Legislature(2003 - 2004)

05/13/2003 08:07 AM JUD

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                    ALASKA STATE LEGISLATURE                                                                                  
              SENATE JUDICIARY STANDING COMMITTEE                                                                             
                          May 13, 2003                                                                                          
                           8:07 a.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Ralph Seekins, Chair                                                                                                    
Senator Scott Ogan, Vice Chair                                                                                                  
Senator Gene Therriault                                                                                                         
Senator Johnny Ellis                                                                                                            
Senator Hollis French                                                                                                           
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
All members present                                                                                                             
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
CS FOR HOUSE BILL NO. 151(JUD) am                                                                                               
"An Act relating  to claims and court actions for  defects in the                                                               
design,  construction,  and   remodeling  of  certain  dwellings;                                                               
limiting when certain court actions  may be brought; and amending                                                               
Rules 79 and 82, Alaska Rules of Civil Procedure."                                                                              
     MOVED SCS CSHB 151(L&C) OUT OF COMMITTEE                                                                                   
                                                                                                                                
SENATE JOINT RESOLUTION NO. 6                                                                                                   
Proposing  an  amendment to  the  Constitution  of the  State  of                                                               
Alaska relating to the duration of a regular session.                                                                           
     HEARD AND HELD                                                                                                             
                                                                                                                                
SENATE JOINT RESOLUTION NO. 18                                                                                                  
Proposing amendments to  the Constitution of the  State of Alaska                                                               
relating to  limiting appropriations from  and inflation-proofing                                                               
the Alaska  permanent fund  by establishing  a percent  of market                                                               
value spending limit.                                                                                                           
     SCHEDULED BUT NOT HEARD                                                                                                    
                                                                                                                                
CS FOR HOUSE BILL NO. 102(STA)                                                                                                  
"An Act relating to concealed deadly weapons."                                                                                  
     MOVED CSHB 102(STA) OUT OF COMMITTEE                                                                                       
                                                                                                                                
SENATE BILL NO. 198                                                                                                             
"An Act relating to recovery of  civil damages by a peace officer                                                               
or firefighter; and providing for an effective date."                                                                           
     MOVED CSSB 198(STA) OUT OF COMMITTEE                                                                                       
                                                                                                                                
CS FOR SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 86(JUD) am                                                                         
"An Act relating to state permitted projects; and providing for                                                                 
an effective date."                                                                                                             
     HEARD AND HELD                                                                                                             
                                                                                                                                
PREVIOUS ACTION                                                                                                               
                                                                                                                                
SB 198 - See State Affairs minutes dated 5/8/03 and Judiciary                                                                   
     minutes dated 5/12/03.                                                                                                     
HB 151 - See Labor and Commerce minutes dated 5/8/03.                                                                           
SJR 6 - See State Affairs minutes dated 2/11/03 and 5/8/03.                                                                     
HB 102 - See Judiciary minutes dated 5/12/03.                                                                                   
HB 86 - See Judiciary minutes dated 5/7/03.                                                                                     
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
Representative Kevin Meyer                                                                                                      
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT:  Sponsor of HB 151                                                                                        
                                                                                                                                
Mr. Richard Tilly                                                                                                               
Interior Alaska Builders Association                                                                                            
Fairbanks, AK                                                                                                                   
POSITION STATEMENT:  Supports HB 151                                                                                          
                                                                                                                                
Senator Gretchen Guess                                                                                                          
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT:  Sponsor of SJR 6                                                                                         
                                                                                                                                
Representative Hugh Fate                                                                                                        
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT:  Sponsor of HB 86                                                                                         
                                                                                                                                
Mr. Jim Pound                                                                                                                   
Staff to Representative Fate                                                                                                    
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT:  Answered questions about HB 86                                                                           
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
TAPE 03-46, SIDE A                                                                                                            
                                                                                                                                
CHAIR  RALPH   SEEKINS  called  the  Senate   Judiciary  Standing                                                             
Committee meeting  to order at  8:07 a.m.  Senators  Ogan, French                                                               
and Seekins were present. He  announced the committee would first                                                               
take up SB 198, which the committee heard the previous day.                                                                     
                                                                                                                                
         SB 198-DAMAGES RECOVERED BY POLICE/FIREFIGHTER                                                                     
                                                                                                                                
SENATOR OGAN  moved CSSB 198(STA) from  committee with individual                                                               
recommendations and the zero fiscal note.                                                                                       
                                                                                                                                
CHAIR  SEEKINS  announced  that  without  objection,  the  motion                                                               
carried. He then called a brief at-ease.                                                                                        
                                                                                                                                
           HB 151-DWELLING DESIGN/CONSTRUCTION CLAIMS                                                                       
                                                                                                                                
REPRESENTATIVE KEVIN MEYER, sponsor of  HB 151, told members that                                                               
the bill provides homeowners  and construction professionals with                                                               
a  process to  solve construction  issues on  new homes  or major                                                               
remodels.  It requires  homeowners to  provide written  notice to                                                               
the  construction   professional  at  least  90   days  prior  to                                                               
litigation. If  a homeowner's complaints  have not  been resolved                                                               
in a timely  manner, the homeowner may proceed  to litigation. He                                                               
pointed out that  most complaints are handled  verbally, but, for                                                               
those  situations  that  are not  easily  resolved,  this  formal                                                               
process is being created. Both  parties will sign a contract that                                                               
explains the process before any work begins.                                                                                    
                                                                                                                                
REPRESENTATIVE MEYER said that under  HB 151, the homeowner would                                                               
have  one year  from the  date of  the discovery  of a  defect to                                                               
proceed with a complaint. However,  a homeowner cannot exceed the                                                               
current 10-year statute of limitations.  He said this legislation                                                               
is  important for  several reasons.  In  Alaska, contractors  and                                                               
homebuilders are  required to carry general  liability insurance.                                                               
Many  insurance companies  no  longer  provide general  liability                                                               
insurance and the insurance that  is available is very expensive.                                                               
The rising cost  of insurance is often passed on  in the price of                                                               
new  homes. This  problem  is  not unique  to  Alaska. Six  other                                                               
states that are  experiencing a housing boom  have passed similar                                                               
legislation. He  said this bill  creates a win-win  situation for                                                               
the  homeowner and  the  homebuilder. He  has  heard no  negative                                                               
comments  about the  bill. He  said  three conforming  amendments                                                               
were made  on the House  floor. Because of those  amendments, the                                                               
Senate  Labor   and  Commerce   Committee  adopted   a  committee                                                               
substitute to  make necessary changes. He  recommended the Senate                                                               
Labor  and Commerce  committee substitute  be  considered as  the                                                               
working  document  before the  committee.  He  offered to  answer                                                               
questions.                                                                                                                      
                                                                                                                                
