MACo Raises Concerns Over One-Sided Attorney Fee Legislation

MACo Associate Director, Natasha Mehu, testified in opposition to legislation (SB 705) that would likely impose an increase in litigation and costs for the State and local governments and create an unbalanced system that favors plaintiffs over defendants. The bill was sponsored by Senator Anthony Muse.

The bill would authorize a court to award a prevailing party reasonable attorney’s fees and expenses in a civil action to enforce a right secured by the Maryland Constitution or Declaration of Rights. This includes claims such as due process, seizure of goods or property, right to an adequate education, and freedom of the press. However, while a prevailing plaintiff can collect attorney’s fees based on a variety of factors and considerations detailed in the bill, a prevailing defendant is only allowed to recover fees if the court determines that the plaintiff’s suit was made in bad faith or without substantial justification. Attorney’s fee awards in local government cases are subject to the liability cap of the Local Government Tort Claims Act (LGTCA).

MACo’s testimony states,

The bill would result in an increase in claims brought against the State and local governments. While attorney’s fees in county government cases would be subject to the LGTCA cap, the bill still incentivizes plaintiff attorneys to bring cases against county governments so long as they are not made in bad faith or without substantial justification (a deliberately high threshold for enforcement).  …

The fiscal note for the bill correctly states that “[l]ocal expenditures increase for (1) payments for claims filed under the Local Government Tort Claims Act (LGTCA) and other eligible claims and (2) higher assessments for local governments if the Local Government Insurance Trust (LGIT) incurs losses from payments authorized by the bill.”

Since many of the cases that would be brought under SB 705 involve nonmonetary damages, county costs would increase due to payment of attorney’s fees if the plaintiff prevails (where currently no fees would be paid). Additionally, counties will see increased costs to their law departments to defend against the additional claims and potentially higher assessments if the Local Government Insurance Trust (LGIT) incurs losses from payments authorized by the bill.

Joining MACo in opposition to the bill on a panel were the Maryland Municipal League, Local Government Insurance Trust (LGIT) and Montgomery County.

The cross-file to the bill, HB 903, was heard by the House Judiciary Committee on February 22.

Follow MACo’s advocacy efforts during the 2017 legislative session here.