Shalom Christian A.

Gaerlan 1S LEGRES
A SPEEDY TRIAL AND COST OF LITIGATION IN PYRAMID SCAM CASES

This paper aims to analyze the litigation process and will mainly focus on pyramid scam
cases. It will analyze the costs of litigation and its effects to the plaintiffs' welfare, which
includes their income and wealth when the process undergoes delay. The economic welfare of
litigants is greatly affected by the delays of their filed cases, they allot a big portion of their time
for any event related to their cases for example hearings, pre-trials, consultation with lawyers etc.
instead of developing their economic welfare using the time they have, they werent able to do so
because they have to pursue the case. The time they allot for any case related event can be use to
something that is more useful for them and develop their economic welfare. Part 1 of the paper
will talk about mainly of what a pyramid scam case is. The second part of this paper will talk
about how our judicial system in the Philippines, delays in cases and cost of litigation. The last
part of this paper will discuss the remedies or even solution to the relationship of speedy trial and
how it will minimize the cost of litigation.
With the rapid economic growth and development that our country has been
experiencing, Filipinos nowadays are thinking of ways of investing their hard-earned money
through traditional and non-traditional investment schemes
1
. One of the investment schemes that
is now prevalent is the Pyramid Scheme. Due to the increase of such schemes in the country, the
rise in cases filed against its perpetrators are being brought to court and reported to the proper
authorities almost every year. As a result of numerous cases being filed, delay in the process of
prosecuting such cases in the judicial courts in the Philippines is inevitable. One notable pyramid
scheme in the Philippines is the MULTITEL Pyramid Scam. Rosario Baladjay, the perpetrator of
this pyramid scheme, was considered as the Pyramid Scam Queen because of the large number
of investments that were put up in the said pyramid scam. She used Multinational Telecom
Investors Corporation (MULTITEL) as a decoy to dupe people into investing their money in her
company, wherein the company offered high returns on investment and varied interests
depending on how many days or months a certain investor puts money into the company as well
as the amount they give. They also gave commissions to people who could bring in recruits.

1
Of Ponzi and Pyramid Scams: Why do Pinoys keep falling in the same old trap? by Cuevas-Miel (2012)
According to the Inquirer News
1
, there are about 950,000 individuals who invested in the
MULTITEL scam. This includes celebrities, government officials, military officers and senior
police. After the company collapsed, investors of the company filed charges, such as fraud and
syndicated estafa, against Baladjay as well as her other employees. Baladjay was convicted last
2008 and was imprisoned in Muntinlupa City.
When victims find out that their hard-earned money has been taken by these scammers,
the victims have no recourse but to fight back by filing cases against the perpetrators. However,
it takes a long time to hear these cases according to an article
2
and the reasons behind the causes
of delay in the process of prosecution of cases filed in relation to these investment scams have to
be examined and amended so that justice will be served on time for the benefit of the people who
were deceived and victimized by the investment swindlers. Asuncion pointed out that delays are
part and parcel of the adjudication of criminal cases. The delays on cases are built in the judicial
process and in the event that it is eliminated, the whole system will collapse. Delays are
significant to the judicial process and allowed to exist because it ensures the due process of
law
3.
Furthermore, they think that some influential people are involved in the delays of some
cases, that they play a significant role in manipulating the dispensation of justice since they are
powerful and influential people.
In accordance to this, Pagunsan stated that when one seeks the aid of courts, he/she is
certainly faced with the problem of how much he/she is expected to gain as cost.
3
The cost of
litigation would involve private costs such as the resource cost and opportunity cost, these two
are essential to analyze the cost of litigation made by the complainants/plaintiffs. Resource cost
involves actual expense on the part of the litigant. The money spent on expenditures for judicial
and legal fees, attorneys fees and miscellaneous expense. Opportunity cost on the other hand
represents the loss of income for time devoted to the prosecution or defense.


2
Appellate court reduces jail term of pyramid scam queen: Rosario Baladjay by Ramos, M. (2012)
2
Delays in the adjudication of criminal cases: A case study on people of the Philippines vs. Mayor Antonio Sanchez by
Asuncion, F. (1997)
3
The economic approach to litigation: A case of Philippine judicial procedure. By Pagunsan, S.R. (1994)