CHAIR SEEKINS  affirmed that  committee members  were considering                                                               
the  Senate  Labor  and Commerce  committee  substitute,  labeled                                                               
Version B.                                                                                                                      
                                                                                                                                
SENATOR ELLIS  asked how a  consumer would receive notice  of the                                                               
one-year time limit in which to take action.                                                                                    
                                                                                                                                
REPRESENTATIVE MEYER  provided an  example of  a contract  and an                                                               
attached explanation that informs the homeowner of the process.                                                                 
                                                                                                                                
SENATOR ELLIS asked if the explanation is clear and obvious.                                                                    
                                                                                                                                
REPRESENTATIVE MEYER  said it is  and that one of  the amendments                                                               
made  on the  House floor  required that  the explanation  of the                                                               
process be put on a separate page.                                                                                              
                                                                                                                                
SENATOR OGAN referred to the language  on page 6, line 16, of SCS                                                               
CSHB 151(L&C) that reads, "Within one  year of the discovery of a                                                               
design,  construction, or  remodeling  defect,..."  and asked  if                                                               
that essentially provides a one-year warranty on a house.                                                                       
                                                                                                                                
REPRESENTATIVE MEYER  said the ten-year statute  of limitation on                                                               
a  home would  still  be  in effect.  The  language Senator  Ogan                                                               
referred to  says that  once a homeowner  detects a  problem, the                                                               
homeowner  has up  to  one  year to  notify  the  builder of  the                                                               
problem and then the process starts.  He said more than likely, a                                                               
homeowner will  notify the builder  right away and will  not wait                                                               
up to one year.                                                                                                                 
                                                                                                                                
SENATOR OGAN said that proving a  homeowner knew of a problem for                                                               
less than a year would be  difficult. He asked what this law does                                                               
to change the current system.                                                                                                   
                                                                                                                                
REPRESENTATIVE  MEYER said  currently, if  a homeowner  detects a                                                               
problem, the  homeowner could go  directly to litigation  and, to                                                               
avoid court costs, the parties often settle out of court.                                                                       
                                                                                                                                
SENATOR OGAN asked if the objective  of this bill is to force the                                                               
homeowner to try to remedy the situation before going to court.                                                                 
                                                                                                                                
REPRESENTATIVE  MEYER said,  "Exactly." He  said he  believes the                                                               
homebuilder merely wants  the opportunity to fix  the problem. He                                                               
said  he  would characterize  SCS  CSHB  151(L&C) as  a  consumer                                                               
protection bill because  it contains a formal process  so that if                                                               
a homeowner  is forced to  litigate, the homeowner can  show what                                                               
steps he  or she took  to address  the problem. In  addition, the                                                               
homebuilder will  be highly motivated  to correct the  problem to                                                               
avoid litigation.                                                                                                               
                                                                                                                                
SENATOR ELLIS  said one of  the driving concerns  of homebuilders                                                               
is the  rising cost of  insurance. He asked  what representations                                                               
the insurance carriers in the  state have made about their future                                                               
plans to  reduce rates or  maintain rates to justify  the changes                                                               
that SCS CSHB 151(L&C) will make.                                                                                               
                                                                                                                                
REPRESENTATIVE MEYER  said that homebuilders say  this bill "will                                                               
stop the  bleeding." Their  insurance rates  are out  of control.                                                               
Insurance companies  have indicated that  if some process  is put                                                               
in  place  to try  to  control  the  costs,  the rates  will  not                                                               
continue to  accelerate as they  have. He  said he does  not know                                                               
for sure whether it will stop  any increase, but it will stop the                                                               
accelerated increase.                                                                                                           
                                                                                                                                
SENATOR ELLIS said he plans  to support the legislation and hopes                                                               
for the best.  He asked Representative Meyer  to follow insurance                                                               
rates over the next few years to see if the increases slow down.                                                                
                                                                                                                                
REPRESENTATIVE  MEYER   said  he  would   do  so  and   that  the                                                               
homebuilders believe this bill will keep costs down.                                                                            
                                                                                                                                
VICE-CHAIR OGAN took public testimony.                                                                                          
                                                                                                                                
MS. ROBIN  WARD told members that  nationwide insurance companies                                                               
and  not   Alaska  companies  write  insurance   policies.  Those                                                               
companies have  said that  an indication  of a  stabilized market                                                               
will be legislation in the  majority of states across the nation.                                                               
She just  returned from Washington,  D.C., where she  worked with                                                               
representatives  of   the  other  49   states  to   achieve  some                                                               
legislation in each state.                                                                                                      
                                                                                                                                
VICE-CHAIR OGAN asked Ms. Ward whom she represents.                                                                             
                                                                                                                                
MS. WARD  said she  is the co-chair  for legislative  affairs for                                                               
the Alaska State Homebuilders' Association  (ASHA). She then told                                                               
members that  ASHA is  trying to make  itself more  attractive to                                                               
nationwide insurers.  ASHA is also working  on better warranties,                                                               
better contracts, and safety programs.  She said this legislation                                                               
is one  very important component  and Alaska  is one "cog  in the                                                               
wheel"  in the  nation.  She said  this  legislation would  help;                                                               
there  are examples  in other  states where  builders and  buyers                                                               
have gone  to court  in which  the buyer  was more  interested in                                                               
money than having  the repairs done. When a  homeowner submits an                                                               
insurance claim,  the insurance  company usually pays  it without                                                               
managing   it.  She   appreciated   members'   support  of   this                                                               
legislation and offered to answer questions.                                                                                    
                                                                                                                                
VICE-CHAIR  OGAN asked  Ms.  Ward if  the problem  is  due to  an                                                               
insurance crisis in general or  if insurance carriers are pulling                                                               
out of Alaska.                                                                                                                  
                                                                                                                                
MS. WARD said the problem is  a combination of both. In addition,                                                               
the  problem  is partially  due  to  timing. Insurance  companies                                                               
never  realized the  claims in  this business  because they  were                                                               
making a  lot of money on  investments. Now, they are  going back                                                               
to  their actuarial  [tables] to  look at  their business  profit                                                               
centers. Homebuilders'  insurance policies  are not one  of those                                                               
profit centers because  of a lot of  construction litigation. She                                                               
said  that  only two  carriers  would  write liability  insurance                                                               
policies  for  homebuilders. One  of  the  major carriers,  State                                                               
Farm,  is  completely pulling  out  of  homebuilder insurance  in                                                               
Alaska.  She said  for homebuilders  who  can find  a carrier,  a                                                               
policy costs from two to ten times more.                                                                                        
                                                                                                                                
VICE-CHAIR OGAN asked  Ms. Ward if she  believes this legislation                                                               
would  help  mitigate the  decline  in  the number  of  insurance                                                               
carriers.                                                                                                                       
                                                                                                                                
8:25 a.m.                                                                                                                     
                                                                                                                                
