2005-01-31                     Senate Journal                      Page 0193
Dear President Stevens:                                                                             
                                                                                                    
Under the authority of art. III, sec. 18, of the Alaska Constitution, I am                          
transmitting a bill to, as a matter of sovereign immunity, limit the                                
award of attorney's fees against the state and municipalities.                                      
                                                                                                    
Since territorial days, Alaska has had a statutory policy of requiring                              
the losing party in most litigation to pay a portion of the prevailing                              
party's attorney fees.  In recent years, this policy has been embodied                              
primarily in Alaska Rule of Civil Procedure 82, which the Alaska                                    
Supreme Court adopted in response to a legislative delegation, made                                 
immediately following statehood, in AS 09.60.010.  In most cases, the                               
prevailing party receives a partial fee award, equal to no more than 20                             
percent of a money judgment or 20 percent of actual fees in a non-                                  
monetary case.                                                                                      
                                                                                                    
In cases brought against state or local governments, departures from                                
the general rule of partial fee reimbursement have occurred with some                               
regularity, with the governmental party required to reimburse all of the                            
prevailing party's fees.  Ordinarily, the basis for these enhanced fee                              
awards has been the judicially created public interest litigant policy,                             
wherein selected litigants bringing suits to advance ends deemed by                                 
the court to reflect strong public policies are granted full fees as a                              
subsidy from the state treasury.  The cost of this subsidy has been                                 
significant to the state in all recent fiscal years and, on a more irregular                        
basis, has been significant to the municipalities targeted by such                                  
lawsuits.                                                                                           
                                                                                                    
There are instances where a Legislative policy sufficiently supports                                
full attorney fee awards and the legislature has chosen to provide for                              
them by statute.  Full reimbursement is also important for eminent                                  
domain proceedings.  Beyond these contexts, the Legislature has not                                 
identified a policy that would support a direct public subsidy to private                           
litigants that goes beyond the traditional norm of partial fee awards.                              
To ensure that public money is not disbursed as a subsidy to these                                  
litigants without an appropriate legislative authorization, this bill                               
would provide, as a matter of sovereign immunity, that the state or a                               
municipality would not be liable for an attorney fee award in excess of                             
certain percentages of a money judgment or, if a money judgment is                                  
not recovered, certain percentages of the reasonable actual attorney                                
fees the prevailing party incurred in litigating the issues upon which