Monday, August 3, 2009

Another wacky idea: bonds for civil suits

From the "my wacky ideas" file:

I think there should be a couple more qualifications in civil suits rather than simply a judgment against the accused or lack thereof. Specifically, I think the court/jury should also have the right to say (in addition to the regular judgments) that the lawsuit had no merit, and that the legal representative for the plaintiff should have been aware of this before bringing the action. This, in and of itself, would not change the system at all, but that brings me to my associated idea...

I think to file a civil lawsuit, against anyone, you should first be required to post a bond in the amount of reasonable court and defense counsel costs. This bond would be forfeit if you drop the action (at least in the amount of incurred court/counsel costs at that time), or if your case is dismissed for lack of merit. If you win, or the case is determined to have merit but is decided against you, you get the entire bond amount back.

The actual bond itself could be handled somewhat like bail is currently, with independent companies available to front the money in exchange for a percentage of the settlement if you prevail (similar to the lawyer's percentage for taking the case with no money up-front). Law firms could also pay the bonds, of course, if they are taking cases on behalf of clients.

The obvious benefit of this is that there's a certain amount of financial risk associated with filing a lawsuit, highly discouraging any lawsuits without obvious legal merit. Of course, wealthy individuals and businesses could still file frivolous lawsuits at their own expense, but the cost to both the accused and the court system would be minimal, since the bond would cover the normal and reasonable expenses of both. If the system works well, frivolous lawsuits would be virtually eliminated, which would be a huge benefit for our society; if it doesn't work, it doesn't make the system much worse than it is today.

Anyway, that's my wacky idea for the day.