National audit suggests scrapping township small claims courts

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A national audit recommends Marion County scrap its nine township small claims courts for one centralized court. It's the latest as lawmakers convene a study committee to decide how to fix the system.

13 Investigates uncovered high fees and bulk filings in random courts more than a year ago. Now there are new calls for change.

Marion County's smallest township, Decatur Township, no longer boasts of big-time filings in small claims court.

It's just one of the findings from a national audit showing the township system inadequate in providing an independent court that avoids potential favoritism from collection attorneys and other high-volume filers.

In fact, the National Center for State Courts recommends lawmakers move all small claims into the Marion County Superior Court System, where it would become more uniform and a court of record.

"It's going to be hard to sell this to the legislature," Rosenberg told 13 Investigates. He believes lawmakers won't like doing away with elected small claims judges.

Judge Louis Rosenberg isn't surprised by new calls for reform. He asked the NCSC to town following troubling revelations by an Indiana Supreme Court task force and 13 Investigates.

We found medical debt attorneys like Derek Johnson bulk filing in Decatur Township, where there are no hospitals, and bypassing closer courts.

"I think that Decatur Township was a popular court for people who didn't have a tie with Decatur Township. They just chose it," said Rosenberg, declining to elaborate on the possible motivation.

According to the audit:

Decatur Township had the second highest number of filings in all Marion County in 2010. By the end of last year, it had the lowest. In fact, the audit found a new State Supreme Court rule hitting the Decatur Township court hard.

It requires debt collectors to file lawsuits in the townships where patients live or were treated.

Between January and April of 2013, Decatur had 1,400 filings, for the same period of time this year it recorded just over 400 filings. That represents a 70-percent decrease.

In 2010, the township brought in more than half a million dollars in revenue and among the top three.

Based on the most recent numbers, Decatur Township is now dead last in revenue at $345,000.

"That's good policy that you want people to be able to go to the court that's the most convenient for them," said Rosenberg.

The report also examined the cost of doing court business. In Washington Township, it costs more than a $101 to handle a case. The most efficient was Pike Township at just $32 per case.

The audit now recommends a centralized administrator handle the budgets for small claims instead of nine different township trustees. The Lawrence Township Deputy Trustee said that office is already working to make the court it's own entity.

"Have that hands off approach to have the Judge run the court how he wants to run it," said Jason Tomcsi.

"I feel very strongly that we need reform," said Rosenberg. The worst option is do nothing," he said.

Judges in all but Perry and Warren Townships have come up with a plan of their own. They want to keep the Township System, with full-time elected judges overseen by an executive committee.

A legislative study committee will look at both proposals in coming weeks.

NOTE: The operational costs to each township for doing court business is the average cost it actually takes for the court staff to handle a single case. It is a measure of court performance. It is NOT the amount consumers pay. There is a set filing fee for each case. For example, in Pike Township the filing fee for consumers is $86.

Read the audit here.