A “tort” is defined as a civil wrong that causes someone to suffer harm or loss, creating legal financial liabilities by the person who has committed the act in question. Louisiana recently passed a tort reform legislation that will drastically change the State’s justice system. For some time, Louisiana has carried a reputation for high insurance premiums; its highways are covered with attorney billboards soliciting to clients in accidents with trucks. The new state law focuses on limiting medical costs and cutting down on a practice allowing attorneys to judge-shop to receive a favorable outcome. With any new legislation, there are pros and cons to be considered regarding how beneficial the new law will be.
The justice system is about making people whole, not about making people rich because of mistakes or unexpected circumstances. Tort reform goals aim to limit the punitive damages that can be awarded so that the justice system does not become about making profits. Lawsuits are one way to find justice to make a victim whole. However, there are cheaper options as well. Limiting the amount of punitive damages a victim receives can encourage the parties to resolve the dispute through arbitrations or mediation. This would allow funds to victims be made available faster than going through an entire lawsuit, which could take years. The biggest supporters of tort reform in Louisiana believe that the limitation set by the reform will reduce the cost of auto insurance in the State. While the bill was largely supported, there were other worried about what the result of limiting punitive damages could have.
Unlimited punitive damages were a way to limit the actions of businesses and individuals when it came to overall liability. In a world where tort reforms are applied, the cost of paying someone off through arbitration can less than the profits that can be achieved by causing harm in the first place. It encourages businesses to maximize profitability without regard to how their actions effect society. Companies could cause harm over and over again and then just pay the limited punitive damages and just pay the limited damages. From a legal standpoint, justice would have been served and everyone is able to move on. However, from the victim’s standpoint, this may not be the case.
Louisiana has long been known for its high auto mobile insurance premiums, and for people taking advantage of the punitive damages they can receive from accidents with truckers. Recently, the state passed a tort reform legislative that will limit the punitive damages in hopes that it will reduce auto insurance premiums throughout the state. While lower premiums are a good thing, what will happen if limiting the punitive damages companies pay causes them to not worry about the harm it is doing to victims? The new tort reform legislation has the potential to do more harm than good for Louisiana
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