Legislature(1999 - 2000)

04/12/1999 03:23 PM House L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                                                                                                                                
HB 146 - LIABILITY FOR COMMERCIAL REC ACTIVITIES                                                                                
                                                                                                                                
Number 1050                                                                                                                     
                                                                                                                                
CHAIRMAN ROKEBERG announced the committee's next order of business                                                              
is HB 146, "An Act relating to civil liability for commercial                                                                   
recreational activities; and providing for an effective date."                                                                  
                                                                                                                                
Number 1075                                                                                                                     
                                                                                                                                
KELLY SULLIVAN, Legislative Secretary to Representative Pete Kott,                                                              
Alaska State Legislature, came forward to present HB 146 on behalf                                                              
of the sponsor.  Ms. Sullivan noted this is pretty straightforward:                                                             
Alaska has its great outdoor experiences like big game hunting,                                                                 
sportfishing, kayaking and river rafting.  There are a lot                                                                      
businesses in Alaska that provide these experiences to the public.                                                              
Ms. Sullivan mentioned the tourism industry.  House Bill 146 would                                                              
establish the responsibilities of the commercial recreational                                                                   
businesses and the responsibilities of the participants in those                                                                
activities.  The legislation addresses specific guidelines                                                                      
operators and participants would follow in order to minimize the                                                                
possibility of accidents.  Should an accident occur, the                                                                        
legislation provides which party would be held liable.  Current                                                                 
legal uncertainties result in high liability insurance costs that                                                               
hurt a lot of Alaskan businesses, especially smaller ones.  The                                                                 
intent of this legislation is the avoidance of unfair and                                                                       
unreasonable claims which make it difficult [for businesses] to                                                                 
provide these recreational activities.  The desire is to encourage                                                              
the continued availability of these recreational businesses.  Ms.                                                               
Sullivan noted there are a few witnesses to provide testimony.                                                                  
                                                                                                                                
CHAIRMAN ROKEBERG indicated Representative Kott, the bill sponsor,                                                              
had joined the committee at the table.                                                                                          
                                                                                                                                
Number 1188                                                                                                                     
                                                                                                                                
MIKE WINDRED, Vice President, Marketing and Sales, Alaska Travel                                                                
Adventures, came forward to testify in support of HB 146.  He                                                                   
informed the committee that his company has several operations                                                                  
throughout the state.  Mr. Windred thanked the sponsor for bringing                                                             
the legislation forward, noting the bill has passed the House three                                                             
times in recent years but has been held up in the Senate for                                                                    
various reasons.  Mr. Windred believes one of the basic ideas                                                                   
behind this legislation is that participants in many of these                                                                   
activities assume some inherent risk when purchasing that                                                                       
recreational activity.  However, he does not believe the                                                                        
legislation would absolve any of the operators from negligent                                                                   
actions.  The bill establishes some basic performance standards the                                                             
operators must adhere to that are not currently specified by Alaska                                                             
Statute.  The legislation would affect a business like Alaska                                                                   
Travel Adventures by requiring it to provide good training to its                                                               
employees, maintain its equipment, and provide a good explanation                                                               
of the inherent risks to participants.  This is not currently set                                                               
out and should increase the level of service within the industry.                                                               
                                                                                                                                
Number 1262                                                                                                                     
                                                                                                                                
MR. WINDRED thinks the primary benefit to his business would be a                                                               
reduction in the costs of what he termed "nuisance suits."  Mr.                                                                 
Windred described that these nuisance suits would be lawsuits for                                                               
damages specifically at the level of a company's insurance                                                                      
deductible - $10,000 for a business like his - so that the                                                                      
insurance company would not be involved, at least for "the first                                                                
hit."  He indicated these suits result in significant costs over                                                                
the long term because it is less expensive for the business to                                                                  
settle them than risk lengthy litigation.  Mr. Windred thinks the                                                               
legislation gives his business some standing to respond that the                                                                
participants had some amount of responsibility in undertaking the                                                               
activity.  He commented that at least the legislation would give                                                                
the businesses a level playing field to begin with and he feels                                                                 
certain it would reduce the money they pay out-of-pocket each year                                                              
for these nuisance suits.  Mr. Windred described the example of a                                                               
nature hiker stumbling on a rock on the beach, cutting his/her                                                                  
forehead.  Mr. Windred's company would provide first aid, take the                                                              
person to the hospital, make sure everything checked out okay, and                                                              
six months later might be sued by that person for $10,000 to                                                                    
$20,000 because the person's vacation to Alaska had been ruined or                                                              
for some other reason.  He noted, "At the point that we've done                                                                 
everything in our ability to ... make that right in terms of paying                                                             
a medical bill or treating them with first aid, et cetera.  That                                                                
would be a lawsuit that I would certainly think ... probably                                                                    
wouldn't be very valid, but at that amount, would be very difficult                                                             
for us to fight legally."                                                                                                       
                                                                                                                                