MS.  WARD  said   she  does.  She  said  ASHA   is  working  with                                                               
representatives in  Montana, Idaho, Wyoming and  Washington State                                                               
to attract  more carriers to  the region. Those states  have less                                                               
litigation than California, Arizona and other areas.                                                                            
                                                                                                                                
VICE-CHAIR OGAN  asked the average  insurance cost for  a general                                                               
contractor.                                                                                                                     
                                                                                                                                
MS. WARD  said about $500 per  house. She said the  latest quotes                                                               
she  received from  two carriers  in Alaska  would increase  that                                                               
amount to $3,000 per house.                                                                                                     
                                                                                                                                
VICE-CHAIR OGAN  asked if an  owner-builder would be  required to                                                               
have insurance.                                                                                                                 
                                                                                                                                
MS.  WARD   stated,  "This  will   be  mandated  by   a  licensed                                                               
contractor. We're hoping that everyone  will do it, including the                                                               
owner-builder."  She  said  the reality  is  that  owner-builders                                                               
often  turn around  and  sell  their homes  to  make extra  money                                                               
because  they  are  allowed  to  build one  per  year  without  a                                                               
license.                                                                                                                        
                                                                                                                                
MR.  RICHARD TILLY,  representing  the  Interior Alaska  Building                                                               
Association, a group  of 190 builders, vendors,  and suppliers in                                                               
Fairbanks,  stated  support  for   SCS  CSHB  151(L&C).  He  said                                                               
securing liability  insurance for homebuilders has  become a very                                                               
expensive proposition.  His company of 22  years requested quotes                                                               
from  seven nationwide  companies  and found  only  one that  was                                                               
willing  to offer  a quote.  The insurance  industry has  claimed                                                               
that homebuilders  are a  risk and  has been  pulling out  of the                                                               
state. He said  this legislation creates a  win-win situation for                                                               
the consumer, builder and the  insurance industry. He pointed out                                                               
his  insurance rates  rose 20  percent last  year and  22 percent                                                               
this year and he has never filed a single claim in 22 years.                                                                    
                                                                                                                                
MR.  ALAN WILSON,  a Juneau  builder and  the second  co-chair of                                                               
ASHA's legislative affairs committee,  told members that ASHA has                                                               
been  working on  this  bill for  over one  year.  ASHA met  with                                                               
representatives of  other states  to hear their  experiences with                                                               
similar legislation. Early reports  from builders in Arizona show                                                               
the  process  is  working  well   there.    Homeowners  are  more                                                               
comfortable  using the  process to  resolve issues.  Builders are                                                               
responding  to  issues that  are  usually  small but  that  could                                                               
become major. He said he believes  this approach will be a breath                                                               
of  fresh  air from  the  consumers'  perspective. He  said  that                                                               
insurance companies  are in the business  to make money so  it is                                                               
not worthwhile  to fight claims  for up to  $60,000. Homebuilders                                                               
have  found  that fraudulent  individuals  file  claims for  high                                                               
amounts when the  cost of repair might be $5,000.  They hope this                                                               
legislation will bring those activities to an end.                                                                              
                                                                                                                                
With  no  further  participants, VICE-CHAIR  OGAN  closed  public                                                               
testimony.                                                                                                                      
                                                                                                                                
SENATOR  FRENCH  said  his  concern was  addressed  at  the  last                                                               
hearing, that  being that this  legislation effectively  places a                                                               
roadblock between the consumer and  the court. He said it appears                                                               
as  though the  roadblock  is minimal  and he  believes  it is  a                                                               
reasonable  compromise  and should  provide  a  better method  to                                                               
resolve disputes.                                                                                                               
                                                                                                                                
SENATOR FRENCH then  moved SCS CSHB 151(L&C)  from committee with                                                               
individual recommendations and attached fiscal notes.                                                                           
                                                                                                                                
VICE-CHAIR OGAN announced without  objection, the motion carried.                                                               
He then announced a brief at-ease.                                                                                              
                                                                                                                                
           SJR 6-CONST AM: 90 DAY LEGISLATIVE SESSION                                                                       
                                                                                                                                
SENATOR GRETCHEN  GUESS, sponsor of  SJR 6, explained  to members                                                               
that SJR  6 proposes an  amendment to the Alaska  Constitution to                                                               
limit  the  legislative session  to  90  days. She  believes  the                                                               
legislature can complete its work in  90 days, but doing so would                                                               
require some  structural and operational changes.  She said after                                                               
three-years in the  legislature, she has seen  a 60-day gestation                                                               
period, and  then the policy  work is  done during the  second 60                                                               
days.  She  said  shortening  the gestation  period  to  30  days                                                               
is reasonable. She  said that prior to  1984, legislative session                                                               
time period  was unlimited.  After that  time, the  sessions were                                                               
limited to  120 days. The same  number of laws has  passed during                                                               
the  shorter sessions.  She believes  the public  process can  be                                                               
accomplished and business completed in 90 days.                                                                                 
                                                                                                                                
SENATOR FRENCH noted  that this year, legislators  were "hung up"                                                               
waiting for the Governor's budget. He  said that is when the real                                                               
work begins.  He said he  believes 90 days  is plenty of  time to                                                               
get the work done but he  is interested in tying the beginning of                                                               
the legislative session to receipt of the Governor's budget.                                                                    
                                                                                                                                
SENATOR GUESS said this year  was an anomaly. Normally the budget                                                               
is prepared  by December 15. She  said the question of  tying the                                                               
session  to  the  budget  dates is  appropriate.  She  asked  Ms.                                                               
Neilsen  to   address  whether  the  House   has  discussed  that                                                               
question.                                                                                                                       
                                                                                                                                
MS. SARA  NEILSEN, staff to Representative  Samuels, told members                                                               
that question did  not come up in House committees  but they have                                                               
discussed  starting the  legislative session  later, possibly  in                                                               
March.                                                                                                                          
                                                                                                                                
SENATOR GUESS said  a big trigger mechanism  to the legislature's                                                               
work is the budget forecast and it needs to be a driving force.                                                                 
                                                                                                                                
VICE-CHAIR OGAN announced that Senator  Therriault had joined the                                                               
committee.                                                                                                                      
                                                                                                                                
VICE-CHAIR   OGAN  pointed   out   that   he  co-sponsored   this                                                               
legislation.  He  said the  legislature  has  the ability,  under                                                               
existing constitutional  language, to  change the month  and date                                                               
of  the beginning  of the  legislative session  by law.  He would                                                               
object to starting  as late as March but he  would agree to begin                                                               
at the  end of January. He  said he hopes that  a shorter session                                                               
will result in fewer laws being passed.                                                                                         
                                                                                                                                
VICE-CHAIR OGAN  noted that no one  had signed up to  testify. He                                                               
then  asked Senator  Therriault,  as a  former Finance  Committee                                                               
chair, how he envisions a 90-day session working.                                                                               
                                                                                                                                
