00 SENATE CS FOR CS FOR SS FOR HOUSE BILL NO. 58(RLS) 01 "An Act relating to civil actions; relating to independent counsel provided under 02 an insurance policy; relating to attorney fees; amending Rules 16.1, 26, 41, 49, 03 58, 68, 72.1, 82, and 95, Alaska Rules of Civil Procedure; amending Rules 1 and 04 4, District Court Rules of Civil Procedure; amending Rule 702, Alaska Rules of 05 Evidence; and amending Rule 511, Alaska Rules of Appellate Procedure." 06 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 07 * Section 1. LEGISLATIVE INTENT. In enacting this bill, it is the intent of this 08 legislature as a matter of public policy to 09 (1) encourage the efficiency of the civil justice system by discouraging 10 frivolous litigation and by decreasing the amount, cost, and complexity of litigation without 11 diminishing the protection of innocent Alaskans' rights to reasonable, but not excessive, 12 compensation for tortious injuries caused by others; 13 (2) provide for reasonable, but not excessive, punitive damage awards against 14 tortfeasors sufficient to deter conduct and practices that harm innocent Alaskans while not 01 hampering a positive business environment by allowing excessive penalties; 02 (3) encourage individual savings and economic growth by fostering an 03 environment likely to control the increase of liability insurance rates to individuals and 04 businesses resulting in a savings to the state, municipalities, and private businesses that are 05 self-insured; 06 (4) encourage the traditionally recognized Alaska values of self-reliance and 07 independence by underscoring the need for personal responsibility in making choices and 08 personal accountability for the consequences of those choices; 09 (5) alleviate the high cost of malpractice insurance premiums that discourage 10 physicians, architects, engineers, attorneys, and other professionals from rendering needed 11 services to the public; 12 (6) ensure that hospitals that comply with the disclosure requirements set out 13 in this Act are not liable for the negligence of emergency room physicians who are acting as 14 independent contractors; to this extent, this Act is intended to overrule Jackson v. Powers, 743 15 P.2d 1376 (Alaska 1987); 16 (7) ensure that one of several tortfeasors is not held responsible for the 17 negligence of an employer; to this extent, this Act is intended to overrule Lake v. Construction 18 Machinery, Inc., 787 P.2d 1027 (Alaska 1990); 19 (8) enact a statute of repose that meets the tests set out in Turner Construction 20 Co., Inc. v. Scales, 752 P.2d 467 (Alaska 1988); 21 (9) ensure that in actions involving the fault of more than one person, the fault 22 of each claimant, defendant, third-party defendant, person who has been released from 23 liability, or other person responsible for the damages and available as a litigant be determined 24 and awards be allocated in accordance with the fault of each, thereby modifying Benner v. 25 Wichman, 874 P.2d 949 (Alaska 1994); 26 (10) reduce the amount of litigation proceeding to trial by modifying the 27 allocation of attorney fees and court costs based on the offer of judgment and the final court 28 award, thereby providing a financial incentive to both parties to settle the dispute; and 29 (11) ensure that this Act does not apply to or in any way have an effect on 30 existing litigation or a civil cause of action that accrues before the effective date of this Act; 31 it is the specific intent of the legislature that this Act not apply to or in any way have an 01 effect on In Re Exxon Valdez, A89-0095 Civ. (D.Alaska) or any other federal admiralty action 02 now or in the future. 03 * Sec. 2. AS 06.05.473(h) is amended to read: 04 (h) After the payment of all other claims, including interest at the rate of 10.5 05 percent a year [ESTABLISHED UNDER AS 09.30.070], the department shall pay 06 claims that are otherwise valid but that were not filed within the time prescribed. 07 * Sec. 3. AS 09.10.050 is repealed and reenacted to read: 08 Sec. 09.10.050. Certain property actions to be brought in six years. Unless 09 the action is commenced within six years, a person may not bring an action for waste 10 or trespass upon real property. 11 * Sec. 4. AS 09.10 is amended by adding a new section to read: 12 Sec. 09.10.053. Contract actions to be brought in three years. Unless the 13 action is commenced within three years, a person may not bring an action upon a 14 contract or liability, express or implied, except as provided in AS 09.10.040, the 15 provisions of this section may be waived by contract, or as otherwise provided by law. 16 * Sec. 5. AS 09.10.055 is repealed and reenacted to read: 17 Sec. 09.10.055. Statute of repose of 10 years. (a) Notwithstanding the 18 disability of minority described under AS 09.10.140(a), a person may not bring an 19 action for personal injury, death, or property damage unless commenced within 10 20 years of the earlier of the date of 21 (1) substantial completion of the construction alleged to have caused 22 the personal injury, death, or property damage; however, the limitation of this 23 paragraph does not apply to a claim resulting from an intentional or reckless disregard 24 of specific project design plans and specifications or building codes; in this paragraph, 25 "substantial completion" means the date when construction is sufficiently completed 26 to allow the owner or a person authorized by the owner to occupy the improvement 27 or to use the improvement in the manner for which it was intended; or 28 (2) the last act alleged to have caused the personal injury, death, or 29 property damage. 