dealer, society must concentrate with special atten- tion on the farmer. H e pus t plant and harvest each year, and society's stake in this process must not be confused with society's stake in the record shop, the back country lawyer, o r the local Hallmark card dealer.

Barkley, supra, at 8 17. B t ~ l c / . II,appe, The Family Farm: Caught in the Co~rttndirtioi~s of ,Iwrti- can I'abe~t, 2 AGRIC. & HUM. VALUES 36, 40 (1985) ("[Olur defense of the family farm has nothing to do with nostalgia! Neither does the importance of the family farm rest on what is 'special' about farmers. I am convinced that the issues raised by the demise of the family farm touch all Americans. The val~ies at stake are widely shared throughout the society.") (italics in original). Compare these views with those found in note 2 supra.

35. Act of Apr. l I, 1963, ch. 287, 5 5, 1963 Kan. Sess. Laws 574; act of Apr. 13, 1967, ch. 295, 5 1, 1967 Kan. Sess. Laws 561 (effective Apr. 20, 1967) (codified at KAN. STAT. ANN. 5 47-1505 (1981)).

492 Haward Journal of Law & Public Policy [Vol. 9

T h e effect of the Kansas legislation was to bar nuisance suits against feedlot operations that were conducted in a reasonable and pollution-minimizing manner. Other states were soon to follow the Kansas lead in enacting such statutes.36

By the late 1970s, a new type of RTF statute had made its way onto the scene. Beginning with 1978 Alabama legisla- t i ~ n , ~ ' RTF statutes became at once more inclusive and more protective of farming activities. Instead of protecting only livestock feedlot operations, as had the Kansas statute, this new legislation expressed concern for "agricultural operations" generally. It also, in many cases, transformed a simple pre- sumption in favor of farming operations into a full-fledged "right" to farm. Both public and private nuisance actions against non-negligently operated farming activities were barred. Perhaps because of this profound change in statutory language and effect, many legislatures went to great lengths to rationalize their new RTF statutes, as this passage from the 198 1 Arkansas statute illustrates:

It is the declared policy of the State to conserve, protect and encourage the development and improvement of its agricultural land and other facilities for the production of food and other agricultural products. When non-agricultural land uses extend into agricultural areas, agricultural operations often become the subject of nuisance suits. As a result, agricultural operations are sometimes forced to cease operations. Many others are discouraged from making investments in farm or other agricultural improvements. It is the purpose of this Act to reduce the loss to the State of its agricultural resources by limiting the circumstances under which agricultural operations may be deemed to be a nuisance.38

Since 1963, when Kansas enacted its livestock feedlot statute, forty-seven of the fifty States (Alaska, Nevada, and South Da-

36. The other states that enacted livestock feedlot statutes, in order o f enactment, were Oklahoma (Act ofApr. 1 , 1969, ch. 116, 8 10, 1969 Okla. Sess. Laws 138 (codified at OKLA. STAT. ANN. tit. 2 , 8 9-210 (West 1973))). Iowa (Act ofJune 28, 1976, ch. 1121, 1976 Iowa Acts 261 (effective Nov. 1, 1976) (codified at IOWA CODE ANN. 8 8 172D.1 to 172D.4 (West Supp. 1985))). Wyoming (Act of Feb. 23, 1977, ch. 59, 1977 Wyo. Sess. Laws 150 (effective May 27, 1977); act o f Mar. 9 , 1978, ch. 32, 1 1 , 1978 Wyo. Sess. Laws 136 (effective Jan. 1 , 1979) (codified at WYO. STAT. $ 5 1 1-39-101 to 11-39-104 (1978))), and Tennessee (Act o f Mar. 29, 1979, ch. 138, 1979 Tenn. Pub. Acts 241 (codified at TENN. CODE ANN. $ 5 44-18-101 to 44-18-104 (Supp. 1985)). Seegerr~rnll\~ 13 N. HARL, supra note 13, 5 124.02(l)(a)(ii).

37. Act of Aug. 7, 1978, No. 79, 1978 Ala. Acts 1767 (codified at ALA. CODE 8 6-5- 127 (Supp. 1985)).

38. ARK. STAT. ANN. 5 34-120 (Supp. 1985).


kota are the exceptions) have enacted RTF statutes of one sort or another. These statutes, while differing considerably in language, have a core of common features. First, RTF statutes de- fine a sphere of activity, such as "agricultural operations," which is alleged to be in need of governmental p r o t e ~ t i o n ~ ~ ; second, RTF statutes set out one or more conditions under which the activity is eligible to receive protection, such as that the activity precede in time the plaintiff's appearance in the area4'; and third, RTF statutes exempt certain farming activities (primarily negligent farming activities) from the protection of the ~ t a t u t e . ~ ' Every RTF statute, in addition, has this feature: It prevents the successful prosecution of a nuisance suit against a farmer by a neighboring property owner for interference with the use and enjoyment of the neighbor's property. For purposes of this Article, I shall take as typical of RTF statutes the following statute (adapted from the 1980 Kentucky legislation):

No agricultural operation or any of its appurtenances shall be or become a nuisance, private or public, by any changed conditions in or about the locality thereof after the same has been in operation for more than one year, when such operation was not a nuisance at the time the operation began; pro- vided, that the provisions of this subsection shall not apply whenever a nuisance results from the negligent operation of any such agricultural operation or its appurtenances.42

RTF statutes are allocatively ineffi~ient."~ In other words,

39. See, e.g., ARIZ. REV. STAT. ANN. Q 3- 105 1 ( 1) (Supp. 1985) (" 'Agricultural operations' means all activities by the owner, lessee, agent, independent contractor and sup- plier conducted on any facility for the production of crops, livestock, poultry, livestock products o r poultry products.").

40. See, e.g., GA. CODE ANN. Q 72-108 (1981) (providing that the activity must have been in operation for "one year o r more").

41. See, e.g., N.C. GEN. STAT. Q 106-701(a) (Supp. 1985) ("[Tlhe provisions of this subsection shall not apply whenever a nuisance results from the negligent o r improper operation of any . . . agricultural operation o r its appurtenances.").

42. KY. REV. STAT. Q 413.072(2) (Supp 1984). 43. See infra Section IIl(C) for a definition of "allocative efficiency." There are, of

course, many different conceptions of efficiency. See, e.g., A. BUCHANAN, ETHICS, EFFI- CIENCY, AND THE MARKET 1-13 (1985). In this Article. I am concerned with only one sort of efficiency, allocative efficiency, o r what is sometimes misleadingly called "productive" o r "Coasian" efficiency. For other conceptions of efficiency, see R. POSNER, sc~pro note 1, Q 1.2, at 10 (" 'Efficiency' means exploiting economic resources in such a way that 'value'-human satisfaction as measured by aggregate consumer willingness to pay for goods and services-is maximized.") (italics omitted); R. LEFIWICH, THE PRICE SYS- TEM AND RESOURCE ALLOCATION 16 (3d ed. 1966) ("The economic efficiency of a partic-

494 HarvardJournal of Law €9 Public Policy [Vol. 9

given certain plausible assumptions about human behavior in bargaining situations (to be made explicit shortly) and certain facts about the world, RTF statutes produce misallocations of at least one resource: land. They also, arguably, produce misallocations of other resources, but these misallocations are not at the heart of the problem addressed by RTF statutes-the conversion of agricultural land to nonagricultural uses-so I shall not discuss them here. If I am right that RTF statutes are allocatively inefficient, then one commonly stated justification of RTF statutes founders. Proponents of RTF statutes have as- serted repeatedly that such statutes "result in a general benefit to the . . . welfare of the people of the state."44 This argument, I will conclude, is unsound. RTF statutes provide a legal framework in which mutually beneficial gains from trade are discouraged, rather than encouraged. They are, therefore, suboptimal from the standpoint of individual and collective welfare.45

A. Assumptions

In what follows, I make two standard economic assumptions. First, I assume that individuals are rational, substantially

ular productive process is the ratio of useful product output to useful input of resources.").

44. FLA. STAT. ANN. 5 823.14(2) (West Supp. 1986). The Florida statute reads: - -

The legislature finds that agricultural production is a major contributor to the economy of the state; that agricultural lands constitute unique and irreplacea- ble resources of statewide importance; that the continuation of agricultural activities preserves the landscape and environmental resources of the state, contributes to the increase of tourism, and furthers the economic self-suffi- ciency of the people of the state; and that the encouragement, development, improvement, and preservation of agriculture will result in a general benefit to the health and welfare of the people of the state.

In personal correspondence with the author of this Article, the chief sponsor of the Michigan RTF statute claimed that "the benefits the people of [Michigan] . . . will reap by protecting the agricultural community [that is, by enacting an RTF statute] shall far outweigh any alleged misallocation of resources my legislation purports [sic]." Letter from Lewis N. Dodak to Keith Douglas Jackson [Keith Burgess-Jackson] (May 5, 1981). According to an analysis performed by the Michigan House Legislative Analysis Sec- tion, "[tlhe entire state [will] benefit from the [Michigan RTF statute], since agriculture is the number two industry in Michigan and represents some $3 billion in farming operations alone. . . ." MICHIGAN HOUSE I.EGISLATIVE ANAI.YSIS SECTION, FIRST ANAI.YSIS. 8 1 s ~ LEG., REG. SESS., HOUSE BILL 4054, at 1 (Mar. 19, 1981).

