Every year, a think tank sponsored by the U.S. Chamber of Commerce, which emphasizes its small business membership, surveys lawyers who work for corporations with annual revenues of $100 million or more in annual revenues. The Chamber’s think tank asks them about the “legal climate” in each state for business.
In 2006, these lawyers liked the legal climate in Colorado better than that in all but seven other states. In 2007, that ranking plummeted to 21st place, a new low for Colorado.Past Rankings
In past years, the Chamber’s think tank, which has generally worked to reduce the rights of ordinary individuals in lawsuits against big business, has rated Colorado as follows:
2006 8th
2005 13th
2004 13th
2003 12th
2002 7th
The sample size of the survey for Colorado (93 persons interviewed) was fairly small, in principle leaving open the possibility of considerable sampling error. But, this isn’t as big a flaw as it would be in many opinion polls. This is because the group sampled (big business lawyers) is very homogeneous compared to a typical survey population. Equally important, the sample is about as large as possible given the small overall population of senior lawyers for big businesses that exists in the state.
Subscores
To gain some insight into this year’s result, it is useful to look at some of the particular factors that led to Colorado’s composite ranking in 2007.
Colorado’s highest ranking from the group came from its 6th place ranking for impartiality of judges. This view is widely held by all Colorado lawyers because of the relevatively non-political way in which judges are chosen in the state. Voters strongly backed the status quo system at the 2006 elections, rejecting a conservative led effort to change the system.
Colorado’s lowest ranking from the group came for its treatment of non-economic damages, like pain and suffering, emotional distress and impairment of quality of life, where they rated the state 26th in the nation. This is a surprising result given that Colorado’s has and has had since 1998 had a firm dollar cap on these awards, although many other states have since followed suit. The cap in Colorado on non-economic damages is $366,250 in most cases, $732,500 in extraordinary cases, and less in medical malpractice, construction and improper liquor sale cases. These damage caps are similar to those the Chamber of Commerce and GOP would like to impose nationally.
The big business lawyers also ranked Colorado 21st or 22nd in its treatment of punitive damages (two tables in the report give different numbers). This is also surprising.
In Colorado, punitive damages are only allowed in cases of fraud, intentional conduct and “willful and wanton” conduct. Colorado also generally only allows punitive damages to no more than double the total award, unless willful misconduct continues during the trial itself or certain other extraordinary conduct is present, in which case punitive damages may quadruple the total award. Colorado is also one of only a few states where evidence of the wrongdoers ability to pay may not be provided to a jury considering a punitive damages award. Colorado also generally allows punitive damage awards only when there is proof beyond a reasonable doubt, a stricter standard than the one usually applied in civil cases.
Colorado’s punitive damages limit is far more limited than that allowed by the U.S. Supreme Court and most states. The U.S. Supreme Court has upheld punitive damages awards in other states dozens of times as large as the compensatory damages award.
And, while big business lawyers believe Colorado judges are impartial, they feel that the state’s judges are only average, 25th place, in their competence. They give Colorado judges the same ranking for the timeliness of their rulings.
What Changed?
Colorado has virtually the same group of judges that it had in 2006. It made only minor changes in its tort and procedural laws in 2006. So what changed?
TABOR
Concern about delay in the Colorado courts may be a lagging result of TABOR. The taxpayer bill of rights forced deep cuts to the non-judicial staff of Colorado’s courts during the last recession, which are just starting to be restored. These staff cuts caused delays at all levels of the judicial system.
Almost every lawyer has a story about these impacts. My personal story is an eviction case that was delayed for months at the end of the year in Adams County, because no money was left to buy next year’s calender in this year’s budget. Judges were answering their own phones on scheduling matters, doing their own court reporting (via audio tape) and setting up furniture and water in their court rooms before trial.
Years of delays may finally have caught up to big business lawyer’s psyches now that the delays are starting to ease and lawyers realize just how slow the process had gotten.
The 2006 Elections
More cynically, it is likely big business has simply had a knee jerk reaction to the fact that there is a Democratic Governor in the state, and that Democrats control both the state house and state senate at the moment, despite the fact that there has been no earth shakingly significant substantive change in Colorado’s legal system in the past year.