PYRAMID SCHEMES
The paper of Detlev Krige
1
, which is considered as the in-depth study of pyramid
schemes in the popular economies, is about the rise of get-rich scheme in South Africa, what it
means for the economy and how it attracts the African people. According to Krige, the rise of
occult economies is due to the South African economic policies. Also, it is due to the widening
gap of the rich and poor and of inequality of the social status of the people. Citizens also want to
find ways of getting rich despite financial illiteracy. One of the policies that the South African
government conjured was to require banks to attract people to have accounts to in the banks in
South Africa. The government think that it is their right and also to show the international market
that they could compete financially. Further, the people in the government detected that there is a
lot of money circulating in the market, which the schemers also knew and used this situation to
attract the people into investing in their scams. The author said that global financial system relies
on this mysticism (or lack of knowledge of how it works) to employ millions of experts to act
as brokers/intermediaries and translators between the complexities of finance capitalism and the
money of ordinary people who dont understand how the system works. The author also
concluded that the desire for quick money has become part of the general culture structure of the
South African society and economy.
The understanding of the investors decision-making processes, their perceptions of the
fraud, and the mechanics of the fraud through interview of victims who specifically lost millions
are the main issue of Wilkins
2
. There were issues that were examined in the investor interviews
like how the investors learned about the investment, did they have receive any professional
advice, what are the investment characteristics, what influenced their decision to invest, what did
the investment promoter use as a means of convincing them to invest and their overall reflections
on their personal experience. The interviews of the author revealed a fraud with the following
characteristics of older educated victims; a credible story that travelled by word of mouth among
people who knew each other; demonstrated returns over several months; low pressure (no
urgency to invest); and a good guy promoter who did facilitation or processing works.
Furthermore, one of the problems that the investors faced is that they fear that they will no longer
receive the investments that they have been fighting to get.

1
The meaning of pyramid schemes in the popular economies. by Detlev Krige.
2
Understanding a Ponzi Scheme: Victims Perspectives. By Wilkins, A. et al. (2012).

JUDICIAL SYSTEM
Justice, according to Andrew Heywood
1

Justice can be understood in a procedural sense to refer to the rules which guide the
legal process, and in a substantive sense to refer to the outcomes or contents of law. The issue of
justice lies at the heart of questions about legitimacy and orderly existence, determining whether
citizens are willing to accept the law as binding.
It is not the function of the judiciary branch to define what justice is, but rather they have
the function of seeing if an individual acquires justice
2
. In the Philippines, most Filipinos suffer
the many frustrations when seeking justice; the delays in the resolution of cases are really long
that in some cases they outlive the complainants, the accused or even the hired lawyers before
they are resolved. The reasons behind the causes of delay have to be examined because justice is
not really given out properly and sometimes miscarried. Because of these delays many are being
deprived of justice, whether they are victims of the crime or the accused who is detained for the
meantime although he/she is not yet proven guilty. Also a lot have already lost their trust to the
judicial system and that their time, effort and most specially their money are most of the time go
to waste
1
. In accordance to this, Pagunsan
3
stated that when one seeks the aid of courts, he/she
certainly faced with the problem of how much he is expected to gain as cost. The cost stated is
produced by the court system itself. For example, in pursuing a lawsuit, it is important to engage
in a service of an able and competent lawyer in order to obtain the remedy, which the courts
provide. Besides the fees paid to the hired lawyer, the complainant is obliged to actually pay for
filing fees and sometimes judicial bonds.
This question on whether or not a citizen acquires justice in a country is not only a
judicial issue but can also be deemed as a responsibility of government as a whole
2
. There are
several reasons why the misadministration of justice is extensive in the Philippine Judicial
System. Sometimes political connection is more important rather than competence and integrity
because it becomes the primary basis of appointing judges in the judiciary. The lack of qualified
judges worsen the delay in the disposition of cases and in the instance where cases are disposed

1
Delays in the adjudication of criminal cases: a case study on people of the Philippines VS Mayor Antonio Sanchez by Barredo,
M. E., &Melo, J. C. (1997). Metro Manila, Philippines: De La Salle University.
2
The reforms initiated and instituted in the judicial system since 1984 to the present by Abad Santos, W. (1996).
3
The economic approach to litigation: A case of Philippine judicial procedure by Pagunsan, S. R. (1994).


by these judges, the complainant thinks of it as if they were resolved with bias and prejudice.
Another point raised by this author is that some lawyers tend to delay the proceedings because
they were paid in a per appearance rate.
On the other hand according to Asuncion
1
, delays are part and parcel of the adjudication
of criminal cases. The delay on cases is built in the judicial process and in the event that it is
eliminated, the whole system will collapse. Delays are significant to the judicial process and
allowed to exist because it ensures the due process of law. But then, Abad
2
also think that
some influential people are involved in the delay of some cases, that they play a significant role
in manipulating the dispensation of justice since they are powerful and influential people.
According to Bailey
2
, descriptive studies attempt to describe a phenomenon in detail or
to fully describe what happened in a given situation or phenomenon. Descriptive approach is
more appropriate to use in discussing the judicial reform programs that Abad Santos (1996) was
talking about in his thesis. Through this approach, he was able to illustrate the problems facing
the Philippine Judicial system. Through the descriptive approach of research design, he acquired
the knowledge of what the Philippine government as a whole did to solve the past and present
problems of the judicial system during that time.
Pagunsan
3
on the other hand didnt specify the research design he used but rather he
illustrated it in a flowchart using the principal elements of cost/delay and uncertainty. The data
gathering technique used by the authors were pretty much the same, they conducted first hand
interviews and all made interview questionnaires. They also made use of the available data from
government agencies such the National Statistics Office (NSO) and the Supreme Court.
DELAYS IN CASES
According to Villarama Jr.
4
, he presented how delays in the Philippines are being
performed. According to him,
One characteristically Filipino trait we are not exactly proud of is the habit of
procrastination and delay. Understandably so when "Filipino Time", "Mamaya na" and "Saka
na bahala na" translates into all kinds of manifestation of inefficiency in government such as red

1
Delays in the adjudication of criminal cases: a case study on people of the Philippines VS Mayor Antonio Sanchez by Barredo,
M. E., &Melo, J. C. (1997). Metro Manila, Philippines: De La Salle University.
2
The reforms initiated and instituted in the judicial system since 1984 to the present by Abad Santos, W. (1996).

