U.S. Department of Justice Office of Justice Programs Bureau of Justice Statistics Bulletin Contract Bench and Jury Trials in State Courts, 2005 September 2009, NCJ 225634 --------------------------------------------------- This file is text only without graphics and many of the tables. A Zip archive of the tables in this report in spreadsheet format (.csv) and the full report including tables and graphics in .pdf format are available from: http://www.ojp.usdoj.gov/bjs/abstract/cbajtsc05.htm --------------------------------------------------- by Donald J. Farole, Jr., Ph.D. BJS Statistician In 2005, state courts of general jurisdiction disposed of approximately 26,950 tort, contract, and real property cases by bench or jury trial. Contract cases (8,917) accounted for about a third of all disposed trial cases. This report provides an in-depth examination of contract cases decided by a judge or jury in 2005. Contract disputes involve fraud, employment discrimination or dispute, tortious interference, or allegations of unfulfilled agreements between buyers and sellers, lenders and borrowers, or landlords and tenants. This report is the second in a series based on analysis of data collected from the 2005 Civil Justice Survey of State Courts (CJSSC). The first report in the series, Civil Bench and Jury Trials in State Courts, 2005 (NCJ 223851), provides a general overview of tort, contract, and real property cases decided by a bench or jury trial. The CJSSC excluded civil cases that did not go to trial, trials in federal courts, and trials in state courts of limited jurisdiction. The 2005 CJSSC marked the first time that the collection examined general civil trials concluded in a nationally representative sample of urban, suburban, and rural jurisdictions. The prior data collections in 1992, 1996, and 2001 had focused on general civil trial litigation in the nation's 75 most populous counties. Highlights *64% of contract cases in general jurisdiction courts were decided by a judge, and 36% were heard by a jury. *Contract trials in the 75 most populous counties declined by more than a quarter from 1996 to 2005. *Nearly two-thirds of contract trials in 2005 were seller plaintiff (32%) or buyer plaintiff (29%) cases. *Contract trials in 2005 most commonly involved an individual suing a business (33%), followed by a business suing another business (25%). *Plaintiffs won in 66% of contract trials. Plaintiffs had higher win rates in mortgage foreclosure, seller plaintiff, and partnership dispute cases (figure 1). *The median damage award for plaintiff winners in contract trials was $35,000. Juries awarded a median of $75,000 and judges a median of $25,000 in final award amounts. In the 75 most populous counties, contract trials declined by a quarter between 1996 and 2005 Prior to the 2005 CJSSC, Bureau of Justice Statistics (BJS) funded three surveys that examined general civil trial litigation in the nation's 75 most populous counties in 1992, 1996, and 2001.***Footnote 1 See Civil Jury Cases and Verdicts in Large Counties, 1992 (NCJ 154346), Civil Trial Cases and Verdicts in Large Counties, 1996 (NCJ 173426), and Civil Trial Cases and Verdicts in Large Counties, 2001 (NCJ 202803) at .***The 2005 study collected data from a nationally representative sample of courts. All trend analyses in this report are based solely on the subset of 2005 civil trial litigation data that were collected in the nation's 75 most populous counties. Limiting analysis to data collected in the 75 most populous counties renders the data comparable to previous collections. The number of contract cases concluded in state courts in the nation's 75 most populous counties declined by over a quarter (28%) between 1996 and 2005 (table 1). Between 1996 and 2005, the number of bench trials declined at a greater rate (33%) than the number of jury (20%) trials. Seller plaintiff and buyer plaintiff cases accounted for 61% of contract trials in 2005 In 2005, 6 out of 10 (61%) contract trials disposed in state courts of general jurisdiction were either seller plaintiff cases involving payments owed for the provision of goods or services (32%) or buyer plaintiff cases in which the buyer of goods or services sought the return of money (29%) (table 2). Another 13% involved fraud. Subrogation, partnership dispute, and tortious interference cases were the least common contract case types. Similar patterns were found when examining the frequency of contract case types among the nation's 75 most populous counties in 2001, 1996, and 1992. Mortgage foreclosure (96%), subrogation (93%), seller plaintiff (83%), and rental/lease agreement (81%) issues were most