30 (b) This section does not apply if 31 (1) the personal injury, death, or property damage resulted from 01 (A) prolonged exposure to hazardous waste; 02 (B) an intentional act or gross negligence; 03 (C) fraud or misrepresentation; 04 (D) breach of an express warranty or guarantee; or 05 (E) a defective product; in this subparagraph, "product" means 06 an object that has intrinsic value, is capable of delivery as an assembled whole 07 or as a component part, and is introduced into trade or commerce; 08 (2) the facts that would give notice of a potential cause of action are 09 intentionally concealed; 10 (3) a shorter period of time for bringing the action is imposed under 11 another provision of law; 12 (4) the provisions of this section are waived by contract; or 13 (5) the facts that would give notice of a potential cause of action of a 14 minor are not discoverable in the exercise of reasonable care by the minor's parent or 15 guardian. 16 (c) The limitation imposed under (a) of this section is tolled during any period 17 in which there exists the undiscovered presence of a foreign body that has no 18 therapeutic or diagnostic purpose or effect in the body of the injured person and the 19 action is based on the presence of the foreign body. 20 * Sec. 6. AS 09.10.070(a) is amended to read: 21 (a) Except as otherwise provided by law, a [A] person may not bring an 22 action (1) for libel, slander, assault, battery, seduction, or false imprisonment, (2) 23 [OR] for personal [ANY] injury or death, [TO THE PERSON] or injury to the rights 24 of another not arising on contract and not specifically provided otherwise; (3) for 25 taking, detaining, or injuring personal property, including an action for its 26 specific recovery; (4) [(2)] upon a statute for a forfeiture or penalty to the state; or 27 (5) [(3)] upon a liability created by statute, other than a penalty or forfeiture; unless 28 the action is commenced within two years of the accrual of the cause of action. 29 * Sec. 7. AS 09.10.140(a) is amended to read: 30 (a) Except as provided under (c) of this section, if [IF] a person entitled to 31 bring an action mentioned in this chapter is at the time the cause of action accrues 01 either (1) under the age of majority, or (2) incompetent by reason of mental illness or 02 mental disability, the time of a disability identified in (1) or (2) of this subsection is 03 not a part of the time limit for the commencement of the action. Except as provided 04 in (b) of this section, the period within which the action may be brought is not 05 extended in any case longer than two years after the disability ceases. 06 * Sec. 8. AS 09.10.140 is amended by adding a new subsection to read: 07 (c) In an action for personal injury of a person who was under the age of eight 08 years at the time of the injury, the time period before the person's eighth birthday is 09 not a part of the time limit imposed under AS 09.10.070(a) for commencing the civil 10 action. 11 * Sec. 9. AS 09.17.010 is repealed and reenacted to read: 12 Sec. 09.17.010. Noneconomic damages. (a) In an action to recover damages 13 for personal injury or wrongful death, all damage claims for noneconomic losses shall 14 be limited to compensation for pain, suffering, inconvenience, physical impairment, 15 disfigurement, loss of enjoyment of life, loss of consortium, and other nonpecuniary 16 damage. 17 (b) Except as provided under (c) of this section, the damages awarded by a 18 court or a jury under (a) of this section for all claims, including a loss of consortium 19 claim, arising out of a single injury or death may not exceed $500,000 or the injured 20 person's life expectancy in years multiplied by $10,000, whichever is greater. 21 (c) In an action for personal injury, the damages awarded by a court or jury 22 that are described under (b) of this section may not exceed $1,500,000 or the person's 23 life expectancy in years multiplied by $30,000, whichever is greater, when the injured 24 person, as a result of the injury, 25 (1) has lost, or has lost the functional use of, one or more limbs; 26 (2) has permanently impaired cognitive capacity and is incapable of 27 making independent, responsible decisions; 28 (3) has third degree burns over one-half or more of the claimant's body; 29 or 30 (4) is totally blind or totally deaf. 31 (d) Multiple injuries sustained by one person as a result of a single incident 01 shall be treated as a single injury for purposes of this section. 02 * Sec. 10. AS 09.17.020 is repealed and reenacted to read: 03 Sec. 09.17.020. Punitive damages. (a) In an action in which a claim of 04 punitive damages is presented to the fact finder, the fact finder shall determine, 05 concurrently with all other issues presented, whether punitive damages shall be allowed 06 by using the standards set out in (b) of this section. If punitive damages are allowed, 07 a separate proceeding under (c) of this section shall be conducted before the same fact 08 finder to determine the amount of punitive damages to be awarded. 09 (b) The fact finder may make an award of punitive damages only if the 10 plaintiff proves by clear and convincing evidence that the defendant's conduct 11 (1) was outrageous, including acts done with malice or bad motives; 12 or 13 (2) evidenced reckless indifference to the interest of another person. 14 (c) At the separate proceeding to determine the amount of punitive damages 15 to be awarded, the fact finder may consider 16 (1) the likelihood at the time of the conduct that serious harm would 17 arise from the defendant's conduct; 18 (2) the degree of the defendant's awareness of the likelihood described 19 in (1) of this subsection; 20 (3) the amount of financial gain the defendant gained or expected to 21 gain as a result of the defendant's conduct; 22 (4) the duration of the conduct and any intentional concealment of the 23 conduct; 24 (5) the attitude and conduct of the defendant upon discovery of the 25 conduct; 26 (6) the financial condition of the defendant; and 27 (7) the total deterrence of other damages and punishment imposed on 28 the defendant as a result of the conduct, including compensatory and punitive damages 29 awards to persons in situations similar to those of the plaintiff and the severity of the 30 criminal penalties to which the defendant has been or may be subjected. 