3
The economic approach to litigation: A case of Philippine judicial procedure by Pagunsan, S. R. (1994).

4
Culture of Delay by Villarama Jr., M. S. (n.d.).

tape and bureaucratic fiascos. Delivery of government services nationwide suffers from constant
delays and the judiciary is no exception.
He explained the Zero Backlog Project of the Court of Appeals. The CA averages a
monthly disposal of 850 decisions or about 13 to 14 cases per justice. About half of the number
of Justices accomplished more than the minimum requirement of 12 cases. From a total of
11,343 cases submitted for decision in 2001, the CA has considerably reduced its backlog to
9,387 cases as of August 31, 2007. Also, there is a One Stop Processing Center which aims at
making follow-up and inquiries on status of cases easier for litigants and their counsel. The
judicial records division being the frontline of CAs public service, the problem of delay is a
matter of continuing for that committee in focusing to the possible ways of improving current
systems and procedures in receiving, docketing, records keeping and archiving. He concluded
that there is indeed much hope in the sincerity and determination on the part of both members
and employees of this court to continuously improve the dispensation of justice and prevent
needless delays.
As we unite efforts in heeding the call for judicial reforms, I strongly believe the
"culture of delay" visualized in the "slow as turtle" image of the Philippine judiciary, will soon
be a thing of the past.
1

In the study of Professor H. Zeisel
2
, he observed the sluggishness of case-flow,
"Delay in the courts is unqualifiedly bad. It is bad because it deprives citizens of a basic
public service, it is bad because the lapse of time frequently causes deterioration of evidence and
makes it less likely that justice be done when the case is finally tried; it is bad because delay may
cause severe hardship to some parties and may in general affect litigants differentially; and it is
bad because it brings to the entire court system a loss of public confidence, respect and pride. It
invites in brief the wisecrack made a few years ago in a magazine editorial, 'Okay, blind, but
why so slow."
Also the observation of J.B Jennings
3
was ought to pin point the subject of civil delay,
Congestion and delay in courts throughout the country threaten to strangle our system

1
Culture of Delay by Villarama Jr., M. S. (n.d.).
2
"Delay in the Court" Greenwood Press, Publishers, Westport, Conn. by Zeisel, Kalven, & Buchholz (1959)
3
"Evaluation of the Manhattan Criminal Courts Master Calendar Project," by J. B. Jennings. Phase 1, Feb. 1. June 30, 197 1,
(New York Rand Corp. 1972), p. 111

of justice, for as delays increase, the innocent who cannot afford to make bail suffer longer in
jail, the guilty who are released pose greater threats to society, and the deterrent value of speedy
justice is lost. The resultant pressures to dispose of cases more and more quickly lead to still
other wrongs; less and less attention is given to each case, and greater reliance is placed on the
disposition of case through 'Plea Bargaining' and the likelihood of injustice increases."

FACTORS OF DELAY
We have a system in our country of causing delays of cases because of the absence of the
prosecutors and the reality of court cases taking time to process. In order to abolish this system,
the researchers want to know first the cause and eventually relate it to their topic. The Supreme
Court has prescribed in the Revised Rules on Criminal Procedures (Rule 110-127) the
aforementioned time frame for the lower Courts to comply. The time that Court has to dispose of
a case will depend on a number of things. That is, time which parties are brought within the
jurisdiction of Courts; to enable the parties to fully express to the Court their basic theories of the
case; to enable the parties to present evidence in support of their averment; for the court to
consider the pieces of evidence after trial, and after disposition of the case, for the party
adversely affected by a judgment, to seek modification or reversal thereof by appeal or
otherwise; for the appellate Court to be informed of the parties positions and proofs, study the
case and decide it. The law prescribed periods for disposition of cases. However, it is not strictly
to be adhered if it were meant to violate the due process of law guaranteed by the Constitution.
As long as the delays are justified, there can be no complaint about violation of the speedy
disposition of cases.
In arraignment, the defense is given ten (10) days to file their counter affidavit, which
may result to delay and suspension thereof. On the pre-trial, judges could grant postponements to
both parties to further gather their pieces of evidence, which again is another cause of delay. The
trial proper is the most crucial part of the proceedings. This is the part wherein both parties have
to present their respective witnesses, documents, and most of the time; the parties have to
consider the availability of their witnesses, the conflict of schedules of the counsels themselves,
or even delaying tactics, which are all factors in the delay of the trial period. Nonetheless, the 3-
months time frame, that is prescribed by the Supreme Court in The Rules of Court in the lower
courts, commence after that the complainant/petitioner has submitted comment/opposition to the
formal offer of evidence of the accused/respondent, and it is only then that the Court will
consider that the case as submitted for decision. After the pre-trial conference, the court shall
issue an Order reciting the actions taken, the facts stipulated, and the evidence marked. This
Order shall bind the parties, limit the trial to matters not disposed of, and control the course of
the action during the trial. This however can be modified by the Court to prevent manifest
injustice, which means, something which is 'obviously unfair' or 'shocking to the conscience.' It
refers to an unfairness that is direct, obvious, and observable.
1