45. I attach no technical meaning to the word "welfare" in this Article. Suffice it to say that if there remain for two individuals mutual gains from trade, then the welfare of each individual will be enhanced by entering into a bargain which exploits that potential gain. See, e.g., Coleman, Book Review, 34 STAN. L. REV. 1105, I I08 (1982) (review- ing R. POSNER, THE ECONOMICS OF JUSTICE (1982)). By "collec~ive welfare" I mean simply the aggregation, by wha~ever means, ofall individual welfares. I assume Lhat Lhis is both possible and feasible.


knowledgeable, self-interested economic agents; and second, I assume that individuals do not engage in strategic behavior in the marketpla~e.~' These assumptions are best understood through an examination of their implications. To say that an individual is rational, substantially knowledgeable, and self-interested is to say that, other things (such as price) being equal, he or she prefers more of a given good to less, and also that, other things (such as quality) being equal, he or she prefers to pay less for a given good than more.47 The second assumption-that individuals do not engage in strategic behavior in the marketplace-implies that where each of two or more individuals stands to gain something through bargaining, the bargain will in fact be struck.

B. The Four Legal Rules

Given these assumptions, it is fairly easy to demonstrate that RTF statutes are allocatively inefficient. Let us begin the analysis by describing a hypothetical situation similar to that de- picted in Section I. Imagine that a corn farmer (F) and a homeowner (H) purchase contiguous parcels of land in a rural community, and that F's corn-farming operation interferes with the use and enjoyment of H's property by producing noise and dust. Suppose further that there are no technological means whereby the interference can be eliminated; that is, the only resolution of the nuisance dispute is either to terminate the corn-farming operation or force one party to move. Finally, to avoid the problem of temporal priorities, imagine that F and H purchase their respective parcels of land at the same time, each without knowledge of the other's purchase.""

46. For a discussion and critique of the assumption of rationality. see Sen, R n ~ i o ~ m l Fools: A Critique oylhe B~hc17~io1.nl Forr~~dr~lio~ts of Eroironrir T ~ I P O I ~ , 6 PHIL. & PUB. AFF. 317 (1977); fl. R. POSNER, S I I ~ T ~ I note 1 , 8 1.3, at 12-14. For a general discussion of the role of assumptions in economic analysis, see id.; A. POI.INSKY, AN INTWODL~CTION TO I.A\v A N D ECONOMICS 2-5 (1983). For a disc~~ssion of the assumption of "substantial knowledge" (which is to be contrasted with [he assumption of perfect knowledge), see Cole- man, E#rietrry, Exrlanng~, rrnd . . l ~ ~ c l i o ~ ~ : Pl~iloso~)l~ir .-fsp~rls o/ I ~ P Ero~io~ir ic :lppronrlr lo I.ni11, 68 CALIF. L. REV. 221, 223 n.6 (1080). For ;I discussion ol'strategic behavior, see Polinsky. Resolvi~zg Nttisanct D I S ~ I I ~ P . ~ : 7 3 ~ SIIIIPII, E l O I I~ I I I I , : , - / f l11j1111rl i7~ ond Dnntrrgp K~111rt1ic.s. 32 S.I..\N. L. REV. 1075, 1078 ( 1980) ("Strategic 1)ehavior consists o f bargaining condrlct in \~~hich a party, perhaps misperceiving his opponent's bargaining position, holds out tijr a settlement that is never rcachctl (or that is rcachcd after undue delay or rlegoti;~tion cost).").

47. SPP generally K . POSNEK. .sn/))n note I . 8 I. I. 48. O n the problem ol' tenll>oral priorities, see Wi t tn l ;~~~ . f i t : $ / COIIIP. I;i,:\/ .SPII~I~I/: .lit

f?oflomir A~zalysis of "(.'ofifif~g lo //to .~~rrsr~f f fc ." ! ) , I . I.~<c:.il. S.r.tll). 557 (I!)80): K;lllin. .vlii-


In a situation such as this, there are four possible resolutions of the land-use conflict between F and H, depending upon ( I ) which party is awarded the entitlement, and (2) how that entitlement, once awarded, is protected. An entitlement, simply put, is a property right."' It grants to its possessor legal authority to do or prevent others from doing certain things on or to that property. In the case described, to award the entitlement to F is to permit F to engage in corn-farming operations, while to award the entitlement to H is to grant H the right not to be interfered with in the use and enjoyment of his or her property. Since we have assumed for purposes of argument that there are no technological means whereby the interference can be eliminated short of terminating the farm operation or forcing one party to move, awarding the entitlement has a dis- positive effect on the conflict. Unless the nonentitled party is willing to purchase the entitlement from the other, either F will have legal authority to grow corn or H will have legal authority to be free of noise and dust. There is, by hypothesis, no other resolution.

Having awarded the entitlement to one of the parties, a second question must be addressed by the appropriate authority: How should it (the entitlement) be p r~ tec ted?~ ' Here again there are two possibilities. The entitlement may be protected by a property rule or by a liability rule. A property rule protects entitlements by granting to the entitlement holder the ability to obtain an equitable injunction-a court order that prevents the infringement of an entitlement by invoking the authority of the court on behalf of the entitled party." The central feature of this protective rule is that the entitlement holder, rather than

sance Law: Rethinking F~cndflnre~i/nl rlssccrnnptio~~.~, 63 VA. L. REV. 1299, 132 1-29, 1325 n.73 (1977).

49. In what follows, I adopt the analytical framework and much of the terminology of Guido Calabresi and A. Douglas Melamed. See Calabresi &- Melamed, Proprrfi R111e.v. Liabilily Rules, and Inalierrnbili/~: OIIP liCiil OJ /he Ca/lredt~ol, 8 5 HARV. L. REV. 1089, 1090 (1972) ("The first issue which must be faced by any legal system is one we call the problem of 'entitlement.' Whenever a state is presented with the conflicting interests of two o r more people, o r two or more groups of' people, it must decidc which side to favor.").

50. See id. at 1092 ("l'hc state not only has to decidc whom to entitle, hut it nlust also simultaneously make a serics of' cclually dificult second order decisions. f l lcsc decisions go to the manner in which cntitlcn~ents are protected . . . .").

5 1. See id. ("An entitlement is protcctrd by a propcrty rule to the extent that sonle- one who wishes to remove the cntitlcmcnt from its holder must buy it from him in ;I

voluntary transaction in which the value o f the cntitlcn~cnt is agrccd upon by the seller.").


the usurping party, decides whether to engage in or prevent the injurious activity. If the entitlement holder desires protection from a potential usurper of the entitlement, he or she must obtain an equitable injunction from the court to that effect. The court, we may assume, will grant the injunction if the threatened injury is reasonably likely to occur.

The second protective rule, a liability rule, protects entitlements by requiring monetary compensation from the usurping party whenever the entitlement in question is infringed.52 The central feature of this protective rule is that the usurping party, rather than the entitlement holder, decides whether to engage in or prevent the injurious activity. If the usurping party desires to infringe the entitlement, he or she may do so, but will be required after the fact to compensate the entitlement holder for actual damages.53 In both cases-the case of the property rule and the case of the liability rule-the entitlement (property right) is respected and enforced by the state, but in one case (the case of the property rule) the decision to produce or prevent injury is left up to the entitlement holder, while in the other (the case of the liability rule) this decision is left up to the usurping party.

Given that the entitlement may be awarded to either F or H, and given that it may be protected by either a property rule or a liability rule, there are four legal rules for the resolution of the hypothetical land-use conflict. In order to clarify the applica- tion of these rules to the nuisance context, and, in particular, to the agricultural nuisance context, I have summarized the rules and given them names. The first rule (FP) awards the entitlement to F and protects it with a property rule:

(FP) F is entitled to produce corn, even if that production interferes with the use and enjoyment of H's property. F may enjoin prospective interferences with his or her entitlement and may voluntarily relinquish the entitlement to another.

52. See id. ("Whenever someorlc III;IV destroy the initial entitlement i f l ~ e is willing to pay an objectively determined value Ibr i t , an entitlement is pro~ected by a liability rule."). I assume throughout this I\~-~iclc that i t is possiblc, in both theory and practice, to determine the value of' infiingcd entitlcrnc~~ts. 'l'his is, of course, a strong assumption, and i t needs defending; but I shall not dcfcnd i t here. For a hclpful discussion of' the "information problem," as this prohlcl~~ is known, see <:oleru;~~~, .srrpr.cr note 45. at 1 109 n.6; Coleman, Tlw ECOIIOIIIIC .l~~nly.si.r ~fI./rii'. in lC~.r~~c;s. E~:ONOMI(:S. ,\NO TIIE I..\\\. 83, 98-99 (J. Pennock &.I. Chapman cds. II)X!!).

53. I assume that all injl~rics arc n~onctizi~l~lc.


The second rule (FL) also awards the entitlement to the farmer, but it protects the entitlement with a liability rule:

(FL) F is entitled to produce corn, even if that production interferes with the use and enjoyment of H's property. H may enjoin F from producing corn, but must compensate F for lost profits if he or she chooses to do so.

