Governor Perry’s Civil Justice Reform Package

In his recent “state of the state” message, Governor Rick Perry presented a package of civil justice reforms designed to discourage non-meritorious lawsuits and increase the efficiency of litigation. The Governor’s proposed reforms:

» Discourage frivolous or abusive lawsuits by imposing risk and cost on those who insist on pursuing such lawsuits.
 

» Provide for the prompt and fair resolution of lawsuits up to $100,000, so that litigants have a chance to have their cases resolved without excessive time and expense.

» Replace Texas’ archaic “special exceptions” practice with a true “motion to dismiss” practice, allowing lawsuits that have no merit to be disposed of quickly.

» Allow a pre-trial appeal of trial court rulings on issues of law that will determine the outcome of the lawsuit, rather than having the parties incur the expense and time of a full trial before the dispositive issues of law are resolved on appellate review.

» Pass a law stating that only statutes or regulations which expressly create a cause of action do so and judges cannot imply causes of actions from statutes or regulations.

Offer of Settlement

An effective offer of settlement mechanism would encourage a defendant to put a full settlement offer on the table early in the lawsuit, which would benefit plaintiffs with legitimate lawsuits. If the plaintiff refuses defendant’s settlement offer and ultimately recovers less than 90% of the defen- dant’s offer, then plaintiff must pay defendant’s litigation costs from the time that the defendant made his offer. If the settlement offer is made and accepted early in the lawsuit, the plaintiff attorney’s fees would be based on a commonly accepted reasonableness standard known as “lodestar.” If the settlement offer is refused and the plaintiff ultimately recovers more than the settlement offer, the plaintiff attorney’s contingency fee would be applied to the amount recovered in excess of the settlement amount offered by the defendant.

Wrongful Prosecution of Lawsuits

The restatement of torts and many states recognize a cause of action against the parties and lawyers who pursue a lawsuit for an improper purpose and without probable cause. Such a cause of action recognizes that a person who successfully defends against abusive litigation is as much an injured person as a person who is harmed by other kinds of malicious or intentional acts, such as defamation or physical assault.

Texas Windstorm Insurance Association (TWIA) Reforms

Hurricanes have become a litigation windfall for some trial lawyers who take a large portion of the insurance payouts that should, instead, be paid to the damaged homeowner or be retained as reserves to prevent or mitigate increases in premiums. It has recently come to light that tens of millions of dollars have been paid by twia in attorneys’ fees in recent hurricane settlements. this adversely impacts homeowners’ insurance rates for all Texans and could potentially even be a drain on the general revenues of the state, which would exacerbate our budget problems.

TWIA is a quasi-state agency and the laws governing it must be reformed to allow for the prompt and fair payment of windstorm claims without the huge transactional costs imposed by aggressive, entrepreneurial lawyers.

Statutory Employer

Statutory employer is a system which encourages workers compensation insurance to be provided for all workers on a worksite and prevents negligence lawsuits for insured workers who are injured on the job. Workers compensation is a no-fault system which has been in place in all fifty states for over a hundred years because it provides immediate compensation to an injured worker for wages and medical and rehabilitation costs even if the worker caused his own injury. By eliminating negligence lawsuits on a worksite, large efficiencies are gained – producing cost savings that benefit consumers.

Statutes of Limitation

Statutes of limitation reflect the sound public policy of prohibiting lawsuits after a reasonable period of time has lapsed after a wrong or injury has allegedly occurred. But there is a provision in current law that allows a defendant to be sued even if he would otherwise be protected by a statute of limitations. this anomaly in the law is being gamed and abused and should be repealed.

Barratry (Also Known as Case Running or Ambulance Chasing)

Barratry is a disgrace to the profession of law. often, lawyers who engage in barratry prey on accident victims at their most vulnerable. Lawyers who unethically solicit lawsuits are undeterred by current rules and laws – a new and more vigorous remedy is needed.

Court Organization

The Texas court system needs tighter organization, greater efficiency and higher funding. In light of the current budget difficulties for Texas and all states, increased funding is not realistic this session. But TLR and the state Bar of Texas have proposed changes to our court system that would add organizational efficiency and some of those recommendations will be considered this session.

Judicial Selection

Texas cities such as Houston, Dallas and San Antonio have suffered sweeps in judicial races – for example, in 2008 almost no Republican judicial candidates won in Harris County and in 2010 no Democratic judicial candidates won. Texans should take a fresh look at the way we select judges to better assure that our judicial bench attracts and retains experienced, honest and competent men and women. For example, eliminate straight-ticket voting for judicial offices.