Legislature(2001 - 2002)
02/22/2002 01:10 PM House JUD
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* first hearing in first committee of referral
+ teleconferenced
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+ teleconferenced
= bill was previously heard/scheduled
HB 384 - DISCLOSE RESOLUTION OF CIVIL LITIGATION [Contains brief mention that HB 384 would satisfy the intent of SB 211.] Number 0734 CHAIR ROKEBERG announced that the next order of business would be HOUSE BILL NO. 384, "An Act relating to submission of civil litigation information; and amending Rules 41(a) and 58, Alaska Rules of Civil Procedure, Rule 511(c) and (e), Alaska Rules of Appellate Procedure, and Rule 503(d), Alaska Rules of Evidence." Number 0736 HEATHER M. NOBREGA, Staff to Representative Norman Rokeberg, House Judiciary Standing Committee, Alaska State Legislature, on behalf of the House Judiciary Standing Committee, sponsor, explained that HB 384 responds to issues that have arisen as a result of the legislature's interest in tort reform. At the time, the legislature decided that it did not have enough information about what was really happening with civil cases, jury decisions, amounts of damages, and other issues. The legislature decided to require attorneys, once a case is closed, to report [certain] information about those cases in order to determine whether a tort-reform problem really exists. To this end, the Alaska Judicial Council (AJC) created a civil-case data-reporting form titled "Information About the Resolution of Civil Cases" from which the AJC could compile information for its report to the legislature. MS. NOBREGA noted that unfortunately, the response to this form has been rather dismal. According to an estimate by the AJC, less than half the attorneys are actually filling these forms out. Therefore, in an effort to increase reporting, HB 384 provides for the form to be changed so that it is clearer and easier to fill out, alters some of the court rules to clarify when the forms are supposed to be filled out, and lets the court system know how and when attorneys are to close cases and report on them. She pointed out that HB 384 does not create any new law; it merely alters existing laws in an effort to encourage attorneys to report their information in a timely manner. Ms. Nobrega informed the committee that the May 2001 report from the AJC is included in members' packets, as is a copy of the new reporting form proposed by the AJC. REPRESENTATIVE BERKOWITZ asked if the question of attorney- client privileges being invoked in some instances has been resolved. MS. NOBREGA confirmed that some attorneys have claimed that the information requested on the form is privileged, but noted that there is a section in HB 384 which clarifies that the information on the forms is kept confidential by the AJC and so is not considered privileged for the purposes of reporting. REPRESENTATIVE OGAN asked whether all the members of the AJC are attorneys. REPRESENTATIVE BERKOWITZ noted that on the inside page of the AJC's report, there is a listing of both attorney members and non-attorney members. REPRESENTATIVE OGAN, after surmising that the attorney members are bound by "attorney-confidentiality restrictions," asked whether the non-attorney members are precluded from looking at the forms. REPRESENTATIVE BERKOWITZ asked whether information about insurance settlements would also be included in the reporting. Number 1085 LARRY COHN, Executive Director, Alaska Judicial Council (AJC), Alaska Court System (ACS), testified via teleconference. After noting that Teresa Carns, Senior Staff Associate, is present with him, he said that there is a proposal to address the attorney-client privilege issue. The AJC did receive a number of responses from attorneys, pursuant to the reporting requirement, in which the attorneys claimed that the information - usually pertaining to their fees - is protected by attorney- client privilege. In those cases, the AJC usually responded via letter, pointing out that this privilege did not apply to the situation, that the attorneys were under a legal obligation to provide the information to the AJC, and that the AJC is under strict confidentiality standards to protect the information. He added that in almost all instances, the attorneys who responded to that letter did provide the required information; however, there are still a few attorneys who have insisted that the attorney-client privilege applies. He explained that HB 384 adds a provision in the evidentiary rules that makes it expressly clear that the attorney-client privilege doesn't apply to the provision of providing this information to the AJC. MR. COHN, in response to the question regarding the makeup of the AJC's membership, relayed that the AJC is [composed] of six people, three who are attorneys and three who are not. He added that the chief justice of the Alaska Supreme Court serves as the ex officio chairperson, that there are two attorneys on the AJC's staff, and that the remainder are not attorneys. He also explained that applicability of the attorney-client privilege would not turn on whether a member of the AJC is attorney. He went on to say that when the legislature passed the tort reform legislation in 1997, it included this requirement that attorneys and pro se litigants provide information to the AJC concerning the resolution of civil cases. The purpose of the requirement was to make available information necessary for an informed public discussion of tort reform. Since that requirement was enacted, the AJC has issued two reports; the most recent report was issued in May 2001 and contains information on nearly 3,000 civil case that were closed between June 1999 and December 2000. Number 1301 MR. COHN explained that in that report, the AJC discussed the problem it had getting attorneys to comply with the reporting requirement. He said that in an effort to monitor attorney compliance, the AJC's staff randomly researched about 875 civil case files from around the state. In 31 percent of those files, he noted, neither attorney submitted any civil-case data, and there were many other cases in which only one attorney submitted a form. As a result, the AJC sent letters and occasionally made phone calls to all the attorneys identified in that review, as well as to noncompliant attorneys who were identified through the AJC's routine collection of data-compliant attorneys, informing them that they had not sent in the required data. He noted that this additional step produced moderately successful results. MR. COHN pointed out that the most recent report from the AJC provides particular information pertaining to attorney compliance. In the period of time covered by the report, plaintiffs or their attorneys were more likely to file reports with the AJC than defendants or their attorneys; overall, 55 percent of the forms that the AJC received were filed by plaintiffs. Of