EVIDENCES EVIDENCES

1
Delays in the adjudication of criminal cases: a case study on people of the Philippines VS Mayor Antonio Sanchez by Barredo,
M. E., &Melo, J. C. (1997). Metro Manila, Philippines: De La Salle University.

Submission of decision




COST OF LITIGATION
Cost is incurred in the course of litigation and it is already built into the litigation process.
The cost of litigation is consisted of two costs. The resource cost and opportunity cost
1
.
Resource cost or accounting is that which involves actual money outlay on the part of the
litigant. It consists of judicial fees and legal fees, attorneys fees and miscellaneous expense.
Opportunity cost on the other hand represents the loss income for time devoted to the
prosecution or defense of the case by the litigant.
The following consists the Resource cost:
1. Judicial Fees is a function of the nature of the action and the relief sought. Shall be
measured in its applicable value fixed by law corresponding to the amount or value
appearing in the complaint.
2. Attorneys Fee is a function of the type of lawyer retained for the purpose. shall be
measured on the active time devoted by the lawyer to the case. Time devoted would be
computed by:

1
The economic approach to litigation: A case of Philippine judicial procedure by Pagunsan, S. R. (1994).


a. Preparation of complaint/petition (filed in RTC) = 8 hours
b. Preparation of memorandum/brief = 8 hours (1 in CA, 1 in SC)
c. Preparation of other pleadings = 3 hours (minimum of 3 hours in RTC, 1 in CA, 1
in SC)
d. Attendance at court proceedings
i. Pre-trial = 1 hour per setting (a minimum of 2 settings)
ii. trial = 1 hour per setting (a minimum of 8 settings)
e. Interview or Consultation with client = 10 hours
(Sub-total of (a) to (e) = 59hours)
f. Others (consisting of follow ups for delay) = 1 hour per year ( a fraction of 6
months being considered as one whole year.
3. Miscellaneous Expense is a function of the amount paid as attorneys fees. Shall be
measured as a fixed percentage of Attorneys Fees to the lawyer for the period covered
and shall be attached 10% thereof.
What constitutes the opportunity cost?
Opportunity Cost is a function of the income of the litigant. It shall be measured in
absolute values on the basis of the active time devoted to the case by the litigant.

The following shall guide in the computation of opportunity cost:

To assess the pyramid scam case using an economic approach adapting the framework
used by Pagunsan
1
showing the total cost of litigation of the plaintiff where the cost shall be
expressed in the following terms:
Total Cost = Resource Cost + Opportunity Cost
Where:
Resource Cost = Judicial Fees + Attorneys Fees + Miscellaneous Expenses
Each component is comprised of the following:
Judicial Fees = (legal fees and judicial bonds)
Attorneys Fees = (Acceptance fee, success fee, appearance fee, etc,)

1
The economic approach to litigation: A case of Philippine judicial procedure by Pagunsan, S. R. (1994).


Miscellaneous Expenses = (Photocopying of documents, notarial fees, cost of transcript
of stenographic notes, own transportation expenses, publication expenses, mailing expenses)
Opportunity Cost = (conference with lawyer, attendance at trial, waste of time due to
anxiety, etc.)
When one seeks aid of courts, he or she is inevitably faced with the costs he will incur
and how big it can get as the litigation continues. Plaintiff suffers a direct loss which he or she
attribute to an act of the defendant, he or she seeks the protection of the court of law and
therefore incurs cost. The plaintiff institutes the case in the expectation that he or she would
recover not only the thing or amount sued upon but also the consequential damages to include
the cost of litigation and the loss for being deprived of the thing if not the loss in purchasing
power of the amount sued upon while the case is pending litigation. It is also important to
measure not only the cost of litigation but as well as the uncertainty in litigation.
The cost of processing a case according for example a murder case in North Carolina, is
more expensive to state tax-payers than noncapital litigation. Zealous advocacy is a source of
increased length and the cost of proceedings goes high. An enhanced constitutional and
legislative provision unique to capital litigation makes the adjudicatory process more expensive.
The objectives of this article provide estimates of the cost of capital adjudication that will be
useful to legislators and criminal justice officials. The estimates are intended to help inform these
decisions and predict their consequences for the utilization of resources in the criminal justice
system. They used the constitutional and statutory framework that shows the legal doctrine of
death is different as a punishment in the fact that capital cases tend to be litigated more
thoroughly than other serious murder cases. The cost presented here is defined as opportunity
cost of extra resources required to adjudicate capital cases and also the additional resources
consumed by these cases. It explains not focusing on death penalty but the imprisonment cost
1
.
Also unit costs is presented where they use the standard accounting procedure to estimate
the unit cost of key resources, time of attorneys in the offices, public defenders, appellate
defender and attorney general. The value of an hour of an attorneys time includes the prorated
position cost together with the appropriate load from support staff and general admission. They
used data gathering of different cases in six prosecutorial districts supplemented with data on
specific cases in other districts. They found out that the trail court cost of murder trials is $84

