Legislature(1993 - 1994)
02/02/1994 02:20 PM HES
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
CHAIRMAN RIEGER introduced HB 79 (DAMAGE TO PROPERTY BY MINORS) (FIN) AM as the next order of business before the committee. REPRESENTATIVE CON BUNDE, representing District 18 and prime sponsor, reviewed HB 79 and the desire to increase the recovery from $5000 to $10,000. SENATOR SHARP clarified that the district court allows up to $50,000 in recovery. He posed an example to clarify how HB 79 would actually work. REPRESENTATIVE CON BUNDE stated that existing statute limits recovery to $2000, HB 79 would raise that limit to $5000. He expressed the need to raise the recovery to $10,000. He noted that a $2000 recovery for a $20,000 car is not much; furthermore, one is often not able to seek recovery from juveniles. There is runaway legislation to protect parents against financial obligation when the juvenile is delinquent. SENATOR MILLER asked if section 2 of HB 79 addresses the runaway issue. REPRESENTATIVE BUNDE was concerned that the section may not carry strength of law in court. SENATOR SALO asked if section 2 addresses when the runaway has to be reported in order to eliminate the parents financial obligation, while disallowing retrospective claims. REPRESENTATIVE BUNDE said that investigators would deal with such issues. CHAIRMAN RIEGER pointed out that line 1 page 2 only eliminates parental obligation for acts of the minor after the runaway is reported. Number 500 SENATOR SALO requested clarification of the $50,000 liability limit for civil damages regarding HB 79. REPRESENTATIVE BUNDE noted that a $5000 limit for juveniles was small in comparison to a $50,000 limit for adults. SENATOR LEMAN commented that the responsibility for compensation of damages should lay closest to the person doing the damage. He suggested that $5000 was too little and should be raised. REPRESENTATIVE CON BUNDE specified that the average in other states is between $10,000 and $15,000. The question of who should suffer the greater loss was mentioned. VINCENT USERA, Assistant Attorney General in the Civil Division of the Department of Law, offered to answer questions. SENATOR SALO stated that the House HESS testimony referred to $50,000, but the bill ended up only raising the money to $5000. She reiterated the desire to clarify the $50,000 limit. VINCENT USERA said that $50,000 was the jurisdictional limit of district court. He pointed out that district court, a court of minimal jurisdiction, could take cases up to $50,000. The comparison is $5000 to $50,000 in terms of the magnitude of the offense. Without this statute, there would be no way to recover at all from the parent for a child. He noted that the legislation increases the limit of the common law currently in effect. SENATOR MILLER asked if the definition of "person" in the first section includes a corporation. REPRESENTATIVE BUNDE stated that yes the definition includes a corporation. SENATOR MILLER asked if a person recovers the $5000 in a civil court action, who would be responsible for the attorney's fee. VINCENT USERA said that attorney's fees are awardable under the discretion of the court, normally 20 percent of the award. These cases seeking under $5000 would usually be limited to Small Claims Court which would not require an attorney. The defendant has the opportunity to move the case to district court and be subject to the formal rules. Mr. Usera agreed with Senator Miller's speculation that a $2000 recovery is not worth the time and effort to go to court. Number 580 SENATOR LEMAN moved to amend the amount on line 7 of page 1 from $5000 to $25,000. CHAIRMAN RIEGER objected. TAPE 94-4, SIDE B Number 578 SENATOR LEMAN explained that he believed in the principle of restitution and that raising the limit to $25,000 comes closer to allowing pay back of damages. SENATOR SALO expressed interest in the circumstance of people unable to pay. She proposed that one would find a greater pool of people unable to pay at $25,000 than at $5000; in this case what would happen. REPRESENTATIVE CON BUNDE specified that like any legal situation if the court places a judgement against you it could result in garnishing wages, permanent fund dividends and assets. GEORGE BINGHAM, Superintendent of Claims for State Farms for Southeast, commented that in these type situations an insurance recovery limit of $2000 would probably cover 40-50 percent of the claims, $5000 would cover 80 percent, $10,000 would probably cover 95 percent of the claims. There is always 5 to 10 percent that will not be covered. SENATOR SHARP asked if the 80 to 90 percent that Mr. Bingham spoke of included auto claims whether insured or not. MR. BINGHAM said that was correct and only 5 percent of the claims by minors are over $10,000. SENATOR SHARP expressed his dislike with establishing a maximum limit; why should someone damaged over the maximum amount be penalized he asked. SENATOR MILLER pointed out that most of the 5 percent are protected with the $25,000 limit. Chances are that 95 percent of the claims will not get up to the $25,000 range. SENATOR LEMAN asked what percentage $25,000 would cover. MR. BINGHAM stated that 97 percent would be covered. CHAIRMAN RIEGER reminded the committee of the previous motion to amend the amount on page 1 line 7 from $5000 to $25,000. A hand vote was taken with the following result: Senators Miller, Sharp, and Leman voted "Yea" and Senators Rieger and Salo voted "Nay". The motion was carried. SENATOR MILLER moved Senate Committee Substitute for CSHB 79 (HES) out of committee with individual recommendations. Hearing no objections, it was so ordered.