Traditionally, the American legal system has operated on the presumption that both sides in a lawsuit will pay their own litigation costs, the bulk of which is likely to be attorney fees. This "pay your own way" procedure is known as the "American rule" because the so-called "English rule," in which the losing party in a lawsuit pays the expenses of the winner, is much more common in other Westernized countries. Underneath the issue of who pays the cost of litigation lie profound questions about the role of the legal system in American society. On one side are those who perceive that Americans are excessively litigious and support a loser-pays rule assuming it would deter frivolous claims and defenses. On the other side, however, are those who focus on Americans who are hardly litigious but in fact are excluded from using the legal system because of inability to pay the costs required. These persons' support or opposition to laws that shift legal fees from one party to another would depend on their likelihood of increasing "access to justice" for legitimate claims. The empirical research question underlying this controversy is whether fee-shifting laws do in fact affect people's decisions to litigate. The purpose of this planning grant is to develop a research design for examining the effects of statutes that shift the costs of litigation, especially attorney fees, to losing parties. The investigator will adopt a sociolegal perspective on outcomes which would require a combination of aggregate and case- level analysis, including disputant surveys. Fee-shifting statutes will be reviewed and interviews will be conducted about the implementation of such statutes. This work will provide the basis for the ultimate selection of jurisdictions for a comparative study of outcomes in jurisdictions with and without fee-shifting. The research design in the full proposal will test the economic and the socio-cultural models of litigation against the behavior of disputants with an opportunity to shift their legal fees to the other party. This research will be of considerable policy relevance as well as add to scientific knowledge about how the change of the fee structure in the legal system can affect the quantity and quality of litigation. The findings will contribute to sociolegal research on claiming and law and economics research on settlement decisions. The opportunity to compare economic with socio/cultural models of litigation behavior will be unique.
