Ask entrepreneurs or non-profit executives what makes it so difficult to run a business or serve the community in New York State and you’ll hear the same things over and over. Taxes. Regulations. Mandates.
It’s not too often that you’ll hear mention of the state’s litigious environment even though it’s just as bad, if not worse, than all those other issues.
Maybe that’s because it’s a hidden cost.
You can’t really see the financial impact directly as you can with New York’s other burdens – not like you do when you run equipment at your facility or try to change your policies and procedures to meet new state laws.
Instead, the upfront costs are buried in the liability insurances we all must carry. Then, there are the unanticipated costs that occur when a lawsuit is levied against an organization or an individual for alleged malpractice or injury, or potential harm.
A 2017 study by the Empire Center found liability costs in New York exceed $20 billion a year. If those costs were passed on to every household in the state -- which really they are, in a way, because all affected organizations and insurers have to pass their costs on to their clients --- it would work out to be $2,700 annually.
Some of the examples cited for that extravagance: We are one of a dozen states that allow people to recover damages even when they are found primarily responsible for their own injuries; we encourage plaintiffs’ lawyers to target the defendant with the most money even if it is least to blame; and, we have unlimited noneconomic and punitive damage awards, fomenting a risk of high payouts.
It’s no wonder that New York City and Albany consistently rate near the top nationally in the American Tort Reform Association’s annual “Judicial Hellholes” report.
New York has become so attractive to those individuals who want to sue everyone that they have caused law to become a growth industry in the state, whether it’s for get-rich-quick lawyers or those across the courtroom from them who look to defend those being sued.
From 2008 to 2017, the number of lawyers practicing in New York climbed 20 percent which is 10 times the state’s rate of population growth. There are now more than 177,000 lawyers here. That’s one lawyer for every 112 residents -- twice the national average.
With skewed numbers like that we, of course, have too many lawyers in the statehouse. One-in-every-four state legislators has a law degree, placing New York among the top states in that regard. Many of them are decent folk intent on doing good for the people of New York State, but we know that not all of them are: We have lawyers serving as lawmakers who are making laws that serve lawyers.
For proof of that look no further than the disgraceful and disgraced Sheldon Silver, the former long-term Assembly leader who was defrocked for a number of things including misusing public office to drive people to a law firm he worked for, reaping a profit while doing so.
So, if things are really that bad with tort law, what is the State Legislature to do?
Well, as is the modus operandi of the state’s leadership, they are certainly not in tune with making things better. They plan to make matters worse.
Two bills have been making their way through committee in Albany that will expand the litigious nature of the state and make it even easier to sue and reap massive rewards.
S.2407B/A.679B would expand the consumer protection deceptive acts and practices section of general business law. It adds the simple yet nebulous word “unfair”, creating a broad and open-ended definition of excessive or unreasonable actions. If this were to pass, defendants would be liable if they, in the eyes of the court, could have known or reasonably should have known that a plaintiff was physically infirm, illiterate, or unable to understand an agreement. The bill also further promotes larger lawsuits by increasing the minimum damage to $2000 and awarding attorney fees.
S.4006/ A.561 amends the Estates, Powers and Trusts Law in relation to payment and distribution of damages in wrongful death actions. It greatly expands remedies for the family of a person who died as a result of negligence to obtain non-economic compensation, allowing for recovery of a decedent's pain and suffering. The Business Council of New York State believes this bill alone would drive up liability insurance costs by double digits.
If you’re sick of seeing businesses close or leave for greener pastures, if you’re equally sick of the incredible number of injury attorney ads on TV, write your legislators to oppose these bills. Businesses and non-profits are getting it handed to them every day with high costs and unconscionable risk -- we can’t subject them to more expensive insurances and even greater chances of getting sued for astronomical sums.
From the 03 June 2019 Greater Niagara Newspapers and Batavia Daily News