Legislature(1995 - 1996)
03/17/1995 01:45 PM House FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 158
"An Act relating to civil actions; amending Alaska
Rules of Civil Procedure 49, 68, and 95; amending
Alaska Rule of Evidence 702; and providing for an
effective date."
REPRESENTATIVE BRIAN PORTER, testified in support of HB 158.
He stressed that HB 158 is a comprehensive piece of
legislation. He maintained that the intended effects of the
legislation can only be obtained if the package remains
intact. He emphasized that the legislation is designed to
reduce costs associated with defense of medical practices in
order to reduce medical insurance and overall health care
costs. He maintained that high medical costs have resulted
in a lack of health care services to some areas of the
state. He asserted that the legislation will provide more
services to more people.
Representative Porter maintained that the legislation will
reduce overall liability insurance costs for business. He
stated that the legislation will help small businesses stay
in business longer.
Representative Porter added that the legislation is aimed at
reducing the cost of litigation, increasing the likelihood
of fair claim settlements, and allowing more people to be
covered by insurance due to a reduction of insurance costs.
Representative Porter stated that the legislation does not
address workers' compensation claims.
Representative Porter noted that there are three types of
compensation available to injured persons:
* Economic Damages;
* Non-economic damages;
* Punitive damages.
Representative Porter explained that economic damages are
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subjective costs and losses such as wages lost or
anticipated to be lost, hospital costs or property damages.
Economic Damages are not capped or limited. The legislation
would place a $300.0 thousand dollar cap on non-economic
damages. Serious injury cases can be expanded to $500.0
thousand dollars. The current cap is $500.0 thousand
dollars.
Representative Porter noted that non-economic damages
include pain and suffering and loss of consortium. Punitive
damages are awarded in cases where the action or omission
was so outrageous that there is a determination that the
defendant needs to be punished. The rationale is that the
action or omission is so serious that it affects all the
people in the community or state. Punitive damages would be
capped at $300.0 thousand dollars or three times the total
compensatory damage whichever is greater. Compensatory
damages are a combination of economic and non-economic
damages. Under the legislation 50 percent of punitive
damages would go to the state and 50 percent to the
plaintiff.
Representative Porter observed that the state of California
experienced a slower growth in insurance rates after
initiating tort reform. From 1976 to 1992 insurance costs
grew by 83 percent in California. From 1976 to 1992 the
national rate in insurance grew by 333 percent. From 1976
to 1992 insurance costs grew by 1,620 in the state of
Alaska.
DON LEHMANN MD., PRESIDENT, ALASKA STATE MEDICAL ASSOCIATION
testified via the teleconference network from Anchorage. He
testified in strong support of HB 158. He described the
current tort system as a lottery, with awards based on
chance and emotion, rather than on true injury and reason.
He asserted that victims seek recompense beyond reason. He
maintained that the current system is broken. He spoke in
favor of changes contained in section 3, Statute of
Limitations. He noted that several liability is not
extended to hospitals. He spoke in support of section 24,
Civil Liability of Hospitals for Non Employees. He
maintained that the single most important measure contained
in the legislation is the cap on non-economic losses.
BRUCE RIZER testified via teleconference, from Anchorage.
He spoke in opposition to HB 158. He stated that his 11
year old son, Bart, was killed at Alyeska Ski Resort while
skiing. He reviewed provisions in sections 6 - 10. He
questioned if $500.0 thousand dollars would be enough to
take care of a paraplegic for the rest of their life. He
maintained that an injured person who is unable to care for
themselves would become the ward of the state, creating a
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greater burden on the state. He maintained that non-
economic damages should be determined by the judge and jury
after all the facts have been heard. He observed that
punitive damages are seldom awarded. He asked why a person
who exhibits "outrageous" behavior should be protected. He
asserted that facts have been misrepresented in regards to
punitive damages awards. He observed that the legislation
will make it more difficult for a person who has caused
death or injury to an Alaskan to be penalized. He
recommended the deletion of "malice or conscious act" from
section 7. He spoke against the cap on punitive damages.
He asserted that victim's rights are diminished by section
8. He observed that most people do not have enough money to
pay an attorney by the hour. He discussed a case in which a
woman was badly burned by a cup of McDonald's coffee. He
observed that the women received third degree burns across
her buttocks and thighs. The coffee was 170 degrees. He
noted that there has been a 1,000 percent increase of
businesses suing businesses. He stated that personal injury
verdicts in Alaska are 8.1 percent lower than the national
average. He alleged that the legislation will protect
corporate profits and will not promote safety.