1
The economic approach to litigation: A case of Philippine judicial procedure by Pagunsan, S. R. (1994).
thousand and a capital trial that ends with the guilt phase of about $57 thousand. The estimates of
extra costs in the trial courts per death penalty are $194 thousand. Using the two year period of
1991-1992, they collected a total of 94 defendants tried trials that have cost the state and
countries about $4.3 million less if they had proceeded non-capital. The cost to the state will total
about $2.8 million for appeals and post conviction proceeding and $1.4 million for retrials and
resentencing proceedings ordered by the appellate courts. Combining all the figures, they
concluded that the overall extra cost on the order of $8 million or an average of $4 million per
year.

REMEDIES AND SOLUTION
Article VIII, Section 15 of the Philippine Constitution provides the maximum
period within which cases or matters must be resolved by the various courts. The period for the
Supreme Court to resolve cases is 24 months, 12 months for lower collegiate courts maximum
and 3 months for all other lower courts. The period is to be counted from the date of submission
of the case of matters for this purpose upon the filing of the last pleading, brief, or memorandum
required by the Rules of Court or by the Court itself. Also there is the Republic Act No. 8493
which is An act to ensure a speedy trial of all criminal cases before the Sandiganbayan,
Regional Trial Court, Metropolitan Trial court, Municipal Trial Court, and Municipal Circuit
Trial Court, appropriating funds therefor, and for other purposes. This act is known as the
Speedy Trial Act of 1998 according to Section 1 of the republic Act No. 8493
Case Flow Management
The basic idea of caseflow management is that the court controls the pace of litigation by
establishing meaningful events, setting scheduled dates and timeframes for pre-trial events and
trials accompanied by strong leadership, commitment to a shared vision, effective
communication, and active management of appropriate time standards and goals as well as the
continuous control of their accomplishment by monitoring and measuring actual performance
1
.
McWilliams
2
define in his article that caseflow suggests that cases should be viewed as moving

1
Can an Italian Court use the American approach to delay reduction? by Steelman, D., Fabri, M. (2008). The Justice System
Journal, Vol. 29, No. 1, pp.1-23.
2
Setting the Record Straight: Facts About Litigation Costs and Delay by McWilliams M. (1992). Business Economics, vol. 27,
No.4, pp. 19-24.


through a series of interconnected events such that overall case processing times, and cost to the
litigants, can be saved by reducing the unnecessary time between events, rather than by altering
or eliminating the events themselves. The term management is intended to suggest that the
preferred approach to dealing with cases is to seek management solutions to case processing
problems.
According to the above definition of the caseflow management concept, the term can be
seen as a synonym for promoting the process effectiveness viewpoint and perspective in the
operations and management of court systems. Caseflow management is thus basically a term for
the application of very basic operations management and process improvement concepts to the
processes of courts of justice.
The project presented by Elepano
1
she presented the case processing method called
effective case flow management (CFM) using a scheme called Differentiated Case Management
(DCM). These processes were inspired by the American bar Associations Standard on Delay
Reduction that stated,
From the commencement of litigation to its resolution, whether by trial or settlement,
any elapsed time other than reasonably required for pleadings, discovery and case events, is
unacceptable and should be eliminated.
Court performances and case disposals in Philippine trial courts were presented. On
monthly caseloads of 346 cases on the average per court or in other words 14 to 15 cases per
calendar day. Cases that are affected due to time constraints create a horrible backlog of cases in
the end. She implemented the project with the help of the Supreme Court by selecting a project
site and creating a Committee to design the Case Management Plan and implement it. The CFM
handbook was described using a step-by-step VVFM process for both criminal and civil cases.
She used the American and Canadian Models on Caseflow and Differentiated Case Management.
Also, Tracking System was formulated by collapsing time frames for case events into reasonable
short to shorten case life and prevent or minimize delay. Simple cases would be assigned to Fast
Track to be disposed of in six month or less. In other cases that demanded judicial attention, they
were assigned to Complex Track with a disposal time of two years. Neither simple nor complex
cases were assigned to Standard Track with a disposal time of one year. CFM software program

