Common Class Action and Litigation Myths, Debunked

Some legal matters like class action and litigation debate capture significant media attention, but they are riddled by misinformation. Terms like US excess and litigation floodgates create an impression that claims by shareholders are proliferating. Data tells another story. Some of the common misconceptions about law include:

GreenMail claims
This class action and litigation myth suggest class action promoters get incentives to commence actions. The merits and ability of the litigation funder to meet adverse cost orders do not matter.

The argument is unsustainable because a court orders a loser to pay legal costs to the winner. Courts also have power payment for those costs by lawyers if there is evidence of serious neglect of lawyer’s duty.

Second, lawyers are in breach of primary duty if they advance litigation just to generate fees.

Third, defendants can apply orders for a ‘security of costs,’ and many do it during all stages of litigation. A litigation funder or claimant should lodge funds with a court as security. The funds cater for likely legal costs that a defendant may be to receive if a claim fails.

Conflicts of interest
The myth suggests the presence of a litigation fund puts the lawyer in conflict. It ignores the fact that lawyers owe their fiduciary duties to:

  • Clients
  • Statutory duties under state or territorial legal profession acts
  • Ethical duties to the court
  • Professional codes of conduct
  • Lawyers owe a ‘paramount’ duty to courts and administration of justice even when clients give contrary opinions.

Another contradiction is that lawyers must act in their clients’ best interests. The interests of an attorney rank a far third behind the first two primary duties. A good demonstration is when lawyers agree to a “no win, no fee” representation.

Claims outside shareholders’ interests argument
This popular class action and litigation myth suggest actions by shareholders are futile because the result is a transfer of money from a shareholder group to another.

The proposition is flawed since listed companies commonly have insurance to cater to such claims. An insurer will pay a part or entire settlement or judgment if there is a responding insurance policy.

Second, many victims are not shareholders anymore. Immunity of unlawful conduct from scrutiny because some victims are still shareholders becomes unfair to other victims. The third point is that this myth ignores the importance of shareholders’ deterrent effect in improving corporate governance standards and the desire to ensure holding law violators into account. Recent evidence from the US suggests shareholder class actions serve as a management disciplining path. It also suggests an association between poor disclosures before a securities class action.

Amid myths, Australian class action procedures have evolved to be an efficient way to aggregate and resolve numerous claims arising out of similar circumstances. However, the Australian system differs from that in the United States. The difference includes a cost deterrent against bringing claims without merit to ensure determination on meritocracy instead of attrition strategies.

How Technology is Transforming the Law Industry

The massive technological growth in the last decade has catalyzed the digitalization of case law and automation of legal service provision. Legal firms can now digitalize the storage and collection of legal data, legal research, and attorney-to-client interactions. In addition, dozens of high-end tools and software are available to help legal firms operate more efficiently and keep their productivity and customer relations a notch higher. Below are ways how technology has transformed the legal industry.

Simplifies Attorney-Client Communication

A Diversity and Flexibility Alliance study recently confirmed that over 60% of established and startup law firms have invested in cutting-edge telecommunicating infrastructure. These unified telecommunication systems allow attorneys to reach out to more clients remotely. Additionally, it cuts the costs and reduces the inconvenience of meeting each of the clients in person.

Live-video platforms such as Zoom and Skype have eased the way lawyers communicate to clients and collect evidence for cases. Moreover, advanced communication solutions such as web conferencing, instant messaging and email, have streamlined how lawyers communicate and collaborate with their clients.

Eases the Way Lawyers Manage Cases

Al-based business management systems have eased the way lawyers manage cases. These systems let lawyers automate billing data entry, document management, and date schedule. With data stored in a centralized database, the systems allow for easy access by different personnel within a law firm.

The AI-infused high-end digital case management systems allow for quick document sharing and lawyer-to-lawyer collaborations. Most modern case management systems are web-based, thus, allowing easy accessibility by remote-based lawyers.

Fueled the Birth of Online Communities

The advanced technology brought about the birth of online communities, giving disadvantaged communities access to pro bono legal counselling, advice, and resources. These internet-based communal areas offer an opportunity for lawyers to connect with law students to share and debate on multiple legal-related issues.

Social networking platforms such as YouTube, LinkedIn, Facebook, and Twitter offer an environment for lawyers to reach out to more underserved communities. They streamline how lawyers network and collaborate with their clients.

Technological advancement is gearing the legal industry towards the much-anticipated growth and automation. The invention of law industry-tailored systems that promise to ease how lawyers operate, network, and collaborate will increase lawyer productivity, service delivery, and customer satisfaction.

Breaking Down “Common Law”

According to an article on Investopedia, Common Law is defined as “a body of unwritten laws based on legal precedents established by the courts.” Common-Law influences the various decision-making processes regarding unique cases where the outcome cannot be determined using previously written rules of Law or existing statutes. In The U.S., the common law system was established as an adaptation from former British traditions. These then were integrated into the U.S. during the colonial periods of the 17th and 18th centuries. Common-Law is currently practised in many different areas globally, such as Hong Kong, New Zealand, Australia, India, Canada and the U.K. Below, we will discuss Common Law in further detail as we break down the different elements. 