SENATOR THERRIAULT  said a  90-day limit could  be a  problem. He                                                               
asked members  to keep in mind  the balance of power  between the                                                               
legislative and  executive branches. This legislature  is working                                                               
better with  this Administration  than it  did with  the previous                                                               
administration  but, even  now, the  legislature must  often wait                                                               
for information and  legal opinions. He said that  members of the                                                               
House get  elected every two years  and new members have  a steep                                                               
learning curve. They need a  certain amount of time to understand                                                               
the budget  process and play a  meaningful role. He said  he does                                                               
not oppose  a 90-day session  but believes the  consequences must                                                               
be studied in depth.  He  pointed out that a piece of legislation                                                               
on  the  floor today  was  introduced  at  the beginning  of  the                                                               
session and people are saying  it was rushed through the process.                                                               
He asked  what people  will think if  legislation gets  passed in                                                               
90-day sessions.                                                                                                                
                                                                                                                                
SENATOR GUESS  commented that Senator Therriault  brought up some                                                               
good  points  that need  to  be  thought  through. She  said  the                                                               
legislature will have to think  through when its organization and                                                               
orientation will take  place, as well as the  budget and election                                                               
year issues. She  said she feels, as a public  servant, she would                                                               
have  to do  more  preparation work  prior to  the  start of  the                                                               
session. She said in her mind,  shortening the session to 90 days                                                               
is a  policy call as to  whether legislators believe they  can do                                                               
the work in 90 days and  what kind of structure will be necessary                                                               
to ensure a good public process.                                                                                                
                                                                                                                                
8:49 a.m.                                                                                                                     
                                                                                                                                
SENATOR  THERRIAULT noted  that  he recently  had a  conversation                                                               
with a  freshman legislator  who said it  was difficult  to start                                                               
the  first day  of  session  with no  staff.  A discussion  about                                                               
swearing  in newly  elected legislators  earlier has  been taking                                                               
place.  Perhaps  consideration should  be  given  to swearing  in                                                               
legislators on the same day the Governor  is sworn in.  He said a                                                               
shorter session would also require  that more work be done during                                                               
the interim. He  said in his experience, half  of the legislators                                                               
have  full-time   jobs  so   committees  with   specific  interim                                                               
requirements   would  need   members  with   flexible  employment                                                               
situations. In addition, that would  drive up the cost during the                                                               
interim.                                                                                                                        
                                                                                                                                
SENATOR GUESS  said the cost of  work done during the  interim is                                                               
less than  the cost of  work done  during session. She  said from                                                               
her personal experience as a  citizen legislator with a full-time                                                               
job, if there  is predictability in the schedule,  she could work                                                               
around it.                                                                                                                      
                                                                                                                                
VICE-CHAIR  OGAN  said  he  has  spent  a  lot  of  time  in  the                                                               
contracting business; his philosophy is  that a job takes as long                                                               
as  one is  given to  do it.  He felt  that Senator  Therriault's                                                               
concerns are  legitimate and the  legislature might need  to look                                                               
at  providing  committees  with   authority  to  take  action  on                                                               
legislation  during   the  interim.   He  said  his   phone  rang                                                               
constantly  when  he was  first  elected.  He  had no  staff  and                                                               
constant demands  on him  although he  was not  sworn in  for two                                                               
months.  He  said  another consideration  is  that  right  before                                                               
session begins, many people take vacations during the holidays.                                                                 
                                                                                                                                
CHAIR  SEEKINS  said his  main  concern  was  that after  he  was                                                               
elected,  he felt  handcuffed by  not having  any staff.  He said                                                               
that  problem should  be addressed  if the  legislature wants  to                                                               
shorten the  session. He said  he would look favorably  upon this                                                               
legislation with a few modifications.                                                                                           
                                                                                                                                
SENATOR GUESS stated that the  concerns that have been raised are                                                               
good  ones.  She  agreed   that  orientation  needs  improvement,                                                               
regardless of whether this legislation moves forward.                                                                           
                                                                                                                                
SENATOR ELLIS asked the date of the spring revenue forecast.                                                                    
                                                                                                                                
SENATOR SEEKINS said it is usually  released in the first part of                                                               
April.                                                                                                                          
                                                                                                                                
SENATOR  ELLIS asked  if the  Governor's budget  was released  on                                                               
March 5.                                                                                                                        
                                                                                                                                
SENATOR GUESS said  she believes that is correct.  She then asked                                                               
that  the  committee hold  this  bill  for  further work  on  the                                                               
structure of a 90-day session.                                                                                                  
                                                                                                                                
CHAIR SEEKINS announced he would hold the bill in committee.                                                                    
                                                                                                                                
TAPE 03-46, SIDE B                                                                                                            
                                                                                                                                
                HB 102-CONCEALED DEADLY WEAPONS                                                                             
                                                                                                                                
OFFICER  MIKE   COUTURIER,  representing  the   Anchorage  Police                                                               
Employees Association,  stated support  for the  proposed changes                                                               
[in  Version Q].  Peace officers  support anything  that provides                                                               
them with a better tool  to ensure everyone's safety through more                                                               
detailed instruction  about what  to do  when contacted  by peace                                                               
officers.                                                                                                                       
                                                                                                                                
SENATOR  FRENCH asked  Officer Couturier  who would  be educating                                                               
the  public about  the bill  requirements regarding  notification                                                               
before  entering a  home with  a concealed  handgun or  notifying                                                               
police officers that one is carrying a concealed handgun.                                                                       
                                                                                                                                
OFFICER COUTURIER said the trainer  would inform anyone obtaining                                                               
a concealed  carry permit  if this bill  passes. The  majority of                                                               
people handling concealed weapons  receive their training [during                                                               
the permit  process]. He  said he  believes once  a person  has a                                                               
concealed carry  permit, that person  would be on a  mailing list                                                               
for updates to any changes to the state law. He said:                                                                           
                                                                                                                                
     As far as  a person that owns a  residence that happens                                                                    
     to have a  guest that happens to be  carrying a weapon,                                                                    
     and the homeowner, knowing that  the person is supposed                                                                    
     to provide  them with that information,  that's part of                                                                    
     the onus that  we all share in educating  the public on                                                                    
     current law and changes to  the law. And partially as a                                                                    
     responsible  citizen  of  the   state  we  all  have  a                                                                    
     responsibility, of  course, to  know what the  laws are                                                                    
     and to obey them. Certainly  some public forum of TV or                                                                    
     municipal  channels  would   assist  in  educating  the                                                                    
     public and those are the options that I see.                                                                               
                                                                                                                                
SENATOR FRENCH said it sounds  like Officer Couturier is assuming                                                               
the  instructional   courses  under  the  current   system  would                                                               
continue and it is through  those courses that people would learn                                                               
the provisions  of the law.  He said  he is skeptical  because he                                                               
believes this bill will repeal the  need for a permit and make it                                                               
less likely that someone will spend the money to take a class.                                                                  
                                                                                                                                