PATTY RIZER testified via teleconference, from Anchorage.
She relayed her frustration with the legislative process.
She emphasized that punitive damages provide strong
incentives for businesses to follow the rules. She pointed
to misinformation in testimony by supporters of the
legislation.
RHONDA SCOTT testified via the teleconference network from
Anchorage. She testified in opposition to HB 158. She
stated that the current system is fair. She spoke in
support of maintaining the current system of punitive
damages. She referred to the Ford Pinto case. She noted
that punitive damages awarded in the case equaled one
month's profits for the company. She emphasized that the
Ford Company knowingly built a dangerous car they knew would
result in death and injury. She maintained that a cap would
not have allowed a punitive damage award large enough to
give the company the right message. She stated that the
proposed cap to punitive damages implies that a jury is not
capable of making good decisions. She stressed that the cap
needs to be large enough to give a company the incentive to
change. She spoke against allowing 50 percent of the award
to go to the state.
KEN CASTNER testified via the teleconference network from
Homer. He spoke against the cap on punitive damages. He
suggested that each individual in a class action suit would
be forced to file suit separately in order to recover a
reasonable amount under the $300.0 thousand dollar cap.
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CHRIS MOSS testified via the teleconference network from
Homer. He spoke against the cap on punitive damages. He
maintained that the cap does not allow for "proper
punishment". He asserted that the bottom line is profit.
He stated that large punitive damage awards send a message.
JOSEPH MALATESTA, PRIVATE INVESTIGATOR, KENAI testified via
the teleconference network. He testified in opposition to
HB 158. He asserted that the legislation should assists
wrongdoers. He spoke against the cap on punitive damages.
He suggested that under the cap there would have been 12,000
separate cases filed by fishermen after the Exxon Valdez oil
spill. He maintained that medical practices provisions
should be addressed separately. He asserted that the
legislation limits rights of injured individuals and
benefits business.
ROBERT COWAN, EXXON VALDEZ PLAINTIFFS' COMMITTEE testified
via the teleconference network. He spoke in opposition to
HB 158. He stated that under the legislation the Exxon
Valdez case would have been under state court jurisdiction.
He objected to changes in section 7. He questioned if Exxon
would have been held liable for the Exxon Valdez oil spill
if HB 158 were enacted. He observed that the punitive
damage judgement against Exxon for the spill was upheld and
found to be reasonable by the court. He spoke against the
provision to divide punitive damages between the plaintiff
and the state. He spoke in opposition to sections 14 and
15.
(Tape Change, HFC 95-49, Side 1)
Mr. Cowan asserted that individuals injured on the job would
be adversely affected by the legislation. He maintained
that the legislation is a "unilateral disarmament on behalf
of the people of the state of Alaska." He asserted that
legislation limiting insurance costs was the major reason
that insurance rate increases were limited in the state of
California.
PETE ERHART, ATTORNEY, EXXON VALDEZ PLAINTIFFS, KENAI
testified via the teleconference network. He spoke in
opposition to HB 158. He alleged that the legislation
favors "the big guy over the little guy". He maintained
that the judicial system is the only place where individuals
can seek redress against larger interests. He referred to
section 10. He maintained that the section would allow
companies to limit payments to plaintiffs. He asserted that
the legislation is designed to "protect special money
interests at the expensive of ordinary folks of the state of
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Alaska."
ROSS MULLINS, CHAIRMAN, PRINCE WILLIAM SOUND FISHERMEN'S
PLAINTIFFS COMMITTEE, CORDOVA testified via the
teleconference network. He spoke in opposition to HB 158.
He noted the adverse effect of the Exxon Valdez oil spill
has had on the fisheries and fishermen. He asserted that
many fishermen are bordering on bankruptcy. He expressed
concern that changes in section 7 would deprive future oil
spill victims the right of seeking redress from large
corporations in court. He recommended that the punitive
damages section be amended.
DORNE, HAWXHURST, CDFU, CORDOVA testified via the
teleconference network. She spoke in opposition to HB 158.
She questioned if a corporation or individual who committed
a "reckless" act would be liable for punitive damages under
HB 158.
DANIELLA LOPER, STAFF, REPRESENTATIVE PORTER clarified that
a corporation or individual found to be "reckless" would not
be liable for punitive damages under section 7.