The third and fourth rules award the entitlement to the homeowner, but differ with respect to the protective rule employed. The third rule (HP) employs a property rule:

(HP) H is entitled to be free of interference from F's farming operation, even if that freedom reduces F's income. H may enjoin prospective interferences with his or her entitlement and may voluntarily relinquish the entitlement to another.

The fourth rule (HL) employs a liability rule: (HL) H is entitled to be free of interference from F's farming operation, even if that freedom reduces F's income. F may produce corn, but must compensate H for actual damages if he or she chooses to do so.

The following table summarizes the four rules:

C. Economic Analysis of the Four Legal Rules

F has Entitlement

H has Entitlement

An allocation of resources is efficient, in the sense in which I use the term, if and only if there is no further reallocation of those resources that will employ them in higher valued uses (where value is measured in terms of willingness to pay)."4 Put

54. I adopt here the Posncrian cotlception o f v;lluc. Sre R. POSNER, . ~ t ~ / ) ) n uotc 1. 9 1.2, at LO ("Willingncss to pav, thc hasis ol' the clticiency and valuc concepts. is ;I

function o f many things. including ~ h c tlistribtttiori of'inco~nc and wealth."). For ;I critique o f this conccptiorl o f value (as well as othcr aspects 01' l'osller's theory). scc Baker, The Ideology of the I k o ~ t o ~ i t i r .Ittcr!,.s~.! 1fI.ctir1. 5 I'IIII.. & Pt115. AFF. 3 (197.5); K. l311t.- gess-Jackson, The <:oncept o S Willirlgncss to l'i~y (1)ec. 17. 1!)05) (unpublished 11i;uiu-

Property Rule

FP

HP

Liability Rule

FL

HL


differently, so long as there remain unexploited mutual gains from trade, a distribution of resources is not efficient.

In an ideal world, market transactions would be costless. En- titlements would be defined with precision, individuals would always know exactly with whom to negotiate in order to achieve their ends, there would be no problems involved in persuading others to bargain, there would be no difficulties in drafting and enforcing contracts, and each party involved in a dispute would know his or her own preferences and the relevant preferences of others.55 In the real world, however, there are many impedi- ments to bargaining. For example, individuals may not realize who or what is injuring them (or even that they are being injured), they may be unable to persuade others to join with them in the bargaining process, and they may mistake another's preferences.

There are also more practical costs associated with transact- ing in the marketplace, such as getting to and from the bargaining table, hiring attorneys and other professionals to negotiate and draft one's contracts, and gathering information about the dispute in order to take steps to resolve it. These costs, commonly referred to as "transaction cost^,"^" may be divided into two categories: (1) those that are sufficiently large to eliminate any net gain from trade (in which case the transaction costs are said to be "significant"), and (2) those that are insufficiently large to eliminate any net gain from trade (in which case the transaction costs are said to be "insignificant"). The limiting

script) (available from the author). .SPP (rho I.. HECKER, PROPER^ RIGHTS: PHII.OSOPHIC FOUNDAT~ONS 67-68. 125 n. 12 (1977).

'This type of efficiency, which I call "allocative efficiency," is slightly different frotll various other types of cllicicncy, sucli as Pareto superiority, Kaldor-Hicks efficieilcy. and wealth maximization. While these conceptions of' efficiency have much in conlnlon. there are also important dilf'ercnces among thcnl, none of which need detain us here. I assume for purposes of' this At.ticlc that allocative elficiency most closely approxitnatcs the concept of "general wellarc." For an excellent analysis of the various conceptiotls of efficicncy, together with a demonbtra~ion ol'their interrelationships. see the series of articles by Jules Coleman: (:olciiian, .ril/)l.n nolc 46; Coleman. EIf;ri~rtc?. l ' / i l i / y . ( i r~r l IZ'enllli Aln,sinr&lion. 8 HOFS~KA I.. REV. 509 (1980): (:oleman, srip,n note 5'1; (:olctn;tn. sr~ppm note 45.

55. As is pointed out iii ~ i o ( c 58 i r ~ l i n , these coilditions ;Ire unlikely to ol)~;~itl in ~ h c real world. Set, p.g'., R. HAKIC. MoK.\I. 'I 'IIINKING: ITS 1 .~v~1 . s . MK~IIOI). AN)) I'oIN.~ 122 (1981) ("Nobody slipposes t h ; ~ ~ in ~)l.ac~icc hu~ti;~n beings will he able to liiid out it11 the facts about other people's ~)rclirct~ccs and tllcir strengths . . . .").

56. SPP, P.R.., A. POI.INSKI., .s i~/ ) )n 1 1 0 1 ~ ' 46, ;II 12; K. I'OSNKK. .rlc/)rn ttotc 1. JI 9.6, ;II 45. For a useful discussion of'tr;iilsac~iort costs gctlerally. scc 1)ahlttlati. 7'11~ I ' w h l ~ ~ r n r~ f I< .h / r~~~- rialilq, 22 J.1.. & EC;ON. I4 I . I48 (1979).

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502 Haward Journal of Law €9 Public Policy [Vol. 9

case of insignificant transaction costs is that in which they are zero.

1. No Transaction Costs

Suppose, to return to our hypothetical example, that F can earn a profit of $100 by growing corn on his or her property. Then, ignoring other (nonpecuniary) values that F attaches to farming, F values corn farming at $100. Suppose also that H will be injured to the extent of $50 if F grows corn. Then H values F's not farming at $50. In a case such as this, where there are no transaction costs, all four of the rules (FP, FL, HP, and HL) are allocatively efficient; that is, under any of the four rules, F, who is the higher-valuing party, will grow corn. T o see this, consider the case of FP (item (a) on Table 2). FP, as we saw, awards the entitlement to F and protects it with a property rule (an equitable injunction). F, given the assumptions set out above, reasons as follows: "I am entitled to grow corn, and, if I choose to do so, I will earn a profit of $100. I also have at my disposal an injunction with which to prevent interference with my entitlement. But perhaps H, who will be injured by noise and dust if I grow corn, is willing to purchase my entitlement from me for a sum in excess of $100. If so, I will take it."

H, who is also rational, substantially knowledgeable, and self- interested, reasons as follows: "F is entitled to grow corn, and will do so unless I purchase his or her entitlement. But F requires at least $100 in order to relinquish the entitlement. Since I will be injured to the extent of only $50 if F grows corn, it is in my interest to suffer the injury rather than pay F $100 to cease farming operations. Hence, I will suffer the injury."

The same reasoning applies under rule FL (item (b)). In that case, F is entitled to grow corn, but the decision whether to prevent its injurious effects lies with H. If H enjoins F's operation, H must compensate F for lost profits-in this case, $100. But H will choose not to do so. H's choice is between paying F $100 for lost profits and suffering injury to the extent of $50 from the noise and dust. Being rational, substantially knowledgeable, and self-interested, H chooses to suffer the injury from noise and dust. Thus, whether F's entitlement is protected by a property rule or a liability rule, the result is the same: Resources are employed in farming.

Next, consider the case in which H is awarded the entitle-


ment. Under rule HP (item (c)), H is entitled to be free of interference from F's farming operation, and can enjoin F from farming should F threaten to do so. In this case, H reasons as follows: "1 am entitled to be free of interference from F's farming operation, and can stop F from growing corn should he or she threaten to do so. But perhaps F is willing to pay me a sum of money in order to be able to farm. Since, if F farms, I will be injured to the extent of $50, I will require at least $50 from F in order to relinquish my entitlement."

F reasons as follows: "H is entitled to prevent me from farming. But, if H does so, I lose the opportunity to earn a profit of $100. I will therefore offer H any sum less than $100 to be able to grow corn. Even if we settle at $75, or $90, I will still be in a better position than if H had not consented to the bargain." Because H is willing to accept any price greater than $50, and F is willing to pay any price less than $100, there is room for bargaining; a mutually beneficial gain from trade remains unexploited. The parties therefore contract with one another at some price between $50 and $100 for relinquishment of H's entitlement, and F proceeds to grow corn. The precise figure at which a bargain is struck depends on, among other things, the relative bargaining strengths of the parties.

Finally, consider the case in which rule HL is in effect (item (d)). Under HL, H has the entitlement, but F decides whether to farm. Since F can earn a profit of $100 by producing corn, and must compensate H for only $50 in damages if he or she does so, F decides to grow corn. In doing so, F earns a net profit of $50. Thus, under any of the four rules, where there are no transaction costs and F values farming more than H values not farming, F grows corn. Stated differently, all four rules are allocatively efficient under that set of conditions.

Now let us change the facts a bit. Instead of F valuing farming at $100 and H valuing not farming at $50, let us reverse the values. Let us suppose that H values not farming at $100 and F values farming at $50. In this situation, as in the first, the choice of rule has no bearing on allocative efficiency. But, unlike the first situation, the resources in the second situation will not be employed in farming. Whereas F grew corn under the first set of values, he or she does not grow corn under the re- vised set of values.

Under rule FP (item (e)), F has the entitlement and an equita-

504 Haruard Journal of Law M Public Policy [Vol. 9

ble injunction with which to protect it. But H values not farming more than F values farming, so H offers, and F accepts, some price between $50 and $100 in order to prevent F from growing corn and injuring H. The same is true under rule FL (item (f)), except that here H goes into court for an injunction to prevent F from farming. Upon being issued the injunction, H must compensate F for lost profits, which, in this case (by hypothesis), amount to $50.