CHAIR SEEKINS  remarked that a  person would still need  a permit                                                               
if he  or she wants  to carry a  concealed weapon outside  of the                                                               
state  because  a person  will  not  have reciprocity  without  a                                                               
permit. In  addition, a person  with a  permit can buy  a handgun                                                               
without  the  waiting  period because  the  necessary  background                                                               
check has  already been done.  Therefore, it is  still beneficial                                                               
to  take the  training classes  to get  the actual  carry permit.                                                               
This  bill will  not  make criminals  out of  people  who wear  a                                                               
jacket over a  weapon when they are carrying it  legally. He said                                                               
he  would   imagine  that  gun   shops,  the  NRA,   and  outdoor                                                               
organizations will do everything they  can to educate the general                                                               
public. It  will not be required  by statute, but if  this law is                                                               
to work,  those organizations know  it is incumbent upon  them to                                                               
educate the public.                                                                                                             
                                                                                                                                
OFFICER COUTURIER said he needed to  back up because when he read                                                               
the bill  he did  not read  anything that  said permits  would no                                                               
longer be required.                                                                                                             
                                                                                                                                
CHAIR SEEKINS  replied, "You  can carry  concealed now  without a                                                               
permit - if you do so in a lawful manner."                                                                                      
                                                                                                                                
SENATOR  FRENCH read,  to  clarify  the nature  of  the bill  for                                                               
Officer  Couturier,  the  following   excerpt  from  the  sponsor                                                               
statement:                                                                                                                      
                                                                                                                                
     HB 102  repeals the  concealed carry laws  that require                                                                    
     permits  to carry  deadly weapons,  including handguns,                                                                    
     knives and  other legal-to-own deadly weapons.  It does                                                                    
     not repeal  any of the  restrictions on where  a person                                                                    
     can  carry  a  concealed  weapon,  such  as  on  school                                                                    
     grounds, in  courthouses or on private  property, where                                                                    
     the owner may prohibit such weapons.                                                                                       
                                                                                                                                
CHAIR SEEKINS noted the third paragraph reads:                                                                                  
                                                                                                                                
     It  does  not  eliminate the  state's  concealed  carry                                                                    
     permit program for two reasons.                                                                                            
                                                                                                                                
OFFICER  COUTURIER  apologized  and  said he  did  not  have  the                                                               
sponsor statement. He said the  support of his organization might                                                               
not  be  as  strong  because   the  Anchorage  Police  Department                                                               
Employees  Association   certainly  feels  the  need,   prior  to                                                               
contacting someone  - whether that be  on a traffic stop  or just                                                               
contacting them  on the  street, to  know ahead  of time  or upon                                                               
recontact that the person has a  concealed carry permit.  He said                                                               
if there were  no system that allows the peace  officer to know a                                                               
person has  a concealed carry  permit, he would not  know whether                                                               
or  not  the carrier  is  violating.  The Association  feels  the                                                               
concealed carry program provides a  valuable tool that the police                                                               
department uses daily.                                                                                                          
                                                                                                                                
SENATOR FRENCH  said he believes  one valid reason for  this bill                                                               
is  that it  is difficult  for  people who  live in  the Bush  to                                                               
qualify  for a  concealed carry  permit because  the courses  are                                                               
only  taught in  metropolitan  areas. He  suggested  it might  be                                                               
possible to  offer the information  that the peace  officers want                                                               
conveyed to people  before they are allowed to  carry a concealed                                                               
weapon  through either  an Internet  session or  a correspondence                                                               
course.                                                                                                                         
                                                                                                                                
OFFICER  COUTURIER  said  his  organization   feels  it  is  very                                                               
important  to have  this tool  as  it makes  contact safer;  they                                                               
would hate to lose this tool.                                                                                                   
                                                                                                                                
SENATOR  FRENCH commented  there may  be  some way  to lower  the                                                               
level of  qualification to get  a concealed carry  weapon permit,                                                               
still convey the  information, and allow law  enforcement to have                                                               
some knowledge of who has a concealed carry weapon permit.                                                                      
                                                                                                                                
CHAIR SEEKINS indicated  the State of Vermont has  this law; that                                                               
state has one of the lowest crime rates in the nation.                                                                          
                                                                                                                                
SENATOR  OGAN  said  the  police  officers  he  spoke  with  were                                                               
supportive of the  concealed carry law because  they felt, "Well,                                                               
the bad guys are all packing, we  might as well let the good guys                                                               
pack too." He  noted when a person is stopped  the police officer                                                               
runs  their  identification  through   the  APSIN  system,  which                                                               
contains criminal records.  He said it seems if  a police officer                                                               
runs a check on a person and  finds they have a clean record, the                                                               
police  officer would  feel there  is some  reasonable amount  of                                                               
certainty the person is not going to be a threat.                                                                               
                                                                                                                                
OFFICER COUTURIER  said that  is a  reasonable assumption  but we                                                               
live in  a world of  exceptions. He said it  is just a  matter of                                                               
having another tool  in the peace officer's tool  bag to approach                                                               
each situation in the safest way possible.                                                                                      
                                                                                                                                
CHAIR SEEKINS thanked Officer Couturier.                                                                                        
                                                                                                                                
9:15 a.m.                                                                                                                     
                                                                                                                                
SERGEANT DAVE  PARKER, Anchorage Police Department,  told members                                                               
he was contacted the previous  day about this legislation. One of                                                               
his  concerns is  that this  bill will  put honorable  gun owning                                                               
citizens in  a higher risk  situation. He understands  there will                                                               
be an  effort to provide  education on the concealed  carry laws,                                                               
particularly about when  a person can use  lethal force. However,                                                               
having  trained  concealed  carry  permit  applicants  for  three                                                               
years, he has found [the police  department] is able to do a much                                                               
more  thorough job  of teaching  about when  lethal force  can be                                                               
used and  about the laws  surrounding the  use of force.  If this                                                               
concealed  carry bill  is enacted,  he is  concerned that  people                                                               
will be acting in ignorance. He  would hate to see gun owners get                                                               
into  trouble because  they  do not  know the  law.  He said  the                                                               
police  department has  no problems  with concealed  carry permit                                                               
gun owners  because they have  undergone the  necessary education                                                               
to get the  permit. He likened the process to  getting a driver's                                                               
license.                                                                                                                        
                                                                                                                                
MR. PARKER  said carrying a concealed  weapon in the Bush  is not                                                               
the problem; problems  occur in the high-density  urban areas. He                                                               
said the current  law is a good  one. If the law  is changed, the                                                               
good citizens will be the ones who have problems.                                                                               
                                                                                                                                
CHAIR SEEKINS  asked Mr. Judy  to inform committee  members about                                                               
the State of Vermont's experience with this law.                                                                                
                                                                                                                                
