Hughes Justice Complex, Trenton, New Jersey. Hughes Justice Complex, Trenton, New Jersey

Fewer lawsuits are being filed in New Jersey state courts, a trend that’s persisted for at least a decade and is sparking fears the judicial system is becoming irrelevant for segments of the population.

New Jersey courts saw 815,922 cases filed in the civil, criminal and family divisions in 2018, which represents a marginal increase from 2017′s filing level. But more significantly, that’s still a 28 percent decline from the number of cases filed in 2008.

Filings of civil suits in New Jersey increased slightly in 2016 and 2017 but still declined 29 percent from 2008 to 2018. Meanwhile, criminal filings declined 23 percent and family court filings fell 28 percent in the past decade. In the same period, New Jersey’s population grew roughly 3 percent, from 8.6 million people to 8.9 million.

Some legal experts say the decrease indicates courts are failing their constituents. Those experts have also said it’s time to change the ways court systems go about their business.

Richard Schauffler of the National Center for State Courts said that a decline in filing volume, and resultant notions that courts are outliving their usefulness, are cause for concern.

“Courts exist to ensure that asymmetries of power do not dictate the outcome of disputes,” he wrote. “Making the best use of available resources and deploying them in the public interest requires that courts ask. What cases belong in court? How might we adjudicate those cases effectively and efficiently, in the eyes of those seeking justice? Courts need to sort out what factors they can influence (e.g., delay and costs that discourage civil litigation) from those they cannot (the divorce rate) and focus on improving the adjudication of cases that belong in court.”

State court officials have noticed the decline in filings.

“The potential factors contributing to the decline are numerous and more often than not, outside the court’s control, such as the use of mediation and arbitration,” said Pete McAleer, spokesman for the state judiciary. “For example, General Equity case filings have been falling because of the decrease in the number of foreclosure filings.”

McAleer declined to offer any ideas about the reason for the recent uptick in civil cases, though.

The number of filings doesn’t impact the judiciary’s budget since the appropriation is based on personnel and staffing needs, as well as other nonsalary expenditures such as capital, IT infrastructure, and other strategic priorities and initiatives, McAleer said.

The drop in the number of new lawsuits filed in state courts is a national trend, according to the National Center for State Courts.

From 2006 to 2015, the number of incoming cases in state courts across the country dropped 16 percent, a pattern the center called “pervasive and persistent” in an April 2017 report, which is the most recent one available. The NCSC said the reason for the decline is unclear, but it offers an assortment of theories, such as the courts’ limited use of information technology, internet and mobile services, which might put off some technology-embracing would-be litigants.

Statistics show that while fewer cases are being filed in New Jersey’s state courts, the opposite is happening in its federal court. Filings more than doubled in the District of New Jersey between 2013, when 9,525 suits were filed, and 2018, which saw 20,184 suits filed. Filings in district courts nationwide declined by 2 percent from 2013 to 2018, or 398,640 cases down to 389,226.

The NCSC said a decline in domestic relations cases in the state courts likely reflects that people are marrying later in life and having fewer children. The group also said state courts are seeing fewer traffic violations because young people are obtaining drivers’ licenses later, if at all.

New Jersey State Bar Association president John Keefe Jr. said the decline is concerning.

“I truly believe in the right to a trial by jury. Any time there’s erosion of that, we should be concerned,” Keefe said.

The spread of mandatory arbitration clauses in consumer-related and business-to-business disputes, as well as changes to the state laws regulating auto insurance are likely all factors in the dip, Keefe said. He added that defendants in many civil suits are exercising any opportunity to take their cases to federal court whenever possible.

Keefe says the decline in state court filings points to a need for a collaborative look at how New Jersey can become more efficient and better serve the public.

“You have to look at questions like, are there too many motions? Why does it take so long for a case to move through the system? I would love to sit down and have an open forum and say, can we do this differently? Are there rule changes needed?”

John Eory, co-chairman of the family law group at Stark & Stark in Lawrenceville, said the decline in volume of family court filings is related to a perception that litigation is expensive. “The cost of doing this scares people, too. I think people are looking twice about making huge investments and maybe just separating or coming up with their own settlements,” he said.

Eory said he is concerned the cost of litigating will make family court into a two-tiered system, with litigation an option only for the few who can afford it. “The problem is people have the right to their day in court,” he said.