31 (d) At the conclusion of the separate proceeding under (c) of this section, the 01 fact finder shall determine the amount of punitive damages to be awarded, and the 02 court shall enter judgment for that amount. 03 (e) Unless that evidence is relevant to another issue in the case, discovery of 04 evidence that is relevant to the amount of punitive damages to be determined under 05 (c)(3) or (6) of this section may not be conducted until after the fact finder has 06 determined that an award of punitive damages is allowed under (a) and (b) of this 07 section. The court may issue orders as necessary, including directing the parties to 08 have the information relevant to the amount of punitive damages to be determined 09 under (c)(3) or (6) of this section available for production immediately at the close of 10 the initial trial in order to minimize the delay between the initial trial and the separate 11 proceeding to determine the amount of punitive damages. 12 (f) Except as provided in (g) and (h) of this section, an award of punitive 13 damages may not exceed the greater of 14 (1) three times the amount of compensatory damages awarded to the 15 plaintiff in the action; or 16 (2) the sum of $500,000. 17 (g) The amount of punitive damages awarded by a court or jury under (a) of 18 this section may not exceed four times the amount of compensatory damages awarded 19 or $3,000,000, whichever amount is greater, if 20 (1) the wrongful conduct or omission arose in connection with a 21 commercial activity motivated by financial gain; and 22 (2) the likelihood of death or serious bodily injury from the commercial 23 activity was previously known by the person responsible for making policy decisions 24 relating to the commercial activity and the knowledge was gained from previous 25 instances of death or serious bodily injury arising from the same wrongful conduct or 26 omission, regardless of where the previous wrongful conduct or omission occurred. 27 (h) Notwithstanding any other provision of law, in an action against an 28 employer to recover damages for an unlawful employment practice prohibited by 29 AS 18.80.220, the amount of punitive damages awarded by the court or jury may not 30 exceed 31 (1) $50,000 if the employer has less than 15 employees in this state; 01 (2) $100,000 if the employer has 15 or more but less than 100 02 employees in this state; 03 (3) $300,000 if the employer has 100 or more but less than 200 04 employees in this state; 05 (4) $400,000 if the employer has 200 or more but less than 500 06 employees in this state; and 07 (5) $500,000 if the employer has 500 or more employees in this state. 08 (i) Subsection (h) of this section may not be construed to allow an award of 09 punitive damages against the state or a person immune under another provision of law. 10 In (h) of this section, "employees" means persons employed in each of 20 or more 11 calendar weeks in the current or preceding calendar year. 12 (j) If a person receives an award of punitive damages, the court shall require 13 that 50 percent of the award be deposited into the general fund of the state. This 14 subsection does not grant the state the right to file or join a civil action to recover 15 punitive damages. 16 * Sec. 11. AS 09.17.080(a) is amended to read: 17 (a) In all actions involving fault of more than one person [PARTY TO THE 18 ACTION], including third-party defendants and persons who have settled or otherwise 19 been released [UNDER AS 09.16.040], the court, unless otherwise agreed by all 20 parties, shall instruct the jury to answer special interrogatories or, if there is no jury, 21 shall make findings, indicating 22 (1) the amount of damages each claimant would be entitled to recover 23 if contributory fault is disregarded; and 24 (2) the percentage of the total fault [OF ALL OF THE PARTIES TO 25 EACH CLAIM] that is allocated to each claimant, defendant, third-party defendant, 26 [AND] person who has been released from liability, or other person responsible for 27 the damages unless the person was identified as a potentially responsible person, 28 the person is not a person protected from a civil action under AS 09.10.055, and 29 the parties had a sufficient opportunity to join that person in the action but chose 30 not to; in this paragraph, "sufficient opportunity to join" means the person is 31 (A) within the jurisdiction of the court; 01 (B) not precluded from being joined by law or court rule; 02 and 03 (C) reasonably locatable [UNDER AS 09.16.040]. 04 * Sec. 12. AS 09.17.080(b) is amended to read: 05 (b) In determining the percentages of fault, the trier of fact shall consider both 06 the nature of the conduct of each person [PARTY] at fault, and the extent of the 07 causal relation between the conduct and the damages claimed. [THE TRIER OF 08 FACT MAY DETERMINE THAT TWO OR MORE PERSONS ARE TO BE 09 TREATED AS A SINGLE PARTY IF THEIR CONDUCT WAS A CAUSE OF THE 10 DAMAGES CLAIMED AND THE SEPARATE ACT OR OMISSION OF EACH 11 PERSON CANNOT BE DISTINGUISHED.] 12 * Sec. 13. AS 09.17.080(c) is amended to read: 13 (c) The court shall determine the award of damages to each claimant in 14 accordance with the findings [, SUBJECT TO A REDUCTION UNDER 15 AS 09.16.040,] and enter judgment against each party liable. The court also shall 16 determine and state in the judgment each party's equitable share of the obligation to 17 each claimant in accordance with the respective percentages of fault as determined 18 under (a) of this section. Except as provided under AS 23.30.015(g), an 19 assessment of a percentage of fault against a person who is not a party may only 20 be used as a measure for accurately determining the percentages of fault of a 21 named party. Assessment of a percentage of fault against a person who is not a 22 party does not subject that person to civil liability in that action and may not be 23 used as evidence of civil liability in another action. 