Underpaying Judges: Bad for Business

As arbiters of the law in the financial capital of the world, New York judges have an important role to play in the national and global economy, however their pay is not commensurate with the importance of their role, which will only encourage jurists to choose other states or the private sectors for their careers, especially in New York where a private attorney has no effective cap on how much money they could make. combined with this temptation to make great money in another state or for a private firm, is the ever rising cost of living in New York, which alone could drive anyone on a fixed salary out of the state. If after cost of living expenses income of judges in New York continues to decrease then the consequences for American businesses will be dire as the quality of judging diminishes as the more qualified jurists leave for greener pastures.

Issue Areas:

Free Enterprise

Case:

Question(s) Presented:

What impact does the current level of compensation of the New York judiciary have on the State’s economy and business community?

ALF’s Amicus Brief:

ALF bases its amicus brief on the statistics from the National Center for State Courts, arguing that the real income of New York Judges has decreased by one third in only ten years. This crisis has grown so dire and bizarre that even relatively inexperienced district attorneys earn nearly 40k more than the State’s Chief Judge and at least 50k more than the trial judges before whom they appear. About 10% of judges have outstanding loans against their pensions. The best talent will choose other careers paths if there is such a good chance that they will have to mortgage their futures just to make ends meet. Justice Anthony Kennedy remarked that one of the “distinguishing marks of the Anglo-American legal tradition is that many of our judges are drawn from the highest ranks of the private bar.” This feature will be eliminated in New York if judicial pay remains unaddressed, leading to average judge tenure shortening, and a loss of efficiency of litigation, increasing the overall costs of doing business in New York, and leading businesses to choose other states.

The need for experienced commercial jurists in the judiciary in the fanatical capital of the country, if not the world, is particularly acute. But why would anyone experienced in commercial litigation agree to become a judge if it meant taking on an effective oath of Franciscan poverty for the sake of public service? Even retaining current judges has become difficult, as one judge put it “I am unwilling to further deplete my savings and reduce my lifestyle just to continue in office.” He added that “a number of judges have retired prematurely because of this sorry situation.”

The State of Texas concluded in an economic study that “investing in the state court system byu increasing the compensation for judges at the trial and appellate levels. . . [will] increase efficiency, thereby affording Texans an excellent opportunity to enhance its economic environment and further increase its competitive advantages on a national and global scale.” Justice Breyer too linked competitive compensation for the judiciary with economic prosperity saying the single institution necessary to promote economic development is an independent judiciary which assures “honest enforcement of contracts, produce[s] investment, and lead[s] to prosperity.”

The business community nation-wide has echoed these sentiments, urging Congress to increase judicial pay for the federal judiciary, in the hopes that this will draw more judges with commercial litigation experience from the private bar. If the government cannot fund its public judges, then businesses will be forced to use privately funded judges to enforce their contracts, or leave the state.

Not maintaining judicial pay relative to inflation raises serious separation of powers concerns under the Constitution of the State of New York. ALF asks this court to affirm the order below.

Status:

On June 2, 2009, the Court of Appeals issued a favorable opinion.