Re: Obama XXIV: Forward ... pause ... rewind ... play
We should go to a "loser pays" tort system like most of the rest of the world. Cut down on lawsuit happy lawyers and frivolous lawsuits.
No it wouldn't. Not even close. In fact, you might very well see more lawsuits.
Lawyers have typically been paid under one of two fee arrangements -- paid on an hourly basis or paid a percentage of a final recovery for their clients (contingency fee). The defendants in a lawsuit will always be paying their attorney on an hourly basis since they aren't seeking to make a recovery upon which a contingent fee is based (some clients may have a lawyer on retainer, or be paying on a "job" basis, but that's the exception and not the rule.)
The plaintiffs, usually, are paying a contingency fee. The norm is probably somewhere between 25% and 50% of any recovery, sometimes subject to court approval.
In the vast majority of lawsuits there is no "fee shifting" as you propose. This means that before a lawyer will start a lawsuit in which he or she is to receive a contingency fee, the lawyer will evaluate the potential damages available to determine whether the prospective contingency fee is worth the time and risk (of no recovery at all) associated with the case.
Right now about the only fee shifting that ever occurs is when it is either specified in a prior agreement between the parties (think, your promissory note and mortgage on your house) or where set out by statute passed by the legislature. Statutory fee shifting is common in things like employment related disputes over wages, discrimination, etc...
Let's say you have a case where you claim you suffered a broken finger as a result of a defective machine designed by John Deere. No lawyer will ever take that case. You might have a few thousand dollars in medical bills, no real permanent disability. A lawyer can't hire the necessary design engineer necessary to make such a case fly for the damages he or she might expect to recover.
But now add fee shifting to the equation. If the attorney believes that in addition to the actual damages sustained that the attorney might be able to recover from John Deere $200,000 in attorneys fees through "fee shifting", the case becomes much more attractive. The attorney is basically working on John Deere's "dime."
The reason legislatures and Congress enacted fee shifting in cases like employment discrimination is to make them attractive to plaintiff's lawyers. Otherwise no one is going to take a case where you might only recover 6 months wages as damages for someone who was making $24,000/year. A lawyer wouldn't take such a case if he or she was only going to make $3000 as a fee.
If you want to create an environment in which every minor grievance is now a basis for an actual lawsuit, then by all means enact fee shifting rules.