One source put the average cost of a divorce in New Jersey at $15,600.

Despite the decline, the state’s family courts seem as overburdened as ever, Eory said. When a divorce case goes to trial, litigants rarely see two consecutive trial days.

Eory thinks a growing number of domestic violence cases is taking up more resources. But another reason family court judges seem overburdened is that “sometimes lawyers can make a case more litigious than it needs to be,” Eory said.

The decline in criminal filings in New Jersey could be linked to a trend toward resolving certain cases in the pre-indictment phase, said Darren Gelber, chairman of the criminal law practice at Wilentz, Goldman & Spitzer in Woodbridge and a former president of the Association of Criminal Defense Lawyers of New Jersey. But the state is also seeing a general downward trend in crime, and lower arrest rates lead to fewer court filings.

Gelber said the decrease has yet to have a noticeable impact on the practice of criminal defense law. “I think there’s always going to be crime. I think there’s always going to be a need for criminal defense lawyers,” he said. “If a solo practitioner devotes their entire practice to criminal defense, they might struggle from time to time,” adding that many criminal defense lawyers handle personal injury cases or real estate closings to help them through the slow periods.

Gelber predicts that the looming legalization of recreational marijuana is likely to create more business for criminal defense lawyers in New Jersey. For example, legalization won’t apply to people under 21, but the number of high school and college students who are charged with possession is likely to increase, he said. And based on the experiences of other states where recreational marijuana has become legal, New Jersey should expect more prosecutions for driving under the influence of marijuana once legislation is adopted, he said.

The decline in state court filings nationwide has drawn the interest of William Henderson, a professor at the Indiana University Maurer School of Law who has written and lectured extensively on the trend. Henderson thinks the high cost of legal services is making lawyers think twice about filing low-value cases.

Analyzing data from the federal Bureau of Labor Statistics, he wrote that the volume of work performed by lawyers representing corporations and government entitles continues to expand, while lawyers’ work for individuals is declining.

From 2007 to 2012, total annual law firm receipts grew from $225 billion to $246 billion. But in that same period, receipts from individuals declined from $65 billion to $58 billion, Henderson wrote in his blog, “Legal Evolution.”

Paradoxically, law schools are turning out too many lawyers, but there are not enough lawyers to serve people with legal grievances, he said.

Many lawyers who represent average people find the earnings are too low and the overhead is too high to make it a sustainable practice, Henderson says. 

“Building a financially successful law practice out of low-stakes, high-volume cases requires capital for technology and marketing along with significant business acumen and managerial ability. Very few small firm lawyers possess these resources and skills,” Henderson wrote.

In a commission report to the State Bar of California in July 2018, Henderson notes that consumers have benefited from declines in the price of certain products, such as clothing, personal computers and long-distance phone service, while costs have far outpaced workers’ income in some other areas, such as medical care, higher education and legal services. But unlike medical care and higher education, “consumers are finding ways to forgo legal services,” Henderson wrote.

Henderson says in the California Bar report that the restriction on ownership of legal practices by nonlawyers is a factor in the legal system’s failure to serve individuals.

He cites decisions by legal regulators in New Jersey and other states that are unfriendly to online legal marketplaces such as Avvo and LegalZoom.

In 2017, New Jersey’s Advisory Committee on Professional Ethics, the Committee on Attorney Advertising and the Committee on the Unauthorized Practice of Law issued a joint opinion declaring Avvo, LegalZoom and Rocket Lawyer off-limits to the state’s lawyers because of concerns over illicit fee-sharing. The state Supreme Court refused to hear an appeal of that decision.

“Nowhere in all this deliberation, however, is there an analysis of how the current legal market is serving consumers,” Henderson wrote. “There is ample evidence that ordinary citizens increasingly cannot afford traditional one-on-one consultative legal services.”

Henderson points to other ways for the legal system to handle disputes involving individuals economically, like the so-called pajama court now in use in Austin, Texas. There, litigants can resolve civil disputes involving less than $10,000 without leaving their homes, or getting dressed, if they opt to use a software-based mediation program. He also points to a similar program in the Canadian province of British Columbia called Civil Resolution Tribunal that provides online resolution of disputes up to $5,000.

“If we don’t do anything, the courts will become less relevant,” Henderson said. “What I worry about is there’s already a lot of cynicism because people feel the system’s not working.”