likely to be heard in a bench trial. The majority of cases were decided by a jury in employment discrimination (91%), tortious interference (62%), and other employment disputes (62%). Individuals comprised the majority of plaintiffs in contract trials, businesses the majority of defendants Contract trials most commonly involved an individual suing a business (33%) or a business suing another business (25%) in 2005. Twenty percent of cases involved an individual suing another individual, and 17% involved a business suing an individual. In 1% of all contract trials, a government entity initiated the lawsuit (not shown in a table). During 2005, individuals accounted for 55% of plaintiffs in contract trials (table 3). Nearly all other contract case plaintiffs were businesses (43%); governments and hospitals together accounted for 2% of all plaintiffs. Individuals were most likely to be plaintiffs in employment discrimination (98%), partnership dispute (77%), and buyer plaintiff (74%) cases. By contrast, businesses were the majority of plaintiffs in subrogation (98%), mortgage foreclosure (77%), seller plaintiff (68%), and tortious interference (60%) cases. Businesses comprised the majority of defendants (58%) in contract trials during 2005. In buyer plaintiff cases 8 out of 10 (81%) defendants were businesses. Nearly two-thirds (64%) of defendants in mortgage foreclosure cases were individuals; another 18% were hospitals or medical companies. Governments were defendants in 35% of employment discrimination cases. Contract trial cases with business plaintiffs were more likely to be decided by a judge Contract trials were more likely to be decided by a judge (64%) than a jury (36%) (table 4). This difference was more pronounced for certain types of litigants. Trials involving business plaintiffs were more likely to be decided by a judge (72%) than cases involving individual plaintiffs (58%). More than 8 out of 10 (87%) trials involving a business plaintiff and an individual defendant were decided by a judge. Jury trials accounted for half (51%) of all cases involving individual plaintiffs and business defendants. Approximately 1 out of 10 defendants appeared without legal representation in contract trials In civil trials, unlike criminal matters, litigants generally do not have a right to legal representation. One or both parties appeared without legal representation in 13% of contract trials in 2005 (table 5). Defendants (10%) were more likely than plaintiffs (3%) to appear without legal representation. Defendants most often appeared without legal representation in mortgage foreclosure (22%) and seller plaintiff (20%) cases. Plaintiffs were most often unrepresented in tortious interference cases (10%). Plaintiffs won 2 out of 3 contract trials Plaintiffs won in 66% of contract trials in 2005 (table 6). Overall plaintiff win rates were highest in mortgage foreclosure (89%) and seller plaintiff (75%) cases. Subrogation (28%) was the only category of contract cases in which less than a majority of plaintiffs prevailed in 2005. Plaintiffs were more likely to prevail in contract trials decided by a judge (69%) than a jury (62%). Plaintiffs had higher win rates in mortgage foreclosure and seller plaintiff cases decided by the bench. Fraud, partnership disputes, employment discrimination, other employment disputes, and other or unknown contract cases had higher win rates when decided by a jury. Both individual and business plaintiffs won about 2 out of 3 contract trials brought against business defendants (text table 1). Business plaintiffs were more likely than individual plaintiffs to win against individual defendants and government defendants. ----------------------------------------------- ----------------------------------------------- Text table 1. Winning plaintiffs in state court contract trials by selected litigant pairings All contract trials Percent plaintiff Total Number of trials winner ------------------------------------------------- Individual v.-- Individual 1,561 57.2% Government 156 52.6 Business 2,562 64.2 Hospital 119 70.6 Business v.