04/08/1997 06:09 PM Senate FIN

       HB 58  CIVIL ACTIONS/ATTY FEES/INSURANCE                                
                                                                               
       Testimony was heard from JEFF BUSH.  HB 58 was HELD for                 
       further consideration.                                                  
                                                                               
                                                                               
       HB 75  APPROPRIATIONS: OPERATING BUDGET                                 
       HB 76  APPROPRIATION: MENTAL HEALTH PROGRAM                             
                                                                               
       SENATOR PARNELL,  Chair of  the Information  Technology                 
       Subcommittee, testified on behalf of the subcommittee's                 
       recommendations.   Also testifying were  SHARON BARTON,                 
       KAREN  MORGAN,  WENDY   REDMAN,  and  MARYLOU   BURTON.                 
       SENATOR    PARNELL    MOVED    to    incorporate    the                 
       recommendations  into HB 75.   SENATOR  ADAMS objected.                 
       The MOTION CARRIED on a vote of 6 to 1.                                 
  CS FOR SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 58(FIN) am                      
  "An Act relating  to civil actions; relating  to independent                 
  counsel  provided  under an  insurance  policy;  relating to                 
  attorney fees; amending  Rules 16.1, 41,  49, 58, 68,  72.1,                 
  82,  and 95, Alaska Rules of  Civil Procedure; amending Rule                 
  702, Alaska Rules of Evidence; and amending Rule 511, Alaska                 
  Rules of Appellate Procedure."                                               
                                                                               
  SENATOR  PHILLIPS  brought  up  a  letter  from  Bruce  Cain                 
  requesting a  teleconference on the bill.  He reiterated the                 
  request.  COCHAIR SHARP  indicated that an attempt had  been                 
  made  to teleconference but  the operators  were unavailable                 
  for the evening meeting.                                                     
                                                                               
  JEFFREY  BUSH, Deputy  Commissioner, Department  of Commerce                 
                                                                               
                                                                               
  and  Economic  Development,  represented the  administration                 
  concerning HB 58, the  tort reform bill.  He  was optimistic                 
  that  the  negotiations  going  on  between  the  interested                 
  parties regarding the  issues would result in  a compromise.                 
  He  pointed   out  that  the  governor   introduced  similar                 
  legislation developed  by the  task force  on civil  justice                 
  reform and to  the extent  that HB 58  was consistent,  they                 
  supported it.   He  expressed some  disappointment that  the                 
  task  force  proposals  received  little  attention  by  the                 
  legislature.   The task force  approach was that the problem                 
  was primarily one  of the cost of the system  to the parties                 
  involved.   As much  as sixty  percent of  damages paid  are                 
  eaten up by the system in court costs, attorney fees, expert                 
  witnesses, et cetera.   There were  two ways to save  money,                 
  either to cut costs in  the litigation process or cut  off a                 
  person's  right  to recover.    The task  force  decided the                 
  second option was inappropriate and unfair.  They  wanted to                 
  make sure people's rights were retained and to save money in                 
  the process by settling  cases more quickly and to  insure a                 
  higher percentage of the money  went to the deserving victim                 
  rather than the attorneys and witnesses.   He believed HB 58                 
  was faulty in that regard.  It contained provisions that had                 
  been unanimously  rejected by  the task  force because  they                 
  were not deemed to be fair to the litigants.                                 
                                                                               
                                                                               
  End SFC-97 #87, Side 1, Begin Side 2                                         
                                                                               
  In  response to  a  question from  SENATOR  ADAMS, MR.  BUSH                 
  discussed   the   task   force   requirements   to   get   a                 
  recommendation or proposal  to move forward.   SENATOR ADAMS                 
  inquired which were the  high points of the task  force that                 
  were missing  in HB 58.   MR.  BUSH responded that  the most                 
  significant   missing  pieces  dealt  with  the  process  of                 
  litigation.   There had been  a proposed  pilot program  for                 
  alternative dispute resolution in an effort to achieve quick                 
  resolution   before   they   went   to   trial.      Another                 
  recommendation was  that the District Court  jurisdiction be                 
  raised  from  $50  thousand  to $100  thousand  and  have an                 
  expedited process that required the litigants to go to trial                 
  within one year.  According to the sponsor, the reasons they                 
  were not included in HB 58 was because the court system said                 
  they would cost too much money.  He disagreed with the court                 
  system analysis.   In response  to a  question from  SENATOR                 
  PHILLIPS, MR. BUSH stated that of the 21 members of the task                 
  force, 9 held law degrees.                                                   
                                                                               
  COCHAIR SHARP announced that HB 58 would be HELD for further                 
  consideration.  He called for a  brief recess and turned the                 
  gavel over to COCHAIR PEARCE.