MR. BRIAN  JUDY, National  Rifle Association,  said the  State of                                                               
Vermont  is the  one  state without  a  prohibition on  concealed                                                               
carry  of weapons.  According  to FBI  statistics,  the State  of                                                               
Vermont consistently falls near the  bottom of the list of states                                                               
in terms of  crime. Last year, Vermont ranked 49th  out of the 50                                                               
states in  violent crime. He said  the law is working  well; law-                                                               
abiding  citizens are  not causing  problems. He  pointed out  in                                                               
Alaska, one  does not need  a permit  to carry a  firearm openly,                                                               
nor is a permit required if  a concealed firearm is being carried                                                               
for a lawful  outdoor activity. Therefore, a  fairly wide segment                                                               
of  people  are  already  carrying  firearms  without  undergoing                                                               
training.  Under existing  law,  a  person who  is  dressed in  a                                                               
manner that is  not compatible with open carry is  required to go                                                               
through the  government program, pay fees,  be fingerprinted, and                                                               
get  on  a  government  database merely  to  cover  the  firearm.                                                               
Regarding  the  training issue,  he  told  members in  the  large                                                               
number of states  with concealed carry permit  laws, the required                                                               
training runs the  gamut; Vermont is one  extreme. Washington has                                                               
a concealed  carry permit  law with  no training  requirement for                                                               
law-abiding  citizens.   Washington  has   approximately  250,000                                                               
licensed permit  holders. Washington  has no problems  with those                                                               
permit holders. The  empirical evidence in all  states shows that                                                               
concealed  weapons permit  holders are  not causing  problems. He                                                               
pointed out  that Alaska experienced  a significant  reduction in                                                               
violent  crime  after  its  concealed   weapons  permit  law  was                                                               
enacted. He told members the NRA  supports HB 102, as it believes                                                               
it is good public policy.                                                                                                       
                                                                                                                                
CHAIR  SEEKINS said  as a  young man,  he was  a resident  of the                                                               
State  of Washington.  At that  time,  he had  a concealed  carry                                                               
weapon permit  to carry a  22 rifle for  hunting. He said  all he                                                               
needed was  a good reason  for the  State of Washington  to issue                                                               
the permit. He asked if that is still the case.                                                                                 
                                                                                                                                
MR. JUDY said a  person does not have to provide  a reason in the                                                               
State  of  Washington, similar  to  the  current law  in  Alaska.                                                               
Issuance of  a permit is  mandatory for law-abiding  citizens who                                                               
can lawfully own a firearm.                                                                                                     
                                                                                                                                
CHAIR SEEKINS asked  if he, as a permit holder,  would be covered                                                               
if he puts  a revolver in the  console of his truck  but his wife                                                               
would be breaking  the law if she unknowingly  borrowed his truck                                                               
with the gun in it.                                                                                                             
                                                                                                                                
SENATOR  OGAN said  the officer  who  last testified  said it  is                                                               
legal to carry a concealed weapon in one's automobile right now.                                                                
                                                                                                                                
SENATOR FRENCH pointed  out that in the April 4,  2003 letter Mr.                                                               
Brady sent to Representative Croft  about the 1995 changes to the                                                               
concealed  carry  weapons  law,  he  wrote,  "Opponents  screamed                                                               
hysterically  that blood  would  run in  the  streets." He  asked                                                               
whether  that  really  happened  or  whether  it  was  rhetorical                                                               
flourish.                                                                                                                       
                                                                                                                                
MR. JUDY said that was not  rhetorical flourish. In 1993 or 1994,                                                               
when  HB 351  was  initially introduced,  people made  hysterical                                                               
claims  and predictions.  He still  has the  white paper  done by                                                               
certain members  of the law  enforcement community in  which they                                                               
predicted traffic  stops turning  into shoot-outs. He  said those                                                               
were the kinds of claims being  made in other states in the 1980s                                                               
that were making  the same public policy change.  In every single                                                               
state, the empirical  evidence showed that was  not happening. He                                                               
said  that "bad"  guys are  going to  continue to  cause problems                                                               
regardless of the level of training.                                                                                            
                                                                                                                                
SENATOR OGAN  said he believes Switzerland  requires all citizens                                                               
to be in  the military. After they get out  of the military, they                                                               
take their weapons and uniforms with  them and can be called back                                                               
at any time. He said that Switzerland has virtually no crime.                                                                   
                                                                                                                                
CHAIR SEEKINS said  when he visited Switzerland he  was told that                                                               
policy has kept Switzerland neutral for many years.                                                                             
                                                                                                                                
SENATOR  OGAN moved  CSHB 102(STA),  \Q version,  with individual                                                               
recommendations and attached zero fiscal note.                                                                                  
                                                                                                                                
SENATOR FRENCH objected.                                                                                                        
                                                                                                                                
The  motion carried  with Senators  Ellis, Ogan,  Therriault, and                                                               
Seekins in favor, and Senator French opposed.                                                                                   
                                                                                                                                
The committee took a brief at-ease.                                                                                             
                                                                                                                                
          HB 86-INJUNCTIONS AGAINST PERMITTED PROJECTS                                                                      
                                                                                                                                
REPRESENTATIVE HUGH  FATE, prime sponsor  of HB 86,  told members                                                               
that for too long, properly  permitted projects have been delayed                                                               
before  ground is  ever broken.  Projects are  often put  on hold                                                               
because  our   current  [legal]  system  allows   individuals  or                                                               
entities  to  stop  projects  without  a  legitimate  reason  and                                                               
without any  serious consequences. Adding  the language in  HB 86                                                               
to  the  code  of  civil  procedure means  that  those  who  file                                                               
malicious or  bad faith claims  in an  attempt to stop  a project                                                               
must realize that  the economic effects of their  actions will be                                                               
increased. This bill is written to  give the defendant a cause of                                                               
action  and to  provide guidance  to the  court when  determining                                                               
damages.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  FATE  said  in  most cases,  when  a  project  is                                                               
permitted,  the  contractor  begins  the  process  of  purchasing                                                               
materials, hiring  subcontractors and employees,  and essentially                                                               
commits to  go to work. The  economic damage of even  a temporary                                                               
forced work  stoppage far exceeds  attorney and court  fees. This                                                               
bill  requires  the responsible  party  or  plaintiffs to  assume                                                               
economic   responsibility  for   their  actions   if  the   court                                                               
determines the action was improper.  He said this legislation has                                                               
been  closely   scrutinized  and   has  been  determined   to  be                                                               
constitutional,  legally clear,  and  it  contains no  provisions                                                               
that  will violate  due  process. He  emphasized  the court  will                                                               
determine whether the cause or action was improper.                                                                             
                                                                                                                                