Ms. Hawxhurst expressed objection to the changes in section
7 regarding punitive damages. She stated that under the cap
Exxon would only have been liable for $857.0 million dollars
in punitive damages. She observed that the figure is equal
to two and a half months of profit. She asserted that the
cap would send the companies the message that it is cheaper
to be reckless than to act responsibly, and that it is okay
and legally acceptable to be reckless. She suggested that
civil justice should be developed by the courts on a case by
case basis.
MICHAEL O'LEARY, PRINCE WILLIAM SOUND PLAINTIFF'S COMMITTEE,
testified via the teleconference network from Cordova. He
spoke in opposition to HB 158. He maintained that the
legislation would take corporations off the hook for being
reckless. He questioned why powers of the jury are being
limited. He maintained that the cap on punitive damages
would not prevent corporations from making life threatening
decisions based on profit alone. He asserted that the
legislation will hurt individual citizens of the state. He
suggested that medical malpractice legislation be considered
separately.
JAMES MYKLAND, CORDOVA testified via the teleconference
network. He spoke in opposition to section 7, Punitive
Damages. He questioned if Exxon would have been held liable
for the Exxon Valdez oil spill if HB 158 had been enacted
prior to the spill. He pointed to damage to the herring
fisheries in Prince William Sound. He asserted that the
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herring fisheries may take 20 years before it is recovered
to pre-spill conditions. He urged the Committee to delete
section 7.
ROBERT STEPHENSON, FAIRBANKS testified via the
teleconference network. He spoke in opposition to HB 158.
Mr. Stephenson was seriously injured by a propane fire. He
recounted his experience. The accident was a result of
improper practices and unlawful activities by businesses.
He urged the Committee to consider the injured people who
want a chance to be compensated.
PHIL HENDINBURGER, GENERAL COUNSEL, NORCAL INSURANCE COMPANY
testified via the teleconference network. He testified in
support of HB 158. He noted that NORCAL has insured half of
the country's physicians for the past several years. He
felt tort reform would generate a real savings for health
care costs. He referred to tort reform in the state of
California. He asserted that tort reform in the state of
California has had a dramatic impact on the cost of
malpractice premiums for physicians and hospitals. He
discussed the effects of the Medical Injury Compensation
Reform Act (MICRA). He maintained that MICRA has resulted
in reduced insurance premium costs in California. He stated
that insurance has become more affordable, as compared to
other states who have not enacted similar reform. Over the
17 years that the California tort reform package has been in
effect, insurance costs grew by 83 percent, while the U.S.
costs, excluding California, have increased by 413 percent.
Alaska experience shows that premiums have increased by 1620
percent over the same 17 year period. He asserted that
California has saved several billion dollars by instituting
the Medical Injury Compensation Reform Act. He stated that
in California, an Obstetrician/Gynecologist (OB/GYN), will
pay $30,000 a year for medical malpractice insurance. A
comparable OB/GYN in Alaska will pay $65,000 per year for
the same insurance. He suggested that the enactment of
similar reforms in Alaska will result in a significant
decrease in the rate of medical malpractice premiums and
health care costs.
In response to a question by Representative Brown, Mr.
Hendinburger estimated there would be a thirty percent
reduction in health care costs once the tort reform
provisions are applied. He stated that Proposition 103
passed by the California did not impact medical malpractice
premiums.
In response to a question by Representative Navarre, Mr.
Hendinburger noted that medical malpractice costs per
delivery would be $600.0 hundred dollars in California and
$1,200 in Alaska. Representative Navarre noted that a
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portion of the cost is attributable to the type of
facilities available in Alaska. He noted that hospital
facilities in Alaska are under utilized.
Representative Grussendorf suggested that the medical
malpractice provisions should be addressed in separate
legislation. He noted that the California legislative body
used a two prong approach.
BERNE MILLER, JUNEAU CHAMBER OF COMMERCE spoke in support of
HB 158. He asserted that civil liability is one of the
business community's most expensive hidden costs. He
observed that liability costs are passed on to customers.
He spoke in support of dedicating 100 percent of punitive
damages to the state.
BOB WARD, ALASKA MINERS ASSOCIATION read a letter to the
committee by Steve, Borell, Executive Director of the Alaska
Miners Association in support of HB 158 (Attachment 1).
DAVID CROSBY, ALASKA STATE HOSPITAL AND NURSING HOME
ASSOCIATION testified in support of HB 158.
