In San Diego, California there have been recent homes damaged in La Jolla due to the hills and homes sliding downhill and into other homes. This was recently reported in the San Diego Union. The law of torts is about apportioning risks and allocating the burden of loss. One state’s highest court wrestled with these issues in a case that arose when a high-rise building collapsed during a large construction project in a past case.
The plaintiffs were businesses, from hot dog vendors to large law firms, who suffered no physical injuries to persons or property as a result of the collapse, but who lost income when city officials closed heavily traveled streets in the vicinity of the accident. The defendants were the owner, tenant, and managing agent of the building that collapsed.
It is beyond dispute that a landowner who engages in activities that may cause injury to persons on adjoining property owes those persons a duty to take reasonable precautions to avoid injuring them. On the other hand, the court had never ruled that a landowner owes a duty to protect an entire urban neighborhood against purely economic losses, and it refused to do so in the case before it. Businesses in the area may well have suffered purely economic losses due to the collapse, but the court saw no satisfactory way “geographically” to distinguish among them.
The businesses also were unsuccessful in claims based on a public nuisance theory. A public nuisance is conduct that substantially interferes with the exercise of a common right of the public. That claim’s downfall was attributable to the principle that a private person or business can recover damages for a public nuisance only by showing a special injury beyond that suffered by the community at large. While the degree of harm suffered by the plaintiffs may have been unusual, the harm was not different in kind from that experienced by the rest of the community.