Legislature(1995 - 1996)

04/28/1996 02:05 PM RLS

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                     SENATE RULES COMMITTEE                                    
                         April 28, 1996                                        
                           2:05 p.m.                                           
  MEMBERS PRESENT                                                              
 Senator Mike Miller, Chair                                                    
 Senator Drue Pearce, Vice Chair                                               
 Senator Bert Sharp                                                            
 Senator Jim Duncan                                                            
 Senator Judy Salo                                                             
  MEMBERS ABSENT                                                               
 All members present                                                           
  COMMITTEE CALENDAR                                                           
 CS FOR HOUSE BILL NO. 22(FIN)                                                 
 "An Act relating to long-term plans of certain state agencies and             
 recommendations regarding elimination of duplication in state                 
 agency functions."                                                            
 CS FOR HOUSE BILL NO. 520(FIN)                                                
 "An Act relating to death investigations and inquests, coroners,              
 public administrators, and medical examiners, including the state             
 medical examiner; relating to the jurisdiction of district court              
 judges and magistrates in certain cases involving death."                     
 HOUSE BILL NO. 525                                                            
 "An Act designating certain permissible investments by the Alaska             
 Permanent Fund Corporation in taxable municipal or state debt                 
 securities and corporate debt securities; changing the allocation             
 limits on domestic and nondomestic government and corporate                   
 securities, nondomestic corporate promissory notes, domestic and              
 nondomestic corporate stocks, and taxable government debt                     
 securities; and providing for an effective date."                             
 CS FOR HOUSE CONCURRENT RESOLUTION NO. 26(FIN) am                             
 Relating to creation of the Public Inebriate Task Force.                      
 SENATE BILL NO. 141                                                           
 "An Act relating to legislative ethics; and providing for an                  
 effective date."                                                              
 CS FOR HOUSE BILL NO. 158(FIN) am(ct rls pfld)(efd fld)                       
 "An Act relating to civil actions; amending Alaska Rule of Civil              
 Procedure 95."                                                                
 PREVIOUS SENATE COMMITTEE ACTION                                              
 HB  22 - Finance report 4/27/96.                                              
 HB 520 - See Judiciary minutes dated 4/3/96.                                  
      Finance report 4/27/96.                                                  
 HB 525 - Finance report 4/27/96.                                              
 HCR 26 - See Community & Regional Affairs minutes dated 4/26/96.              
 SB 141 - See State Affairs minutes dated 4/20/95, 4/27/95, 1/30/96,           
      2/6/96, 2/27/96, 3/26/96, and 3/28/96.                                   
 HB 158 - See Judiciary minutes dated 5/3/95, 8/21/95, 8/23/95,                
          8/24/95, 8/25/95, 2/9/96, 2/19/96 & 2/28/96.                         
      See Labor & Commerce minutes dated 3/12/96 & 3/14/96.                    
      Rules minutes dated 4/24/96.                                             
  WITNESS REGISTER                                                             
 Jeff Bush, Deputy Commissioner                                                
 Department of Commerce & Economic Development                                 
 P.O. Box 110800                                                               
 Juneau, AK 99811-0800                                                         
  POSITION STATEMENT:   Outlined Administration's concerns with SCS            
      CSHB 158(RLS)                                                            
 Rick Vollertsen, Representing Alaska Action Trust                             
 420 L St.                                                                     
 Anchorage, AK 99501                                                           
  POSITION STATEMENT:   Testified in opposition to SCS CSHB 158(RLS)           
 Michael Lessmeier, Representing State Farm Insurance Co.                      
 770 L St., #720                                                               
 Sacramento, CA 95814                                                          
  POSITION STATEMENT:   Testified in support of SCS CSHB 158(RLS)              
  ACTION NARRATIVE                                                             
 TAPE 96-8, SIDE A                                                             
 Number 001                                                                    
  CHAIRMAN MILLER  called the Senate Rules Committee meeting to order          
 at 2:05 p.m.                                                                  
 before the committee as the first order of business.  Hearing no              
 discussion, he asked for the pleasure of the committee.                       
  SENATOR SHARP  moved and asked unanimous consent CSHB 22(FIN) be             
 approved for calendaring.  Hearing no objection, it was so ordered.           
