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States finding that Binding Arbitration not so good after all
Monday, 24 January 2011

MoDOT wants day in court on highway lawsuits
The Missouri Department of Transportation wants its day in court when it is sued over injuries or deaths blamed on defects in state roads. The highway agency contends it is paying out millions of dollars more than necessary because of arbitration rulings against it. So the department wants to be able to take its chances before a judge and jury. Legislation considered by a Senate committee this past week would repeal a 1999 law that allows plaintiffs to decide whether to submit their cases to binding arbitration instead of a jury. The bill would require lawsuits to go to arbitration only if the Missouri Highways and Transportation Commission agreed to it.

MoDOT wants day in court on highway lawsuits

By WES DUPLANTIER
The Associated Press

JEFFERSON CITY | The Missouri Department of Transportation wants its day in court when it is sued over injuries or deaths blamed on defects in state roads.

The highway agency contends it is paying out millions of dollars more than necessary because of arbitration rulings against it. So the department wants to be able to take its chances before a judge and jury.

Legislation considered by a Senate committee this past week would repeal a 1999 law that allows plaintiffs to decide whether to submit their cases to binding arbitration instead of a jury. The bill would require lawsuits to go to arbitration only if the Missouri Highways and Transportation Commission agreed to it.

In arbitration, cases are decided by a panel of three arbitrators — one chosen by the plaintiff, one by the defense and the other by both sides. Decisions made in binding arbitration cannot be appealed.

The bill's sponsor, state Sen. Bill Stouffer, R-Napton, said his legislation could save the state money because lawyers may be less likely to sue MoDOT if they had to go to court, where proving their case to a jury might be more difficult. Any money saved in legal cases then could be plowed back into road maintenance and construction, he said.

Currently, "what happens is when a lawyer has a weak case he'll go to arbitration, if he has a strong case he'll go to trial," said Stouffer, chairman of the Senate Transportation Committee, which could vote on the bill soon.

According to a financial estimate by legislative researchers, MoDOT's legal costs were $4 million per year before the arbitration law was passed in 1999. A decade later, the costs had risen to $11.9 million. If Stouffer's bill passes, the transportation agency said, its legal costs could be about $2 million less than in 2009.

MoDOT attorney John Cauwenbergh told the Senate committee that those costs are paid out of the state's road fund, which is used to maintain state highways and bridges.

"There's been a significant financial impact resulting from the enactment of this provision," Cauwenbergh said of the 1999 law. "Getting rid of this provision simply gives MoDOT its day in court."

Denise Henning, an attorney at the Kansas City-based Henning Law Firm, said she believes taking away the arbitration requirement would not help the state because jury trials can take twice as long as the arbitration process.

"It's in the best interests of taxpayers for MoDOT to resolve cases quickly," Henning said in an interview Friday. "And arbitrators may be better decision-makers, because these cases involve highway and road issues that they might more familiar with than the average juror."

Roger Brown, an attorney who works in Jefferson City, told the committee that removing the arbitration option would make it harder for injured people to file claims against MoDOT, because state law caps awards at $300,000. He said plaintiffs would see little money after a trial, because they would have to hire more experts and pay higher attorney fees for a long trial, while the state can use the in-house counsel and experts that it has on salary.

"It's very expensive to put these cases together," he said. "So when you're looking at a limited recovery, it's cost-prohibitive."



Read more: http://www.kansascity.com/2011/01/23/2604273/modot-wants-day-in-court-on-highway.html#ixzz1ByI3TA7P
 
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