Issue Position: Reform Civil Justice and End Predatory Lending

Issue Position

REFORM CIVIL JUSTICE AND END PREDATORY LENDING
The Virginia Declaration of Rights was written by George Mason who lived in Mason Neck on the Fairfax and Prince William County border. George Mason was a Virginia Delegate to the Constitutional Convention, but refused to sign the U.S. Constitution because it did not contain a bill of rights similar to what he had written and Virginia had enacted in 1776. Article I, Section 11 of the Constitution of Virginia provides "[t]hat in controversies respecting property, and in suits between man and man, trial by jury is preferable to any other, and ought to be held sacred."

Civil jury trials rarely occur in Virginia for a variety of reasons. First, boilerplate arbitration clauses contained in "Terms and Conditions" robotically agreed to by consumers or long fine print provisions on written contracts frequently waive jury trial rights.

Next, Virginia has continued to adhere to ancient concepts rejected in 48 other states such as contributory negligence and assumption of risk which say that if someone is 1% to blame for their injuries, they can recover nothing instead of reducing their recovery by the amount they are to blame.

Also, Virginia also adheres to an auto insurance policy minimum of $25,000 for liability and $50,000 for property damage that was adopted in the 1970's. While today's cars have become safer, they have also become much more expensive and people survive crashes more often. Virginia's old policy limits severely limit innocent Virginia's ability to be compensated for their injuries or even replace their car when they are hurt through no fault of their own.

Virginia's punitive damage cap of $350,000 is pocket change to most corporations and not a deterrent. Virginia is also the only state in the country that does not allow class action law suits.

It is then no surprise, that Virginia has also become a fertile playground for predatory lenders. The U.S. 1 Corridor is littered with lenders who make loans at 267% interest rates -- blessed by the Code of Virginia. Internet lenders pick up the slack and charge interest rates north of 400% using Indian Tribes who are rented out for their ability to claim tribal sovereignty and use contractual provisions requiring the application of tribal law and tribal arbitration.

Other lenders have used loopholes in Virginia laws like restructuring payday loans and open end credit arrangements which do not have interest rate caps.

These types of laws were common nationwide in the 1920's but are not appropriate in today's world.

To reform our civil justice system, we should:

Restrict the use of mandatory arbitration
Raise Virginia's punitive damage cap to $10 million
Adopt comparative negligence
Raise Virginia auto insurance minimums
Apply consumer protections to open end credit arrangements
Prohibit all loans over 36%
Allow class action lawsuits

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