Legislature(2005 - 2006)BUTROVICH 205
04/15/2005 08:00 AM Senate JUDICIARY
| Audio | Topic |
|---|---|
| Start | |
| HB155 | |
| HB91 | |
| SB86 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 86 | TELECONFERENCED | |
| *+ | SB 159 | TELECONFERENCED | |
| + | HB 91 | TELECONFERENCED | |
| + | HB 155 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 86-STATE/MUNI LIABILITY FOR ATTORNEY FEES
8:40:45 AM
CHAIR RALPH SEEKINS announced SB 86 to be up for consideration.
He moved Version \G as the working document. Hearing no
objections, the motion carried.
MR. CRAIG TILLERY, assistant attorney general, Department of Law
(DOL) introduced the bill. SB 86 would prevent enhanced fee
awards against the state or municipalities that are not
authorized by statute, but leave those governments open to the
standard partial fee awards called for in the Civil Rule 82 fee
schedule. Enhanced fee awards cost the state approximately
$600,000 per year. SB 86 provides that, as a matter of sovereign
immunity, states and municipalities are not liable for
attorney's fees that are in excess of certain percentages.
8:42:24 AM
MR. TILLERY said the Governor's administration believes it is
the Legislature's role to determine what litigation is to be
subsidized through the use of public funds.
Section 1 states clearly that were SB 86 enacted into law, it
would neither preclude nor repeal specific statutes authorizing
the award of costs or fees in particular situations. Section 2
of the bill would create a new provision in the chapter of AS 09
devoted to immunities. Section 3 would make the bill applicable
only to civil actions or appeals initiated after it takes
effect.
8:44:28 AM
SENATOR GRETCHEN GUESS asked the definition of attorney's fee.
MR. TILLERY explained attorney's fees are the expenditures of
time and the costs of travel and depositions.
SENATOR HOLLIS FRENCH asked whether the state has to pay full
fees when the public interest litigant loses.
MR. TILLERY answered no.
8:46:32 AM
CHAIR SEEKINS clarified if any element of the public interest
litigant's case is later enacted by legislation, they can claim
the attorney's fees.
MR. TILLERY explained that would be the catalyst theory they
could seek it under. If they win any part of the case, they get
full fees.
CHAIR SEEKINS said it is a complex structure.
SENATOR FRENCH clarified when the public litigant loses they
receive no restitution.
8:48:40 AM
SENATOR FRENCH added when the public litigant wins on all claims
they are entitled to full fees. He asked whether the government
has to pay to a group when a public interest litigant wins.
MR. TILLERY said yes.
SENATOR FRENCH asked whether the group receives cash or whether
it is a public policy that costs the government money.
MR. TILLERY answered it is generally a public policy. The public
interest litigant can't have an overriding economic incentive
involved.
SENATOR FRENCH stated the public interest litigate, if he wins,
gets paid for his work. The public interest litigant doesn't
enrich himself.
8:50:16 AM
MR. TILLERY responded the public interest litigant works
generally for public policy purposes.
SENATOR FRENCH asked Mr. Tillery to give an example of when a
public litigant could enrich himself.
MR. TILLERY answered a person could have some economic incentive
where the case could have larger consequences.
SENATOR FRENCH asked whether SB 86 embodies a court rule change.
MR. TILLERY responded it does not.
8:52:01 AM
SENATOR GENE THERRIAULT asked whether the attorney fees were
calculated on a standard hourly rate.
MR. TILLERY responded they were calculated at the hourly rate of
the attorney. In the instance where an attorney does not have an
hourly rate, they get a standard rate of $150 an hour.
SENATOR THERRIAULT speculated attorneys' work under a salary
knowing the hourly rate the court would pay covers more than
their salary and so the entity they represent does make money.
MR. TILLERY stated correct. The money would go to the entity and
then it is between the entity and the public interest law firm.
He stated there is potential for profit.
8:53:45 AM
SENATOR THERRIAULT asked Mr. Tillery whether he thought the
Alaska Supreme Court was extremely liberal in construing due
process.
