Tuesday, July 17, 2012

Disincentives to Bad Litigation

Today morning I had an epiphany about the Indian judicial system.  I realized that there is a formidable class of people which is strongly opposed to any reform in the dispensation of justice in this country, and that that is why judicial reforms are at a stand-still and why we are seeing more and more draconian laws (since normal laws are proving ineffectual).

It is common knowledge that the Indian courts are clogged with millions of pending cases, with some trials going on for more than three decades.  Civil suits go on even longer.  There have been many studies and recommendations on how to resolve this mess, and how to make the theoretical "right to speedy trial" a reality in this country, but to little effect.

Having experienced the Indian judicial system at close hands, I find that most judges do not penalize the litigants enough for wasting the time of the court.  If only they started imposing heavy costs and punishments to litigants and their lawyers for obstructing the course of justice through frivolous and mendacious petitions, appeals and affidavits, I am quite sure the number of new cases will come down drastically.  But that doesn't happen.

Contrast this with the speed of trials in United States, and the fact that most judgments do not go through an appeals process.  Litigation in the United States is an expensive proposition, and the courts frequently award litigation costs to the winner of the case, in addition to levying punitive damages on the loser.

There is a difference between fighting a case in good faith, and trying to subvert the administration of justice by filing an appeal on every little decision.  Consider the trial of the Aarushi murder case.  The accused in this case are appealing every little decision of the trial court.  If the trial court summons them, they appeal it.  If a witness is to be cross-examined, they appeal it.  And if nothing else, they appeal to shift the place of trial itself.  All these appeals take time to adjudicate, and the trial languishes.  People who are astute in filing such appeals can delay the final decision for decades.  Till then, injustice continues to thrive, and the other party usually gets exhausted and gives up on the fight.

I think there are three very strong reasons why Indian courts do not impose costs on litigants and lawyers.  And all three reasons are linked.

The first reason is that judges are ex-lawyers, and they generally refrain from criticizing or disciplining their own kind.  Even when there is clear evidence of false affidavits or vexatious litigation, the judges do not pass a stricture against the lawyers.  Lawyers oppose tooth-and-nail any reform in the judicial process if it hurts their business (for example, the non-requirement of a bail application in any offence carrying a maximum sentence of less than seven years), they go on flash strikes and shun work and nary a stricture is passed against such thuggish bar councils by the judges.  (As a digression, professional bodies in India are, in general, not for regulation and ethics, but for protecting their own interests.  As another example, the Medical Council of India (MCI) in its entire history has not dis-affiliated even a single doctor for any malpractice.)

The second reason is that lawyers clearly gain from more and more cases being filed in courts.  Every appeal, every application, every affidavit has a cost for the litigant, and a benefit for the lawyers.  And it is therefore to the lawyers' advantage that the possibility of appeals and revisions be kept alive.  If a decision is to be considered final, then that cuts the cash stream to the lawyers from the future cases.  So, the judiciary (which is friendly to the lawyer community) is loath to reform the process so that appeals and revisions are disallowed.  This also means that the justice administered is mostly shoddy, since the judges know that their mistakes will probably get corrected in the higher courts.  If someone does a study of how many decisions of Indian courts are overturned due to a revision or an appeal, one might be appalled.  Even the decisions of High Courts are routinely criticized by the Supreme Court for failing to apply basic common sense.

If the courts start imposing heavy costs on losing litigants (including on the government, which is perhaps the largest litigant in India and which is only too happy to appeal every judgment that goes against it), I think people will think twice about filing or fighting a case or about appealing a judgment.  Also, an overturned decision (under appeal) must mean a career setback to the original judge.

The test of whether a petition is frivolous, bad in law, or an attempt to delay justice is not easy.  Given that Indian courts routinely contradict each other and their own past judgments, any capable lawyer can find enough grounds to appeal a decision.  I think there needs to be a massive exercise of obtaining consistency in Indian case law.  Till that happens, justice in India is a roll of dice, based on which cases you can cite, how forcefully you argue, and the mood of the judge.

The third reason is that most litigation costs are paid under the table.  Lawyers are champions in taking heavy fees and not paying any taxes on their income.  I haven't heard of any lawyer who routinely issues receipts for his fees.  If one does a study on income tax returns of Indian lawyers vis-a-vis their lifestyles and possessions, one will be quite amused.  Of course, since the authorities need a lawyer to litigate for evasion of income tax against another lawyer, this practice is going to continue.  One solution could be the use of foreign lawyers by the Income Tax department, but foreign lawyers are not allowed in India, to the obvious benefit of the lawyer lobby.

Due to this black economy, the winner's litigation costs on paper are negligible and therefore there is no point to awarding of litigation costs to him.

Due to these reasons, there is every incentive to file/appeal a case in India and no cost/punishment if one fails in one's attempt.  One must look at these perverse incentives, and reverse them, if there is to be efficient justice in this country.


Anonymous said...

Court can charge court costs from the loser.

Jogeshwar said...

Yes the litigants are hardly penalised, most of the time if the respondent is state, AAG's tend to evade the court. AAG( additional advocate generals) are inept and are mostly partisans and hold their office as long as their party is in power. In my personal experience, state evaded the court for four successive hearings, taking 8 months to file a reply. Had the state failed to file a reply the fifth time, the judge would have imposed the state with a measly fine of Rs. 5000. In a High court, on an average it takes a time of 2 months between two successive hearings.
Also it is common hearsay, since the judges are piled up with so many cases and with a lot of pending judgements, they hire lawyers to write judgements of the cases reserved by them.

Anonymous said...

I am in complete agreement with you. I too speak from experience, having spent 15yrs seeing this process firsthand.
A few years ago thee was a move to limit the number of appeals to two and the entire country's lawyers went on strike ! does it take extraordinary intelligence to make a lawyer understand that he lives this life outside his proffesion too and he could suffer the system too were he to be at the receiving end and in anycase he will never be short of business given the size of the population and its aggresive tendencies.
Geetu Garewal