Legislature(2007 - 2008)
04/10/2008 02:17 PM House JUD
| Audio | Topic |
|---|---|
| Start | |
| SB226 | |
| SB8 | |
| SB273 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 226 - VEXATIOUS LITIGANTS 2:17:47 PM CHAIR RAMRAS announced that the first order of business would be SENATE BILL NO. 226, "An Act relating to litigation brought by a vexatious litigant; amending Rules 3, 4, 12, and 41, Alaska Rules of Civil Procedure; and providing for an effective date." 2:17:53 PM CINDY SMITH, Staff to Senator Hollis French, Alaska State Legislature, relayed on behalf of Senator French, chair of the Senate Judiciary Standing Committee, sponsor, that SB 226 creates a process in statute for courts to manage the problem of lawsuits brought by individuals who are "vexatious litigants." A vexatious litigant is defined as a person who, among other things, repeatedly litigates the same claims or previous adverse decisions against the same parties, files multiple frivolous lawsuits, repeatedly files pleadings or motions that are frivolous or in bad faith, or repeatedly engages in tactics that are without merit or intended to cause unnecessary delay. MS. SMITH continued to explain that the bill would allow the court to impose reasonable restrictions on access to the court and to review complaints before an action can proceed. She pointed out that the states of Hawaii, California, Ohio, Florida, and Texas have passed similar legislation; in fact, the bill was modeled on California's Code of Civil Procedure and was deemed constitutional by the California Supreme Court. 2:19:46 PM SUSAN COX, Senior Assistant Attorney General, Torts and Worker's Compensation Section, Civil Division (Juneau), Department of Law (DOL), in response to a question, said that the bill has not been introduced in the legislature before and that she was unaware of a similar bill. She assured the committee that the bill would not affect litigation of public interest lawsuits and would only affect nuisance plaintiffs who file without merit. In addition, the bill would provide a means to control pro se litigants, those who file without the assistance of an attorney, and thus are not subject to other means of control. Ms. Cox said that there are not too many people abusing the court system; however, there are those who are not deterred by adverse attorney fee awards when cases are lost and who re-file cases repeatedly. MS. COX, in response to a question, said she has no knowledge of the administration's policy toward public interest litigants as that is not her field of expertise. REPRESENTATIVE SAMUELS asked for examples of vexatious litigation. MS. COX relayed previous testimony from an attorney representing a landlord whose tenant filed a lawsuit against the owner, the neighbors, family members, and the attorney. The case has been litigated eight times. REPRESENTATIVE SAMUELS then asked for an estimate of the number of similar cases and whether there have been unintended consequences, for example, on cases regarding permitting issues. MS. COX stated that SB 226 does not prevent the filing of litigation; however, it does provide the court with a means of reviewing cases, especially those that are not filed by an attorney. She opined that cases involving permitting would be litigated by an attorney. REPRESENTATIVE SAMUELS surmised that the bill would not stop vexatious litigation by an attorney. MS. COX clarified that an attorney, representing himself/herself, is still an unrepresented party. REPRESENTATIVE SAMUELS asked why cases brought with the assistance of an attorney are excluded. MS. COX explained that there are civil rules that apply to the professional conduct of attorneys; moreover, an attorney would be financially motivated to not waste time. 2:27:03 PM REPRESENTATIVE HOLMES expressed favor with SB 226, adding that her experience as a clerk for the Alaska Supreme Court was that the court wasted a lot of time on repeated filings and appeals for cases with no merit. Time and money is wasted throughout the trial court system and at the supreme court level. Furthermore, [vexatious litigation] delays the processing of meritorious cases. Representative Holmes then referred to page 2, lines 20-23, which read: If the clerk mistakenly filed the litigation without an order from the presiding judge, any party may file with the clerk and serve on the parties a notice stating that the plaintiff is a vexatious litigant subject to a prefiling order under (d) of this section. REPRESENTATIVE HOLMES asked how one party would know whether another party is a vexatious litigant. MS. COX pointed out that subsection (g) on page 2 instructs the Alaska Court System to maintain a record of vexatious litigants that would be available to clerks of the court and the public. REPRESENTATIVE SAMUELS asked whether someone listed as a vexatious litigant could still file a meritorious suit. MS. COX reminded that committee that the intent of the bill was to enable the court to screen a filing, not to preclude it. She noted that similar action is taken in federal courts, and when there is merit to a case the court allows the case to proceed. In fact, under subsection (e), the presiding judge would decide whether a case has merit. 2:34:03 PM REPRESENTATIVE COGHILL stated his concern about the creation of a burden so heavy as to prevent a citizen from presenting legitimate issues. In addition, page 1, subsection (b), requires the provision of security to "secure payment of a prevailing party's reasonable expenses." He observed that that may also be a burden on one in a "pro se situation." MS. COX opined that the court would consider what is appropriate and what is a reasonable balance between the protection of the plaintiff from the vexatious litigant and the merits of the issue. REPRESENTATIVE COGHILL questioned whether the criteria precedes the security, or if the security comes first. He gave the example of a judge who has before him a reasonable case from a vexatious person and who subsequently requires security. MS. COX stressed that in order to be considered a vexatious litigant, a person would have to meet the four definitions on page 3 of the bill. It should be a label that not many people end up