-- Individual 1,375 76.9% Government 114 77.2 Business 1,991 65.8 Hospital 4 ** -------------------------------------------- **Too few cases to obtain statistically reliable data. -------------------------------------------------- ------------------------------------------------- Median awards to plaintiff winners were 3 times higher in jury trials than bench trials In 2005 the median damage award for plaintiff winners in contract trials (including both compensatory and punitive damages) was $35,000 (not shown in a table). The median award amount was greater in jury trials ($75,000) than in bench trials ($25,000) (table 7). Tortious interference and partnership disputes were the categories with the highest median awards for both jury and bench trials. Buyer plaintiff and seller plaintiff cases accounted for nearly two-thirds (65%) of all contract cases with plaintiff award winners in 2005. Median awards in buyer plaintiff and seller plaintiff cases were under $75,000 in jury trials and under $30,000 in bench trials. Eight percent of plaintiff winners in contract jury trials received awards of $1 million or more; 1% of plaintiff winners in contract bench trials received at least $1 million. Such high award amounts were particularly likely to occur in tortious interference and other or unknown contract cases decided by a jury. At the lower end of award classifications, 29% of plaintiffs in contract bench trials were awarded less than $10,000, as were 1 out of 10 plaintiffs in contract jury trials. Rental/lease cases decided by a jury and buyer plaintiff cases decided by a judge were particularly likely to have awards at the lower end of the spectrum. In general, cases brought against business defendants featured higher awards than cases brought against individual defendants (table 8). The highest median awards were in cases in which businesses brought suit against other businesses. Cases involving two individual parties had the lowest median awards. Median awards for plaintiff winners in the 75 most populous counties increased by 17% between 1996 and 2005. This growth was driven by a roughly 30% increase in awards in bench trials between 1996 and 2005. By contrast, the median jury trial award declined by 6% during this 10-year period. Punitive damages were awarded to 8% of plaintiff winners in contract trials Punitive damages, which are awarded to punish the defendant and deter similar behavior in the future, were sought in 17% of the estimated 5,658 contract cases with plaintiff winners in 2005 (not shown in a table). Punitive damages were awarded to winning plaintiffs in 8% of contract cases with plaintiff winners, with fraud and buyer plaintiff cases accounting for 65% of all cases in which punitive damages were awarded (table 9). The median punitive damage award was $69,000. Punitive damage amounts awarded to plaintiff winners were greater in jury trials (median award of $100,000) than in bench trials (median award of $25,000) (not shown in a table). The percentage of cases in which punitive damages were awarded to plaintiff winners was no greater in 2005 than in 1996. Punitive damage awards were greater than compensatory damages in 62% of the cases in which punitive damages were awarded In a series of cases since 1996, the United States Supreme Court has examined what comprises a constitutionally acceptable ratio between plaintiff punitive and compensatory damage amounts. In 2003, the Supreme Court ruled that "few awards exceeding a single-digit ration between punitive and compensatory damages ... will satisfy due process." ***Footnote 2 State Farm Automobile Insurance Company v. Campbell (123 S.Ct. 1513, April 7, 2003).*** Among the 446 contract cases in 2005 in which punitive damages were awarded, the median ratio between punitive and compensatory damages was 1.45. That is, the median punitive damage award was 45% greater than the compensatory damage award (not shown in a table). In 62% of cases where punitive and compensatory damages were awarded, punitive damages were greater than compensatory damages; in about a third (36%), punitive damages were at least 4 times greater than compensatory damages (table 9). Jury trials lasted longer than bench trials In 2005 the median length of jury trials for contract cases was 3 days; the median length of bench trials was 1 day (not shown in a table). The median overall case processing time--from the filing of the case until final disposition--was about 23 months for jury trials and 17 months for bench trials. Case processing time has not changed much among the 75 most populous counties from 1996 to 2005, although case processing time did increase by 11% in contract bench trials. Motions for new trials were the most common form of post-trial relief sought among parties that did not prevail at trial After a verdict or judgment is rendered, litigants generally have a right to petition the court for post-trial relief. Common forms of post-trial relief include petitions to set aside the verdict or judgment in favor of a new trial, modify the award amounts, or overrule the jury's decision through a judgment notwithstanding the verdict (JNOV). In 2005 the plaintiff or defendant sought post-trial relief in approximately a