Senate contemplates sliding fees for civil cases
By Gary Blankenship
Preliminary House and Senate budgets mostly keep spending for Florida’s courts and their related agencies stable for the 2009-10 fiscal year, but accomplishes that by a big hike in some court filings fees. In the case of the Senate budget, it affects several types of cases, while the House limits the increase mostly to probate filings.
The proposed spending plans also enhances funding for drug courts. The Senate would require clerks to set up an electronic filing program and take a 10 percent budget cut.
The Senate Criminal and Civil Justice Appropriations Committee on March 24 unveiled its preliminary budget, which includes expenditures for the Department of Corrections, the Department of Juvenile Justice, the courts, state attorneys, public defenders, the Florida Department of Law Enforcement, capital collateral regional counsels, guardians ad litem, the Attorney General’s Office, and the Parole Commission.
The House Criminal and Civil Justice Appropriations Committee released its plan a week later.
A key difference is in the new graduated filing fee, which could be as high as $2,000 in the Senate bill for some cases but up to $5,000 for some probate cases in the House version. The House budget limits sliding fees to probate cases, and also imposes a fee on “repeat violence” cases which are now not subject to any filing fee.
In the Senate’s plans, the higher fees would apply to probate cases, foreclosure filings, economic damages under a contract, claim of indebtedness, when a condominium association goes to court and asks for damages, antitrust and trade regulation cases asking economic damages, business transactions asking economic damages, declaratory judgments on whether a claim is covered by an insurance policy, intellectual property and/or trade secret cases asking economic damages, and dissolution of marriage based on the amount in controversy subject to equitable distribution.
Sen. Victor Crist, R-Tampa, chair of the Senate panel, said a major change in the budget was the acceptance of a proposed graduated filing fee for civil cases, suggested by Gov. Charlie Crist’s office.
The proposed new filing fee would be linked to a declared value of the case. Those worth up to $50,000 would retain the current $295 fee. For cases worth $50,000 to $250,000, the fee would be $1,000. And for those valued at more than $250,000, the filing fee would be $2,000. The bill requires attorneys to set a value on the case, although that information would not be shared with a jury. In some cases where a value can not be determined, the fee would be paid retroactively at the case’s conclusion. The House version would limit the sliding fees to probate cases, which would be $280 for estates up to $75,000; $1,000 for estates valued at $75,000 to $250,000; $2,000 on estates from $250.001 to $1 million; and $5,000 on estates over $1 million. All fees collected above $280 would be remitted to the new courts’ trust fund.
In the Senate bill, the trust fund would receive $705 of the $1,000 fee and $1,705 of the $2,000 filing fee.
Both plans provide $20 million for expanding drug courts, with an eye toward reducing the number of people in state prisons.
Both preliminary budgets provide the same amount of funding next year for state attorneys, public defenders, criminal conflict and civil regional counsels, and the Justice Administrative Commission. The Senate cuts 10 positions from the two capital collateral regional counsel offices, from 73 to 63, while the House leaves those offices untouched.
The state’s Guardian ad Litem Program is proposed to have cuts in both House and Senate spending plans. The House would cut 154 of the current 596 positions; the Senate version would cut 49.
The House budget would shrink the Office of the State Courts Administrator by 23 positions, a reduction that State Courts Administrator Lisa Goodner called “devastating.”
Ninth Circuit Chief Judge Belvin Perry, chair of the Trial Court Budget Commission, said the loss of 23 positions would cut OSCA by about a third and warned that the $2.3 million OSCA cut in the House budget might lead to as many as 37 layoffs. Goodner said the cut would mean a 90 percent reduction in OSCA’s operating budget, which would include eliminating funding for the computer network lines for the Supreme Court, the five District Court of Appeals, and OSCA.
At an April 2 meeting, Rep. Sandy Adams, R-Oviedo, chair of the House committee, said she had met with Goodner and OSCA’s reductions would be addressed in conference to resolve the budget differences.
The Senate budget also reduces clerks of the court budgets by $46 million, shifting that money to the courts. The House budget sets a cap on clerks’ expenditures of $474.2 million, down from $539 million this current year.
Both budgets are preliminary spending plans. As this News went to press, they were being fleshed out with implementing legislation even as legislative staffers worked to refine revenue and spending estimates.
The Senate’s proposed sliding filing fee — and its wider application to a variety of cases — drew questions from the Bar’s Trial Lawyers Section, but Crist defended them.
Bob Harris, representing the section, said the high filing fees raised constitutional issues.
“A number of people will not have access to the courts that the constitution guarantees,” Harris told the Senate committee.
“We had to weigh which had greater impact, realigning the fee so it would be more fair and equitable to handle the work needed for that trial or going to a four-day work week for the court system,” Crist added. “If we downsize [the courts], is that better for access?”
The proposed legislation provides that if a litigant can show indigency, the filing fees will be waived.
Lawmakers and court officials were struggling to figure out the impact of the proposed filing fee hikes. Complicating the calculations was determining how many cases the higher fees would apply to and when the higher fees take effect.
According to one analysis of the Senate’s proposal:
• The sliding fee on probate cases — with the $2,000 top fee and not the House’s $5,000 maximum — would raise $10.4 million next year, if it were effective January 1.