24 * Sec. 14. AS 09.17.900 is amended to read: 25 Sec. 09.17.900. Definition. In this chapter, "fault" includes acts or omissions 26 that are in any measure negligent, [OR] reckless, or intentional toward the person or 27 property of the actor or others, or that subject a person to strict tort liability. The term 28 also includes breach of warranty, unreasonable assumption of risk not constituting an 29 enforceable express consent, misuse of a product for which the defendant otherwise 30 would be liable, and unreasonable failure to avoid an injury or to mitigate damages. 31 Legal requirements of causal relation apply both to fault as the basis for liability and 01 to contributory fault. 02 * Sec. 15. AS 09.20 is amended by adding a new section to read: 03 Sec. 09.20.185. Expert witness qualification. (a) In an action based on 04 professional negligence, a person may not testify as an expert witness on the issue of 05 the appropriate standard of care unless the witness is 06 (1) a professional who is licensed in this state or in another state or 07 country; 08 (2) trained and experienced in the same discipline or school of practice 09 as the defendant or in an area directly related to a matter at issue; and 10 (3) certified by a board recognized by the state as having acknowledged 11 expertise and training directly related to the particular field or matter at issue. 12 (b) The provisions of (a) of this section do not apply if the state has not 13 recognized a board that has certified the witness in the particular field or matter at 14 issue. 15 * Sec. 16. AS 09.30.065 is amended to read: 16 Sec. 09.30.065. Offers of judgment. At any time more than 10 days before 17 the trial begins, either the party making a claim or the party defending against a claim 18 may serve upon the adverse party an offer to allow judgment to be entered in complete 19 satisfaction of the claim for the money or property or to the effect specified in the 20 offer, with costs then accrued. If within 10 days after the service of the offer the 21 adverse party serves written notice that the offer is accepted, either party may then file 22 the offer and notice of acceptance together with proof of service, and the clerk shall 23 enter judgment. An offer not accepted within 10 days is considered withdrawn, and 24 evidence of that offer is not admissible except in a proceeding to determine the form 25 of judgment after verdict. If the judgment finally entered on the claim as to which an 26 offer has been made under this section is at least five percent less [NOT MORE] 27 favorable to the offeree than the offer, or if there are multiple defendants at least 28 10 percent less favorable to the offeree than the offer, the offeree, whether the 29 party making the claim or defending against the claim, shall pay all costs as 30 allowed under the Alaska Rules of Civil Procedure and shall pay reasonable 31 actual attorney fees incurred by the offeror from the date the offer was made, 01 [THE INTEREST AWARDED UNDER AS 09.30.070 AND ACCRUED UP TO THE 02 DATE JUDGMENT IS ENTERED SHALL BE ADJUSTED] as follows: 03 (1) if the offer was served no later than 60 days after both parties 04 made the disclosures required by the Alaska Rules of Civil Procedure the offeree 05 shall pay 75 percent of the offeror's reasonable actual attorney fees [OFFEREE 06 IS THE PARTY MAKING THE CLAIM, THE INTEREST RATE SHALL BE 07 REDUCED BY FIVE PERCENT A YEAR]; 08 (2) if the offer was served more than 60 days after both parties 09 made the disclosures required by the Alaska Rules of Civil Procedure but more 10 than 90 days before the trial began, the offeree shall pay 50 percent of the 11 offeror's reasonable actual attorney fees; 12 (3) if the offer was served 90 days or less but more than 10 days 13 before the trial began, the offeree shall pay 30 percent of the offeror's reasonable 14 actual attorney fees [OFFEREE IS THE PARTY DEFENDING AGAINST THE 15 CLAIM, THE INTEREST RATE SHALL BE INCREASED BY FIVE PERCENT A 16 YEAR]. 17 * Sec. 17. AS 09.30.065 is amended by adding a new subsection to read: 18 (b) If an offeror receives costs and reasonable actual attorney fees under (a) 19 of this section, that offeror shall be considered the prevailing party for purposes of an 20 award of attorney fees under the Alaska Rules of Civil Procedure. Notwithstanding 21 (a) of this section, if the amount awarded an offeror for attorney fees under the Alaska 22 Rules of Civil Procedure is greater than a party would receive under (a) of this section, 23 the offeree shall pay to the offeror attorney fees specified under the Alaska Rules of 24 Civil Procedure and is not required to pay reasonable actual attorney fees under (a) of 25 this section. A party who receives attorney fees under this section may not also 26 receive attorney fees under the Alaska Rules of Civil Procedure. 27 * Sec. 18. AS 09.30.070(a) is amended to read: 28 (a) Notwithstanding AS 45.45.010, the [THE] rate of interest on judgments 29 and decrees for the payment of money, including prejudgment interest, is three 30 percentage points above the 12th Federal Reserve District discount rate in effect 31 on January 2 of the year in which the judgment or decree is entered [10.5 01 PERCENT A YEAR], except that a judgment or decree founded on a contract in 02 writing, providing for the payment of interest until paid at a specified rate not 03 exceeding the legal rate of interest for that type of contract, bears interest at the rate 04 specified in the contract if the interest rate is set out in the judgment or decree. 