quarter (26%) of all cases (not shown in a table). In cases with plaintiff winners, defendants filed motions for at least one form of post-trial relief in 23% of cases; plaintiffs filed in 10% of cases (table 10). In cases with defendant winners, the plaintiff sought post-trial relief in 20% of cases, and defendants sought relief in 5% of cases. A new trial was the most common form of post-trial relief sought among losing parties. Defendants sought new trials in 55% of cases in which the plaintiff won and the defendant sought some form of post-trial relief. Plaintiffs sought new trials in 65% of cases in which the defendant won and the plaintiff sought some form of post-trial relief. In half of cases where plaintiffs prevailed, they filed motions seeking to increase the award amount. In a quarter of cases where plaintiffs prevailed, defendants filed motions to decrease the award amount. Winning parties were granted post-trial relief in a higher percentage of trials than were losing parties Plaintiffs were granted some form of post-trial relief in 45% of the cases in which they prevailed at trial and also sought post-trial relief (table 11).***Footnote 3 Parties may seek more than one type of post-trial relief. Litigants who were granted any form of relief in a case were not necessarily granted all forms of relief that they sought.*** Defendants were granted relief in 60% of cases in which defendants prevailed at trial and sought relief. Parties that did not prevail at trial were granted post-trial relief in a smaller percentage of those cases in which they sought relief. Litigants filed notices of appeal in nearly 1 out of 4 contract trials A notice of appeal is a document litigants are required to file with the trial court in order to petition an appellate court to overturn or modify the trial court's verdict or judgment. Plaintiffs or defendants filed notices of appeal in 22% of contract trials concluded in 2005 (not shown in a table). Both plaintiffs and defendants filed notices of appeal in about 1 out of 5 contract trials in which they did not prevail (table 12). Defendants were most likely to file notices of appeal when they did not prevail in a partnership dispute or employment dispute not related to discrimination. Plaintiffs were most likely to file notices of appeal in tortious interference and other contract cases with defendant winners. ------------------------------------------------- In 11 jurisdictions, 99% of contract cases were disposed without trial Eleven of the surveyed jurisdictions were able to provide full information on all types of trial and non-trial contract dispositions in 2005. These 11 sites provided trial and non-trial information on 40,932 contract dispositions (figure 2). Among the 11 jurisdictions that could provide complete information, the rate of cases disposed through trial was approximately 1%. Nearly half of contract cases were settled or withdrawn prior to trial. The 11 jurisdictions able to provide complete information include the following: Orange and Santa Clara Counties and Santa Barbara, California; Fairfield and Hartford Counties and Middlesex, Connecticut; Orange Circuit Court, Indiana; Philadelphia County and Pike, Pennsylvania; and King County and Grant, Washington. ------------------------------------------------- Methodology Sample The sample design for the 2005 Civil Justice Survey of State Courts (CJSSC) differed somewhat from that used in previous BJS civil trial studies. Previous studies were designed so that inferences could be made about general civil trials litigated in the nation's 75 most populous counties. The 2005 study maintained the 75 most populous counties design in order to examine trends in civil trial litigation. This sample is a stratified sample with 46 of the 75 most populous counties selected. Unlike previous studies, the 2005 CJSSC also included a second sample of non-metropolitan counties, from which to estimate civil trial litigation in counties other than the 75 most populous counties. This sample was constructed first by forming 2,518 primary sampling units (PSUs) from the 3,066 counties that are not among the nation's 75 most populous. The 2,518 PSUs were divided into 50 strata according to census region, levels of urbanization, and population size (based on the square root of the estimated 2004 population in each of the PSUs). From the 50 strata, 100 PSUs containing 110 counties were selected. Therefore, a total of 156 counties--46 representing the nation's 75 most populous and 110 representing the remainder of the nation--were used for the sample. The second stage of the sample design involved generating a list of cases to