CHAPTER 5B
The Cost of Illegal and Unethical Acts by Lawyers
• What can be done to reduce the sum-total of lost consumer-surplus which such misuse of law swallows ?
• Can economist overlook this misuse, and expend time only in an effort to evaluate law in it's optimum setting, (fictional and Coase-like) with no externalities, and no transaction costs ?
• Does creating "secret procedures", secret local rules, and/or arbitrary local rules act as a form of rent seeking by requiring the hiring of the locals to interpret for outsiders ?
• Do small community courts practice a form of tax on all local transactions by requiring that pro se litigants or "outsider" lawyers hire a local facilitator ?
• What is the actual cost of : Absence of notice; ex parte hearings; absence of sworn testimony from which facts can be developed; delays due to absentee-judges; frivolous pleadings and cases; clerks of dubious skill and educational level briefing cases for judges ?
• Is there economic value lost in failure to follow stare decisis - that is following "settled points of law" ?
• Does the public lose production which it is entitled to receive when a judge writes a incoherent unpublished opinion ?
• Does the court become a facilitator of monopoly when it allows a constitutional deprivation to occur due to a litigant being a pro se non-member of the bar ?
• Does the court become a facilitator of monopoly when it allows a technical dismissal of a substantive case thus causing the cost of legal redress for the litigant to rise ?
My first experience in an actual court was Spencer County, KY. This is a small county, with just a few lawyers, a judge who "rides" a circuit, and a very "laid back" way of settling disputes.
This court allows facts to be established and hear-say testimony can be heard without the benefit of time-consuming swearing-in or even attendance. When asked that the oath to reduce "lying" called "perjury" be administered to a lawyer as he "testified", the judge said " we don't do that here".
What of statute law . . . does the legislative mandate hold in this county ? Not hardly. When this court wants to violate a state legislatively-written statute, the judge merely ignores it. What are you gonna do ?
When the local lawyer wants to make a few dollars (like a tax he can levy upon any property matter in that county) he calls another frivolous hearing. Of course he doesn't need witnesses, documents, or proof to call a hearing and stand before the court, because his pal the judge (remember political elections depend on votes and support) will put the burden of proof on the defendant.
An adverse ruling in that county court requires the vanquished, "taxed" , defendant to go to the state court of appeals, and spend a lot more time, aggravation, and money. This county court wants to create a very high level of complexity (very secretive) to increase the total of lawyer income. This county court allows the use of "fabricated suit" to create business advantage, or conversely interfere with a business. To do this it must create "rights" which do not exist, and deny rights which are clear, in both statute law and case (common) law.
The Court of Appeals was mandated a job by law it must do, but it can avoid correcting those "taxing" political lawyers in Spencer County by technically denying that the appeal will have a hearing "on the merits". No issue is settled, and the small political county court goes uncorrected, in an unpublished opinion. The litigant's rights remain violated.
Then, when the small court is faced with motions to raise the issues not settled, and not yet lawfully executed, more violations of law are "urged on the court by more frivolous motions, imposed on the wronged litigant, and ACCESS to the court is effectively denied.
So the wronged defendant litigant is compelled in his search for justice and redress to approach the federal court system to get some constitutional protection for the clear civil rights violations continuously being caused or allowed by the state court and several state employees.
The federal court decides that it can ignore the actual issues in the case, and can dismiss the complaint, based on the "facts" which the court itself made up, (more or less a "boiler plate" brief) which did not match the actual facts of the situation, as it is presented in the brief of the wronged litigant.
The unpublished opinion of the federal court represents a loss to society, 1) because an incorrect decision is inefficient, and 2) a technical dismissal is even more inefficient. It settles no issue, closes no matter and settles no future point of law which it might have served to reinforce or settle. And as Posner wrote, inefficient decisions, in which a losing litigant has a large stake invite repeated attacks, the never-ending quest to reach an efficient ruling.
In the mean time the additional expense imposed by the transaction cost add to the "incremental marginal cost" of the Appx H graph.
We need to write a legislative codification of the law, which spells out the right to sue a judge in the federal court when the judge uses the court to interfere with business (unlawfully gain a business advantage) and carries out some non-discretionary act which violates the rights defined in law. This would be a "regulation", but it can if correctly written reduce a possible reoccurrence of the inefficiencies described herein.