05 * Sec. 19. AS 09.30.070 is amended by adding a new subsection to read: 06 (c) Prejudgment interest may not be awarded for future economic damages, 07 future noneconomic damages, or punitive damages. 08 * Sec. 20. AS 09.50.280 is amended to read: 09 Sec. 09.50.280. Judgment for plaintiff; punitive damages. If judgment is 10 rendered for the plaintiff, it shall be for the legal amount found due from the state with 11 [LEGAL] interest as provided under AS 09.30.070 [FROM THE DATE IT BECAME 12 DUE] and without punitive damages. 13 * Sec. 21. AS 09.55.440(a) is amended to read: 14 (a) Upon the filing of the declaration of taking and the deposit with the court 15 of the amount of the estimated compensation stated in the declaration, title to the estate 16 as specified in the declaration vests in the plaintiff, and that property is condemned 17 and taken for the use of the plaintiff, and the right to just compensation for it vests in 18 the persons entitled to it. The compensation shall be ascertained and awarded in the 19 proceeding and established by judgment. The judgment must include interest at the 20 rate of 10.5 percent a year [SET OUT IN AS 09.30.070] on the amount finally 21 awarded that [WHICH] exceeds the amount paid into court under the declaration of 22 taking. The interest runs from the date title vests to the date of payment of the 23 judgment. 24 * Sec. 22. AS 09.55.536(a) is amended to read: 25 (a) In an action for damages due to personal injury or death based upon the 26 provision of professional services by a health care provider, including a person 27 providing services on behalf of a governmental entity, when the parties have not 28 agreed to arbitration of the claim under AS 09.55.535, the court shall appoint within 29 20 days after filing of answer to a summons and complaint a three-person expert 30 advisory panel unless the court decides that an expert advisory opinion is not necessary 31 for a decision in the case. When the action is filed, the court shall, by order, 01 determine the professions or specialties to be represented on the expert advisory panel, 02 giving the parties the opportunity to object or make suggestions. 03 * Sec. 23. AS 09.55.536(c) is amended to read: 04 (c) Not more than 30 days after selection of the panel, the panel [IT] shall 05 make a written report to the parties and to the court, answering the following questions 06 and other questions submitted to the panel by the court in sufficient detail to explain 07 the case and the reasons for the panel's answers: 08 (1) Why did the claimant seek [WHAT WAS THE DISORDER FOR 09 WHICH THE PLAINTIFF CAME TO] medical care? 10 (2) Was a correct diagnosis made? If not, what was incorrect 11 about the diagnosis [WHAT WOULD HAVE BEEN THE PROBABLE OUTCOME 12 WITHOUT MEDICAL CARE]? 13 (3) Was the treatment or lack of treatment [SELECTED] appropriate? 14 If not, what was inappropriate about the treatment or lack of treatment [FOR 15 THE CASE]? 16 (4) Was the claimant injured during the course of evaluation or 17 treatment or by failure to diagnose or treat [DID AN INJURY ARISE FROM THE 18 MEDICAL CARE]? 19 (5) If the answer to question 4 is "yes," what [WHAT] is the nature 20 and extent of the medical injury? 21 (6) What specifically caused the medical injury? 22 (7) Was the medical injury caused by unskillful care? Explain. 23 (8) If a medical injury had not occurred, what would have been the 24 likely outcome of the medical case [HOW WOULD THE PLAINTIFF'S 25 CONDITION DIFFER FROM THE PLAINTIFF'S PRESENT CONDITION]? 26 * Sec. 24. AS 09.55.536(f) is amended to read: 27 (f) Discovery may not be undertaken in a case until the report of the expert 28 advisory panel is received or 60 days after selection of the panel, whichever occurs 29 first. However, the court may relax this prohibition upon a showing of good cause by 30 any party. If the panel has not completed its report within the 30-day period 31 prescribed in (c) of this section, the court may, upon application, grant the panel [IT] 01 an additional 30 days. 02 * Sec. 25. AS 09.55.536 is amended by adding a new subsection to read: 03 (i) This section applies regardless of whether a party in the action or the health 04 care provider whose professional services are the subject of the action is a 05 governmental entity or in the public or private sector. 06 * Sec. 26. AS 09.55.560(1) is amended to read: 07 (1) "health care provider" means an acupuncturist licensed under 08 AS 08.06; an audiologist licensed under AS 08.11; a chiropractor licensed under 09 AS 08.20; a dental hygienist licensed under AS 08.32; a dentist licensed under 10 AS 08.36; a nurse licensed under AS 08.68; a dispensing optician licensed under 11 AS 08.71; a naturopath licensed under AS 08.45; an optometrist licensed under 12 AS 08.72; a pharmacist licensed under AS 08.80; a physical therapist or occupational 13 therapist licensed under AS 08.84; a physician licensed under AS 08.64; a podiatrist; 14 a psychologist and a psychological associate licensed under AS 08.86; [AND] a 15 hospital as defined in AS 18.20.130, including a governmentally owned or operated 16 hospital; [AND] an employee of a health care provider acting within the course and 17 scope of employment; an ambulatory surgical facility and other organizations 18 whose primary purpose is the delivery of health care, including a health 19 maintenance organization, individual practice association, integrated delivery 20 system, preferred provider organization or arrangement, and a physical hospital 21 organization. 