Legal News

City Halts Payment of Counsel and Arbitrator Fees

By Brian Harris

By Amaris Elliott-Engel
Of the Legal Staff

The First Judicial District has issued a notice to the bar that the city of Philadelphia has begun to delay payment to its vendors, including attorneys who take court-appointed counsel cases and serve as arbitrators in the arbitration center.

The FJD's announcement comes on the heels of Mayor Michael A.  Nutter's announcement last week that the city doesn't have enough cash to pay its vendors until there's action in Harrisburg to pass a state budget and approve the city's proposals to temporarily raise Philadelphia's sales tax and to temporarily adjust how the city pays it pension payments.  Court officials said in their notice to the bar that "payments to vendors of a non-emergency nature" were being suspended by the city.  

 FJD Court Administrator Dave Lawrence said Wednesday payments to court-appointed counsel has already stopped, and cash to pay for arbitrators is expected to run out within a few days.

"We have enough cash to pay arbitrators for several more days but after that the money just won't be there," Lawrence said. The payment stoppage for "court-appointed counsel has taken effect immediately."

Lawrence said that he hasn't heard that attorneys are refusing to take court-appointed counsel cases or to serve as arbitrators because there will be a delay in receiving their remuneration, but he also said it's possible those comments are being made and he has not heard them.

While Lawrence and a handful of other court administrators whose salaries are paid by the state are working payless days until a budget for the commonwealth is passed, Lawrence said that all of the FJD employees paid by the city are still being paid on time for every day they work.

If Harrisburg approves the city's requests, the FJD will only have to close four to seven days in this current fiscal year in order to save money. But without the sales tax and pension approval, the city, along with the courts, will be looking at a "Plan C" budget that city leaders are predicting will mean cataclysm for the city's budget. Details of what "Plan C" would mean haven't been deeply detailed.

Lawrence said court administration is in the process of looking at how many staff would have to be laid off and how many days the courts would be closed under "Plan C." He said it would be at least as bad as the scenario he described during his City Council budget testimony in April: closing the courthouse for 22 days this fiscal year, laying off 209 people or requiring employees to take unpaid furloughs.

Full post as published by The Legal Intelligencer Blog on July 23, 2009 (boomark / email).