Judicial Decision Making in Times of Financial Crisis

• NCJ Number: 236629
• Journal: Judicature Volume: 95 Issue: 2 Dated: September-October 2011 Pages: 68-77
• Author(s): Udi Sommer; Quan Li
• Date Published: October 2011
• Length: 10 pages
• Publication Format: Article
• Publication Type: Report (Study/Research)
• Language: English
• Country: United States of America

Annotation

This article proposes a tripartite theory to explain the role of the judiciary in crises in general and in the housing market in particular.

Abstract

Using original data from four State Supreme Courts regarding their decisions on mortgage moratorium laws, the study determined that judicial discretion mandated by law increases the likelihood of a conservative vote. Partisan elections result in more ideological voting by judges. In addition, the judicial hierarchy influences judicial decisions in mortgage cases. Judges on the high court are attentive to signals that their doctrine is not followed; and if necessary, would act to reverse divergent lower court decisions. Also, economic conditions such as inflation and average foreclosure costs influence judges. The findings suggest that when decision power over housing questions is delegated to the judiciary, the scope of judicial discretion determined by the legislature is consequential. To a considerable extent, the scope of judicial discretion determined by the legislature determines the degree of ideological alignment between the court decisions and legislative political preferences. More discretion for a court dominated by judges who are largely in agreement with legislators would mean the court serves legislative preferences. If the legislature and the judiciary are not in alignment on political ideology, then the legislature would likely limit judicial discretion so as to restrict the ability of judges to interpret law in a way that undermines the political goals of the legislature. The study controlled for the method of judicial selection, judicial attitudes, the judicial hierarchy, system of separation of powers, and economic conditions at the State and national levels. The four State Supreme Courts used in the study are representative of the four major regions of the country. 3 tables and appended supplementary information