22 * Sec. 27. AS 09.55.560 is amended by adding new paragraphs to read: 23 (4) "professional negligence" means a negligent act or omission by a 24 health care provider in rendering professional services; 25 (5) "professional services" means service provided by a health care 26 provider that is within the scope of services for which the health care provider is 27 licensed and that is not prohibited under the health care provider's license or by a 28 facility in which the health care provider practices. 29 * Sec. 28. AS 09.60 is amended by adding a new section to read: 30 Sec. 09.60.080. Contingent fee agreements. If an attorney contracts for or 31 collects a contingency fee in connection with an action for personal injury, death, or 01 property damage and the damages awarded by a court or jury include an award of 02 punitive damages, the contingent fee due the attorney shall be calculated after that 03 portion of punitive damages due the state under AS 09.17.020(j) has been deducted 04 from the total award of damages. 05 * Sec. 29. AS 09.65 is amended by adding a new section to read: 06 Sec. 09.65.085. Civil liability of electric utility. (a) A utility offering 07 electrical service to the public for compensation under a certificate of public 08 convenience and necessity issued by the Alaska Public Utilities Commission under 09 AS 42.05.221 may not be held strictly liable for property damage, death, or personal 10 injury resulting from an act or omission of the utility relating to the production, 11 delivery, or sale of electricity. 12 (b) This section does not preclude liability for civil damages that are the result 13 of an intentional, reckless, or negligent act or omission. 14 * Sec. 30. AS 09.65 is amended by adding a new section to read: 15 Sec. 09.65.096. Civil liability of hospitals for certain physicians. (a) A 16 hospital is not liable for civil damages as a result of an act or omission by an 17 emergency room physician who is not an employee or actual agent of the hospital if 18 the hospital provides notice that the emergency room physician is an independent 19 contractor and the emergency room physician is insured as described under (c) of this 20 section. The hospital is responsible for exercising reasonable care in granting 21 privileges to practice in the hospital, for reviewing those privileges on a regular basis, 22 and for taking appropriate steps to revoke or restrict privileges in appropriate 23 circumstances. The hospital is not otherwise liable for the acts or omissions of an 24 emergency room physician who is an independent contractor. The notice required by 25 this subsection must be posted conspicuously in all admitting areas of the hospital, 26 published at least annually in a newspaper of general circulation in the area, and must 27 be in substantially the following form: 28 Notice of Limited Liability 29 The following emergency room physicians are independent 30 contractors and are not employees of the hospital: 31 (List specific emergency room physicians) 01 (b) This section does not preclude liability for civil damages that are the 02 proximate result of the hospital's negligence or intentional misconduct. 03 (c) A hospital is not immune from liability under (a) of this section for an act 04 or omission of an emergency room physician who is an independent contractor unless 05 the emergency room physician has liability insurance coverage in the amount of at 06 least $500,000 for each incident and $1,500,000 for all incidents in a year, and the 07 coverage is in effect and applicable to those health care services offered by the 08 emergency room physician that the hospital is required to provide by law or by 09 accreditation requirements. 10 (d) In this section, 11 (1) "emergency room physician" means a physician who does not have 12 an ongoing physician-patient relationship with the emergency room patient and who 13 provides emergency health care services in a hospital emergency room; 14 (2) "hospital" has the meaning given in AS 18.20.130 and includes a 15 governmentally owned or operated hospital; 16 (3) "independent contractor" means an emergency room physician who 17 is not an employee or actual agent of the hospital in connection with the rendition of 18 the health care services. 19 * Sec. 31. AS 09.65.210 is repealed and reenacted to read: 20 Sec. 09.65.210. Damages resulting from commission of a felony or while 21 under the influence of alcohol or drugs. A person who suffers personal injury or 22 death or the person's personal representative under AS 09.55.570 or 09.55.580 may not 23 recover damages for the personal injury or death if the injury or death occurred while 24 the person was 25 (1) engaged in the commission of a felony, the person has been 26 convicted of the felony, including conviction based on a guilty plea or plea of nolo 27 contendere, and the party defending against the claim proves by clear and convincing 28 evidence that the felony substantially contributed to the personal injury or death; 29 (2) engaged in conduct that would constitute the commission of an 30 unclassified felony, a class A, or a class B felony for which the person was not 31 convicted and the party defending against the claim proves by clear and convincing 01 evidence 02 (A) the felonious conduct; and 03 (B) that the felonious conduct substantially contributed to the 04 personal injury or death; 05 (3) fleeing after the commission, by that person, of conduct that would 06 constitute an unclassified felony, a class A felony, or a class B felony or being 07 apprehended for conduct that would constitute an unclassified felony, a class A felony, 08 or a class B felony if the party defending against the claim proves by clear and 09 convincing evidence 10 (A) the felonious conduct; and 11 (B) that the conduct during the flight or apprehension 12 substantially contributed to the injury or death; 13 (4) operating a vehicle, aircraft, or watercraft while under the influence 14 of intoxicating liquor or any controlled substance in violation of AS 28.35.030, was 15 convicted, including conviction based on a guilty plea or plea of nolo contendere, and 16 the party defending against the claim proves by clear and convincing evidence that the 17 conduct substantially contributed to the personal injury or death; or 18 (5) engaged in conduct that would constitute a violation of 19 AS 28.35.030 for which the person was not convicted if the party defending against 20 the claim proves by clear and convincing evidence 21 (A) the violation of AS 28.35.030; and 22 (B) that the conduct substantially contributed to the personal 23 injury or death. 