1
Case management reform: The Philippine experience by Elepano, Z. N. (2009). Supreme Court of the Philippines

based on CFM software were used to track and monitor the progress of case. The technology was
provided by USAID.
In effect, the project showed the disposal of cases increased with the use of CFM
methods. According to CFM timeframes, 95 percent of the civil cases and 90 percent of the
criminal cases have been disposed in the first level courts. The project resulted in a heightened
level of awareness of judges, court personnel, lawyers and the public on the importance of
reducing or eliminating delay through CFM. The different challenges were presented in doing
this kind of project. Several judges and court personnel became allergic to the idea of meeting
shorter deadlines and observing new timeframes and schedules because this process upset
established patterns of their professional and personal lifestyle. Some courts suffered from
culture shock because they had no specific knowledge and training especially in the use and
operation of the technology. The technology was difficult to maintain and it suffered
innumerable glitches to the program. Also the computer illiteracy of several judges and court
personnel thought that the technology was beyond their mortal understanding. She concluded
that the system continues to be enhanced with the addition of new features such as electronic
payment of filing and other legal fees, electronic docketing and numbering of cases and
electronic assignment or raffling of cases.
Martin Levins paper
1
is case studies of delay in the courts of Chicago, Pittsburgh,
Columbia and Minneapolis. The author stated that the criminal court delay usually stresses large
caseloads thrust upon the mismanaged and inefficient courts. He described delay as an aberration
in the court system and the solution for this problem that always pop up stresses a better
administration.
Furthermore, he suggested that delay tends to be associated with the behavior of the
judges, attorneys and the prosecutors. These behaviors include the suppression of evidence, full
length trials, and a large caseload. The author cited an example wherein defense attorneys often
consciously take actions associated with delay as an indirect means of achieving their own goals,
even at the expense of the defendant's goals. According to Levin (1975), delay does not seem to
be an external phenomenon thrust upon unwilling court participants.
The author also discussed basic terms and facts about delay. He also analyzed the goals
of the judges, defense attorneys, and prosecutors as well as some background and contextual

1
Delay in Five Criminal Courts by Levin, M. (1975).
characteristics of the criminal court process. He also analyzed the factors most immediately
associated with delay, the effects and significance of delay and some possible remedies for delay.
The problem that the author faced is that the study had significant variation in several of
the other important characteristics that he was to analyze of these courts such as caseload size,
proportion of public defenders, and proportion of guilty pleas. With that, the analysis of the
author is suggestive rather than conclusive.

LOSERS PAY RULE
The idea of Loser Pay rule was presented in the paper of Gryphon
1
. According to
Gryphon (2008), the United States pay a high price for a system of justice that makes the legal
system abusive. Replacing the American rule to Loser-pay system will have a great development
in response to legal reforms, exposure to liability of fees and can promote early settlement. The
study explains the adaptation of loser pays rule for the attorneys fees. It could be an important
part to reduce litigation cost and discourages meritless lawsuits. Different goals for the reform
are also presented like; compliance with the law, compensation for the victims, low transaction
costs, equitable distribution of cost. Some data were presented including the data from Alaska
and Florida in using this kind of system for their judicial system. According to the article, Alaska
recorded 5,793 civil filings per 100,000 inhabitants in 1992. This number was only slightly
below the national median of 6,610 per 100,000. In effectively of the loser pays rule in Alaska, it
is responsible for more selective filing of tort claims in Alaska than in other jurisdictions. In
Floridas case, it experiences an increase in litigation expenses both those that settled and those
that proceeded to trial during the loser-pays experiment.
Litigants with weak cases should be far more likely to abandon their claims under loser
pays which allows lawyers to focus on more worthy cases. Also some proposals were presented
in prevailing party for the costs of litigation and reasonable attorneys fees. Some proposals are;
Compensating Winning Litigants, Reducing the Number of Abusive Lawsuits, Promoting Early
Settlement, Containing Litigation Costs, and Promoting Litigation Insurance.
Loser Pays or the English rule is sometimes called a way to discourage frivolous cases
and make the civil justice system fairer and efficient. When lawsuit losers are forced to pay the

1
Greater Justice, Lower Cost: How a "Loser Pays" Rule Would Improve by Gryphon, M. (2008).

legal fees of winners, the cost of litigation for everyone goes up. The article
1
talks about the case
of Naomi Campbell, which shows the cost of litigation for both sides was over 1 million and
like the most of the countries, it requires litigation losers to pay the legal fees and expenses of
litigation winner. Campbell won the case and her lawyer was asking for 250,000 in costs.
According to Kritzer,
Loser pays sounds like a silver bullet for a costly litigation system, particularly to
defendants who believe they have been wrongly sued. It also looks simple: Someone wins, and
the other side pays his costs. But experience reveals a far more complex reality, one full of
disputes over fees and related issues, and with plaintiffs like Naomi Campbell, who can win
paltry awards and still be owed astronomical legal fees.
There is also no doubt that loser-pays rule can discourage people from filing lawsuits. If
losers pay became standard in the U.S., it would probably create a market for insurance covering
the risk of losing and having to pay a winning defendants costs.