Common-Law, also referred to as case law, takes information from previous cases and statutes similar because there is no official code they can rely on for the particular case. The judge then will analyze which specific precedents can apply to the case at hand. Then, the cases tried in higher courts serve as an example for those tried in lower courts. 

It is essential to know that Common Law is not the same as Civil Law. According to the article linked above, Civil Law is defined as “a comprehensive, codified set of legal statutes created by legislators.” The civil system details what kind of cases can be brought before the court, the processes for dealing with the claims and the various penalties for the specific circumstances. Civil Law is updated frequently, but it serves as a standardized system to provide order and eliminate discriminatory practices in Law. 

Common-Law takes information from public juries and judicial authorities while also using other institutionalized opinions. Common Law and Civil Law are similar in that they intend to set up the framework for consistent outcomes. However, common Law can differ based on the different districts it is set up in. One downfall to Common Law is that the judges can significantly influence the criteria presented to a jury as they set the precedents themselves. Over time, this has been seen as being unfair, especially to marginalized groups.

Unique Laws Around the World

There are many different interesting laws worldwide, especially those that have been created many years ago. Regulations can range from a bit odd to straight-up bizarre, which can be found in every nation. Below we will look at some of the unique laws worldwide, as featured in an article on The Lawyer Portal.

  1. In the Salmon Act of 1986, Parliaments made it illegal to hold salmon under suspicious circumstances. 

Unfortunately, you read that correctly. Section 32 of this act states that holding salmon under suspicious circumstances is no longer allowed. This law is specific to Wales and England, making it an offence for anyone who receives or even disposes of salmon in areas where it is likely the salmon could be or has been illegally fished. Penalties range, but the most a person can experience is up to two years in prison. The context behind the legality makes more sense once it is explained; however, it is still interesting to imagine someone being arrested while holding a piece of salmon. 

2. As the owner of chickens in Quitman, Georgia, be sure to keep them from crossing the road. 

Although this concept has become a generational joke, letting chickens in your property cross the road in Quitman is a grave offence. The government encourages owners to have control over their chickens at all times. If you think about it, this makes a lot of sense, considering that letting animals run about along the streets could cause great chaos; however, the specificity of chickens makes for an exciting picture. In addition, Georgia prides themselves on maintaining the sacredness and safety of their chickens, and other parts of the state have unique chicken-based laws as well. Considering that Georgia truly values the chicken, it becomes less surprising that they want to avoid any accidents stemming from them on the roads. 

3. You must smile at all times unless you are at a hospital or funeral while in Milan, Italy.

This particular law is very peculiar. While Italians are known for their friendly demeanour, it is quite intense that the law upholds this as a requirement. This law stemmed from Austro-Hungarian times and was never repealed. The exception to the rule is that staying bedside for an ill family member or friend at a hospital, being a hospital worker, or a funeral goer releases you from this requirement.

Commercial Property Investors – How Much Rent Should You Charge?

When it comes to renting a commercial property, many investors struggle to calculate the right amount to charge. Charge too much, and your property will be at risk of sitting unclaimed on the market for an extended period. Conversely, charge too little, and you’re reducing your return on investment and may potentially devalue your property. So how do you determine the right balance? Lawyer and solicitor Glenn Duker offers some guidelines. Continue reading Commercial Property Investors – How Much Rent Should You Charge?

Three Important Retail Lease Considerations

Retail leasing today is significantly more sophisticated and has better protections for a tenant than a decade ago. Across Australia, in various jurisdictions, there are many things in favour of tenants nowadays. Examples would be key money and lease duration. Another is the matter of the security deposit. Continue reading Three Important Retail Lease Considerations

Permitted Use, Tenancy Mix and the Anchor Tenant

The role of a tenant’s lawyer is to assist the tenant to get the best lease possible deal. The purpose of this short article is to look at three different aspects that will hopefully be helpful for you as a tenant entering into a new lease, with an emphasis on your proposed use of the building and the importance of the other tenants in your immediate vicinity. Continue reading Permitted Use, Tenancy Mix and the Anchor Tenant

Top Tips for Negotiating Your Retail Lease

So, the time has come for you to sign a new retail lease, or to renew a current one. Unfortunately, many lessees sign on the dotted line without attempting negotiation. However, by speaking up, it may be possible to get a reduction in rent, or to haggle better lease terms. If you are going to pursue negotiation, here are a few useful tips from lease lawyer Glenn Duker to help you obtain the best deal.

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3 Things to Consider Before Leasing a Commercial Location

If you’re looking to lease a commercial location, it’s important to consider a wide range of factors to ensure the location is suitable for your business. A well-chosen location can contribute to your business’s success, while a poorly chosen one can have disastrous results. In this article, professional lease lawyer Glenn Duker lists 3 considerations to keep in mind when searching.

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