I’m not saying I necessarily agree with it, but I believe the intention is basically as a deterrent. If you cause $5000 worth of “damages” to someone and they have to sue and win, and the most that can happen is $5000 of repayment, you’ve basically created an incentive to try to get away with stuff - the worst case scenario would be paying what you owed anyway. If you might have to pay $175k for making 5k, it might make you think twice about taking that chance.
Now the real conversation is actually about whether those kinds of negative incentives are actually related to the decision to commit a crime. I don’t have any solid evidence but my gut tells me no - people who are going to commit a crime usually assume they are going to get away with it, don’t factor potential outcomes into their risk assessment, or don’t have any risk assessment at all.
The loser of a lawsuit always has to cover the cost of the lawsuit, including the other party’s lawyer fees (except in cases where the state attorney sues and a bunch of other exceptions like when an employee starts a labor dispute). They are very much capped based on the disputed sum though. The higher the dispute, the higher the attorney fees you have to pay when losing.
For example, if the disputed sum is 5000€ the base lawyer fees are ~390€. It can then be multiplied by some factor - I think 2.5 is the maximum but I’m unsure - depending on the length and difficulty of the case.
They aren’t a punishment but rather a consequence of losing a lawsuit.
They are also usually covered by your legal protection insurance which is generally recommended to have.
I’m not saying I necessarily agree with it, but I believe the intention is basically as a deterrent. If you cause $5000 worth of “damages” to someone and they have to sue and win, and the most that can happen is $5000 of repayment, you’ve basically created an incentive to try to get away with stuff - the worst case scenario would be paying what you owed anyway. If you might have to pay $175k for making 5k, it might make you think twice about taking that chance.
Now the real conversation is actually about whether those kinds of negative incentives are actually related to the decision to commit a crime. I don’t have any solid evidence but my gut tells me no - people who are going to commit a crime usually assume they are going to get away with it, don’t factor potential outcomes into their risk assessment, or don’t have any risk assessment at all.
The loser of a lawsuit always has to cover the cost of the lawsuit, including the other party’s lawyer fees (except in cases where the state attorney sues and a bunch of other exceptions like when an employee starts a labor dispute). They are very much capped based on the disputed sum though. The higher the dispute, the higher the attorney fees you have to pay when losing.
For example, if the disputed sum is 5000€ the base lawyer fees are ~390€. It can then be multiplied by some factor - I think 2.5 is the maximum but I’m unsure - depending on the length and difficulty of the case.
They aren’t a punishment but rather a consequence of losing a lawsuit.
They are also usually covered by your legal protection insurance which is generally recommended to have.