CONCLUSION
Overall, costs are hard to evade, but we could do something to lessen these costs.
The researchers recommend that a person who wants to file cases should get a lawyer that
utilizes a results based option when it comes to defending their clients, this will fully prioritize
the client and get their moneys worth when it comes to hiring an attorney. Furthermore, this
option will help prevent delaying tactics that some lawyers employ, minimizing the possible time
that people will invest as well unnecessary cost it may induce.
Every time a case hearing schedule is delayed due to a petition of the lawyers, the
government should fine them as they delay the case and unnecessarily use up time of the judges
as well as their clients. Also, the courts should utilize a computerized system in filing cases as
well as distributing their resolutions and other notices. This will minimize the use of paper
because they could just use soft copies of their files thus lessening the miscellaneous expense of
complainants as well as defendants. Furthermore, it could lessen some of the delays since
subpoenas could be sent through e-mail, and most people already have email addresses that they
use and check almost every day. It will be hard to miss.


1
Losers Pay Doesnt by Kritzer, H. M. (n.d.).
REFERENCES:

Abad Santos, W. (1996). The reforms initiated and instituted in the judicial system since 1984 to
the present.

Asuncion, F., Barrezo, M. E., & Melo, J. C. (1997). Delays in the adjudication of criminal cases: A
case study on people of the Philippines vs. Mayor Antonio Sanchez.

Bautista, E. The Judiciary under the new Constitution. Lawyers Review. Mr. 21, 1987, pp. 9

Barredo, M. E., &Melo, J. C. (1997). Delays in the adjudication of criminal cases: a case study on
people of the Philippines VS Mayor Antonio Sanchez. Metro Manila, Philippines: De La Salle
University.

Becker, G. (1976) The Economic Approach to Human Behavior. Chicago: University of Chicago
Press.
Church, T. (1978). Civil Case Delay in State Trial Courts. The Justice System
Journal, Vol. 4, pp. 166.

Coase, R. (1960) The problem of social cost. Journal of Law and Economics, 3(1), 1-44.
Coase, R. (1988) The Firm, the Market, and the Law. Chicago: University of Chicago Press.
Conde, C. H. (2003, March 30). Investors in Philippine Pyramid Scheme Lose Over $2 Billion.
Retrieved October 22, 2013, from http://www.nytimes.com/2003/03/30/world/investors-in-
philippine-pyramid-scheme-lose-over-2-billion.html
Cuevas-Miel, L. (2012). Of Ponzi and pyramid scams: Why do Pinoys keep falling into the same
old trap?. Retrieved from: http://www.interaksyon.com/business/48146/special-report--of-
ponzi-and-pyramid-scams-why-do-pinoys-keep-falling-into-the-same-old-
traphttp://www.interaksyon.com/business/48146/special-report--of-ponzi-and-pyramid-
scams-why-do-pinoys-keep-falling-into-the-same-old-trap
http://www.interaksyon.com/business/48146/special-report--of-ponzi-and-pyramid-
scams-why-do-pinoys-keep-falling-into-the-same-old-trap
Development Academy of the Philippines Task Force on Human Settlements: Social Equity
Studies in the Philippines; Technical Report/Task Force on Human Settlements, DAP-QC: TFHS,
1975, p.23

Di Pietro, S., Carns, T. W., & Kelley, P. (1995). Alaska's English Rule: Attorney's Fee Shifting in
Civil Cases. Anchorage, Alaska: Alaska Judicial Council.

Easterbrook, F. (1984) The Supreme Court, 1983 Term-Foreword: the court and the economic
system. Harvard Law Review, 98, 4-60
Elepano, Z. N. (2009). Case management reform: The Philippine experience. Supreme Court of
the Philippines

Federal Bureau of Investigation (n.d). Common Fraud Schemes. Retrieved from:
http://www.fbi.gov/scams-safety/fraud/fraud#pyramidhttp://www.fbi.gov/scams-
safety/fraud/fraud - pyramid
http://www.fbi.gov/scams-safety/fraud/fraud - pyramid

Global Finance. (n.d). Countries by Income Group. Retrieved August 30, 2013, from Global
Finance: http://www.gfmag.com/tools/global-database/economic-data/12066-
countries-by-income-group.html#axzz2du0DObA5
Gryphon, M. (2008). Greater Justice, Lower Cost: How a "Loser Pays" Rule Would Improve the
American Legal System. Civil Justice Report, (11). Retrieved from http://www.manhattan-
institute.org/html/cjr_11.htmhttp://www.manhattan-institute.org/html/cjr_11.htm
Hammergren, L. (2001). Diagnosing Judicial Performance: toward a tool to help guide judicial
reform programs. Working draft, prepared for Transparency International

Hsiung, B. (2004) An interpretation of Ronald Coases analytical approach. History of Economics
Review, 39, 12-32.
Hsiung, B. (2006). Economic Analysis of Law: An Inquiry of Its Underlying Logic.Erasmus Law and
Economics Review, 2(1), 1-33.