(Tape Change, HFC 95-49, Side 2)
Mr. Crosby discussed section 24, Civil Liability of
Hospitals for Non Employees. He referred to the Jackson
versus Power(1998) Alaska Supreme Court decision. He noted
that the court ruled that a general acute care hospital has
a nondelegable duty to provide emergency room services, and
that the hospital is vicariously liable for the negligence
of an emergency room physician.
He asserted that the Jackson decision runs counter to the
modern trend of apportioning liability according to fault.
He maintained that the Jackson case ensures that municipally
owned and non-profit hospitals are named as "deep pocket"
defendants in cases involving physicians' negligence. He
stated that since 1987, five jurisdictions have discussed
the Jackson ruling without its adoption.
In response to a question by Representative Brown, Mr.
Crosby clarified that nurses would not be covered by the
legislation. He emphasized that hospitals cannot control
how a doctor practices. He stressed that the hospital must
determine if the doctors on staff are generally competent.
Doctors are considered independent contractors. Nurses are
employees of the hospital. Hospital staff is expected to
directly supervise their nurses. He explained that if the
hospital has been negligent in permitting an incompetent
doctor to practice then the hospital would be liable.
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BOB NESTEL, INSURANCE AGENT, ANCHORAGE testified via the
teleconference network. He asserted that there has been a
lack of insurance expertise among the drafters of the
legislation. He noted that NORCAL paid dividends to their
customer doctors.
JIM FORBES, ASSISTANT ATTORNEY GENERAL, DEPARTMENT OF LAW
testified via the teleconference network from Anchorage. He
stated that the Administration has concern about the
provisions of CSHB 158 (JUD). He stated that studies show
that the claims made in section 1 have not come to pass upon
the adoption of tort reforms. He cautioned the Committee
from comparing the California experience to one that may
occur in Alaska in regards to health care provisions. He
pointed out that California has an elected Insurance
Commission. He noted that California has a higher degree of
managed care facilities. He stated that the Administration
is concerned that the Legislature might pass a bill that
makes radical changes to the legal system without adequate
information to support the findings. He stated that the
legislation takes away substantial safe guards that benefit
ordinary Alaskans, and builds protective walls around large
outside based insurance companies and manufactures that do
not return any direct benefits to the state of Alaska. He
questioned if the bill would promote quicker settlements of
claims in the legal system. He estimated that section 19,
Prejudgment Interest, would slow claims. He noted that the
Administration is concerned that the cap on non-economic
damages in section 6 discriminates against large families.
He expressed concern that the legislation discriminates in
favor of people with higher incomes. He observed that there
will be discrimination and denial of access to the legal
system under the legislation.
Mr. Forbes suggested that sections 14 and 15 would make it
difficult for plaintiffs to prove a case. He stressed that
if a person's ability to prove a case is inhibited then
their ability to recoup economic damages is drastically
affected.
Mr. Forbes stated that the cap on punitive damages would
make Alaska a more dangerous place to live. He observed
that government regulators cannot ensure product safety. He
stressed that the punitive damage system is a privatized
manner of enforcing safety. He maintained that the punitive
damage system works. He stated that without fear of
punitive damages some companies will engage in cost benefit
analysis. The cost of paying off injured people will be
calculated into their profits, rather than improving product
safety. He pointed to the Ford Pinto case.
In response to a question by Representative Martin, Mr.
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Forbes clarified that the Governor has not offered specific
amendments.
In response to a question by Representative Brown, Mr.
Forbes stated that the legislation may have constitutional
problems. He noted that studies do not support the
assertions made in section 1. He added that the Statute of
Repose section could be found unconstitutional. Co-Chair
Hanley questioned Mr. Forbes' reasoning that the legislation
would not be constitutional. Representative Martin
recommended that a severability clause be considered.
MIKE LESSMIER, ATTORNEY, STATE FARM INSURANCE COMPANY
testified in support of HB 158. He noted that the State
Farm Insurance Company has approximately 32 percent of the
automobile liability insurance market in the state, and
approximately 43 percent of the homeowners market. He
suggested that windfalls exist in the system which need to
eliminated. He suggested that section 9, Damage
Calculation, is a windfall. He stated that section 18,
Prejudgment Interest, is a potential windfall. The
legislation would float the interest rate on judgement.
Section 19 would provide for no prejudgment interest on
future damages.