Number 1394                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI noted Mr. Windred's testimony that this                                                                
legislation would not preclude lawsuits for negligence on the part                                                              
of the tour company or operator.  She noted the legislation does                                                                
define some areas of responsibility for operators, but she                                                                      
expressed some doubt it covered, for example, a leaky raft.                                                                     
Someone put into that type of situation by an operator should be                                                                
able to sue.                                                                                                                    
                                                                                                                                
MR. WINDRED agreed someone in that situation should be able to sue                                                              
and indicated he thought that would be covered in the legislation                                                               
by the operator's responsibility to maintain its equipment.  He                                                                 
stated, "And in reality, that's probably almost more harmful to the                                                             
operator the way this bill is written, which is a good thing in the                                                             
industry, ... it'll ensure that as an operator, I don't send a                                                                  
faulty piece of equipment out on tour."                                                                                         
                                                                                                                                
REPRESENTATIVE HALCRO referred to the language, "explain to a                                                                   
participant", on page 2, line 23, under "Responsibilities of                                                                    
operators of commercial recreational activities.".  He noted an                                                                 
example of a white water rafting situation where the risks were                                                                 
explained to the participants but someone was hurt and denied that                                                              
he/she had been informed.  Representative Halcro said his concern                                                               
is with having some kind of a written disclosure.  It does not look                                                             
like the legislation provides for that.                                                                                         
                                                                                                                                
Number 1492                                                                                                                     
                                                                                                                                
MR. WINDRED related participants in his company's river rafting                                                                 
sign a sheet before the activity which basically says the                                                                       
participant understands the safety precautions.  These precautions                                                              
and inherent risks are gone through verbally.  If the person                                                                    
chooses not to sign that paper, or does not want to sign off on the                                                             
risks, at that point he/she has the opportunity to return to town                                                               
and not participate in the activity.  Mr. Windred thinks if there                                                               
was no documentation, it would be more difficult for the operator                                                               
to win in that case.                                                                                                            
                                                                                                                                
REPRESENTATIVE HALCRO thinks some kind of written agreement would                                                               
probably be important in this legislation.                                                                                      
                                                                                                                                
REPRESENTATIVE CISSNA noted she did not see anything in the                                                                     
legislation regarding some kind of an assessment the operator might                                                             
need to perform when, for example a participant is intoxicated and                                                              
should not be allowed to engage in the activity.  She questioned if                                                             
that is something that should ever be addressed in something like                                                               
this.                                                                                                                           
                                                                                                                                
MR. WINDRED answered he thinks that would definitely be a gray area                                                             
and is probably a battle that would occur in court.  He indicated                                                               
it would certainly behoove such an operator to inform a person the                                                              
operator feels the person is not prepared to take the inherent risk                                                             
or is a safety problem.  Mr. Windred further indicated he thinks                                                                
there is some responsibility on the part of the participant to                                                                  
evaluate his/her own fitness level for the activity.                                                                            
                                                                                                                                
Number 1677                                                                                                                     
                                                                                                                                
STEVE BEHNKE, Executive Director, Alaska Wilderness Recreation and                                                              
Tourism Association (AWRTA), came forward to testify in support of                                                              
HB 146.  Mr. Behnke noted his organization represents a couple                                                                  
hundred of the types of companies Mr. Windred spoke about.  AWRTA                                                               
members feel this kind of legislation is necessary to protect small                                                             
businesses in this arena.  The organization's members depend on                                                                 
providing experiences that have inherent risks.  The kinds of                                                                   
measures proposed by the legislation that help encourage safer                                                                  
operations are major improvements over the current situation.  Mr.                                                              
Behnke said it seems like a balanced approach to protect the                                                                    
interests of AWRTA's members while also protecting the interests of                                                             
the participants.                                                                                                               
                                                                                                                                
