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(n261) Id.

(n262) "The trial judge's comments ... show he used the word 'overt' as a synonym for 'intentional' to indicate an absence of scienter necessary for fraud." Id. at 780.

(n263) 789 P.2d 960 (Cal. 1990).

(n264) 789 P.2d at 970.

(n265) 512 NE.2d 1141 (Mass. App. Ct. 1987).

(n266) Id. at 1143.

(n267) Id.

(n268) Id.

(n269) Florenzano v. Olson, 387 N.W.2d 168 (Minn. 1986).

(n270) Id. at 176.

(n271) Id. at 176 (quoting WILLIAM PROSSER, LAW OF TORTS 5 107, at 706 (4th ed)).

(n272) WILLIAM M. LANDES & RICHARD A. POSNER, THE ECONOMIC STRUCTURE OF TORT LAW (1987) [hereinafter ECONOMIC STRUCTURE|.

(n273) See id. at 16-19. Landes and Posner use the term "efficiency" throughout their book in the Kaldor-Hicks (or potential Pareto superiority) sense, in which a policy change is said to be efficient if the winners from the exchange could compensate the losers, that is, if the winners gain more from the change than the losers lose, whether or not there is actual compensation. Another way of stating the Kaldor-Hicks criterion is in terms of wealth maximization. Id. at 16. Landes and Posner "do not argue that tort law is efficient in the strict Pareto-superior sense," Under Pareto superiority no person should be worse off because of a change. Such a system would require injurers to compensate victims in the absence of negligence, because if they did not the injurers might be better off but victims would be worse off. However, common law negligence rules may be efficient in the Pareto-superiority "on an ex ante (before the fact) basis." Id. at 17. For our analysis in this article we accept the Landes-Posner/Kaldor-Hieks definition of efficiency.

(n274) See id. at 59. The social costs of accidents is defined "as the sum of the expected accident losses and the costs of care (or avoidance)."

(n275) Landes and Posner generally are contemplating personal injury or property damage accidents involving strangers, but their analysis and model is also useful for analyzing pecuniary losses caused by misrepresentations in transactions if the parties are more closely related.

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