MR. TILLERY said the Alaska Supreme Court has zealously
protected due process rights.
SENATOR GUESS asked Mr. Tillery to explain whether SB 86 would
save money. She also asked him the reason for zero fiscal notes.
MR. TILLERY answered the zero fiscal note from the DOL is
because they don't pay the money, it comes out of the general
fund.
SENATOR GUESS stated it was odd that testimony claimed SB 86
would save the state money and yet there are no fiscal notes to
support the claim.
8:55:48 AM
SENATOR GUESS inquired as to why the state does not proportion
attorney fees but is instead attempting to limit them all.
MR. TILLERY answered SB 86 has proportion in it. Section 2
breaks it down. The Legislature needs to make the decision as to
where the attorney fees come from. He said SB 86 treats
apportionment but it is really about restoring to the
Legislature the power to control when public funds are going to
be used to subsidize litigation.
9:00:37 AM
SENATOR FRENCH explained the chances are a person would sue for
a money reason; for example, wrongful discharge. If they win,
they are awarded 20 percent of the attorney's fees as well as
the monetary damage claimed. Out of the awarded money, the
person would pay the balance of the attorney's fees. The
difference in these situations is there typically isn't any
money involved, its on principle or enforcement of the law.
There is no deep economic stake in the case.
9:02:18 AM
SENATOR THERRIAULT commented in the instance where there are
multiple allegations, the court only has to find one instance of
violation and the public interest litigant would win the entire
case.
SENATOR GUESS asked the reason public interest litigant cases
aren't structured to award fees that are proportionate to the
win. She said it seems to be better public policy to do some
type of apportionment.
9:04:20 AM
CHAIR SEEKINS said there is also a provision under the rules
where a defendant can prove the case is frivolous and petition
the court for 100 percent of the attorney's fees. When a public
interest litigant brings a frivolous case against the state or
municipality, the state or municipality has to defend it yet can
never recover the fees. He said the people's money is being
spent to defend against someone else's frivolity.
9:05:50 AM
SENATOR FRENCH asserted there is a protection and that is there
must be a finding that the individual who brought the suit was
seeking to vindicate strong public policy.
SENATOR CHARLIE HUGGINS asked Mr. Tillery to give an example of
litigation brought against the state by a public interest law
firm.
MR. TILLERY answered there was litigation over HB 145 two years
ago.
SENATOR HUGGINS asked the timeframe of resolution.
MR. TILLERY answered several years from start to finish.
SENATOR HUGGINS asked the issue.
MR. TILLERY answered it was the constitutionality of HB 145.
9:08:10 AM
MR. TILLERY added another example is a number of lawsuits
against the Prince William Sound contingency plans where the
state is defending the Department of Economic Development's
contingency plans. Judges have awarded up to $250 an hour for
attorney's costs. He said the point of SB 86 is if the people
are going to expend their money in this manner, the Legislature
should make that decision.
SENATOR HUGGINS commented SB 86 potentially has a restraining
effect on spending the people's money.
SENATOR FRENCH clarified it would be the laws that Alaska has
passed that are being vindicated. The state sets out rules and
if someone finds the state has broken it's own rules, the state
is forced to pay.
9:10:42 AM
CHAIR SEEKINS suggested many public interest lawsuits are
brought for philosophical reasons such as water quality issues,
watershed issues, and environmental impact issues. Groups that
have a philosophical interest in stopping development bring
lawsuits. The court rule the committee is looking at is not a
rule established by the Legislature.
9:15:28 AM
SENATOR FRENCH asserted it is important for people to be able to
challenge the government to abide by it's own rules. He agreed
with Senator Guess's suggestion to modify the attorney fee
schedules.
9:17:14 AM
CHAIR SEEKINS responded many organizations that bring public
interest lawsuits are multi-million dollar corporations.
SENATOR GUESS asked Mr. Tillery the reason the administration
isn't addressing the compensation issues and the attorney fee
schedule issues.