REPRESENTATIVE MURKOWSKI pointed out the legislation limits                                                                     
recreational activity to outdoor activity.  She asked if there is                                                               
any specific reason for this, commenting she has done great damage                                                              
with a bowling ball.  She noted the question might be best                                                                      
addressed to the sponsor.                                                                                                       
                                                                                                                                
MR. BEHNKE responded he is the wrong person to ask because his                                                                  
organization's members are all [outdoor] outfitters and operators                                                               
providing activities with obvious inherent risks.  He said most                                                                 
operators do currently require some of the kinds of steps in the                                                                
legislation, but it would apply to a broader range of companies and                                                             
help encourage them to be safer and more responsible operators.                                                                 
                                                                                                                                
Number 1817                                                                                                                     
                                                                                                                                
REPRESENTATIVE BRICE mentioned that indoor climbing walls are                                                                   
increasing in popularity, noting there are opportunities to perform                                                             
these kinds of formerly outdoor activities inside.                                                                              
                                                                                                                                
CHAIRMAN ROKEBERG commented the committee seems to have a question                                                              
about the limitation on outdoor activities vis-a-vis other rather                                                               
dangerous indoor pursuits.  He asked if there is a reason for the                                                               
limitation.                                                                                                                     
                                                                                                                                
REPRESENTATIVE KOTT indicated there was no intent to distinguish                                                                
the two, other than the fact that the visitor businesses who                                                                    
primarily need this measure generally offer outdoor activities                                                                  
within the category.  He has no problem changing it to include                                                                  
both, noting there are some climbing walls even he wouldn't attempt                                                             
to go up, given the constraints he has.  Referring to bowling,                                                                  
however, he noted, "If you get into establishing various types of                                                               
recreational activity and requiring each of the operator[s] to                                                                  
provide some kind of documentation to be signed, then you have to                                                               
get into that whole quandary of whether or not when I go bowling                                                                
the operator there should have me sign a disclosure or some kind of                                                             
form understanding the problems and potential dangers."                                                                         
                                                                                                                                
Number 1989                                                                                                                     
                                                                                                                                
CHAIRMAN ROKEBERG asked if Representative Kott had considered                                                                   
establishing a new "prudent man rule" for sports activities, noting                                                             
he is half-joking but really half-serious.                                                                                      
                                                                                                                                
REPRESENTATIVE BRICE asked if they simply redefined recreational                                                                
activity to mean "an activity usually undertaken outdoors for the                                                               
purpose of exercise", deferring to the lawyers on the committee.                                                                
                                                                                                                                
REPRESENTATIVE HALCRO suggested simply the deletion of "outdoor".                                                               
                                                                                                                                
REPRESENTATIVE MURKOWSKI answered if "outdoor" is deleted, this                                                                 
would be "an activity for the purpose of exercise or education".                                                                
She could go to a seminar on throwing pots or grant-writing; she                                                                
does not think that is the intended direction of this definition.                                                               
Representative Murkowski thinks where the definition needs to go is                                                             
"those inherently dangerous activities", indicating there are                                                                   
certain things like being on the water, ice climbing, et cetera,                                                                
that are inherently more dangerous than bowling.  She indicated                                                                 
that perhaps the discussion would occur in the next committee of                                                                
referral, the House Judiciary Standing Committee (Judiciary).                                                                   
                                                                                                                                
CHAIRMAN ROKEBERG mentioned contributory negligence in the case of                                                              
fishing and being "hooked" by a fellow fisherman.                                                                               
                                                                                                                                
Number 2136                                                                                                                     
                                                                                                                                
REPRESENTATIVE HALCRO appreciates the intent of the legislation but                                                             
commented the Surgeon General's warning has been on cigarette packs                                                             
for almost 30 years and it hasn't stopped people from suing tobacco                                                             
manufacturers.                                                                                                                  
                                                                                                                                
CHAIRMAN ROKEBERG questioned if it was Representative Kott's                                                                    
intention to insert contributory negligence as a defense here.                                                                  
                                                                                                                                
REPRESENTATIVE KOTT replied that it was at least some extent.                                                                   
There is some inherent risk to just about any activity.  Certainly,                                                             
when a person is engaging in outdoor activities in Alaska, the risk                                                             
is a little more inherent, because of Alaska's terrain, than                                                                    
perhaps in some of the other states.  He noted Alaska's good                                                                    
tourist population, small state population, and the medium-sized                                                                
group of what he would term "mom-and-pop" commercial operators who                                                              
provide these types of environments for the state's visitors.                                                                   
Representative Kott indicated he thinks these operators need some                                                               
assurance of protection from expensive lawsuits brought by people                                                               
who ignored the inherently risky nature of the activity they were                                                               
participating in.                                                                                                               
                                                                                                                                