the cases that the AJC analyzed, about 71 percent had information from plaintiffs while only 54 percent had information from defendants. He noted, however, that in tort cases, significantly more defendant's attorneys than plaintiff's attorneys filed forms with the AJC. MR. COHN relayed that currently the AJC is sending one or more letters to attorneys identified by the routine collection of data as being noncompliant. He added that the AJC is advising attorneys, in appropriate instances, that their willful failure to abide by the reporting requirement will be reported to the [Alaska Bar Association]. He also noted that the AJC's current statistics suggest a moderately higher compliance rate since the May 2001 report. He pointed out that this last report recommended that the automatic reporting requirement be eliminated and substituted with legislation that would enable the AJC to obtain information responding to specific needs identified by the legislature. Number 1399 MR. COHN said that the AJC is in favor of HB 384 because it is intended to enhance attorneys' compliance - it does so by clarifying the duty of attorneys to report civil-case information - and it also enables the AJC to more accurately track the reporting of cases. He also pointed out that HB 384 eliminates three additional types of cases from the reporting requirement: [delinquent tax cases, tax foreclosure cases, and quiet title cases]. REPRESENTATIVE BERKOWITZ said that to his recollection, in requiring the collection of settlement information, there is also an insurance component. He asked if the AJC has any responsibility to acquire or to use the data collected by the Division of Insurance regarding insurance costs. MR. COHN said yes. He noted that there is a provision in AS 21.06.087 that requires the director of the Division of Insurance to report annually to the House Judiciary Standing Committee, the Senate Judiciary Standing Committee, and the Governor, information pertaining to the availability and cost of insurance in Alaska. He noted that one of the express intentions of that legislation was to ensure that liability insurance would be affordable and available to all Alaskans. He explained that in November, he wrote a letter to the director of the Division of Insurance requesting a copy of the reports filed with the legislature and the governor, because that information would assist the AJC in its reporting. He noted, however, that the Division of Insurance has not responded to this request. He pointed out that the statute authorizes the Division of Insurance to consult with the AJC with respect to implementing those responsibilities, but added that he is unaware of any such efforts by the Division of Insurance. CHAIR ROKEBERG assured Mr. Cohn that he would research that issue as soon as possible. REPRESENTATIVE BERKOWITZ noted that he has "something" from Mr. Lorh dated 1999, and he surmised that the Division of Insurance complies at a much lower rate even than the attorneys to which Mr. Cohn referred. He remarked that perhaps something could be done to remediate the Division of Insurance's delinquency. CHAIR ROKEBERG said he would look into this issue. MR. COHN, in response to a question, reiterated that the proposed additional exemptions are: delinquent tax cases, tax foreclosure cases, and quiet title cases. He noted that should HB 384 pass, it would satisfy the intent of legislation proposed by Senator Leman - SB 211 - which refers to excluding municipal tax cases. REPRESENTATIVE BERKOWITZ, in response to questions directed at Mr. Cohn, pointed out that the form in members' packets is a sample of what the AJC would like to start using. Number 1732 CHAIR ROKEBERG closed the public hearing on HB 384. REPRESENTATIVE OGAN asked whether there is still a need for this information. CHAIR ROKEBERG said that according to his recollection, at the time tort reform legislation was passed, the central argument for gathering this information was to see what impact the reform bills had on awards, settlements, and insurance rates. He surmised that because proponents suggested that tort reform would lower insurance rates, it is still important to gather the information in order to ensure that the insurance industry is following the spirit of the law. REPRESENTATIVE BERKOWITZ said: That's why I would hope that before we move this bill, we find a way of checking it out, because the preliminary information I have, also from that 1999 survey from the Division of Insurance, indicated that the initial response [was] ... that there had either been no change in insurance rates, or that the insurer had been unable to assess the affect of tort reform on the cost and availability of insurance in Alaska. And, thus, if we had information from [a] subsequent couple of years, we might be able to craft that into the legislation. CHAIR ROKEBERG noted that he is in quite a bit of contact with the Division of Insurance regarding other legislation; he knew that "they are always under the gun to be able to do that," so he did not see any need to delay reporting HB 384 from committee. REPRESENTATIVE OGAN suggested that some people would argue that because the trial lawyers watered the bills down so much, they didn't have much effect. He asked whether they should consider putting a sunset date on HB 384 so that they could take another look at the issue "in a couple of years" and analyze whether gathering this information is useful. Number 1857 REPRESENTATIVE BERKOWITZ pointed out that it was the Speaker of the House who launched "this legislation," which, he opined, "was closing the barn door after the horse has already fled." He said he thought it was a good idea both then and now; "if we're trying to assess the impact of tort reform, we ought to have some hard data to do it." "Having been through the tort reform battle with only anecdotal information at our disposal," he opined that "that was wholly inadequate." And "as for the trial lawyers watering this thing down," he said that "this was a garden planted, grown, and sowed by the insurance agencies." CHAIR ROKEBERG noted that he would not support a sunset date, but added that he did think they should get the information from the Division of Insurance as soon as possible; therefore, in order to determine whether any other legislation is needed, he would ask the director to come before the committee. REPRESENTATIVE BERKOWITZ mentioned that the committee also has the ability to change the title [in order to add any necessary provisions to HB 384]. CHAIR ROKEBERG said he would prefer to move HB 384 out of committee and move on to the rest of items on the calendar. Number 1950 REPRESENTATIVE OGAN moved to report HB 384 out of committee with individual recommendations and the accompanying zero fiscal note. There being no objection, HB 384 was reported from the House Judiciary Standing Committee.
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