24 * Sec. 32. AS 09.68 is amended by adding a new section to read: 25 Sec. 09.68.130. Collection of settlement information. (a) Except as 26 provided in (c) of this section, the Alaska Judicial Council shall collect and evaluate 27 information relating to the compromise or other resolution of all civil litigation. The 28 information shall be collected on a form developed by the council for that purpose and 29 must include 30 (1) the case name and file number; 31 (2) a general description of the claims being settled; 01 (3) if the case is resolved by way of settlement, 02 (A) the gross dollar amount of the settlement; 03 (B) to whom the settlement was paid; 04 (C) the dollar amount of advanced costs and attorney fees that 05 were deducted from the gross dollar amount of the settlement before 06 disbursement to the claimant; 07 (D) the net amount actually disbursed to the claimant; 08 (E) the total costs and attorney fees paid by or owed by all 09 parties; and 10 (F) any nonmonetary terms, including whether the attorney fees 11 incurred by the claimant were based on a contingent fee agreement or upon an 12 hourly rate; if a contingent fee was paid, the percentage of the total settlement 13 represented by the fee must be included; or, if an hourly rate, the hourly rate 14 paid; 15 (4) if the case is resolved by dismissal, summary judgment, trial, or 16 otherwise, 17 (A) the gross dollar amount of the judgment; 18 (B) the amount of attorney fees awarded and to which party; 19 (C) the amount of costs awarded and to which party; 20 (D) the net amount, after deduction of (B) and (C) of this 21 paragraph, for which the prevailing party has judgment; 22 (E) the dollar amount of advanced costs and attorney fees that 23 were deducted from the gross dollar amount of the judgment before distribution 24 to the claimant; 25 (F) the total costs and attorney fees paid by defending parties; 26 and 27 (G) any nonmonetary terms, including whether the attorney fees 28 incurred by the claimant were based on a contingent fee agreement or upon an 29 hourly rate; if a contingent fee was paid, the percentage of the total settlement 30 represented by the fee must be included; or, if an hourly rate, the hourly rate 31 paid. 01 (b) The information received by the council under (a) of this section is 02 confidential. This restriction does not prevent the disclosure of summaries and 03 statistics in a manner that does not allow the identification of particular cases or 04 parties. 05 (c) The requirements of (a) of this section do not apply to the following types 06 of cases: 07 (1) divorce and dissolution; 08 (2) adoption, custody, support, visitation, and emancipation of children; 09 (3) children-in-need-of-aid cases under AS 47.10 or delinquent minors 10 cases under 47.12; 11 (4) domestic violence protective orders under AS 18.66.100 - 12 18.66.180; 13 (5) estate, guardianship, and trust cases filed under AS 13; 14 (6) small claims under AS 22.15.040. 15 * Sec. 33. AS 21.06 is amended by adding a new section to read: 16 Sec. 21.06.087. Insurance report. (a) The director shall require reporting of 17 and shall compile information necessary to evaluate the effect of the measures enacted 18 in this Act on the availability and cost of insurance in the state. 19 (b) Information described in (a) of this section shall be provided by all insurers 20 doing business in this state in the format specified by the director and must include 21 factual information stating premiums, claims, losses, expenses, and solvency of the 22 company as a whole. Information shall be compiled by the division in a way that 23 protects the identity of individual insureds. 24 (c) The director shall adopt regulations to implement and interpret this section, 25 including requiring insurers doing business in the state to provide information 26 necessary for the division to carry out its responsibilities under (a) and (b) of this 27 section. If there are indications of market disruption, the director may waive all or 28 part of the reporting requirements in this section. 29 (d) Beginning June 1, 2000, the information compiled under (a) of this section 30 shall be reported annually to the governor and the judiciary committees of both houses 31 of the legislature. 01 (e) The division may consult with the Alaska Judicial Council when 02 determining what information to require to be reported under (a) - (c) of this section 03 and when implementing the compilation required under (a) of this section. 04 * Sec. 34. AS 21.89.100(d) is amended to read: 05 (d) If the insured selects independent counsel at the insurer's expense, the 06 insurer may require that the independent counsel have at least four years of experience 07 in civil litigation, including defense experience in the general subject area at issue in 08 the civil action, and malpractice insurance. Unless otherwise provided in the insurance 09 policy, the obligation of the insurer to pay the fee charged by the independent counsel 10 is limited to the rate that is actually paid by the insurer to an attorney in the ordinary 11 course of business in the defense of a similar civil action in the community in which 12 the claim arose or is being defended. In providing independent counsel, the insurer 13 is not responsible for the fees and costs of defending an allegation for which 14 coverage is properly denied and shall be responsible only for the fees and costs 15 to defend those allegations for which the insurer either reserves its position as to 16 coverage or accepts coverage. The independent counsel shall keep detailed 17 records allocating fees and costs accordingly. A dispute between the insurer and 18 insured regarding attorney fees that is not resolved by the insurance policy or this 19 section shall be resolved by arbitration under AS 09.43. 