Under rule HP (item (g)), H simply exercises his or her right to an injunction to prevent F from farming. Because H is entitled to do so, no compensation is required. F suffers lost profits, but cannot exact compensation. Finally, under rule HL (item (h)), H has the entitlement but cannot prevent F from farming. At most, under this rule, H can require compensation from F for actual damages ($100) if F chooses to grow corn. F, however, knowing that compensation will be required and that H values not farming at $100, decides to refrain from producing corn, because it will cost him or her $100 in order to earn a profit of only $50. Once again, the constraints of rationality, substantial knowledge, self-interest, lack of strategic behavior, and absence of transaction costs produce a uniform result: Whether the prevailing legal rule is FP, FL, HP, or HL, F does not grow corn.

The third possible scenario is that in which F and H attach equal values, respectively, to farming and not farming. Let us assume that F can earn a profit of $75 by farming, and that H will be injured to the extent of $75 if F farms. In this case, under any of the four rules, F and H are indifferent between two states of affairs-F's farming and F's not farming. Under rule FP (item (i)), F requires at least $75 in order to relinquish his or her entitlement to farm, while H is willing to pay no more than $75 to purchase it. Thus, there is no basis in rational self-interest for choosing between (1) bargaining for a relinquishment of the entitlement at $75, and (2) permitting F to farm. Similarly, under rule FL (item (j)), H can either enjoin F from farming, in which case H must compensate F for $75 in lost profits, or suffer injury amounting to $75. H is indifferent between these states of affairs.

Under rule HP (item (k)), H requires at least $75 in order to permit F to farm, while F, who can earn only $75 by farming, is willing to pay no more than $75 in order to do so. Finally,

No. 21 Right-to-Famn Statutes 505

under rule HL (item (l)), F can either grow corn, in which case he or she earns a profit of $75 and must use all of it to compensate H for injury suffered thereby, or refrain from farming alto- gether, in which case there is neither a profit nor a loss. So, whenever F and H attach equal values to farming and not farming, respectively, and transaction costs are zero, all four rules are allocatively efficient; the parties are indifferent between F's farming and F's not farming. This general result (the lack of an allocative effect on resources) obtains in all three of the possible valuation situation^.^'

2. InsignzJicant Transaction Costs

T o this point, I have considered only the limiting case of insignificant transaction costs, that in which they are zero. Now let us analyze the effect of insignificant but nonzero transaction costs on the allocative efficiency of the four rules.5s By definition, insignificant transaction costs are those costs of bargaining which are insufficiently large to eliminate any net gain from trade. Thus, insignificant but nonzero transaction costs cannot logically have an effect on allocative efficiency. T o see this, consider the two cases in which F and H enter into a bargain under the assumption of zero transaction costs.

In the first case (item (c)), F values farming at $100, H values not farming at $50, and rule HP is in effect (entitlement to H, protected by a property rule). H, in this case, is willing to accept any sum of money in excess of $50 in order to relinquish his or her entitlement to be free of noise and dust, while F is willing to pay any sum less than $100 in order to be able to farm. There is, accordingly, room in this case for the parties to bargain. Now, however, by hypothesis, there are costs involved

57. This result demonstrates the Coase Theorem. Stt Coase, Tht Problttt~ of Socinl Cost, 3 J.L. & ECON. 1 (1960); see also Cooter, The Cost of Const, I I J . LEGAL STUD. 1, 15 (1982); R. POSNER, st~pra note I, 5 3.4, at 35-36 n.1; Regan, Tht Probknr of Socinl Cost Reuisited, 15 J.L. & ECON. 427, 427 (1972).

One other assumption needs to be made here: that there are no wealth effects on the demand to farm o r to be free from the injurious effects of farming. If there are such effects, then the choice of legal rule will have an effect, however minimal, on the use of potential farmland. See R. POSNER, ~ l ~ p r n note 1, 8 3.4, at 36 n. I .

58. In the real world, of course, there are always transaction costs. Stt Calabresi & Melamed, supra note 49, at 1096 ("[Nlo one makes an assumption of no transaction costs in practice. Like the physicist's assumption of no friction o r Say's law in macro- economics, the assumption of no transaction costs [is merely] a useful starting point . . . . "). For an early discussion of the effect of transaction costs on such variables as resource allocation and the distribution of wealth, see Demsetz, l l ' / , t t r Dots tilt RIIIP of Liability ~Watter?, 1 J . I.EGAI. STUD. 13 (1972).

506 Haruard Journal of Law L% Public Policy [Vol. 9

in bargaining (item (0)). These costs are insufficiently large to eliminate the net gain from trade, so the bargain will still go through, but some of the gross gain from trade (available where transaction costs are zero) is dissipated in the form of payments to third parties (such as attorneys) or some other form of opportunity cost^.^"

In the second case (item (e)), F values farming at $50, H values not farming at $100, and rule FP is in effect (entitlement to F, protected by a property rule). In this case, F is willing to accept any sum of money in excess of $50 in order to relinquish his or her entitlement to farm, while H is willing to pay any price less than $100 in order to induce F to refrain from farming. The total gain from trade, as in the first case, is $50. But now, given the assumption of insignificant but nonzero transaction costs (item (q)), F and H do not reap all of the gross gain from trade. Some of the gain, as indicated above, is dissipated. Therefore, as in the case of zero transaction costs, the presence of insignificant but nonzero transaction costs has no effect on the allocation of resources; all four of the rules produce allocatively efficient outcomes in that situation. If F values growing corn more than H values not growing corn, then F will grow corn; if H values not growing corn more than F values growing corn, then F will not grow corn."'

3. Significant Transaction Costs

By definition, transaction costs are significant if and only if they are sufficiently large to eliminate any net gain from trade. This situation obtains in only two of the twelve cases described (items (w) and (y))-those cases in which, where transaction costs are insignificant, a bargain is struck between F and H (items (c), (o), (e), and (q)). Intuitively, it is easy to grasp the

59. The proposition that some of the gain from trade is "dissipated" rather than "shared with others" in the form of payments to third parties is true insofar as the payments to those third parties do not exceed the marginal costs of those parties. For a useful discussion of the concept of opportunity cost, see S. RHOADS, THE ECONOMIST'S VIEW OF THE WORLD: GOVERNMENT, MARKETS, AND PUBLIC POI.ICY 11-24 (1985).

60. The Coase Theorem is typically understood as making a claim about resource allocation under conditions of zero transaction costs. See, e g . , M. HORWITZ. THE TRANS- FORMATION OF AMERICAN LAW, 1780-1860 xvi (1977) ("Coase has shown that where there are no 'transaction costs' between parties-that is, in situations where the parties are able to engage in costless bargaining-it does not matter from the standpoint of efficiency which of the parties is saddled with legal liability."). As I have shown. however, it makes the same claim under conditions of insignificant but nonzero transaction costs.


concept of significant transaction costs. Imagine, as in the cases described above, that the total gain from trade is $50, and that transaction costs amount to $55. In a case such as this, it is irrational for F and H, who are assumed to possess substantial knowledge about the costs of their prospective transactions, to enter into negotiations leading toward a bargain, for they stand to lose more (collectively) by bargaining than they stand to gain by contracting. F and H therefore fall back on the initial distribution of entitlements and protective rules, rather than attempt to bargain around those entitlements.

Where transaction costs are significant, as they often are in the real world, two of the four rules that we have been consid- ering block efficient allocations of resources. One of those rules (HP), as I will show in Section III(D), corresponds to TLAN, while the other (FP) corresponds to the typical RTF statute. Let us begin the analysis with FP. Under FP, where F values farming at $50 and H values not farming at $100, H purchases F's entitlement where transaction costs are insignificant (items (e) and (q)). Since H attaches a higher value to F's not farming than F attaches to farming, there is a mutual gain from trade to be exploited by the parties; both F and H can be made better off by bargaining than by not bargaining. Hence, the efficient result, in terms of resource allocation, is for F to refrain from growing corn.

But when transaction costs are assumed to be significant (item (y)), F and H no longer have an incentive to bargain, for the prospective gain from trade ($50) is more than offset by the costs of the bargaining process itself. Instead of H purchasing F's entitlement to farm, as would be the case under an assumption of insignificant transaction costs, the parties fall back on the initial distribution of entitlements and F proceeds to grow corn. This is, by hypothesis, allocatively inefficient. The effect of FP under a plausible set of assumptions (significant transaction costs, greater valuation by H than F) is, therefore, to employ resources in farming, when the most efficient use of those resources is in nonfarming (for example, residential) uses.

