Wednesday, April 08, 2015

Misconceptions About Common Law Litigation

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Davidson Samosir[1] and Julie Ota[2]
For parties in a civil dispute over the legal grounds for tort and breach of contract cases, litigating and waiting for a judgment is time consuming and exhausting regardless of whether there is a strong legal ground for the complaint. Parties who are exposed tothe common law system, which is different fromthe Indonesian European Continental legal system, often complain about the Indonesian legal system. Most of theircomplaints relate to the undetermined legal feesfor their case and the undetermined time spent on their case.They often see countries such as Singapore and the United States as the model for how cases should be tried in Indonesia.  
Based on informal conversations with numerous court clerks and judges in the Central Jakarta first instance court, court officials see things differently. Theirmain complaint about handling cases is about their enormous case load.Ajudge, assisted by a court clerk,  may try up to 40 to 50 cases in one week,explaining why trials take longer than they need to.
On the other hand, legal practitioners often complain that court officials have no discipline and often deliberately prolong trials. Often, they come to court as early as 9 am, as agreed by the parties and judges from a previous trial, but the panel of judges arenot availableuntil after 11 am. There are even times when judges neglect their case  or are absent. Legal practitioners also complain about chief judges postponing trials whenever the opposing parties feel unpreparedfor a certain trial phase, even when the parties have been notified about the trial agenda in advance, resulting in an undetermined time for the judgment and additional legal costs for the parties in dispute.                       
According to legalpractitioners, itgenerallytakes around 5 to 7 months for a tort or a breach of contract cases toobtain a judgmentin Indonesia.As an illustration,theplaintiff and defendant have to undergo several procedural phases, including registering the complaint,waiting for the court to summon to the defendant, mediation,the exchange of documents/written arguments,presenting the evidence, witness examination and cross-examination; and closing written arguments before a judgement is rendered. As a result, trials sometimes take more than 5 to 7 monthsto complete.
Faced with these obstacles, Indonesians often assume that litigation in a common law system is more efficient. However, this belief is often based on pop-culture sources such as Hollywood movies and tv /or stories heard through the grapevine, which do not provide an accurate account.
In reality, litigation in a common law system can be complex, costly, and time consuming. The rules of procedure differ from jurisdiction to jurisdiction and sometimes from court to court within the same jurisdiction. Failure to comply with rules of procedure may limit a litigant’s ability to pursue certain claims or defenses at trial or lead to dismissal of the case. Additional complexities arise in a federal system (such as in the U.S.), where there may be questions about which court has jurisdiction and what law should be applied.
In general, the litigation procedure involves: 1) Pleading and Pretrial Motions; 2) Pretrial Discovery; 3) Jury Selection; 4) Trial; and 5) Appeals.
During the Pleadings and Motions phase, the plaintiff files a complaint with the court stating the legal and factual basis for the case and the damages/relief sought. The Defendant is summoned and has an opportunity to file an answer stating any challenges to the court’s jurisdiction and counterclaims. Sometimes, parties will participate in a pretrial conference to reach a pretrial settlement. If no settlement is reached, parties will begin the pretrial discovery phase.
During the discovery phase, parties may request interrogatories, depositions, documents, and mental or physical examinations if relevant to the case. High discovery costs can make litigation prohibitive. The historical rationale for discover was to facilitate fact finding, ensure that parties proceed on an equal footing, provide relevant material to the court, save time, and reduce expenses. However, the volume of data available today can make it costly and burdensome to produce and review. The Australian Law Reform Commission found that discovery is often the single largest cost in corporate litigation in Australia.
At the end of discovery, parties may pick a jury and proceed by jury trial or proceed by a bench trial heard only by a judge, if a jury is waived or is not guaranteed for their particular claim. Juries are rarely used in civil law countries other than the U.S. and Canada. Jury selection practices vary widely by jurisdiction. In the United States, jurors are generally questioned voir dire about their background and potential biases to before being chosen to serve on a jury.            
The trial phase begins after the jury is impaneled and sworn in. Trial procedures are similar to Indonesian procedural phases. However, arguments are presented orally and, in a jury trial, the jury must be convinced of material facts. The trial phase includes opening statements, the presentation of evidence to the jury, examinations and cross-examinations of witnesses, rebuttals, closing arguments, deliberation of the jury, the jury verdict, and entering a judgment.
Given the long litigation process in common law countries, it may actually be faster and cheaper to try a case in Indonesia. For example, litigation in the United States takes an average of 6 months to resolve, and often takes much longer. One study estimated that litigation costs Fortune 500 companies in the U.S. about $210 billion to resolve each year (equivalent to approximately one-third of their after tax profits) and they  spend an average of 3 years to resolve litigation.
It should be noted that 98 % of all cases filed in the U.S. aresettled outside of court and never tried. This creates an impression that cases in the U.S are fast and cost efficientcompared to Indonesia where rates of settlement outside of court are low and not well-recorded. However, settlements in the U.S. are also motivated by a desire to avoid costly litigation.
Despite persistent beliefs that litigation in Indonesia would be more efficient and cost-effective if it adopted a common law system, the common law experience shows that this is not true. Parties face similar problems in both the Indonesian system and common law systems. As a result, its probably better to avoid litigation in both common law and continental systems.

[1] Davidson Samosir is the Editor-in-Chief of Hukumonline English Newsroom
[2] Julie Ota was a foreign legal consultant for Hukumonline and currently working at USAID – Ukraine as an officer
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