House panel endorses attorney-fee bill to avoid new ‘loser pay’ system

All the testimony in the House Judiciary Committee today on HB 97 , a measure to re-impose the same rule for when attorney fees should be awarded in civil cases that Idaho’s had for the past 38 years, was in favor of the bill, and it passed unanimously; it now heads to the full House. The bill, co-sponsored by committee Chairman Lynn Luker, R-Boise, and Senate Judiciary Chair Patti Anne Lodge, R-Huston, comes in response to an Idaho Supreme Court decision that would have imposed a new rule March 1 if lawmakers didn’t act.

Both Ken McClure of the Idaho Liability Reform Coalition and Kurt Holzer of the Idaho Trial Lawyers Association praised the bill, though Holzer noted they often disagree on issues. “I think probably everyone would agree that the old system is more predictable and probably fairer,” McClure told the lawmakers.

HB 97 would award attorney fees to the prevailing party in a civil case when the case was brought frivolously, unreasonably or without legal foundation. The rule applies to cases that don’t fall under a specific statute directing attorney fee awards. The fall Idaho Supreme Court decision would have shifted Idaho to a new standard, which many feared would nearly always award fees to the winning party – even if they exceeded the amount at issue in the case. Opponents of that type of “loser pay” approach said it would make it so financially risky to go to court that many wouldn’t risk it, even if they were justified.

To become law, the bill still needs to pass the full House and Senate and receive the governor’s signature.