 MORTEMS, ETC.) before the committee.  Hearing no discussion, he               
 asked for the pleasure of the committee.                                      
  SENATOR SHARP  moved and asked unanimous consent CSHB 520(FIN) be            
 approved for calendaring.  Hearing no objection, it was so ordered.           
 the committee.  Hearing no discussion, he asked for the pleasure of           
 the committee.                                                                
  SENATOR SHARP  moved and asked unanimous consent HB 525 be approved          
 for calendaring.  Hearing no objection, it was so ordered.                    
 FORCE) before the committee.  Hearing no discussion, he asked for             
 the pleasure of the committee.                                                
  SENATOR PEARCE  moved and asked unanimous consent CSHCR 26(FIN) am           
 be approved for calendaring.   SENATOR SALO  objected and then                
 removed her objection.  There being no further objections, the                
 Chairman stated the calendaring motion passed.                                
  CHAIRMAN MILLER  brought  SB 141  (LEGISLATIVE ETHICS) before the            
 committee, and directed attention to a proposed Rules CS.  However,           
 he stated the committee would not be taking any action on the                 
 legislation this date, but that it would probably be on the Senate            
 calendar on Tuesday, April 30.                                                
  CHAIRMAN MILLER  brought  CSHB 158(FIN) am  (CIVIL LIABILITY) before         
 the committee as the final order of business.  He directed                    
 attention to a proposed Rules SCS and outlined the following                  
 differences between it and the Senate Finance SCS:                            
 1)  Additional court rules changes, which are considered technical            
 amendments, have been added to the title.                                     
 2)  Section 2 is a new section relating to responsibilities of                
 operators of commercial recreational activities.                              
 3)  In Section 3, the statute of repose has been changed from eight           
 years to 10 years.                                                            
 4)  In Section 4, page 5, line 27, the words "from the accrual of             
 the action" have been added at the request of the Administration.             
 5)  In Section 6, the noneconomic damages section the amounts have            
 been changed to $500,000 and $750,000, and the escalator clause for           
 inflation has been eliminated.                                                
 6)  In Section 8, the punitive damages section, it changes the                
 amount of the award for punitive damages going to the state of                
 Alaska from 90 percent to 75 percent.                                         
 7)  Sections 11 & 12 add back in the "empty chair amendment" which            
 was in the Senate Judiciary SCS, but was eliminated in the Senate             
 Finance SCS.                                                                  
 8)  Section 13 is a new section which is a technical fix to a gap             
 that was in a law created with the tort initiative of 1987.                   
 9)  In Section 16, a subsection (b) has been added, which was a               
 request of the Administration.                                                
 10)  Section 18 is a substantial rewrite of the mandatory                     
 arbitration, which was drafted with the help of the court system.             
 11)  Section 19 tightens up civil liability for hospitals.                    
 12)  Section 20 is a new section which relates to civil liability             
 for false claim and improper actions.                                         
 13)  In Section 21 the wording "and the person has been convicted             
 of a felony including convictions based on the quality of a plea or           
 a plea of nolo contendere" has been deleted.                                  
 14)  Sections 24, 25 & 26 are court rule changes that have been               
 15)  Section 30 is new section which is a retroactivity clause on             
 the punitive damages awards only.                                             
 Number 200                                                                    
 Concluding his review, CHAIRMAN MILLER then invited comments on the           
 proposed Rules SCS.                                                           
  JEFF BUSH , representing the Administration, noted he had sent a             
 letter to the Chairman outlining their concerns with the                      
 legislation, and that many of those concerns have been dealt with             
 in the draft Rules SCS, but that many more of them have not been              
 dealt with.                                                                   
 Mr. Bush outlined the Administration's concerns with the following            
 sections of SCS CSHB 158(RLS):                                                
 Section 2.  The Administration has a problem with a new section               
 being added in the final committee of referral.  They believe there           
 has been insufficient process in terms of opportunity for a hearing           
 on this section, and the Department of Law believes that there may            
 be some legal problems and several ambiguities raised by this                 
 Section 3.  As does any statute of repose, Section 3 raises                   
 constitutional questions, and the Governor doesn't want a bill on             
 his desk that adds to constitutional issues or constitutional legal           
 concerns.  The Supreme Court has indicated that there is an issue             
 with a statute of repose with any legislation that cuts off a                 
 person's right to recover for an accident before the accident                 
 actually occurs.                                                              
 Section 6.  There is concern that whenever there is a system that             
 has caps, it is making a policy judgment that those who have minor            
 injuries can be fully compensated, but those who have major                   
 injuries may not be fully compensated  for their injuries.                    