• The sliding fee on foreclosure cases would raise $182.9 million, if effective June 1.
• The sliding fee on contract, indebtedness, condominium cases, antitrust/trade regulation, business, declaratory judgment, intellectual property/trade secret, and dissolution cases would raise $21.3 million if it became effective January 1.
(Another part of the Senate plan would transfer $108 of the current $295 filing fee to the state courts trust fund, which would raise $60.9 million if it becomes effective June 1.)
While the fiscal ramifications may not be in sharp focus, concerns by lawyers about the higher filing fees are clear.
Trial Lawyers Section Legislation Committee Chair Glenn Burton said the sliding and higher filing fees would be problematic for many lawyers.
He said the section e-mailed its members soliciting comments.
“I got hundreds and all but two were against it,” Burton said.
Reservations include, Burton said:
• There’s not necessarily a direct correlation between the size of the case and its complexity and demand on court resources.
• In some cases, the value of a case won’t be known up front, creating the possibility of a retroactive filing fee. That in turn can create a problem for judges, whose rulings can affect the size of an award and hence the size of the filing fee that ultimately goes to support court operations.
• Because the size of the case isn’t always directly related to its complexity, the higher filing fee may really be a tax.
“It’s not a user fee because there’s no rational relationship between the amount of dispute and the judicial labor . . . so what it is is a tax,” said Burton, adding it taxes people who have been injured, wronged, or, in the case of probate, died.
“You’re going to take $130 million or $200 million [annually] from these people just because they’re involved in the courts?” he asked. “That’s an access to the courts issue.”
Scott Rubin, chair of the Family Law Section, said discussions with legislators have focused on setting a dissolution filing fee based on the amount of marital assets.
“While there may be a substantial marital estate, frequently, the marital estate is in control of one party or the other. If a party is not in control of the estate, and you tell them they have to scrape together $2,000 instead of $295, that’s an access issue.”
While there is a proposed indigency waiver, Rubin said that might not help working families, or those who have substantial assets but in illiquid holdings, such as a house.
He also said that $2,000 is the retainer many lawyers charge for handling a divorce. If faced with the choice of the retainer or the filing fee, many parties may choose to proceed pro se. Since those cases require more resources from the court, Rubin said that could eat up resources from the higher filing fees.
“In many cases clients have no idea what the estate is worth,” he added. “They know they have a house, they know their spouse has a business, but they have no idea of what the business is worth. . . . If you have to do this [impose a higher filing fee] in a family case, you’re better off doing it at the backend, where this could be a taxable cost that the judge would allocate depending on who ends up with liquidity and who ends up with illiquid assets.”
Aside from the sliding filing fee issue, the House budget places a $200 filing fee on repeat violence injunctions, as defined in F.S. §784.046.
A court analysis of the change estimates it would raise about $2.5 million, as well as end the large number of frivolous repeat violence injunction petitions filed. The analysis notes that many child custody issues or domestic disputes are filed as repeat violence petitions because there is no filing fee.
The proposal drew concerns from victims’ rights groups that vicitms might have to pay the fees, but Rep. Adams and Goodner said they would work to refine the bill to aim it at frivolous motions that are frequently filed as part of dissolution cases, and not motions filed on domestic or sexual violence charges.
Both Crist and Adams said their primary budgetary goals are to prevent early prison releases and ensure courts can carry out their constitutional mandates.
“I think we’ve crafted a proposal that will not impact public safety and not impose on the constitutional requirements of our justice system,” Adams said.
Both Adams and Crist said the budgets put resources into prevention programs to lessen the need for more expensive prison beds. Part of that, Adams said, was the expanded funds for drug courts. The House uses $20 million of federal stimulus monies for the drug courts, plus another $1.5 million each for public defenders and state attorneys to staff those courts, she said.
Crist said the Senate budget does not call for any new prison beds, although those already being planned or under construction will be finished. Instead, the budget sets a priority of investing more in alternative programs like drug courts, which are less costly.
“The focus is put on diversion, prevention, intervention, and treatment,” Crist said, adding the intent is to keep prison beds for the worst offenders and avoid early release.
On the clerks, Crist said the budget mandates a 10 percent budget reduction — or $46 million — in the clerks’ court-supporting programs.
“Over the last 24 months, the courts, the state attorneys, and most everyone in this room have been hit 10 to 12 percent budget cuts and the clerks were not, because their work load has been increasing,” Crist said. “But at this time we went ahead and cost shifted about 10 percent [of the clerks’ budget], which is about $46 million.”
Crist also said that while the courts, state attorneys, public defenders, and criminal conflict and civil regional counsels were not having their budgets cut, the state’s two capital collateral regional counsel offices were losing staff and funds. The southern and central collateral offices combined will lose 10 employees, to a total of 63, and $563,281 in funding total of nearly $6.5 million. Crist said the state hopes to receive federal funds to replace about half that amount.
Bill Jennings, who heads the middle district regional office, said the state won’t likely realize the full savings because the cuts mean the regional offices will have to refuse some death row appeals. Those will be turned over to private attorneys on a registry list and paying them will reduce the savings. He also noted that the Supreme Court has said it prefers the work done by the CCRCs to work done by registry attorneys.