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Governor Perry Signs Loser Pays Bill
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May 31, 2011
AUSTIN,Texas: Governor Rick Perry signed significant judicial reform into law yesterday that supporters say will "streamline and lower the cost of litigation in Texas courts, allowing parties to resolve disputes more quickly, more fairly and less expensively."[1] The bill (HB 274) has been nicknamed the "Loser Pays Bill," because it requires plaintiffs who sue and lose to pay the defendants legal costs under certain circumstances. But the watered-down 'loser pays' portion is only one of the judicial reforms brought about by the bill.
Some of the other highlights of the bill are:[2]
Allows a trial court to dismiss a frivolous lawsuit immediately if there is no basis in law or fact for the lawsuit; Allows a trial judge to send a question of law directly to the appellate court without requiring all parties to agree if a ruling by a court of appeals could decide the case; Allows plaintiffs seeking less than $100,000 to request an expedited civil action; and
Encourages the timely settlement of disputes and helping prevent a party from extending litigation by seeking a "home run" if they have already been offered a fair settlement.
Supporters of the bill, such as former judge Joan Huffman believe that the bill "balances the needs of both the plaintiffs and the defense."[1]Currently Texas is one of only eight states that does not have a system in place to allow for dismissals before evidence is presented; HB 274 will change that.
Opponents say the reform places burdensome costs on small businesses and individuals, even potentially preventing some from filing legitimate suits.[2]
It will only be after September 1st, when the law goes into effect, that the true effects of HB 274 will be seen.[2]
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