The doctrine of private nuisance occupies an anomalous position in tort law. Unlike negligence, which requires proof of a breach of a duty of care, or intentional tort, which requires proof of a deliberate wrongful act, nuisance liability can attach even when the defendant has acted entirely reasonably and in compliance with all applicable regulations. A landowner who operates a cement plant lawfully, using best available control technology and meeting every emissions standard, may nonetheless be held liable in nuisance if the dust and noise substantially and unreasonably interfere with neighboring landowners' use and enjoyment of their property.

The central balancing test in nuisance law asks whether the gravity of the harm to the plaintiff outweighs the utility of the defendant's conduct. Courts consider factors including the severity of the harm, its character (physical vs. aesthetic), the social value of the defendant's activity, the practical availability of alternatives, and whether the harm could be avoided at reasonable cost. This balancing inquiry has been criticized for its indeterminacy: because virtually any set of facts can be characterized in ways that favor either side, outcomes are difficult to predict and may reflect judicial preferences rather than principled legal standards.

A competing approach, associated with the law-and-economics movement, proposes that courts should assign liability to whichever party could have avoided the conflict at lower cost — the 'cheapest cost avoider.' On this view, the cement plant would be liable only if it could have relocated or installed abatement technology more cheaply than neighboring residents could have insulated their properties or moved. The efficiency rationale is clear: placing liability on the cheapest cost avoider minimizes total social cost.

Critics of the law-and-economics approach contend that reducing nuisance to a cost-minimization problem ignores the dignitary dimension of property rights. Landowners, they argue, have a right not to be subjected to substantial interference with their property that cannot be fully compensated through damages — a right that exists independently of efficiency considerations.