Members of The Florida Bar who began practicing prior to 1986 have a completely different view of a legal doctrine known as the economic loss rule than those who became members of the Bar after the turn of the 21st century. Younger members of the Bar probably studied it in law school. Older members saw development of the economic loss rule as the creation of a legal doctrine out of whole cloth and observed that doctrine as it achieved near constitutional status. It has since settled back into equilibrium with other well-established tort and contract doctrines. Prior to the 1986 decision of the U.S. Supreme Court in East River Steamship Corp. v. Transamerica Delaval, Inc., 476 U.S. 858 (1986) (where Chief Justice Rehnquist famously expressed his concern that the law of contract might “drown in a sea of torts”), and the decisions of the Florida Supreme Court in Florida Power & Light v. Westinghouse Electric, Inc., 510 So. 2d at 899 (Fla. 1987), and AFM Corp. v. Southern Bell Tel. & Tel. Co., 515 So. 2d 180 (Fla.1987), few lawyers and even fewer courts had ever heard of the doctrine. In less than 15 years, this judicially created rule became so prominent in Florida that one intermediate appellate court actually gave it the power to deny claimants recovery under statutorily created remedies. The Florida Supreme Court, adopting the dissent of Judge Gerald Cope of the Third DCA, reigned in the economic loss rule in Comptech Intern., Inc. v. Milam Commerce Park, Ltd., 753 So. 2d 1219 (Fla. 1999), and subsequent decisions.
In much the same way that proponents of the economic loss rule vested it with near constitutional gravitas sufficient to reject the right of the state legislature to create remedies, the U.S. Supreme Court has done the same with respect to the FAA to preempt state arbitration laws and to apply in areas never contemplated by those involved in its adoption. The parochialism article fails to put the decisions of the U.S. Supreme Court into their proper historical context while characterizing the courts of Florida as “parochial” for being out of step with those Supreme Court decisions. While the conclusion that Florida law was out of step with several landmark arbitration decisions of the U.S. Supreme Court is undeniably accurate, the conclusion that this is the result of parochialism on the part of Florida courts is not.
Joe is so right. When I started practicing, all anyone ever asked me to research was the applicability of the economic loss rule in possibly killing a particular claim or suit. We briefed it constantly, dissected every new decision, attended seminars about it, wrote and thought about it constantly, discussed it all the time, and attempted to apply it to every single case that we came across.
Now, it's pretty much a limited defense, applicable in fairly discrete situations.
Is Joe right that everyone right now is "arbitration-crazy," the way we were all ga-ga about the Economic Loss Rule back in the 80s?
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