SENATOR THERRIAULT asked if a court  would have to dismiss a case                                                               
and  declare  it  to  be  malicious  and  ungrounded  before  the                                                               
permittee could initiate the civil action.                                                                                      
                                                                                                                                
MR.  JIM POUND,  staff to  Representative Fate,  said this  would                                                               
happen at  the injunctive part  of the process. If  an injunction                                                               
were granted, which is an  extensive process, the cause of action                                                               
would fall  into place when  the determination was made  that the                                                               
case was based on unfounded, bad faith, or malicious claims.                                                                    
                                                                                                                                
SENATOR THERRIAULT asked  if he was granted a  permit through the                                                               
agency process  and someone  moved for  an injunction,  which the                                                               
court denied, whether  he would then make a claim  in civil court                                                               
that the filing  for injunctive relief was a bad  faith action or                                                               
whether  the court  would  have  to make  a  proclamation on  the                                                               
request for  injunctive relief before  he could initiate  a civil                                                               
action.                                                                                                                         
                                                                                                                                
REPRESENTATIVE FATE said his understanding  is that a plaintiff's                                                               
filing for injunctive relief will not  be granted by the court if                                                               
the court  finds the cause of  action was filed in  bad faith. If                                                               
injunctive  relief   is  not  granted,  the   project  continues.                                                               
However,  that  does not  stop  the  court from  determining  the                                                               
plaintiff  had just  cause  in  filing the  cause  of action  for                                                               
injunctive relief.  In that event,  it is likely the  court would                                                               
rule for injunctive  relief, in which case there  would either be                                                               
a  delay or  the project  would be  stopped. The  beauty of  this                                                               
piece  of legislation  is that  it actually  allows the  court to                                                               
determine whether the  cause of action was filed in  bad faith or                                                               
was malicious.                                                                                                                  
                                                                                                                                
CHAIR  SEEKINS  said  under  normal  circumstances,  if  a  court                                                               
determines  that the  plaintiff  is liable  under  this law,  the                                                               
court would  initiate damages  at a damages  hearing. If  not, it                                                               
would  be  incumbent upon  the  defendant's  attorney to  file  a                                                               
motion for  damages. He said  he has observed that  when lawsuits                                                               
are  determined  by  the  court  to  be  frivolous,  damages  are                                                               
assessed at meetings with the clerk of the court.                                                                               
                                                                                                                                
REPRESENTATIVE  FATE  said  this  legislation  should  act  as  a                                                               
deterrent  because the  liability  for filing  a  lawsuit in  bad                                                               
faith will increase.                                                                                                            
                                                                                                                                
SENATOR  FRENCH  offered  an amendment  [Amendment  1]  and  told                                                               
members the U.S.  Supreme Court has provided  some good direction                                                               
in this  area. His amendment  is an  attempt to comport  with the                                                               
U.S.  Supreme  Court's position  on  these  lawsuits. Second,  he                                                               
believes the  amendment will  help shift the  focus to  the legal                                                               
merit of a  claim and away from the subjective  intentions of the                                                               
person filing it.                                                                                                               
                                                                                                                                
SENATOR FRENCH moved to adopt Amendment 1.                                                                                      
                                                                                                                                
CHAIR SEEKINS objected.                                                                                                         
                                                                                                                                
SENATOR   FRENCH  said   the  amendment   would   make  a   small                                                               
modification  to page  2, line  8,  by changing  the language  to                                                               
read:                                                                                                                           
                                                                                                                                
        the person initiates or maintains an objectively                                                                        
     baseless legal or administrative claim.                                                                                    
                                                                                                                                
He said that he and  Representative Fate discussed the difficulty                                                               
of  defining "objectively  baseless" but  the U.S.  Supreme Court                                                               
has defined that  term as a case in which  no reasonable litigant                                                               
could  reasonably expect  success on  the  merits. He  said if  a                                                               
person  brings a  lawsuit on  grounds with  no legal  merit, that                                                               
person should  be held accountable.  His amendment  would clarify                                                               
that the  court first looks at  the legal merits of  the case and                                                               
then look at  the intention of the person who  filed the case. He                                                               
noted  that Amendment  1  comports with  the  U.S. Supreme  Court                                                               
decision written  by Justices  Scalia, Thomas,  Rehnquist, White,                                                               
Blackmun, Kennedy, and Souter.                                                                                                  
                                                                                                                                
CHAIR SEEKINS asked Senator French  if he means that if Amendment                                                               
1 is not  adopted, a person's rights would be  violated under the                                                               
U.S. Constitution.                                                                                                              
                                                                                                                                
SENATOR FRENCH  said his intent  is to get  the bill as  close as                                                               
possible to what he sees as "the state of the law."                                                                             
                                                                                                                                
CHAIR SEEKINS  continued, "The  state of  the law  regarding that                                                               
particular case that is cited, in other words."                                                                                 
                                                                                                                                
SENATOR FRENCH replied, "Exactly. The  case where you sue - where                                                               
you assess damages  against somebody who has gone  to court under                                                               
a [indisc.] citizen."                                                                                                           
                                                                                                                                
CHAIR SEEKINS asked if the  state could maintain these conditions                                                               
under paragraph  (c) without  running afoul  of the  U.S. Supreme                                                               
Court.                                                                                                                          
                                                                                                                                
SENATOR FRENCH said  he is just trying to make  the bill a little                                                               
bit better.                                                                                                                     
                                                                                                                                
SENATOR  THERRIAULT questioned  how  the amendment  would fit  on                                                               
page 2, line 8.                                                                                                                 
                                                                                                                                
SENATOR  FRENCH said  he was  referring  to CS  SSHB 86(JUD)  am,                                                               
version W.A.                                                                                                                    
                                                                                                                                
CHAIR  SEEKINS  asked  Representative  Fate his  opinion  of  the                                                               
amendment.                                                                                                                      
                                                                                                                                
REPRESENTATIVE FATE told  members his only concern is  that he is                                                               
not  aware of  the U.S.  Supreme Court  case that  Senator French                                                               
referred  to. He  expressed concern  that  using two  adjectives,                                                               
"baseless" and "objectively," will add confusion.                                                                               
                                                                                                                                
CHAIR   SEEKINS  maintained   his  objection   to  adopting   the                                                               
amendment.                                                                                                                      
                                                                                                                                
SENATOR THERRIAULT  asked Senator  French if  it is  necessary to                                                               
include the word "objectively."                                                                                                 
                                                                                                                                
SENATOR FRENCH said he believes  including the word "objectively"                                                               
will force the court to look  at the legal arguments and stay one                                                               
step removed from the person  filing the claim. He explained that                                                               
he  is concerned  about separating  the legal  argument from  the                                                               
person who filed  it. He said the person who  files a lawsuit may                                                               
have an  irrational hatred of  asphalt but  if that person  has a                                                               
sound legal  reason for his  argument, that person should  not be                                                               
forced to pay damages.                                                                                                          
                                                                                                                                
