February 18, 1999
Civil justice reform gains
momentum as Volker, Morelle introduce tort reform bill;
Broad coalition of business, municipalities, many professions strongly
supports the bill
Senator Dale Volker (R-Buffalo) Assemblyman Joe Morelle (D-Rochester), two of the Legislature's strongest supporters of civil justice reform, have introduced a comprehensive tort reform bill.
The bill is backed by New Yorkers for Civil Justice Reform, a broad coalition of organizations representing big and small businesses, municipalities, physicians, architects and many others.
The Business Council is a member of New Yorkers for Civil Justice Reform and considers the Volker-Morelle bill a top priority.
The bill includes provisions that would have a broad impact across the state's business community, including:
A repeal of "joint and several liability," under which a defendant can be forced to pay all of the damages awarded-even if the defendant's liability is assessed at only 1 percent.
Repealing joint and several liability is a top priority of New York City and other municipalities, which often are dragged into lawsuits because of their "deep pockets" (i.e., ability to tax their citizens).
A cap on non-economic damages awarded in tort cases.
A "statute of repose" to limit the period in which a manufacturer can be held liable for damages attributable to its product. The provision would limit liability to 10 years after the product leaves the manufacturer's control unless there is an express warranty to the contrary. Currently, manufacturers' liability never expires, regardless of how many times the product has been re-sold or modified.
A measure to allow contractors and employers to defend themselves against lawsuits over worksite injuries by introducing evidence that the plaintiff's own negligence was a factor. Contractors now are strictly liable for an employee's worksite injury even if there is contributory negligence on the employee's part.
A limit on contingency fees. New Yorkers for Civil Justice Reform argues that contingency fees, which can be up to one-third of damages awarded, effectively encourage more lawsuits and are a major reason why less than half of all money spent on the liability system winds up compensating victims.
The Volker-Morelle bill (S.2277-A.4509) also includes industry-specific provisions. For example, it would limit the liability of farm stands and riding stables for injuries to people who accept risks associated with these activities.
The introduction of the Volker-Morelle bill came amid signs that the effort to rein in New York's lawsuit industry through civil justice reform may be gaining momentum.
Earlier this month, New York City Mayor Rudy Giuliani testified in Albany that "tort reform would enable the city to continue to compensate injured parties reasonably while preventing tort costs from escalating uncontrollably."
Other bills designed to restore sanity to the civil justice system have been introduced this year, including two bills that would bar recovery for injuries sustained during the commission of a crime and a bill that would impose criminal penalties on anyone who solicits lawsuits at an accident scene.
The lawsuit industry costs New Yorkers $14 billion each year, or almost $800 per person, and adds hundreds of millions of dollars every year to the property tax burden, because of runaway lawsuits against municipalities.
Tort filings in New York jumped 58 percent between 1988 and 1996, the third highest jump in the nation. A surge in motor vehicle claims in this period came despite a sharp drop in injury accidents, the presence of no-fault insurance and slow overall population growth.
The lawsuit industry is being driven in part by a population of lawyers in New York State that is growing 26 times as fast as the state's overall population.