The same situation obtains under HP, except that under HP F does not grow corn. Where transaction costs are insignificant, F values farming at $100, and H values not farming at $50, F and H contract to permit F to grow corn and pay H a sum of money between $50 and $100 (items (c) and (0)). The

508 Haroard Journal of Law €9 Public Policy [Vol. 9

net gain from trade in this situation is $50, minus whatever transaction costs are incurred by the parties. But when the assumption of insignificant transaction costs is relaxed (item (w)), there is no longer any prospective gain from trade for F and H, so they do not bargain. H asserts his or her entitlement to be free of interference from F's farming operation, and F is prevented by injunction, if necessary, from doing so. Because neither party would ideally (that is, in a world without transaction costs) prefer this state of affairs, there is once again a misallocation of resources. Rule HP, together with the assignment of the entitlement to the lower-valuing party and significant transaction costs, entails that no corn is produced, when the allocatively efficient outcome is that in which corn is p r ~ d u c e d . ~ '

There are two other situations in which FP and HP affect the allocation of resources, although in neither case can it be said that a misallocation results. Under FP, where F and H attach the same value to farming and not farming, respectively, we saw that the parties are indifferent between F's farming and F's not farming (item (i)). F requires at least $75 in order to relinquish his or her entitlement to farm, while H is willing to pay no more than $75 in order to purchase that entitlement; hence, there is no basis in rational self-interest for choosing between these alternatives. But once the assumption of zero transaction costs is relaxed (item (cc)), the parties are no longer indifferent between F's farming and F's not farming. Now there is not only no mutual gain to be made through trade, but the parties will be worse ofby bargaining than they would be otherwise. Conse- quently, F falls back on his or her entitlement and proceeds to grow corn. (Note that in this situation-that in which the parties attach equal value to farming and not farming, respectively--any transaction cost is significant.)

The second situation involves HP. Where F and H attach equal value to farming and not farming, respectively, and there are no transaction costs (item (k)), the parties are indifferent

61. It might be objected, against this conclusion, that there is n o allocative ineffi- ciency where the parties forgo a trade as a result of significant transaction costs; for i t would, by hypothesis, be irrational for the parties to enter into such a bargain. This assertion, however, misses the point. The parties prpfpr to strike a bargain, but, being rational and self-interested, refrain from doing so. There is thus a reallocation of resources which will employ them in higher-valued uses: hence, the existing allocation is inefficient. See supra note 54 and accompanying text; see also K. Burgess-Jackson, srrpra note 54.


between bargaining and not bargaining-that is, between F's farming and compensating H for damages and F's not farming. But when transaction costs are painted into the picture (item (ee)), it becomes rational for the parties to refain from bargaining, for bargaining in this situation is not costworthy. H, therefore, who is entitled to be free of noise and dust, proceeds to enjoin F from farming. Thus, both FP and HP have an effect on the allocation of resources under conditions of (1) equal valuation, and (2) significant transaction costs. This allocative effect, however, cannot be characterized as inefficient, for there is no reallocation of resources that will employ them in higher-valued uses.

D. The Allocatiue Ineficiency of Right-to-Farm Statutes

I have now argued that when transaction costs are insignificant and individuals behave rationally and self-interestedly in the marketplace, all four rules (FP, FL., HP, and HL) permit efficient allocations of resources. I have also argued that when transaction costs are significant and individuals behave rationally and self-interestedly in the marketplace, rules FP and HP block efficient allocations of resources under certain valuation conditions (items (w) and (y)). To this point, however, the analysis has been largely theoretical. I shall now argue that rule FP has a real-world correlate: the typical RTF statute. Rule HP, moreover, corresponds to TLAN. If I am right in making these correlations, then to the extent that the assumptions made in this Article obtain in the real world, neither TLAN nor the typical RTF statute is allocatively efficient. Hence, we would do better, on allocative-efficiency grounds alone, to adopt either FL or HL as our rule for resolving agricultural nuisance disputes.

TLAN holds that substantial, unreasonable interferences with the use and enjoyment of a person's property are legally impermissible. This implies that a neighboring property owner, such as H, is entitled to be free of interferences that can be characterized as "substantial" and "unreasonable." Whenever such interferences are imminent, the property owner in question has at his or her disposal an equitable injunction with which to prevent the infliction of injury. This situation corresponds precisely to HP, which awards the entitlement to H and protects it with a property rule (equitable injunction). H, under

510 Haruard journal of Law M Public Policy [Vol. 9

TLAN, is entitled to be free of substantial and unreasonable interferences with his or her property, and is able to prevent such interferences by obtaining an equitable injunction should they be imminent. Where H does not have available this injunction, the situation more closely corresponds to HL, which requires ex post facto compensation for infringements of entitlements.

Just as TLAN corresponds to rule HP, the typical RTF statute corresponds to rule FP. RTF statutes, as we have seen, protect farmers from nuisance suits when the farm operation in question is carried out in a nonnegligent manner. This rule, in effect, awards an entitlement to the farmer. To protect that entitlement, RTF statutes implicitly employ a property rule-"implicitly" because, although RTF statutes do not provide in so many words for injunctive relief, it is likely that such protection would be forthcoming if a neighboring property owner were to threaten interference with a farm operation."* Moreover, RTF statutes do not protect entitlements with liability rules, for that would entail granting a "conditional injunction" to the neighboring property owner-an injunction conditional on the neighbor's compensating the farmer for lost profits. Signifi- cantly, none of the forty-seven RTF statutes enacted to date grants a conditional (or any other) injunction to neighboring property owners. One must infer from this that the entitlements granted by those statutes are protected by property rules.

It follows that both TLAN and the typical RTF statute are, under certain conditions, allocatively inefficient. More specifi- cally, to the extent that the assumptions of rationality, substantial knowledge, and self-interestedness hold, TLAN is allocatively inefficient whenever (1) F values farming more than H values not farming, and (2) transaction costs are significant. The typical RTF statute is allocatively inefficient whenever (1) H values not farming more than F values farming, and (2) transaction costs are significant. Property rules, in general, are allocatively inefficient whenever (1) transaction costs are

62. Injunctions, traditionally, have been employed to restrain people from commit- ting "unjust," "inequitable," or "injurious" actions. BLACK'S LAW DICTIONARY 705 (5th ed. 1979). There is no reason to believe that farming activities would be exempt f ion~ this protection, especially since, in states where RI'F statutes have been enacted, there is a clear manifestation of legislative intent that farmers be protected.

No. 21 Right-to-Farm Statutes 51 1

significant, and (2) the entitlement is awarded to the lower-valuing party.

I have assumed thus far in the Article that liability rules are costless to implement-that is, that there are no costs associated with going to court to determine whether an entitlement has been usurped and, if so, how much compensation is required in order to make the entitlement holder whole. This assumption, unfortunately, is not likely to obtain in the real world, for factfinding is notoriously expensive. Indeed, one might object that because I have assumed away the costs of ad- ministering liability rules, my conclusions in favor of liability rules on allocative efficiency grounds do not hold.63 Put differently, absent empirical evidence that liability rules are less costly to implement than property rules, it is the merest specu- lation to hold that one sort of protective rule (a liability rule) is allocatively efficient, while another (a property rule) is not. As- sertion is not enough; one must adduce some argument or empirical evidence to show that bargaining, on the whole, is more costly than judicial factfinding, especially since a court may mis- estimate the willingness-to-pay of the litigants.

This is a powerful objection, and I am not sure in the end that it can be met. But it is important to understand what the objection does and does not establish. At most, the objection undercuts the assertion that liability rules, of which FL and HL are instances, are allocatively efficient, while property rules, of which FP and HP are instances, are not. In order to sustain this objection, the objector must show that bargaining, on the whole, is less costly than judicial factfinding. This task calls for empirical research, not philosophical argument.

The objection does not undercut the assertion that property rules are allocatively inefficient in the situations described (where transaction costs are significant and there is a disparity in valuation between the parties). T o say that property rules are allocatively inefficient in the situations described is to say no more than that there are such things as "market failure^,""^ wherein transaction costs prevent individuals from entering into mutually beneficial bargains. Nor does the objection un-

- - -

63. Lawrence H. White hiis tnaclc this ol?jcc.tiotl in criticism of an rarlicr dr-;lli ol'lhis Article.

64. For a discussion 01' thr c.onc.cpt of 111;1rkct liiilurc, see K. I'OSNEH, .vttptn note 1 . 8 13.1, at 271; Coleman, .SII/)J.(I note 52, at !)5.

512 HarvardJournal of Law C3 Public Policy [Vol. 9

dercut the assertion that the typical RTF statute, to the extent that it corresponds to rule FP, is allocatively inefficient in the way described. It may be no more inefficient than any other rule, but it is inefficient nonetheless.

Despite the objection, then, it may be said that the move from TLAN to RTF statutes during the late 1970s and early 1980s substituted one allocatively inefficient regime for another. Instead of awarding the entitlement to the neighboring property owner in a land-use conflict, as did TLAN, RTF statutes award the entitlement to the farmer. Both regimes, as we have seen, protect the entitlement with a property rule. Thus, to an ideal observer concerned solely with allocative efficiency, there is no difference between TLAN and the typical RTF statute, for both are allocatively inefficient in the same way and for the same reason. This conclusion holds unless the ideal observer is privy to information which shows that farmers (or neighboring property owners), as a class, attach greater values to their respective uses of land. Legislators, unfortunately, are not ideal observers, nor do they have ready access to such information.