bearing. REPRESENTATIVE COGHILL asked whether the definition section would be the criteria considered before a decision was made on requiring security from a litigant. MS. COX said yes. 2:37:09 PM REPRESENTATIVE LYNN declared a conflict of interest in that he is involved in a political contest and some have characterized a participant as a "serial litigator." CHAIR RAMRAS said, "So noted." He then referred to the zero fiscal note and asked for an estimate of the savings by the court system as a result of the passage of this bill. 2:38:12 PM DOUG WOOLIVER, Administrative Attorney, Administrative Staff, Office of the Administrative Director, Alaska Court System (ACS), informed the committee that the ACS is neutral on SB 226. He observed that there are not many vexatious litigants; however, their cases are time consuming for the attorneys at the Department of Law. The Alaska Court System would not save a measurable amount of money to indicate on a fiscal note. CHAIR RAMRAS again asked whether some public interest groups would be regarded as vexatious litigants. MR. WOOLIVER acknowledged that any group could conceivably be considered; however, the bill is meant to address extraordinary cases, not just cases that can not win. CHAIR RAMRAS opined that the same could be said of some public interest cases. REPRESENTATIVE SAMUELS asked for the sponsor's opinion of an amendment such that public interest litigants would be put in a "loser pays" situation. MS. SMITH opined that the sponsor would prefer that the bill not be amended in that way. 2:41:15 PM REPRESENTATIVE GRUENBERG asked whether the court system has any experience with vexatious or frivolous defendants. He stated his concern that the bill only addresses one side of the problem and referred to certain groups that make their living by denying claims using frivolous defenses. He opined that the court does not extend protection from defendants. MR. WOOLIVER said that he was not aware of this issue, or how the court could pre-screen a lawsuit in the same way. He remarked: You know who the plaintiff is and you may know who the defendant is. I don't think you could issue summary judgment, somehow, against the defendant without hearing from ... REPRESENTATIVE GRUENBERG interjected to say that that is not his intent. He gave the example of a defendant who is also a defendant in similar claims. He then asked whether the court should have the ability to impose a similar security against defenses that have been ruled as frivolous by other courts. MR. WOOLIVER expressed the need to conduct research on this topic. REPRESENTATIVE GRUENBERG observed that as technology advances, this scenario can occur. In fact, present day law firms specialize in certain types of claims. CHAIR RAMRAS offered an example of a case against a drug company. REPRESENTATIVE GRUENBERG described a case against the Mercer Company. The law firm that the state retained specialized in a certain type of litigation, and so did the defense firm. He surmised that the defense firm may have been involved in other cases for other clients raising similar kinds of defenses. Furthermore, he is also concerned that poorer citizens may bring unsuccessful cases pro se, that are rejected for technical reasons, and then the citizens end up declared vexatious litigants. MR. WOOLIVER said that he is reluctant to debate how the court would interpret this legislation. MS. SMITH pointed out that the court has discretion and "may" take action if litigants meet the definitions. REPRESENTATIVE GRUENBERG questioned whether the language on page 1, lines 10-11 - "reasonably probable that the plaintiff will prevail in the litigation" - would create too high a standard, particularly given that it pertains to a very early stage of a lawsuit. 2:48:14 PM MS. COX re-stated that the court is not required to take action. The court may order the plaintiff to provide security if the court determines that the plaintiff is a vexatious litigant and probably would not prevail. There would obviously be a motion brought by the defendant explaining the circumstances and requesting protection from the court. In the case of litigants who already have a prefiling order against them, other provisions in the bill would apply. REPRESENTATIVE GRUENBERG observed that once the defendant makes the motion, the burden of persuasion shifts to the plaintiff to show reasonable probability. MS. COX affirmed that the court would determine whether the plaintiff was a vexatious litigant, whether the definitions of the bill have been satisfied, and whether there was a reasonable probability that they could succeed in the case. She opined that these are judgments that the court routinely makes. REPRESENTATIVE GRUENBERG said, "So you're not saying that necessarily the plaintiff must show that it is reasonably probable, you think it might be the defendant's burden to show that it's not reasonably probable. MS. COX said yes. REPRESENTATIVE GRUENBERG said, "It's very important for us to establish, on the record, who has that burden, and it's the defendant." 2:51:09 PM CHAIR RAMRAS closed public testimony on SB 226. REPRESENTATIVE COGHILL indicated that he might have a future amendment for SB 226 regarding the inflexibility of the provision for security. REPRESENTATIVE LYNN expressed his support for the intent of the bill; however, the bill creates two procedures for filing a lawsuit, one for "you and I" and two court hearings for someone defined as a vexatious litigant. REPRESENTATIVE GRUENBERG, in response to Representative Coghill's statement, offered that security could come in the form of cash or a corporate bond, or another bond or undertaking, under Civil Rule 80, which could be a piece of property, or an unsecured bond by people who are worth the required amount of money. MS. COX said she didn't disagree. REPRESENTATIVE SAMUELS surmised that even vexatious litigants must account for "loser pays" which is something that public interest litigants do not. 2:54:47 PM REPRESENTATIVE Dahlstrom moved to report SB 226 out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, SB 226 was reported out of the House Judiciary Standing Committee.
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