 Section 12.  Allocation of fault between parties, which is known as           
 the "empty chair provision" raises the issue of fairness.  Any time           
 a system is set up where someone who is responsible for an injury             
 cannot be brought to the table, then there is going to be some                
 unfairness in the system.                                                     
 Section 14.  By allowing offers of judgements between individual              
 parties rather than as a group, and penalize the plaintiff or the             
 plaintiff's attorney for failing to guess on whether or not the               
 amounts being offered is going to be responsible or is going to be            
 what a jury is going to award is very difficult.  A fair way to               
 look at this may be to adopt the Senate Judiciary version which               
 simply requires that all the parties on one side of the litigation            
 make their offers jointly before the penalty provisions kick in.              
 Although many of the Administration's concerns with the expert                
 testimony provision have been addressed, it still has some                    
 technical changes that need to be made.  There is concern that the            
 way the arbitration provision is written there is no opportunity to           
 file a motion to dismiss the case before the arbitration kicks in.            
 Section 19.  There is concern that the requirement of $500,000 in             
 liability insurance may be too low.                                           
 Section 20.  The Administration believes that Section 22, which               
 allows increased penalties against lawyers who file pleadings                 
 improperly under Civil Rule 11, covers what the committee is trying           
 to accomplish in Section 20 so there is no longer a need for the              
 section.  The Department of Law is convinced that there will be               
 lots of frivolous cases filed under Section 20 if it is left in.              
 Number 340                                                                    
  RICK VOLLERTSEN , an Anchorage attorney speaking on behalf of the            
 Alaska Action Trust, stated he believes the bill is a poorly                  
 drafted and a profoundly ill-conceived piece of legislation for               
 plaintiffs, for defendants and for businesses, and, if passed, it             
 will be a travesty for those who are seeking legal redress in this            
 jurisdiction.  To pass the bill is to jeopardize fundamental                  
 constitutional rights of Alaskan citizens, including the right to             
 a jury trial and the right to counsel.  He pointed out there have             
 been no hearings on the new provisions contained in the Rules SCS,            
 no study of costs, no statement of the statistics which support it.           
 He also stated the bill will increase litigation time and                     
 litigation costs, and he cautioned that plaintiffs or defendants              
 will not be able to find lawyers to represent them if Section 20,             
 the civil liability provision, is kept in the bill.                           
 Number 424                                                                    
  MICHAEL LESSMEIER , speaking on behalf of State Farm Insurance               
 Company, stated the Rules SCS is a product of significant                     
 compromise that has been going on for more than 10 years with many            
 people working together with different interests trying to make the           
 system better.  State Farm believes the Rules SCS does that, and              
 that the changes that have been made are significant.  He said the            
 role of the Legislature is to balance fairness, and each provision            
 in the bill is a balancing process.  He said Section 20 is an                 
 attempt to impose a level of responsibility that does not currently           
 exist in our system, as well as an attempt also to place a penalty            
 in our system for someone that comes to court and doesn't tell the            
 truth.  He believes these provisions will lead to less litigation,            
 not more, because they will force people to take responsibility for           
 their actions, including lawyers.  In conclusion, he urged the                
 committee's support for the Rules SCS.                                        
 There being no further testimony on SCS CSHB 158(RLS)  CHAIRMAN               
 MILLER  asked for the pleasure of the committee on SCS CSHB                   
  SENATOR PEARCE  moved SCS CSHB 158(RLS) be adopted.  Hearing no              
 objection, the motion carried.                                                
  SENATOR PEARCE  moved that SCS CSHB 158(RLS) be approved for                 
 calendaring.   SENATOR DUNCAN  objected.  The roll was taken with the         
 following result:  Senators Sharp, Pearce and Miller voted "Yea"              
 and Senators Salo and Duncan voted "Nay."  The Chairman stated the            
 motion carried on a 3-2 vote.                                                 
 There being no further business to come before the committee, the             
 meeting was adjourned at 2:43 p.m.                                            

Document Name Date/Time Subjects