Number 2266                                                                                                                     
                                                                                                                                
TINA LINDGREN, Executive Director, Alaska Visitors Association                                                                  
(AVA), came forward to testify in support of HB 146.  As Mr.                                                                    
Windred had said, this is legislation the AVA has supported and the                                                             
House has passed at least three times that she is aware of.  It has                                                             
taken different forms because people start identifying other kinds                                                              
of recreational activities.  At one time equine activities were                                                                 
been included, another time skateboarding.  Ms. Lindgren indicated                                                              
the number of bills on the subject is a strong case that the                                                                    
legislation is needed.  She emphasized a strong point of HB 146 is                                                              
that it sort of covers all of the outdoor activities.  She thinks                                                               
the suggestion of including some indoor activities may be good and                                                              
perhaps this can be examined in Judiciary.  Ms. Lindgren noted the                                                              
legislation is before the committee primarily at the request of                                                                 
small businesses concerned about the cost of insurance and nuisance                                                             
lawsuits from people "who through their own activity have caused                                                                
some injury."  She commented it is very similar to the skiing                                                                   
reform bill passed several years ago.  House Bill 146 has                                                                       
participants agreeing to accept some level of risk and operators                                                                
agreeing that they have to provide a safe environment.  Ms.                                                                     
Lindgren stated AVA wholeheartedly supports the legislation.                                                                    
                                                                                                                                
REPRESENTATIVE MURKOWSKI questioned if this would really lower                                                                  
insurance rates for the "mom-and-pops."                                                                                         
                                                                                                                                
MS. LINDGREN replied she does not know - that is the hope.  It                                                                  
would be a tool companies could use.  She does know that companies                                                              
currently are targeted by a lot of frivolous lawsuits from people                                                               
seeking financial gain.                                                                                                         
                                                                                                                                
Number 2471                                                                                                                     
                                                                                                                                
REPRESENTATIVE BRICE referred to subsection (1)(B) on page 2,                                                                   
beginning on line 26, "(B) the skills or equipment required to                                                                  
participate in the commercial recreational activity that are not                                                                
apparent to an inexperienced participant;".  He stated, "'The                                                                   
skills or equipment required' rather than 'the skills...'"                                                                      
[TESTIMONY INTERRUPTED BY TAPE CHANGE]                                                                                          
                                                                                                                                
TAPE 99-38, SIDE A                                                                                                              
Number 0001                                                                                                                     
                                                                                                                                
REPRESENTATIVE BRICE continued, "...conjunction word."                                                                          
                                                                                                                                
CHAIRMAN ROKEBERG asked if Representative Brice wished to make a                                                                
conceptual amendment.                                                                                                           
                                                                                                                                
REPRESENTATIVE KOTT stated he has no objection.                                                                                 
                                                                                                                                
Number 0025                                                                                                                     
                                                                                                                                
REPRESENTATIVE BRICE moved Conceptual Amendment 1 to replace "or"                                                               
with "and".  There being no objection, Conceptual Amendment 1 was                                                               
adopted.  Subsection (1)(B) on page 2, beginning on line 26, as                                                                 
amended by Conceptual Amendment 1, reads:                                                                                       
                                                                                                                                
               (B) the skills and equipment required to                                                                         
     participate in the commercial recreational activity that                                                                   
     are not apparent to an inexperienced participant;                                                                          
                                                                                                                                
Number 0050                                                                                                                     
                                                                                                                                
REPRESENTATIVE HALCRO offered two friendly conceptual amendments.                                                               
He moved the addition of "and condition of health" on page 2, line                                                              
13, after "act within the limits of the person' abilities".                                                                     
Representative Halcro indicated he thinks a negative incident                                                                   
during an activity resulting from a person's health condition would                                                             
be the responsibility of the participant, because only the                                                                      
participant knows his/her condition of health.  He used the example                                                             
of someone with a bad heart.  Representative Halcro noted his                                                                   
conceptual amendment 3 would be on page 2, line 23, after "explain                                                              
to a participant", inserting "in writing", if that is acceptable to                                                             
the sponsor.  Representative Halcro said he thinks that protects                                                                
all involved, even if it is just a sign-off sheet.                                                                              
                                                                                                                                
