Taxation & Estate Planning

Should probate litigants "opt out" of the public court system?

By Juan C. Antúnez

This letter from Miami-Dade County Chief Judge Joseph Farina was recently emailed to Miami-Dade County attorneys asking us to get involved in the political process revolving around looming budget cuts.  According to Judge Farina:

The judicial branch was recently advised that due to the State of Florida's budgetary deficit totaling approximately 4 billion dollars, the State Courts' budget would have to be reduced by more than 16 million dollars by June 30, 2008. While this unanticipated reduction amounts to only 0.06% of the state budget, the loss of these funds would be devastating to  the judicial branch and its ability to provide access to justice and quality service to the public.

Should probate litigants "opt out" of the public court system?

As a "user" of Florida's court system faced with the negative consequences of an underfunded system, I have the option of passively accepting the status quo and simply resigning myself to doing the best I can under less than ideal circumstances.  Another possible reaction is to opt out of the public court system whenever possible.  There are no jury trials in probate litigation, so these cases lend themselves to alternative dispute resolution mechanisms.  Fortunately, existing Florida law provides litigants and their attorneys a wide menu of ADR options to chose from, including:

[1]  Court-ordered mediation (F.S. 44.102).  This option is well-known and commonly used.  It's not really an alternative to the public court system because there's no third party acting as "judge" to resolve the dispute.  The parties either voluntarily come to an agreement - or they don't - and end up right back in the public court system.

[2]  Court-ordered, nonbinding arbitration (F.S. 44.103).  This option is a little closer to private litigation because you have an independent third party making findings of fact and law that can end up in a legally-binding judgment.  Although the parties don't have to live with the arbitrator's ruling if they don't want to, if you decide to reject the arbitration ruling and go back into the public court system for a trial you may have to pay the other sides attorney's fees and costs if your after-trial judgment isn't at least 25% higher than what you got from the arbitrator.  This can be a powerful incentive to stick with the arbitration ruling.

[3]  Special Masters (Florida Rule of Civil Procedure 1.490; Florida Probate Rule 5.697).  Special masters can perform a wide variety of tasks usually shouldered by the trial judge directly. They serve various roles in pretrial discovery and proceedings, facilitate the mediated settlement of cases, make recommendations and submit reports to judges, assist with complex issues, chair advisory committees composed of lawyers of record, help administer class actions and settlements, propose orders jointly recommended by the parties, make decisions based on judicial reference or the parties' consent, and become engaged in post-trial proceedings.  In short, special masters are a flexible and commonly-used means of lightening the load for overburdened trial judges while also making life much easier for the litigants.  A recent Florida Bar Journal article by Howard R. Marsee entitled Utilizing "Special Masters" in Florida: Unanswered Questions, Practical Considerations, and the Order of Appointment does a good job of explaining all the ins and outs of using special masters in Florida litigation.

[4]  Voluntary trial resolution a/k/a "Rent-a-Judge"  (F.S. 44.104).  This is Florida's version of California's "rent-a-judge" statute, which first gained prominence in the early '80s.  I'm intrigued by this concept.  Why put up with an underfunded public court system when you can hire a judge with subject-matter expertise and get all the benefits of a trial and the right to appeal an adverse ruling while avoiding the worst aspects of the public court system?

The following excerpt from a piece in Time entitled Rent-a-Judge does a good job of describing the pros and cons of the rent-a-judge option in plain English:

Once both sides in a dispute agree to set up their own court, they select a judge (so far all have been retired jurists) and settle on his pay (usually $125 an hour, split by the parties). If the regular court approves, trial can begin when and where the litigants choose.

By averting the 4½-year wait for trial, parties almost automatically save money. Normally, Chodos asserts, "lawyers have to justify their existence, so they file 39 depositions and countless motions that are meaningless but costly." Another advantage of the system, particularly important to litigants in complicated business cases, is that parties can pick judges with expertise in certain fields. Moreover, proceedings can be held in secret and kept off the public record. When Tonight show Host Johnny Carson and NBC were battling over his contract in 1979, they hired a retired judge to hear their megabuck dispute behind closed doors. (Before the trial began, however, they settled the case.)

Judges regard the system as the best thing since raised benches. Los Angeles jurists, who earn $60,000 a year, retire comfortably: a 20-year man receives a pension of $45,000. But an energetic ex-judge can increase that income greatly by freelancing. Eugene Sax received more than $40,000 for five months of work on a dispute between California's air resources board and several oil industry giants.

Because private courts can work only when both parties want a prompt decision, their growth potential is limited. Explains Judge Schauer: "Over 99.9% of our cases involve one side that doesn't want to go to court. Defendants don't want that day of judgment." The typical rent-a-judge case involves squabbling business partners who are eager to get a ruling and resume their profitable venture. Recently, private judges have also started handling family law matters.

The private jurist program resembles arbitration, a widely used procedure that calls on a non-judge to resolve disputes typically involving labor contracts. But the California procedure has some features that arbitration does not. Examples: the judge must adhere to regular procedural and substantive aspects of law, and decisions can be appealed.

For Florida-specific articles describing our rent-a-judge statutory regime see: Christopher M. Shulman's “Voluntary Trial Resolution: Tailor-Made for Employment Claims”, The Checkoff, Vol. XLII, No. 3, at 5 (Florida Bar Labor and Employment Section May 2004) [click here]; and Cary R. Singletary's "Voluntary Trial Resolution - A New Dispute Resolution Process in Florida," The Checkoff, Volume XXX, No. 4, July 2000, The Florida Bar [click here].

Full post as published by Florida Probate Litigation Blog on March 03, 2008 (boomark / email).