include in the data set. Participating jurisdictions were asked to identify cases that had been disposed of by jury or bench trial between January 1, 2005, and December 31, 2005. Trial cases were to meet the definitional criteria for jury and bench trials developed by the National Center for State Courts: A jury trial is presided over by a judge as a case is presented to a lawfully selected group of laypersons who issue a verdict for the plaintiffs or defendants. Unless otherwise noted, "jury trial" includes jury trials with a directed verdict or judgment notwithstanding the verdict (JNOV) and jury trials for defaulted defendants. A bench trial is not heard by a jury and culminates in a judge's verdict for plaintiffs or defendants. For the sample of civil trials occurring in the nation's 75 most populous counties, data on 1,027 contract jury and 1,403 contract bench trials met the study criteria. When these trials were weighted to the nation's 75 most populous counties, they represent 3,473 general contract bench and jury trials. For the sample of civil trials occurring outside the nation's 75 most populous counties, data on 123 contract jury trials and 256 contract bench trials met the study criteria. When these trials were weighted, they represent 5,443 contract bench and jury trials disposed of in counties outside the nation's 75 most populous counties. For additional details about the sample design and procedures used to determine cases to include in the data set, see Civil Bench and Jury Trials in State Courts, 2005 (NCJ 223851) at Sampling error Since the data in this report come from a sample of civil bench and jury trials rather than the entire population of civil bench and jury trials, a sampling error (standard error) is associated with each reported number. In general, if the difference between two numbers is greater than twice the standard error for that difference, there is confidence that for 95 out of 100 samples a real difference exists and that the apparent difference is not the result of measurement error associated with using the sample rather than the entire population of cases. All differences discussed in the text of this report are statistically significant at or above the 95% confidence level. Definitions of case types In general, contract cases address allegations of breaches of contract. Following are definitions of terms used to describe the specific types of contract cases. Buyer plaintiff--buyer claims no delivery or delivery of incomplete, incorrect, or poor quality goods or services. Employment discrimination--firing, failure to promote, or failure to hire due to age, race, gender, or religion. Fraud--claim of negligent or intentional misrepresentation of the nature of a person, product, or service within a legal contract. Mortgage foreclosure--forced sale of commercial or residential real property due to failure to pay mortgage debt. Other contract claim--any contractual dispute other than the case categories used in this study, such as stockholder claims. Other employment disputes--any dispute between employer and employee not based on an allegation of discrimination. Partnership dispute--dispute over a business not organized as a corporation but owned by two or more persons. Rental/lease agreement--a dispute between a landlord and a tenant over the terms of a lease or rental property. Seller plaintiff--any debt collection for delivery of goods or services, including lenders seeking payment of money owed by a buyer or borrowers. Subrogation--a dispute arising from a contract provision giving one party (typically the insurer) the right to act on behalf of another party (typically the insured) in legal actions related to the subject of the contract. Tortious interference--dispute alleging a defendant's intentional procuring of breach of a commercial or contractual relationship and damages. The Bureau of Justice Statistics is the statistical agency of the U.S. Department of Justice. Michael D. Sinclair is Acting Director. BJS Bulletins present the first release of findings from permanent data collection programs. This Bulletin was written by Donald J. Farole, Jr., Ph.D., BJS statistician. The report was verified by Sean Rosenmerkel. Catherine Bird and Jill Duncan edited the report. Tina Dorsey produced the report. Jayne Robinson prepared the report for final printing. September 2009, NCJ 225634 This report in portable document format (includes 5 appendix tables) and in ASCII and its related statistical data are available at the BJS World Wide Web Internet site: Office of Justice Programs Innovation  Partnerships  Safer Neighborhoods http://www.ojp.usdoj.gov 09/28/2009/JER