March 12, 2010

Order in the court for business disputes



Staff Writer

PORTLAND — Almost two years after the creation of the Business and Consumer Court, lawyers and justices praise the streamlined business-focused court as significantly cutting down on the cost and time needed to resolve complex business disputes.

''It works very well, and that's good not only for the business community, but for all of us who spend time trying to attract businesses to Maine,'' said David Soley, a real estate attorney with Bernstein Shur in Portland. ''One of the things they are looking for is a business court.

''(Business owners) know they can get cases heard relatively quickly and efficiently, and judges make decisions quickly with business acumen,'' said Soley, who has had several cases go before the court since it was established in June 2007.

In the past, these civil cases were filed in local courts and frequently became bogged down in the midst of all the other cases before the court.

Business cases involving contract disputes, fiduciary claims and construction disputes can involve multiple parties, counterclaims and extremely detailed written and oral agreements. Because of this, it is difficult to shoehorn the case into the working calendar of courts handling everything from traffic tickets to murder cases.

Handling the business court docket is Superior Court Chief Justice Thomas Humphrey in Portland and Superior Court Justice John Nivison in Augusta, both of whom said it has been very successful in expediting cases. The ability to focus their time and work intently on the cases has also been personally satisfying, they said.

''I really enjoy the challenge of starting something new,'' Nivison said. ''We're dealing regularly with very talented people, and that's been very rewarding.''

Humphrey said the court, which hears cases statewide, also is important for the local business communities.

''To keep businesses in Maine, there needs to be a sense that business will get a fair shake,'' he said. ''If you have a legal dispute, you want to know that it will be addressed in a reasonable time.''

The original intent was to have the justices, along with clerks Gladys Howard and Andy Frechette, dedicated full-time to the court, but they all work about half-time on business court duties. Humphrey has administrative duties; Nivison is needed on the bench for nonbusiness cases; and because of a shortage of about 15 clerk positions among the state's 500 judicial employees, Howard and Frechette have been called on for other duties.

''All of these demands have been intruding on our ability,'' Humphrey said. For the moment, they are able to handle the caseload, although extra time would be welcome, he said.

''I wish there were more time to dedicate to it, more time to think about and deliberate on the issues,'' Humphrey said.

The business court allows for an almost paperless legal experience, using e-mail for filings and communications, and aggressive use of tele- or video-conferencing on most pretrial activity.

Speed is important, experts say, because in a business dispute there is frequently an ongoing business or construction project that is continuing to operate. The longer a dispute lingers in court, the bigger impact it can have on the business owners.

Lawyer Michael Bosse, who specializes in construction law at Bernstein Shur, said he had a case in York County that began in 2004 and didn't get to trial until 2008.

''Things were that backed up,'' Bosse said. ''Luckily, I had an understanding client.''

In contrast, the handful of cases he's had before the business court have gone ''pretty quickly,'' he said.

The idea of a specialized court is not new. Many states have business courts, and the Maine court system has other specialized courts or dockets, such as the Family Division or child protective custody cases.

''People who are entrepreneurs do not want to be weighed down by four years of litigation,'' Bosse said.

''It's pretty clear to me that we need (the business court) if we want to attract the kind of business that will keep us vibrant.''

Here's how the court works: Cases are filed in regular courts, and the case is referred to the business court by either the judge or one of the parties involved. Then, either Humphrey or Nivison decides whether to accept it, and that decision is not subject to appeal. The complaint is filed and answered, and immediately, a case management conference is held.

It is at these case management conferences -- which tend to be intense hours-long meetings -- that all parties gather and set out firm deadlines and agree to strict timetables, and a trial date is set.

''We all agree in advance, it moves quicker and there are fewer disputes,'' Soley said of the case management process. ''It makes it cheaper for the state and the client -- the only party with less is the lawyers, who make less in fees.''

So far, the court has heard 143 cases and held seven trials.

Only a handful have been consumer cases, Humphrey, the chief justice, said, although it is not clear why they are not getting more. It may be partly due to the relatively new nature of the court, he said.

An example of a consumer case could be a consumer-brought class action suit about faulty building materials in a development.

The court handles only cases that are complex and require close judicial management, so it does not take run-of-the-mill collections or foreclosures, Humphrey said.

It is those complex cases that could become ''docket blockers'' on a regular court calendar, he said.

Humphrey described one business court case, involving the $17 million RiverPlace luxury apartment complex in South Portland, that involved 17 parties, all individually represented by attorneys. At a conference, they had 30 participants, he said, from attorneys to clients to insurance company representatives.

''They were looking at a trial that could have gone 2½, three weeks,'' he said, noting that it was resolved before trial. ''The hard part would have been finding a courtroom for that trial.''

The down market has had an impact on civil court filings in general, lawyers and court officials say.

Aside from an increase in foreclosures, most civil filings are down, said courts spokeswoman Mary Ann Lynch.

''As the economy contracts, people are making decisions to avoid court,'' Lynch said.

On the other hand, Bosse said he's seen more disputes being litigated in the midst of a project, because the various parties -- say, plumbers, construction workers, roofers -- don't have the kind of financial flexibility they might have in a boom market.

Humphrey said that despite the slight decrease in filings, and the scaled-back resources available to the court, he is confident in the business court's future.

''We've pulled back our horns a little, but there are no plans afoot at all to extinguish the business court,'' he said.

Staff Writer Noel K. Gallagher can be contacted at 791-6387 or at:

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