John Howard Griffin asks: “What problems occur because we have a Capitalistic form of legal representation?” Which is a big question. A BIG question. And, although I don’t think Mr. Griffin intended it this way, a trick question. To say we have a “capitalistic legal representation” means that the lawyers get paid money, and hopefully make a profit, for guiding clients through the legal system.
It’s a trick question because notions of capitalism, the way business out to be done, property rights, and economics are inextricably intertwined into the law to such an extent that to speak of “capitalistic” legal representation is basically a redundancy. Our legal system IS capitalism and without our legal system capitalism is not possible. There really isn’t a realistic alternative. Given that the ideology of money and property is so pervasive, the idea that the wealthy would not somehow pay for the best available lawyers strains the imagination near to, if not past the breaking point. So given that this is inevitably the way things must be, there is definitionally no distortion at all: it is the natural and ordinary state of affairs.
But the nearly as basic fact is that yes, money distorts justice. And not always in the way you might expect. Let me lead with an example, one that may seem counterintuitive.
My firm does a lot of eviction work. Which is a way we get clients who have enough money to own rental property. Thing is, compared with the coastal regions of California, my corner of the state has a fairly low barrier to entry for that category. “Landlord” does not equal “wealthy person.” And sometimes, the tenants don’t pay the rent. There’s all sorts of reasons for this, good and bad.
The basic process of eviction in California is this: Tenant owes rent on June 1, fails to pay. Landlord serves a three-day notice to pay rent or quit on June 2. Tenant has until June 4 to pay the rent or move out. On June 5, if the rent isn’t paid and the tenant is still in the house, the landlord can file an unlawful detainer action. Let’s say this gets filed and served the same day. The tenant then has five days to answer, which period of time always necessarily straddles a weekend, so it’s really seven days. On day 12, the tenant files an answer with the court. On day 13, the landlord can file a “memo to set” which tells the court “this case is ready for trial.” The Court, in theory, is supposed to calendar a trial date within 20 days of the date the “memo to set” is filed. So on day 33, the case should go to trial. A bench trial is a five-minute process: the landlord says “The tenant didn’t pay the rent. The rent’s $1,000, and the tenant owes me thirty-three days as of today, so that’s $1,084.91.” The Court asks the tenant, “Why didn’t you pay the rent?” and the tenant usually says, in effect, “Because I don’t have the money.” Tenant loses, court orders an eviction. If the landlord is on top of the paperwork, on day 34, something called a writ of possession goes to the sheriff, and the sheriff then sits on it for about two weeks and then serves a five-day warning notice on day 47. On day 52, the tenant is escorted off the premises by armed officers.
That’s if everything goes smoothly. I can offer this service to my clients for a pretty reasonable flat fee, a few hundred dollars. But now let’s alloy in procedural due process (of which I am a big fan) and money.
An eviction case is a civil trial. At stake is more than twenty dollars’ worth of value. Therefore, the tenant has a constitutional right to invoke a trial by jury. The court cannot handle a trial by jury in a particularly efficient fashion; jury trials are tremendously inefficient and cumbersome. There is substantial paperwork to prepare so that the court can deal with the jury, which the lawyers write, and witnesses the lawyers have to prepare for, and jurors the lawyers have to screen out of veniere and empanel, and then statements the lawyers deliver, examination of witnesses for the jury, closing arguments, jury deliberations, and so on.
…Wait, Burt. You wrote “lawyers.” As in more than one lawyer. I know you’re the landlord’s lawyer. But how did the tenant, who didn’t have enough money to pay the rent in the first place, ever get a lawyer to do all this stuff?
Well, you see, I have to charge my client for all of this. I can’t afford to do all of that for a few hundred dollars. I have to budget at least five days for even the simplest eviction trial if there’s a jury involved. And I have to tell my client that juries are inherently unpredictable and uncontrollable – there’s nothing to stop someone on the jury from irrationally feeling sorry for the tenant (who is, after all, economically disadvantaged or she wouldn’t be there in the first place) and unsympathetic to the landlord (who must, by definition, be rich and therefore well able to give help to someone less fortunate than her because she owns rental property).
I charge five thousand dollars for a jury trial like this, and that’s selling my time at half its usual rate. If I sold my time at the market rate of $300 an hour, the actual cost would be between ten and twelve thousand dollars for an entire week’s worth of my time.
Meanwhile, the tenant hasn’t paid her lawyer a dime. The tenant’s lawyer says instead, “Tell you what. Why don’t you waive the back rent, give my client another 45 days to move out, and pay her $2,500 on top of that?” If my client agrees, the lawyer takes a contingent fee – between forty to seventy-five percent, from what I hear in the courthouse hallway. But $2,500 in cash for keys, and the equivalent of $1,500 in foregone future rent, is $4,000. I have to charge my client $5,000 to try the case.
Consequently, it is a financially rational decision for my clients to pay tenants to move out. Nearly all of them do this, although most must vent profanity-laced moral outrage first. They are, after all, facing foreclosure themselves because the tenant hasn’t been paying the rent, which they use to pay the mortgage. To waive that money, give more free rent away, and dig into their own pockets to pay money to a lawyer who has not even looked at the file and solicited perjury from the tenant (“Oh, this place is a dump! No human being should have to live here! Please let me stay.”) is often both insulting and obviously unjust.
So now you see how the tenant’s lawyer gets paid. I will leave for you the moral evaluation of the tenant’s attorney, who has managed to obtain 501(c)(3) status for the law firm that does this to my clients between three and eight times a week for the past seven years.
So this is one way money gets in the way of the right result, and indeed inverts justice (at least from my perspective). You might think it’s all rich people buying themselves better justice than is available to poor people, but I stress again that the “big guy” is probably not nearly so wealthy as you might assume in these cases.
The real advantage goes to the party represented by the lawyer best able to leverage the transaction costs of the justice system, not necessarily the party with more financial resources. That’s the true distorting mechanic caused by the fact that lawyers are expensive. Now, in a related question, zic asked what might be done about this.
Perhaps frustratingly, with our due process clause allowing people to retain the lawyers of their choice, I think the answer is “nothing effective.” Even a radical idea like making every lawyer paid publicly on the same pay scale won’t advance the interests of justice particularly well. The system to look to there is the Judge Advocate General system that prevails in the military — all JAGs are paid the same by way of their ranks, and assigned cases effectively at random, sometimes as prosecution and sometimes as defense. There’s little cognate to the civil justice system in military justice, though; and that’s where a lot of the heavy work in law happens.
 A 3+2 with 1,750 square feet in a not-great-but-not-awful neighborhood crossed my desk recently which had sold at the foreclosure sale for $92,000.
 That’s pretty cheap rent for these parts. That same 3+2 with 1,750 square feet will probably rent for between $1,300 and $1,500 a month when my client is eventually able to get a tenant in there.