CHAIRMAN ROKEBERG stated the committee would address Amendment 2                                                                
first.  The chairman expressed his approval, terming it "the fat                                                                
guy amendment."  He indicated if a person is too out-of-shape to be                                                             
participating in an activity, the person should not be doing it.                                                                
                                                                                                                                
REPRESENTATIVE KOTT noted he considers it a friendly amendment and                                                              
does not object.  He thinks it is contained in the bill's original                                                              
language but it is fine to add that and clarify.                                                                                
                                                                                                                                
Number 0166                                                                                                                     
                                                                                                                                
CHAIRMAN ROKEBERG questioned if there were any objections to                                                                    
Conceptual Amendment 2, adding "condition of health" on page 2,                                                                 
line 13.  There being none, Conceptual Amendment 2 was adopted.                                                                 
Subsection (2) on page 2, line 13, as amended by Conceptual                                                                     
Amendment 2 reads:                                                                                                              
                                                                                                                                
          (2) act within the limits of the person's abilities                                                                   
     and condition of health;                                                                                                   
                                                                                                                                
REPRESENTATIVE HALCRO moved Conceptual Amendment 3, adding "in                                                                  
writing" on page 2, line 23.                                                                                                    
                                                                                                                                
CHAIRMAN ROKEBERG objected for purposes of discussion.  He asked if                                                             
the sponsor wished to comment.                                                                                                  
                                                                                                                                
Number 0201                                                                                                                     
                                                                                                                                
REPRESENTATIVE KOTT answered he would defer to Ms. Lindgren since                                                               
she is probably closer to these issues.  He indicated he can                                                                    
potentially see some problem in a situation where a previously                                                                  
unforeseen risk is being explained.                                                                                             
                                                                                                                                
CHAIRMAN ROKEBERG noted it can be problematic.                                                                                  
                                                                                                                                
REPRESENTATIVE KOTT agreed it could be.                                                                                         
                                                                                                                                
CHAIRMAN ROKEBERG commented he thinks it is warranted in certain                                                                
circumstances but perhaps not universally; that is his only                                                                     
concern.                                                                                                                        
                                                                                                                                
REPRESENTATIVE HALCRO withdrew Conceptual Amendment 3.                                                                          
                                                                                                                                
CHAIRMAN ROKEBERG noted that was his only concern there.  The                                                                   
chairman expressed that he would actually like to see a two-tier                                                                
thing here, indicating he was referring to a differentiation                                                                    
between very risky activities and those of a more sedate nature.                                                                
                                                                                                                                
Number 0287                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI posed a conceptual amendment concerning                                                                
children and dogs.  On page 2, subsection (4), beginning line 16,                                                               
she recommended the use of "any minors under the participant's                                                                  
control" to replace "the participant's children".  She noted                                                                    
whenever she goes out with her children she also always has other                                                               
people's children.  On page 2, subsection (4), Representative                                                                   
Murkowski indicated it is also her intention to include animals                                                                 
under the participant's control, like a dog, not just animals the                                                               
participant might be using, like a horse.                                                                                       
                                                                                                                                
CHAIRMAN ROKEBERG stated, "Any equipment, devices, or animals the                                                               
participant is using or under the participant's control."                                                                       
                                                                                                                                
REPRESENTATIVE MURKOWSKI spoke over, "or under the control of the                                                               
-- or animals under the control of the participant."  She noted                                                                 
this would include a person's dog.                                                                                              
                                                                                                                                
CHAIRMAN ROKEBERG asked if there were any objections to Conceptual                                                              
Amendment 4, which includes everything on page 2, lines 16 and 17.                                                              
There being none, Conceptual Amendment 4 was adopted.  According to                                                             
the above discussion, subsection (4) on page 2, beginning on line                                                               
16, as amended by Conceptual Amendment 4, reads:                                                                                
                                                                                                                                
          (4) maintain control of the participant's person,                                                                     
     any minors under the participant's control, and any                                                                        
     equipment, devices, or animals the participant is using                                                                    
     or animals under the control of the participant;                                                                           
                                                                                                                                
Number 0453                                                                                                                     
                                                                                                                                
REPRESENTATIVE BRICE made a motion to move HB 146, as amended, out                                                              
of committee with accompanying zero fiscal notes and individual                                                                 
recommendations.  There being no objection, CSHB 146(L&C) moved out                                                             
of the House Labor and Commerce Standing Committee.                                                                             

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