Mr. Lessmier asserted that there are hidden costs associated
with the punitive damage provision. He emphasized the
number of cases that are actually defended from punitive
damages claims. He stressed that the defense of these cases
is at a tremendous cost to the system. He maintained that a
reasonable Statute of Repose would make risk and potential
liability more predictable.
Mr. Lessmier referred to the 1988 Tort Reform Ballot
Initiative. He noted that the intent of the initiative was
to make each party liable for damages only equal to their
share of fault and to repeal the law concerning
reimbursement from other parties. He observed that the
Alaska Supreme Court concluded in Benner versus Wichman that
fault can only be apportioned among parties to the action.
Judgement could be entered against a third-party defendant.
He maintained that a defendant could be required to pay more
than their percentage of fault.
Mr. Lessmier observed that the cost of health care has risen
beyond the rate of inflation. Representative Navarre noted
that the increasing rise in health care costs can be
attributed to many factors.
RICHARD CATTANACH, VICE PRESIDENT, UNION COMPANY, ANCHORAGE
testified via the teleconference network. He spoke in
support of the Statute of Repose provision. He asserted
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that the current Statute of Repose is unreasonably long. He
noted that a lack of maintenance can be attributed to the
cause of construction related injury or damages. He
observed the difficulty associated with defense of old
cases. He referred to the punitive damages provision. He
asserted that punitive damages are used to extort money from
a defendant because punitive damages are not covered by
insurance. He stressed that the settlement of a dubious
claim may be advisable given the high cost of defense even
if the defendant is victorious. He read a letter by George
McGovern regarding tort reform which was published in the
Wallstreet Journal. He noted that Mr. McGovern argued on
behalf of tort reform.
CHARLES COE, ATTORNEY, ANCHORAGE testified via the
teleconference network. He pointed to misinformation
regarding medical malpractice cases. He suggested that a
paralegal review three years of cases for the state of
Alaska to see the actual results.
(Tape Change, HFC 95-49, Side 1)
Mr. Coe maintained that individuals are being forced to file
suits before the outcome of their injury is determined due
to the requirement that cases must be filed within two years
of the occurrence. He urged the Committee to hold the
legislation for further study. He questioned the
constitutionality of having the state as a recipient of
punitive damage awards.
RICHARD RITTER, MEMBER, ALASKA PROFESSIONAL DESIGN COUNCIL
LEGISLATIVE LIAISON COMMITTEE. He testified in favor of the
Statute of Repose provision included in section 2. He noted
that a six year Statute of Repose for architects and
engineers was enacted in 1967. The Statute of Repose
provision was declared unconstitutional in 1988. The Court
expressed concern that the statute shifted liability and
violated the equal protection clause. He noted that a
fifteen year Statute of Repose was adopted in 1994. He
observed that there are only two states with a fifteen year
Statute of Repose. He stressed that a recent study by
Victor O. Schinnerer and Company found that 95 percent of
all claims are filed nine years after project completion.
The study found that one hundred percent of claims are filed
within eleven years. He asserted that a fifteen year
Statute of Repose is excessive.
In response to a question by Representative Brown, Mr.
Ritter explained that buildings are designed to last 25
years. He stressed that the Statute of Repose does not
protect against gross negligence. He emphasized the
difficulty plaintiffs have in proving cases where records
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are old. He pointed out that designers have no control over
maintenance. He noted the expense of proving innocence. He
spoke in favor of reaching a balance that protects the
rights of plaintiffs and guards against unmerited suits.
JOHN HOLTZ, SUPERINTENDENT, SITKA SCHOOL DISTRICT recounted
his experience with the tort system. His son was injured
while commercial fishing due to the negligence of a fish
unloading company. He noted that the insurance company
tried to settle at a minimum amount. He asserted that
insurance companies play "hardball" in the hopes that most
victims will settle with a pittance. He maintained that the
legislation would hand a club to insurance companies to beat
up on victims. He asserted that the legislation will
inflict serious damage on victims. He pointed out that the
legislation is omnibus. He emphasized that the bill
addresses fifteen different items that ought to be addressed
in separate legislation. He maintained that the legislation
will force victims to walk away from obtaining their day in
court. He observed that prejudgment interest on damages
encourages insurance companies to settle quickly and
reasonably.
PHIL THINGSTAD, LOCAL 1281, ANCHORAGE testified via the
teleconference network. He spoke in support of tort reform.
CHRISTY TENGS-FOWLER testified via the teleconference
network from Haines. She testified in support of HB 158.