One commonly stated legislative justification of RTF statutes can now be seen for what it is: a falsehood. As we saw earlier, more than one state legislature has justified its RTF statute on grounds that it "result[s] in a general benefit to the . . . welfare of the people of the ~ t a t e . " " ~ This claim is false, and it is false whether the comparison is between RTF statutes and TLAN or RTF statutes and some other rule for the resolution of nuisance disputes. Presumably, the argument is that since agriculture produces income for large numbers of people and

65. FLA. STAT. ANN. 5 823.14(2) (West Supp. 1986). It is, according to Bruce Acker- man, a mistake to accept uncriticallv the stated justification o r any statute, for "the likely impact of a legal rule can be very different from the objectives that-on the sur- face at least-seemed to inspire the court or legislature that enacted it." Ackerman. Introduction: On the Role of Ern~lorrtir :111nl?si.r 111 Pi.o/~~p.l? I.ozo, in ECONOMIC FOIINDATIONS OF

PROPERTY LAW xiv (B. Ackerman ed. 1975). This, in turn, raises the question of the proper role of economists in the policymak-

ing process. Although economists, qtrtr economists, are unsuited to make value judg- ments, they have an important role to play in setting out the costs and benefits 01 particular public policies. . S ~ ~ g . ~ r t r . ~ ~ n l l j K. P ~ S N E K , .st~/>t.n note I, jj 2.2, at 17 ("[The economist] can . . . clarify a valur conllict by showing I~ow much o r one value--effirienc).. surely an important, if not necessarilv paranlount, valuc in any societv-must be sacri- ficed to achieve another."): Stiglcr, l:'rotto~~cIr.r or E l l ~ i c s l , in 2 ' l ' t l ~ ' ~ . A N N E R I.ECI.IIWES O N

HUMAN VALUES 143, 14.5 (S. Mchlurrill ed. 1981) ("14:co~lomisls have no special prorcs- sional knowledge of that which is virtuous o r j u s ~ . . . ."). A large part of lny task in this Article is to make explicit thc social costs of K.1'1: statutes.


provides products for general consumption, the protection of farmers from nuisance suits (together with the associated preservation of agricultural land) redounds to the benefit of every- one (or a substantial number of people) in society, farmers and nonfarmers alike.66 This, in turn, is supposed to promote the general welfare. While intuitively appealing, the argument is ultimately unsound.

The error in the argument lies in assuming that whenever a farmer is protected from a nuisance suit by a neighboring property owner, nobody is injured. But this is false. Property owners suffer injury every bit as real, if not as easily calculable, as a farmer's lost profits. Enhancing the welfare of farmers sometimes necessitates lowering the welfare of neighboring property owners. Moreover, if the assumption about property rules being more costly to administer than liability rules is correct, then there are two rules (FL and HL) that produce allocatively efficient outcomes, whereas the typical RTF statute does not. It is simply disingenuous to assert that RTF statutes result in a general benefit to the welfare of the people of the state without providing evidence in support of that claim. T o the extent that RTF statutes are allocatively inefficient (that is, to the extent that RTF statutes produce misallocations of resources), they result in fewer, not greater, benefits to the welfare of the people of the state than alternative, allocatively efficient rules.67

IV. THE ETHICS OF RIGHT-TO-FARM STATUTES

Conspicuously absent in the discussion to this point has been any mention of the distributive impact of the four rules. Noth- ing has been said, thus far, about which of the rules, if any, is fair, just, or otherwise ethically required or permissible; nor has

66. For example, this is the rationale of the Florida Legislature, found at FL.A. STAT. ANN. 5 823.14(2) (West Supp. 1986) (quoted srtprcr note 44).

67. My argument does not address the question of how a ro~rrt should decide a given land-use conflict. Richard Posner has argued that a court should determine which party would purchase the entitlement under conditions of' zero transaction costs and then award the entitlement to that party. SPP K. I'OSNER, sttpin note 1; CJ K. POSNEW. THE ECONOMICS OF JUSTICE 62 (1(.)83). I 'hc cflicct, Posncr claims, is to promote cHiciency in the allocation of resources. In contr;lsl. this Article deals with the ltg~.\lntii~~ stage of thc process during which a whole cl/rr.\ ol'cascs is decided. D c m ~ ~ s e legislators cannot know in advance which party will attacli greater value to the entitlcnlcnt in a given nuisance dispute, they should prefer a rule that is allocatively cficicnt under as many v;llu;rtion situations as possible. I'wo of thc rules considered (F1. and HI.) arc. if less costl!- to administer than FP or HI', allocatively cllicicnt under cvcry possiblc valuation situ;i- tion. TI.AN and the typic,al lt'1'1: statute arc sonlctinlcs allocativcly ineflicicnt.

514 HaruardJournal of Law t.3 Public Policy [Vol. 9

a standard been enunciated for making such a determination. And yet, the four rules distinguished in this Article are not without distributive implications. Even where transaction costs are zero (a state of affairs in which the parties enter into mutually beneficial bargains until there are no such bargains left to be made), the choice of rule for the resolution of nuisance disputes has an impact on the distribution of wealth between the parties. This is one of the "forgotten" implications of the Coase T h e ~ r e m . ~ ~ It is now time to put allocative efficiency aside for the moment in order to assess the distributive impact of the four rules.

A. The Distributive Impact of the Four Legal Rules

1. No Transaction Costs

As demonstrated above, where transaction costs are insignificant, all four rules are allocatively efficient. They have different impacts, however, on the distribution of wealth between the parties. T o see this, consider once again the case in which F values farming at $100, H values not farming at $50, and transaction costs are zero. In this situation, the choice of rule deter- mines whether F receives $50, $100, or some price between those figures. If FP is in effect (item (a)), then F grows corn, because H does not place a sufficiently high value on not farming to purchase F's entitlement. F receives $100 in profits from growing corn, while H suffers injury to the extent of $50 from noise and dust. The same result obtains under FL (item (b)), except that here the basis for the distribution is different. H does not enjoin F's operation because it will cost him or her more ($100) than it is worth ($50) to be free of noise and dust.

Now consider the effect of HP on the distribution of wealth. HP, as we saw, generates a contract between F and H at some price between $50 and $100 (item (c)). Unless F has sufficient bargaining ability to be able to induce H to settle at precisely $100, H is better off under HP than under either FP or FL. If the parties settle at a price of, say, $75, the following situation obtains: F grows corn, earns the $100 profit from doing so, compensates H $75 for relinquishment of the entitlement to be free of noise and dust damage, and retains a net profit of $25.

68. See, P.R., Coleman, .sttj,vrt t ~ o t c 52, ;II 09-94. <;olc~nan 1 1 0 soot~cl- sets out this in~pli- cation than he casts doubt o n its validitv. SOP id. at $14.


H, in turn, is better off by $25 because he or she receives $75 from F as consideration for the bargain and suffers only $50 worth of damage. The total gain from trade is therefore $50, a figure which the parties, by hypothesis, split evenly.

Finally, consider the effect of HL on the distribution of wealth. Under HL, F grows corn and compensates H expost facto for damage (item (d)). Here, F is better off by $50 than if he or she were unable to grow corn ($100 in profit minus $50 in compensation to H), while H is no worse off than if F did not grow corn ($50 in damage from F's farming operation minus $50 in compensation). In all four cases, therefore, the net gain to "society" (that is, to F and H collectively) is $50, but the gain is distributed differently depending upon which rule-FP, FL, HP, or H L i s in effect.

Much the same analysis applies where F values farming at $50 and H values not farming at $100. The only difference is that here, H receives a larger share of the $50 gain under three, and possibly four, of the rules (items (e), (f), (g), and (h))-just as F received a larger share under the first valuation situation. The relative share of the gain from trade depends not only upon which rule is in effect, but also upon the relative values placed by the parties on the activity (or lack thereof). Where F values farming more highly than H values not farming, and transaction costs are zero, F's wealth is great relative to H's; where H values not farming more highly than F values farming, and transaction costs are zero, H's wealth is great relative to F's.

Finally, consider the distributive impact of the four rules under conditions of equal valuation. Under both FP and FL (items (i) and (j)), F is better off by $75, while H is worse off by $75. This is because F has the entitlement to farm and can earn a profit of $75 by doing so. H, on the other hand, suffers injury to the extent of $75 from the farming operation. H, therefore, is indifferent twice over. In the case of rule FP, H is indifferent between suffering the injury and paying F $75 not to farm, while in the case of rule FL, H is indifferent between suffering the injury and compensating F $75 for being enjoined from farming. Under HP and HL, the situation is reversed (items (k) and (1)). Under HP and HI,, H is better off by $75, while F is worse off by $75. Thus, in all four cases where F and H value farming and not farming (respectively) equally, the net gain


from trade is zero. In two of the four cases, F is better off; in the other two cases, H is better off.

2. Insign$cant Transaction Costs

Now let us change the assumption about transaction costs. Where transaction costs are insignificant but nonzero, there are two situations in which the distribution of wealth is affected. In both situations, the distributive effect is the result of one party-F or H-bearing a disproportionate share of the transaction costs. Consider, briefly, the case in which F values farming at $50, H values not farming at $100, and FP is in effect. Where there are no transaction costs (item (e)), the parties contract with one another at some price between $50 and $100 to prevent F from growing corn. But, as we have seen, the injec- tion of insignificant but nonzero transaction costs has (by definition) no effect on the making of the bargain; it simply dissipates some of the gain from trade in the form of lost opportunities (item (q)). If the parties split this "forgone gain" in the same proportion as they split the gain itself, there will be no distributive impact. (The other situation obtains where F values farming at $100, H values not farming at $50, and HP is in effect (items (c) and (o)).)