Jacobs, P., Schain, L. (n.d.). The Never Ending Attraction of the Ponzi Scheme. Retrieved from:
http://jupapadoc.startlogic.com/compresearch/papers/JCR11-
6.pdfhttp://jupapadoc.startlogic.com/compresearch/papers/JCR11-6.pdf
http://jupapadoc.startlogic.com/compresearch/papers/JCR11-6.pdf
J. B. Jennings, "Evaluation of the Manhattan Criminal Courts Master Calendar Project," Phase 1,
Feb. 1. June 30, 197 1, (New York Rand Corp. 1972), p. 111

Levin, M. (1975). Delay in Five Criminal Courts. Retrieved from:
http://www.jstor.org/discover/10.2307/724103?uid=3738824&uid=2&uid=4&sid=2110261332
1453http://www.jstor.org/discover/10.2307/724103?uid=3738824&uid=2&uid=4&sid=2
1102613321453
http://www.jstor.org/discover/10.2307/724103?uid=3738824&uid=2&uid=4&sid=2110
2613321453

Krige, D. (2010). The meaning of pyramid schemes in the popular economies. Retrieved from:
http://www.lse.ac.uk/anthropology/research/popular_economies/20_Detlev_Krige.dochttp://
www.lse.ac.uk/anthropology/research/popular_economies/20_Detlev_Krige.doc
http://www.lse.ac.uk/anthropology/research/popular_economies/20_Detlev_Krige.doc

Kritzer, H. M. (n.d.). Losers Pay Doesnt. Retrieved August 20, 2013, from
http://www.legalaffairs.org/printerfriendly.msp?id=923http://www.legalaffairs.org/prin
terfriendly.msp?id=923
http://www.legalaffairs.org/printerfriendly.msp?id=923

Mahoney, B., Winberry, P., Church, T. (1981). Addressing Problems of Delay in Limited
Jurisdiction Courts: A Report on Research in Britain. Justice System Journal, Vol. 6, No.1,
pp. 44-72.

McWilliams M. (1992) Setting the Record Straight: Facts About Litigation Costs and Delay.
Business Economics, vol. 27, No.4, pp. 19-24.

National Statical Coordination Board. (2013, May 30). Retrieved July 10, 2013, from
http://www.nscb.gov.ph/sna/

Pagunsan, S. R. (1994). The economic approach to litigation: A case of Philippine judicial
procedure.

Pekkanen, P. (2011). Delay reduction in courts of justice Possibilities and challenges of
process improvement in professional public organizations. Lappeenranta University of
Technology, Lappeenranta.

Posner, R. (1993) Gary Beckers contributions to law and economics. Journal of Legal Studies,
22(2), 211-15.
Posner, R. (1996) The Federal Courts: Challenge and Reform. Cambridge, MA: Harvard
University Press.
Ramos, M. (2012, April 4). Appellate court reduces jail term of pyramid scam queen Rosario
Baladjay. Retrieved October 23, 2013, from http://newsinfo.inquirer.net/172329/appellate-
court-reduces-jail-term-of-%E2%80%98pyramid-scam-queen%E2%80%99-rosario-baladjay
Rollon, M., Linares, S., Rodriguez, L. (2004). Handbook for Judicial Diagnosis. Department of
Political Science and Administration, Salamanca University, March 2004.

Steelman, D., Fabri, M. (2008). Can an Italian Court use the American approach to delay
reduction? The Justice System Journal, Vol. 29, No. 1, pp.1-23.

The Supreme Court of the Philippines: Action Program For Judicial Reform (n.d.). Stages of
Criminal Actions in Philippine Courts. Retrieved September 18, 2013, from
http://apjr.judiciary.gov.ph/wallsheets/wallsheets_criminal.html

U.S. Securities and Exchange Commission (2009). Pyramid Schemes. Retrieved from:
http://www.sec.gov/answers/pyramid.htmhttp://www.sec.gov/answers/pyramid.htm
http://www.sec.gov/answers/pyramid.htm
Villarama Jr., M. S. (n.d.). Culture of Delay. Retrieved August 20, 2013, from
http://ca.judiciary.gov.ph/index.php?action=mnuactual_contents&ap=j6040

Wigberto E. Tanada, et al., intervenors; Danilo S. Ursua vs. Republic of the Philippines, G.R. Nos.
177857-58 & G.R. No. 178193, January 24, 2012.

Wilkins, A. et al. (2012). Understanding a Ponzi Scheme: Victims Perspectives. Retrived from
http://www.bus.lsu.edu/accounting/faculty/lcrumbley/jfia/Articles/FullText/2012_v4n1a1.pdf

Zeisel, Kalven, & Buchholz, "Delay in the Court" Greenwood Press, Publishers, Westport, Conn.
1959