9:20:09 AM
MR. TILLERY said the point of SB 86 is an attempt to protect the
state's fiscal purse and also to restore to the Legislature the
control over which type of litigation it wishes to subsidize
with public monies.
SENATOR HUGGINS speculated the majority of Alaskans are
supportive of drilling for oil in the Alaska National Wildlife
Refuge (ANWR) and are supportive of a natural gas pipeline. He
expressed concern over public interest litigation in those
areas.
9:22:28 AM
CHAIR SEEKINS referred to Page 2, line 9 and asked Mr. Tillery
to give an example of an award by a court of a sanction.
MR. TILLERY explained the court might find the actions of an
attorney were out of bounds.
9:24:22 AM
SENATOR GUESS asked Mr. Tillery to describe a sanction-able
action of conduct in a case.
MR. TILLERY explained the most typical sanction would be where
somebody refuses to provide discovery or goes against court
rules.
9:26:09 AM
MICHAEL MCCLOUD-BALL, executive director, Alaska Civil Liberties
Union (ACLU), testified the ACLU opposes SB 86 on the grounds
that it will to widen the legal advantage currently held by
governmental litigants over private individuals. The typical
plaintiff in a public interest lawsuit is an individual, a non-
profit agency, or a charitable organization. The typical
defendant is a governmental entity. The typical suit is a party
with limited financial resources who needs to hire outside
counsel against a governmental entity with access to
substantially greater financial and legal resources. The dispute
is usually over principle and rarely over money.
9:27:09 AM
The public interest litigant only receives reimbursement if they
are acting in the public interest and if they are successful in
showing that the government acted wrongly. The government gets
it's subsidies from the taxpayers whether it wins or not. The
individual within the government who caused the government to
violate the victim's rights is not made to reimburse the
taxpayers for the internal cost of running the government in a
manner that violates the public interest. SB 86 will discourage
normal everyday people from trying to make a difference when
they see the government failing to do its job.
9:29:40 AM
MR. MACLEOD-BALL continued most of the actions are brought by
relatively small organizations. One thing missing from the
discussion is the amount of overhead involved in the public
interest law firms, not just the attorney's fees.
9:31:00 AM
MR. MACLEOD-BALL added when a public interest litigant brings a
suit in a frivolous manner, they are subject to the same penalty
as any other party.
9:31:54 AM
CHAIR SEEKINS asked Mr. Ball to give some examples of public
interest litigation brought by the poor, uneducated, or elderly
public.
MR. MACLEOD-BALL offered to prepare a list and submit it to the
committee.
CHAIR SEEKINS asked Mr. Ball the reason SB 86 would make it
harder for the public to bring lawsuits against the state.
MR. MACLEOD-BALL explained when a person is fighting over
something other than money; it is hard to find legal
representation. A wealthy individual has the advantage over an
average citizen.
9:35:47 AM
MS. ALLISON MENDEL, attorney, testified in opposition of SB 86.
She said access to justice is almost synonymous with access to
lawyers. There is no reasonable possibility of litigating any
complex issue without the help of an attorney. The private
individual has to have access to a lawyer but no lawyer will
take a case where there is no prospect of being paid unless it
is pro-bono. If the government adopts an illegal policy the only
way a private citizen will be able to challenge it is if the
private individual can find legal counsel. The people who bring
these lawsuits are not exclusively public interest law firms.
9:37:52 AM
People from all parts of the political spectrum have brought
public interest lawsuits and have won them justifiably. The only
people who receive payment are those who win in their claim
against the government.
9:39:38 AM
MS. MENDEL continued there has been much testimony about people
winning insignificant parts of a lawsuit and receiving large
sums for fees, which is unrealistic. The court always has the
discretion to pare down the fees.
9:41:14 AM
CHAIR SEEKINS asked for an example of a public interest case
where the litigants received nothing.
MS. MENDEL said cases such as that would not be reported.
9:43:37 AM
CHAIR SEEKINS closed public testimony on SB 86. He recessed the
meeting subject to the call of the chair at 9:48:21 AM.
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