3. Signtjicant Transaction Costs

Finally, consider the case in which F values farming at $100, H values not farming at $50, and HP is in effect. Where transaction costs are significant (item (w)), there is, as we saw, an underproduction of corn. Both F and H would have been better off had a bargain been struck to permit F to grow corn; but significant transaction costs prevented this state of affairs from obtaining. Observe, however, the distributive impact of this rule. F, who is prevented by H from growing corn, experiences an opportunity cost of $100 (the amount that he or she would have earned in profits from farming had farming been permitted), while H experiences a gain of $50 (the amount that he or she would have been injured by F's farming operation). Instead of society as a whole (represented by F and H) being better ofby $50, as would be the case under any of the other rules, society is worse o f by $50 for having adopted HP.

The same is true of FP, at least where F values farming at $50 and H values not farming at $100. Given the presence of signif-


icant transaction costs (item (y)), the parties have no incentive to strike a bargain to prevent F from growing corn, so F, being a rational, self-interested economic agent, proceeds to farm. This, in effect, results in an overproduction of corn relative to other values-that is, a "market failure" has taken place. But observe the distributive impact of this rule. F, who values farming at $50, is better off by $50 (the profit from farming), while H is worse off by $100 (the extent of injury from noise and dust). Society as a whole, therefore, is worse off by $50 for having adopted FP (the typical RTF statute) rather than some other rule.

B. Ethics, Farmers, and Right-to-Farm Statutes

The differential distributive impact of the four rules provides a basis for making an ethical argument in favor of one rule rather than the others. If, as a matter of social policy, it is desirable that wealth be distributed in favor of farmers, then, c e t h paribus, FP ought to be enacted. But, if it is desirable that wealth be distributed in favor of neighboring property owners, then, c e t h paribus, HP ought to be enacted. FP, as we saw, corresponds to the typical RTF statute; it would be the choice of a rational, self-interested farmer, for it is preferable to the other rules in every valuation situation and under every assumption about transaction costs. HP, on the other hand, corresponds to TLAN; it would be the choice of a rational, self-interested neighboring property owner. The farmer's preference ranking of the four rules is FP, FL, HL, and HP, while the neighboring property owner's preference ranking is just the reverse: HP, HL, FL, and FP.

There are, then, if the arguments of this Article are sound, quite different conclusions to be drawn depending upon whether our concern is allocative efficiency or a particular distribution of wealth. If our concern is solely with allocative efficiency (and the assumptions made earlier in this Article hold in the real world), then we should enact either FL or HL in preference to either FP or HP. FL and HL produce efficient allocations of resources, while FP and HP do not."" Should we adopt

69. Needless to say, I have not def'endcd the goal ol'allocativc efficiency in this Arti- cle, nor has this been my intention. I have nierely assumed t h a ~ allocative cfficicnc\ is (I goal o f the legal system. As (;oleman points out, there are two Limns of n o n ~ ~ a t i v c economic analysis oT law: o n e in which it is n s r ~ r ~ ~ ~ ~ r l that enicicncy is a norm. and ;In-

518 HaruardJournal of Law €9 Public Policy [Vol. 9

this strategy, moreover, considerations of wealth distribution may enter; they provide a basis for preferring FL to HL, or vice versa. FL, as we saw, is biased in favor of farmers, while HL is biased in favor of neighboring property owners. This strategy has the additional virtue of employing both allocative efficiency and distributive justice as grounds for selecting the appropriate legal rule. Efficiency and justice are usually thought to be com- peting, but important, social goals.

If our concern is solely with effecting a particular distribution of wealth, then we ought to enact either FP or HP, depending upon whether the object of our concerns is the class of farmers or the class of neighboring property owners. Arguments for this strategy will be ethical in nature, focusing on some special characteristic of farmers (or neighboring property owners) that entitles them to preferential treatment by the state.70 RTF statutes, as I have shown, correspond to rule FP; they therefore favor farmers. TLAN, which corresponds to rule HP, favors neighboring property owners. If I have done nothing more in this Article than point out the economic costs of enacting RTF statutes, I will have been successful in my task. RTF statutes are not, as is sometimes argued, justifiable on grounds of allocative efficiency; if anything, they are justifiable on ethical grounds- on grounds that farmers, as a class, deserve special treatment. Unfortunately, to date, ethical arguments of the latter sort have not been forth~oming.~'

RTF statutes are of recent and widespread vintage in this country. One commonly stated justification of such statutes is that they "result in a general benefit to the . . . welfare of the

other in which the norm itself is dcknded by argument. SPP Coleman. srip,a note 45. at 1105. According to Coleman's tcrminologv, this Article is an exercise in the first forn~ of normative analysis. For an outlinc of a normative argument on bchalf of allocative efficiency, see id. at 1108; Colcnlan, .src/),n notc 52, at 88-89; r j : Armitage. Gmrrorrrir EJcienrj ' 4 s a Legal .\'orrrr, 7 Kesc~uctt I.. & ECON. 1 (1985).

70. Sec, ~ . g . , W . BERRY, .sr(/)~.n 11ote I I; Barklev, .srrpvo notc 34; SPP nlsn .rlrpvn note 2. As Lawrence Becker points out, one ol'thc ~raditional iwgunlmts in defense of the i~~s t i tu - lion of private property is that certain people, or classes ol' people, deserve property because they are virtuous or will use it to good cll'cct. I.. BKCKER. .S I I~ I .O note 54. at 81- 87. One might construct a similar argunlcnt to the clt'cct t h a ~ f>r~ncrs, as a cl;~ss, deserve preferential trralment by thc state ( o ~ l c instance oI'\vhicl~ is R'1.1: statt~tes). I will not speculate here as to thc stlcccss of such all ilrgunlcnt.

7 1 . Btil SPP Montmarquct. I'IrIlo.so/~hicnl I~irrrrrd~r/Inrfi /i)r. :l~r.~rr~o~irri.~,a. 2 ACRIC:. k H L ~ ~ I . VALUES 5. 5 (1985) (distinguishing IOur varieties ol' " a g r ; ~ r i ; ~ ~ ~ i s ~ ~ ~ ~ ) .


people of the state."" This justification, given certain assumptions about human behavior in bargaining situations and certain facts about the world, is false. I have argued in this Article that RTF statutes are allocatively inefficient; that is, that they block efficient allocations of resources in some cases. More- over, to the extent that liability rules are less costly to implement than property rules, there are at least two rules for the resolution of nuisance disputes that permit allocatively efficient results. Finally, I demonstrated that there are four distinct rules for the resolution of nuisance disputes between farmers and neighboring property owners, and that these rules have different distributive impacts on the wealth of farmers and neighboring property owners. T o the extent that the assumptions made in this Article obtain in the real world, RTF statutes can be justified, if at all, on ethical grounds. They cannot be justified on economic grounds.

72. FLA. STAT. ANN. 5 823.14(2) (West Supp. 1986).

520 Haruard Journal of Law M Public Policy [Vol. 9

APPENDIX

STATE RIGHT-TO-FARM STATUTES

Act of Aug. 7, 1978, No. 79, 1978 Ala. Acts 1767 (codified at ALA. CODE $ 6-5-127 (Supp. 1985)).

Act of Apr. 17, 1981, ch. 168, 1981 Ariz. Sess. Laws 509 (effective July 25, 1981) (codified at ARIZ. REV. STAT. ANN. $ 9 3- 1051, 3-1061 (Supp. 1985)).

Act of Mar. 3, 1981, No. 301, 1981 Ark. Acts 513 (codified at ARK. STAT. ANN. $ 9 34-120 to 34-126 (Supp. 1985)).

Act of Sept. 17, 1981, ch. 545, 1981 Cal. Stat. 2192 (codified at CAL. CIV. CODE $ 3482.5 (West Supp. 1986)).

Act of June 9, 198 1, ch. 408, $ 9 1, 7-8, 198 1 Colo. Sess. Laws 1694 (effective July 1, 1981) (codified at COLO. REV. STAT. $ 3 35-3.5-101 to 35-3.5-103 (1984)).

Act of Jan., 1981, No. 81-226, 1981 Conn. Acts 320 (Reg. Sess.) (effective Oct. 1, 1981) (codified at CONN. GEN. STAT. ANN. $ 19a-341 (West Supp. 1985)).

Act of July 8, 1980, ch. 347, 62 Del. Laws 801 (1980) (codified at DEL. CODE ANN. tit. 3, $ 1401 (1985)).

Act of May 16, 1979, ch. 79-61, 1979 Fla. Laws 327 (filed with Secretary of State May 17, 1979); act of Mar. 15, 1982, ch. 82- 24, 1982 Fla. Laws 49 (filed with Secretary of State Mar. 16, 1982) (codified at FLA. STAT. ANN. $ 823.14 (West Supp. 1986)).

Act of Mar. 31, 1980, No. 1297, 1980 Ga. Laws 1253 (codified at GA. CODE ANN. $ 5 72-107, 72-108, (Supp. 1985)).

Act of June 16, 1982, No. 256, 1982 Hawaii Sess. Laws 481 (codified at HAWAII REV. STAT. $ 9 165-1 to 165-4 (Supp. 1984)).

