In reading state Sen. Brad Hoylman’s Dec. 22 commentary in the New York Law Journal, one can only find it amazing how the politicians of the state with the highest tort cost per household in the nation manage to keep straight faces when they try to characterize their support for the Grieving Families Act (GFA) as a reform measure designed to drag New York State out of the “antebellum era”. So let’s get something clear.It is true, as Hoylman says, that most other states provide some form of recovery for emotional damages of close family members in a wrongful death case. It’s also true that the statute prohibiting such recovery in New York is of hoary provenance, from 1847.It’s unclear why this date is being used to connect the current state of the law to the Civil War and thus the specter of slavery, an institution abolished decades earlier in New York, but overwrought rhetoric is now a staple of our political discourse: not long ago, a woman was pilloried on Twitter because her observation that she enjoys coffee on the patio with her husband was insufficiently sensitive to those who lack patios or leisure time. So it goes.While the above is true, it’s not the whole truth. To see the whole truth, one would have to know that despite New York’s prohibition on awards for emotional damages in these types of cases, New York still has the highest tort cost per household of any state.How can that be, while we bar a whole class of damages most other states allow?
Well, because it isn’t the only difference between New York and most other states.Most other states provide some kind of cap for pain and suffering damages in personal injury and wrongful death cases. New York has no cap in personal injury, and under the GFA, will have no cap for any form of damage in wrongful death cases either. Obviously, typical awards are much higher in uncapped environments-or no one would want a cap.Most other states provide for a lower rate of statutory prejudgment and judgment interest than New York’s 9% as well. While a handful of states do go higher, it remains odd that interest across the Hudson in New Jersey runs at a mere 3.5%. Some states even make the award of judgment interest discretionary. As long as the rate runs far above the return on a safe bond, it actually incentivizes plaintiff lawyers to delay resolution of lawsuits-but it also increases costs.And not one other state has a law similar to New York’s Labor Law §240(1), the so-called Scaffold Law, which provides for strict liability for deep-pocketed owners and general contractors whenever anyone is injured in a “gravity-related” accident while engaged in construction.As the Scaffold Law dates from 1885, we suppose we could play by Hoylman’s rules and call it a “Jim Crow-era” law simply to smear it-but it any case, it indisputably was not designed for the modern world. As any practitioner in the field knows, §240(1) jurisprudence is a thicket of confusing rules and exceptions, but the field of play overwhelmingly favors plaintiffs-by design.Nevertheless, this materially adds to the tort burden on the state economy. A partner in my firm, in a discussion with a prominent New York plaintiff’s attorney, offered to “trade” the GFA for the Scaffold Law. He tells me it got a pretty good laugh, and no surprise.There are other examples, but the above suffice for the point. The GFA isn’t being opposed by hospitals, insurance carriers, and other interests because they are mustache-twirling supervillains trying to kill the poor. That’s a lazy trope that’s disappointing to see from a member of the bar, albeit completely expected and typical from a politician.It’s getting opposition because there’s a real chance the GFA will be the straw (or girder) that breaks the camel’s back and creates an unsustainable cost spiral at the highest pain points- hospitals and health care-which, famously, already cost far too much, particularly for the uninsured.To be clear: the same insurance companies that
oppose the statute along with the hospitals will be the very same entities that will, when the statute is passed, mechanically respond by raising their annual insurance premiums for all hospitals, building owners, business owners, landowners, and municipalities, who will then pass the rising costs to the patients, renters, purchasers, and citizens of New York.They will have to, or they will face insolvency. Nevertheless, the pain will be passed to the very same patients, renters, purchasers, businesses, hospitals and citizens that our politicians are supposed to be protecting. The inevitable higher costs are always inevitably passed down to the middle and lower classes who can least afford it.Now, the defense bar is not guiltless here. It’s a not-so-secret-secret that reforms that benefit the plaintiffs’ bar benefit the defense bar too, insofar as they increase the demand for our services. We have a name for these laws: “Full Legal Employment Acts”.It’s our clients who get hurt by these reforms-we ourselves do OK. We say this not to accuse anyone of anything improper-but having taken our shots at the plaintiffs, we think fairness requires us to note that it’s all litigators who stand to benefit.The entire tort system is, of course, a net drag on the economy. The bigger and less efficient it is, the worse the state’s economy will be-even though the personal household economy of most lawyers benefit. This, we think, explains why opposition to the GFA is being led by hospitals and insurance carriers, rather than law firms.The GFA would get an entirely different reception as part of a prudent overhaul of the entire tort system, one that reflects the modern economy and re-allocates costs in a manner designed for both justice and efficiency. That is not what is on offer. Without concomitant reforms, the GFA is a reckless gamble with the state’s economy, premised on emotional appeals that simply don’t match reality.There is a real opportunity for reform – for bringing New York’s tort system out of what we may more neutrally call the 19th century and into the 21st. Count us in for that conversation, when it comes around. The current conversation, a mix of half-truths and hysteria, we could do without.
Initially published in the NYLJ