She is a small business owner with a bar and restaurant
which has been in her family for 43 years. She referred to
an incident where someone used fake identification to buy
alcohol from their liquor store. A few hours later, he
totalled his pick-up and died in a crash. She observed that
he had been carded by eight different employees and had been
drinking alcohol in the presence of his parent in her
establishment and in other establishments. The family of
the deceased sued them. After two years they settled the
case because they could not afford to continue litigation.
She emphasized that everything they had saved for her
father's retirement was spent on attorney fees and
settlement costs. She stated that she lives in fear of
being sued.
AL TAMAGNI ANCHORAGE testified via the teleconference
network. He suggested that section 10 be amended to read:
"In an action to recover damages, the court, at the request
of any party elected to receive or pay future damages, enter
judgment ordering an amount awarded a judgement creditor for
future damages, that $100.0 thousand dollars be paid to the
maximum extent feasible by periodic payments rather than a
lump-sum payment." He stressed that the amendment would
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define who the parties are.
Mr. Tamagni recommended that AS 09.17.040(a) also be
amended. He stated that periodic payments can be set up
without the use of an annuity contract through treasury bond
trusts. He stressed that the exclusion for self insured
municipal entities should be retained.
Mr. Tamagni also recommended that section 12, AS
09.17.040(f) be amended. He stated that the Internal
Revenue Service has allowed periodic payments to be adjusted
upward to as much as 10 percent based on the national
Consumer Price Index. He recommended that "for Anchorage"
be deleted on page 9, line 22 and the national Consumer
Price Index be used.
Mr. Tamagni observed that the state of Alaska is exempted
from punitive damages. He observed that some insurance
carries require that in order to collect prejudgment
interest plaintiffs must hire an attorney. He suggested
that prejudgment interest should be a mandatory payment by
any insurance carrier in regards to economic losses.
TOM DOOLEY, ATTORNEY spoke via teleconference from
Anchorage. He testified against changing the current law in
regards to punitive damages. He stated that since 1961 only
17 out of 51 punitive damage awards were upheld by the
Alaska Supreme Court on appeal. He reviewed amounts awarded
in punitive damages over the past 14 years, in the state of
Alaska. He asked why individuals who have malice or
conscious disregard for another person are being protected.
He observed that plaintiffs must be advised that under Rule
82, the loser pays attorney fees for the other side. He
noted that it is uneconomic to take a case that is fifteen
years old. He stated that the legislation will make it
uneconomic to bring forth a punitive damage lawsuit. He
stressed that doctors can withhold documents from plaintiffs
until a suit is initiated. He observed that some suits are
initiated in order to allow documents to be obtained under
penalty of perjury. He suggested that legislation requiring
that documents be available upon patient request with an
affidavit of authenticity would reduce suits.
Mr. Dooley noted that the Association of Retired Persons did
not support HB 292, which contained many of the same
provisions in the last legislative session.
(Tape Change, HFC 95-49, Side 2)
Mr. Dooley noted that out of 3,500 hundred cases, 192 cases
alleged punitive damages in the complaint. Juries did not
award punitive damages in the majority of the cases. He
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emphasized that the state of Alaska has not experienced a
problem with high punitive damage awards. He observed that
only two states provide that attorney fees are paid by the
losing party.
PAM NEAL, PRESIDENT, ALASKA STATE CHAMBER OF COMMERCE spoke
in support of HB 158. She observed that the tort litigation
system has been criticized by the public and policy experts.
She maintained that protection from frivolous lawsuits
should be the right of every citizen and business. She
asserted that litigation is an expensive mechanism for
compensating injured parties. She stated that the Alaska
State Chamber of Commerce believes that business within the
state is being jeopardized by present tort law, particularly
in the area of punitive damages. She stressed that punitive
damages should have a preset standard and should only be
assessed when malicious intent or willful neglect is proven.
She compared criminal and administrative law to the tort
litigating system.
Representative Navarre questioned if punitive damage awards
should go to the state. He stressed that there would be no
incentive for attorneys to submit claims for punitive
damages, if 100 hundred percent of the award went to the
state. He suggested that every jury or judge be charged
with the responsibility of determining, in civil liability
cases, if punitive damages are warranted. Ms. Neal
emphasized the expense in time and money to defendants of
punitive damage complaints. Representative Navarre noted
that some cases of wrongdoing are not brought to court due
to the high cost to the plaintiff.
Representative Brown noted that there has been significant
tort reform in the state of Alaska over the last ten years.
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