Act of Mar. 3 1, 198 1, ch. 177, 198 1 Idaho Sess. Laws 3 1 1 (codified at IDAHO CODE $ 9 22-4501 to 22-4504 (Supp. 1985)).

Act ofJune 30, 198 1, No. 82-509, 198 1 Ill. Laws 2599 (effective Sept. 16, 1981) (codified at ILL. ANN. STAT. ch. 5, $ 9 1101 to 1 105 (Smith-Hurd Supp. 1985)).

Act of Apr. 27, 198 1, No. 288, 198 1 Ind. Acts 2302; act of Feb. 24, 1982, No. 199, 1982 Ind. Acts 151 1 (codified at IND. CODE ANN. $ 34-1-52-4 (Burns Supp. 1985)).


Act of June 28, 1976, ch. 1 12 1, 1976 Iowa Acts 261 (effective Nov. 1, 1976) (codified at IOWA CODE ANN. $ 3 172D. 1 to 172D.4 (West Supp. 1985)); act of May 14, 1982, ch. 1245, 3 12, 1982 Iowa Acts 437 (codified at IOWA CODE ANN. 3 93A. 1 1 (1984)).

Act of Apr. 11, 1963, ch. 287, 3 5, 1963 Kan. Sess. Laws 574; act of Apr. 13, 1967, ch. 295, 3 1, 1967 Kan. Sess. Laws 561 (effective Apr. 20, 1967) (codified at KAN. STAT. ANN. 3 47-1505 (1981)); act of Apr. 15, 1982, ch.3, 1982 Kan. Sess. Laws 3 (codified at KAN. STAT. ANN. $ 3 2-3201 to 2-3203 (1982)).

Act of Apr. 3, 1980, ch. 214, 1980 Ky. Acts 664 (effective July 15, 1980) (codified at KY. REV. STAT. 3 4 13.072 (Supp. 1984)).

Act ofJune 23, 1983, No. 95, 1983 La. Acts 253 (codified at LA. REV. STAT. ANN. tit. 3, $ 3 3601 to 3607 (West Supp. 1986)).

Act of Sept. 18, 1981, ch. 472, 1981 Me. Laws 977 (codified at ME. REV. STAT. ANN. tit. 17, 3 2805 (1983)).

Act of May 19, 1981, ch. 763, 1981 Md. Laws 2836 (effective July 1, 1981) (codified at MD. CTS. & JUD. PROC. CODE ANN. 3 5- 308 (1984)).

Act of May 31, 1979, ch. 224, 1979 Mass. Acts 123 (effective Aug. 29, 1979) (codified at MASS. ANN. LAWS ch. 11 1, 3 125A (Michie/Law Co-op. Supp. 1985)).

Act of July 1 1, 198 1, No. 93, 198 1 Mich. Pub. Acts 644 (codified at MICH. COMP. LAWS ANN. $ 3 286.471 to 286.474 (West Supp. 1986)).

Act of Mar. 22, 1982, ch. 533, 1982 Minn. Laws 985 (effective Jan. 1, 1983); act of May 19, 1983, ch. 182, 1983 Minn. Laws 457 (codified at MINN. STAT. ANN. 3 561.19 (West Supp. 1986)).

Act of Apr. 25, 1980, ch. 374, 1980 Miss. Laws 684 (effective July 1, 1980); act of Mar. 18, 1981, ch. 357, 1981 Miss. Laws 800 (codified at MISS. CODE ANN. 3 95-3-29 (Supp. 1985)).

Act ofJune 10, 1982, 1982 Mo. Laws 678 (codified at Mo. ANN. STAT. 3 537.295 (Vernon Supp. 1986)).

Act of Mar. 23, 1981, ch. 123, Mont. Laws 170 (codified at MONT. CODE ANN. $ 3 27-30- 10 1 (3), 45-8- 1 1 l(4) (1985)).

522 Haruard Journal of Law & Public Policy [Vol. 9

Act of Apr. 5, 1982, No. 668, 1982 Neb. Laws 606 (codified at NEB. REV. STAT. $ 3 2-4401 to 2-4404 (1983)).

Act of Mar. 18, 1981, ch. 38, 1981 N.H. Laws 18 (effective May 17, 198 1) (codified at N.H. REV. STAT. ANN. $ 9 430-C: 1 to 430- C:4 (1983)).

Act of Jan. 26, 1983, ch. 31, 1983 NJ. Laws 94 (codified at NJ. STAT. ANN. $ $ 4:lC-1 to 4: 1C-10 (West Supp. 1985)).

Act of Apr. 8, 1981, ch. 287, 1981 N.M. Laws 1448 (codified at N.M. STAT. ANN. $ 9 47-9-1 to 47-9-4 (Supp. 1982)).

Act of July 15, 1981, ch. 586, 1981 N.Y. Laws 1 17 1 (codified at N.Y. PUB. HEALTH LAW $ 1300-c (McKinney Supp. 1986)).

Act of Mar. 26, 1979, ch. 202, 1979 N.C. Sess. Laws 140 (codified at N.C. GEN. STAT. $ 3 106-700, 106-701 (Supp. 1985)).

Act of Mar. 16, 1981, ch. 434, 1981 N.D. Sess. Laws 1206 (codified at N.D. CENT. CODE $ 9 42-04-01 to 42-04-05 (1983)).

Act of Mar. 10, 1982, 1982 Ohio Laws 258 (effective June 29, 1982) (codified at OHIO REV. CODE ANN. $ 929.04 (Page Supp. 1986)).

Act of Apr. 1, 1969, ch. 116, $ 10, 1969 Okla. Sess. Laws 138 (codified at OKLA. STAT. ANN. tit. 2, $ 9-210 (West 1973)); act of May 12, 1980, ch. 189, 1980 Okla. Sess. Laws 425 (effective Oct. 1, 1980) (codified at OKLA. STAT. ANN. tit. 50, $ 1.1 (West Supp. 1985)).

Act of Aug. 19, 198 1, ch. 7 16, 198 1 Or. Laws 944 (filed with Secretary of State Aug. 21, 1981); act of Aug. 4, 1983, ch. 730, $ 1, 1983 Or. Laws 1359 (codified at OR. REV. STAT. $ 9 30.930 to 30.945 (1985)).

Act of June 10, 1982, No. 1982-133, 1982 Pa. Laws 454 (effective Aug. 9, 1982) (codified at PA. STAT. ANN. tit. 3, $ 9 951 to 957 (Purdon Supp. 1985)).

Act of Mar. 11, 1982, ch. 10, 1982 R.I. Pub. Laws 59 (codified at R.I. GEN. LAWS $ 9 2-23-1 to 2-23-7 (Supp. 1985)).

Act of May 30, 1980, No. 452, 1980 S.C. Acts 1369 (codified at S.C. CODE ANN. $ $ 46-45-10 to 46-45-50 (Law. Co-op. Supp. 1985)).

Act of Mar. 29, 1979, ch. 138, 1979 Tenn. Pub. Acts 241 (codified at TENN. CODE ANN. $ 9 44-18-101 to 44- 18-104 (Supp.


1985)); act of Mar. 10, 1982, ch. 609, 1982 Tenn. Pub. Acts 92 (effective July 1, 1982) (codified at TENN. CODE ANN. $ 5 43-26- 101 to 43-26-104 (Supp. 1985)).

Act of May 13, 1981, ch. 124, 1981 Tex. Gen. Laws 313; act of June 16, 1981, ch. 693, $ 2 1, 1981 Tex. Gen. Laws 2589 (effective Aug. 31, 1981) (codified at TEX. AGRIC. CODE ANN. $ 0 25 1 .OO 1 to 25 1.005 (Vernon 1982)).

Act of Feb. 2, 1981, ch. 154, 1981 Utah Laws 930 (approved Mar. 6, 1981) (effective May 12, 1981) (codified at UTAH CODE ANN. $ 9 78-38-7, 78-38-8 (Supp. 1985)).

Act of May 1, 1981, No. 68, 1981 Vt. Acts 266 (codified at VT. STAT. ANN. tit. 12, $ 9 5751 to 5753 (Supp. 1984)).

Act of Mar. 20, 1981, ch. 384, 1981 Va. Acts 489 (codified at VA. CODE $ 9 3.1-22.28, 3.1-22.29 (1983)).

Act of Mar. 26, 1979, ch. 122, 1979 Wash. Laws 473 (effective June 7, 1979) (codified at WASH. REV. CODE ANN. $ $ 7.48.300 to 7.48.310 (Supp. 1986)).

Act of Mar. 13, 1982 ch. 5, 1982 W. Va. Acts 12 (effective June 11, 1982) (codified at W. VA. CODE $ 9 19-19-1 to 19-19-5 (1 984)).

Act of Mar. 14, 1982, ch. 123, 1981 Wis. Laws 921 (codified at WIS. STAT. ANN. $ 9 814.04(9), 823.08 (West Supp. 1985).

Act of Feb. 23, 1977, ch. 59, 1977 Wyo. Sess. Laws 150 (effective May 27, 1977); act of Mar. 9, 1978, ch. 32, $ 1, 1978 Wyo. Sess. Laws 136 (effective Jan. 1, 1979) (codified at WYO. STAT. $ 5 11-39-101 to 11-39-104 (1978)).

No Statute: Alaska, Nevada, South Dakota.

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