Liability, Not Fees, Needs Overhauling
In a political brawl between big business and trial lawyers, who will be the public’s sentimental favorite?
CEOs who collect millions while presiding over downsizing efforts that put wage earners out of work? Nah.
Attorneys who talk juries into exorbitant verdicts (of which they keep up to half) on behalf of clients who burned themselves with hot coffee? Again nah.
Perhaps, then, the thing to remember in the ongoing contest over tort reform is that the real stakeholders, potentially, are all citizens.
Looking at it that way, it’s easier to weigh the proposals that are being pushed by business interests and resisted by the trial lawyers in terms not of whose balance sheets they improve but whether they are just.
Consider two concepts that figure prominently in the struggles between these adversaries - contingency fees and the legal doctrine known as “joint and several liability.”
A bill that cleared the Washington state House of Representatives last year and that will be under consideration in the Senate when the Legislature reconvenes this month would (among many other things) limit contingency fees to 20 percent.
An attorney who takes an injured plaintiff’s case on a contingency fee agrees to take a certain percentage of the final settlement as payment. If the client loses, the lawyer gets nothing, not even out-of-pocket expenses incurred in handling the case.
Contingency fees sometimes are 40 percent or more of the settlement - but that’s between the lawyer and client. Mandating a statutory limit amounts to price fixing, something business interests ordinarily oppose vigorously.
Without the contingency fee structure, many injured clients would never get a chance to collect legitimate damages because they couldn’t afford to retain legal counsel. By the way, say trial attorneys, how about asking insurance companies’ attorneys to forgo their pay when they lose?
The tort reform bill in the Senate also would eliminate joint and several liability. If that legalistic phrase baffles you, perhaps you’re familiar with another: “deep pockets.” Under the doctrine, in an injury suit against multiple defendants, any one of them can be held accountable for the full verdict, even if he bears only 1 percent of the liability.
Yes, it’s tragic if an injured party goes uncompensated because the party at fault is, say, bankrupt. But it’s unjust to correct that problem by making others bear a burden that isn’t theirs.
Washington lawmakers would best serve justice by leaving contingency fees alone and doing away with joint and several liability.
, DataTimes The following fields overflowed: CREDIT = Doug Floyd For the editorial board