CHAIR  SEEKINS said  that person  would not  have to  pay damages                                                               
according  to  paragraph  (c)(4),  because that  person  was  not                                                               
acting with malice.                                                                                                             
                                                                                                                                
SENATOR  FRENCH  said  he  believes  a  person  could  argue  the                                                               
contrary  and wants  to keep  the focus  on the  strength of  the                                                               
legal argument.                                                                                                                 
                                                                                                                                
CHAIR  SEEKINS  called for  the  question.  The motion  to  adopt                                                               
Amendment  1 failed  with  Senators French  and  Ellis voting  in                                                               
favor and Senators Ogan, Therriault, and Seekins voting against.                                                                
                                                                                                                                
SENATOR FRENCH moved  an amendment to add the  word "baseless" to                                                               
page 2, line 8, and said he believes that is a fair compromise.                                                                 
                                                                                                                                
SENATOR FRENCH  explained the word  "baseless" would  be inserted                                                               
in front of the word "legal" on page 2, line 8.                                                                                 
                                                                                                                                
CHAIR SEEKINS objected to the motion to adopt Amendment 2.                                                                      
                                                                                                                                
TAPE 03-47, SIDE A                                                                                                            
9:40 a.m.                                                                                                                     
                                                                                                                                
CHAIR SEEKINS  noted that  all claims are  based on  something so                                                               
that if  a lawsuit were  based on, for  example, a hatred  of oil                                                               
drill rigs, the claim would not be baseless.                                                                                    
                                                                                                                                
SENATOR FRENCH replied:                                                                                                         
                                                                                                                                
     I  guess  that  is   why  the  word  'objectively'  was                                                                    
     important,  because  it  gets  you back  to  the  legal                                                                    
     merits  and  not  to  the  mind  of  the  person  who's                                                                    
     bringing it. Once you step  into the mind of the person                                                                    
     who is bringing  it, you're into a hall  of mirrors and                                                                    
     I think you're somewhere where  you just can't win. Any                                                                    
     judge can look  at the quality of a  legal argument and                                                                    
     say  that's  a  joke.   That's  when  it's  objectively                                                                    
     baseless.                                                                                                                  
                                                                                                                                
CHAIR  SEEKINS said  a judge  would  have to  determine that  the                                                               
plaintiff acted in bad faith.                                                                                                   
                                                                                                                                
REPRESENTATIVE FATE said  he would prefer that  "bad faith claim"                                                               
be used.                                                                                                                        
                                                                                                                                
CHAIR  SEEKINS  noted  that  language   is  already  included  in                                                               
paragraph (c)(3).                                                                                                               
                                                                                                                                
SENATOR  OGAN commented  that determining  malice is  subjective;                                                               
therefore he feels  that including the word  "baseless" will help                                                               
to quantify  the malice.  He questioned  how one  would determine                                                               
the legal standard for the culpability of "malice."                                                                             
                                                                                                                                
CHAIR SEEKINS pointed out that  legal precedence has been set for                                                               
"malice."                                                                                                                       
                                                                                                                                
SENATOR THERRIAULT said he  understands Senator French's argument                                                               
in that a person  might have a "legal hook" to  hang the claim on                                                               
but  is filing  the claim  for the  sole reason  of delaying  the                                                               
project.  Senator French  is  trying to  focus  the liability  on                                                               
cases in  which there is  no legal  valid argument that  is filed                                                               
with bad intentions.                                                                                                            
                                                                                                                                
CHAIR SEEKINS stated:                                                                                                           
                                                                                                                                
     I think  that - what  we're trying  to get to  there is                                                                    
     that, Senator Therriault if I  understand is, you could                                                                    
     still bring the  action on a legally valid  point or it                                                                    
     probably would  be defeated  in summary  judgment right                                                                    
     up front,  but the question  is was that  legally valid                                                                    
     complaint done  in bad  faith and  I think  that's what                                                                    
     the sponsor  is trying  to get  to is that  - am  I not                                                                    
     correct?                                                                                                                   
                                                                                                                                
REPRESENTATIVE FATE said that is correct.                                                                                       
                                                                                                                                
CHAIR SEEKINS continued:                                                                                                        
                                                                                                                                
     So, if it has no basis  under the law, if it's baseless                                                                    
     under the  law, more than  likely it would  be disposed                                                                    
     of  in  a  very  short  period  of  time  with  summary                                                                    
     judgment because  someone has not brought  any basis to                                                                    
     bring the action.  And I think what he's  trying to get                                                                    
     to  is the  element of  bad faith.  He's not  trying to                                                                    
     keep  someone  from  bringing   an  action  that  would                                                                    
     otherwise be legally allowed.                                                                                              
                                                                                                                                
SENATOR THERRIAULT  said a person can  bring an action to  get an                                                               
injunction against  a project and  the court can refuse  to grant                                                               
that injunction by saying if the  project goes ahead, no one will                                                               
be harmed.  The injunction  was not  dismissed because  the claim                                                               
had no basis; it was dismissed  because no one will suffer if the                                                               
project goes  ahead. He questioned  whether under (2) on  page 2,                                                               
line 12, the  claim would be considered to be  the request for an                                                               
injunction.                                                                                                                     
                                                                                                                                
CHAIR SEEKINS  said the claim  to get injunctive relief  would be                                                               
rejected; he referred to the language on lines 6 and 7.                                                                         
                                                                                                                                
SENATOR  FRENCH said  he believes  it could  be either.  A person                                                               
could get  an injunction and later  fail on the merits,  when the                                                               
injunction would  be lifted. That  would be a far  more expensive                                                               
hurdle  for a  company  to  get over  because  the company  could                                                               
suffer  a three-month  project delay.  He said  the risk  for the                                                               
plaintiff  is that  the plaintiff  gets the  injunction and  then                                                               
loses the  case three months later  and is liable for  $3 million                                                               
in damages.  He said a person  who may be considered  an agitator                                                               
could be  on the  hook for  millions of  dollars of  damages even                                                               
though  that person  had  a  valid legal  reason  for filing  the                                                               
claim.  That  is the  reason  he  preferred including  the  words                                                               
"objectively baseless."                                                                                                         
                                                                                                                                
CHAIR SEEKINS  called for a roll  call vote. The motion  to adopt                                                               
Amendment 2  carried with Senators  French, Ogan,  Therriault and                                                               
Ellis in favor and Chair Seekins opposed.                                                                                       
                                                                                                                                
CHAIR SEEKINS announced that he would hold CS SSHB 86(JUD) in                                                                   
committee until the next hearing.                                                                                               
                                                                                                                                
SENATOR THERRIAULT informed members that he might propose an                                                                    
amendment to this legislation at the next meeting.                                                                              
                                                                                                                                
CHAIR SEEKINS adjourned the meeting at 10:02 a.m.                                                                               

Document Name Date/Time Subjects