20 * Sec. 35. AS 21.89.100 is amended by adding a new subsection to read: 21 (h) When an insured is represented by independent counsel, the insurer may 22 settle directly with the plaintiff if the settlement includes all claims based upon the 23 allegations for which the insurer previously reserved its position as to coverage or 24 accepted coverage, regardless of whether the settlement extinguishes all claims against 25 the insured. 26 * Sec. 36. AS 23.30.015(g) is amended to read: 27 (g) If the employee or the employee's representative recovers damages from 28 the third person, the employee or representative shall promptly pay to the employer the 29 total amounts paid by the employer under (e)(1)(A) - (C) [(e)(1)(A), (B), AND (C)] 30 of this section [,] insofar as the recovery is sufficient after deducting all litigation costs 31 and expenses. Any excess recovery by the employee or representative shall be 01 credited against any amount payable by the employer thereafter. If the employer is 02 allocated a percentage of fault under AS 09.17.080, the amount due the employer 03 under this subsection shall be reduced by an amount equal to the employer's 04 equitable share of damages assessed under AS 09.17.080(c). 05 * Sec. 37. AS 44.77.015(a) is amended to read: 06 (a) For the purposes of filing claims for medical services provided under 07 AS 47.07 or AS 47.25.120 - 47.25.300, "promptly," in AS 44.77.010(a), means (1) 08 within six months after the date of service, or as provided in (b) of this section, if 09 there is no third-party claim, or (2) within 12 months after the date of service if there 10 is a third-party claim. Except as provided in (c) of this section, a claim may not be 11 paid if it is not filed promptly; an inference to the contrary may not be drawn from 12 AS 09.10.053 [AS 09.10.050], AS 09.50.250 - 09.50.300, or AS 37.25.010. 13 * Sec. 38. Rule 16.1(c), Alaska Rules of Civil Procedure, is amended to read: 14 (c) Motion to Set Trial and Certificate. Unless otherwise ordered by the 15 court, a [A] motion to set trial may not be filed until after the meeting of parties 16 under (n) of this rule has occurred and the scheduling order under Rule 16(b) has 17 been issued [105 DAYS AFTER SERVICE OF THE SUMMONS AND 18 COMPLAINT]. A party seeking to obtain a trial date must serve and file a motion to 19 set trial together with a certificate, signed by counsel, stating: 20 (1) That the issues in the case have actually been joined; 21 (2) That all parties have completed discovery or have a reasonable 22 opportunity to do so within the next 60 days; 23 (3) That the procedure for listing witnesses and exhibits and providing 24 exhibit copies, as set forth in [PARAGRAPH] (d) of this rule has been completed; 25 (4) Whether trial by jury has been timely demanded; 26 (5) The estimated number of days for the trial, including estimates for 27 each party's case and for jury selection; 28 (6) The names, addresses and telephone numbers of all attorneys and 29 pro se parties who are responsible for the conduct of the litigation; 30 (7) Which, if any, statute or rule entitles the case to preference on the 31 trial calendar; 01 (8) That the parties have complied with [PARAGRAPH] (k) of this 02 rule. 03 * Sec. 39. Rule 16.1(n), Alaska Rules of Civil Procedure, is repealed and reenacted to read: 04 (n) Meeting of Parties. Except when otherwise ordered, the parties shall, as 05 soon as practicable after the exchange of initial disclosures required under Rule 06 26(a)(1) and in any event at least 14 days before a scheduling conference is held or 07 a scheduling order is due under Rule 16(b), meet to discuss the nature and basis of 08 their claims and defenses and the possibilities for a prompt settlement of the case and 09 to develop a proposed discovery plan. The attorneys of record and all unrepresented 10 parties that have appeared in the case are jointly responsible for arranging and being 11 present or represented at the meeting, for attempting in good faith to agree on the 12 proposed discovery plan, and for submitting to the court within 10 days after the 13 meeting a written report outlining the proposed discovery plan. The proposed 14 discovery plan shall indicate the parties' views and proposals concerning 15 (1) what changes should be made in the timing or forms of subsequent 16 disclosures under the rules, including a statement as to when the disclosures required 17 under Rule 26(a) were made; 18 (2) the subjects on which discovery may be needed, when discovery 19 should be completed, and whether discovery should be conducted in phases or be 20 limited to or focused upon particular issues; 21 (3) what changes should be made in the limitations on discovery 22 imposed under these rules and what other limitations should be imposed; 23 (4) whether a scheduling conference is unnecessary; 24 (5) whether there will be dispositive or partially dispositive motions 25 filed in the case and whether other deadlines should be set aside pending resolution of 26 the dispositive or partially dispositive motions by the court; and 27 (6) any other orders that should be entered by the court under Civil 28 Rule 16(b) and (c). 29 * Sec. 40. Rule 26, Alaska Rules of Civil Procedure, is amended by adding a new 30 subsection to read: 31 (g) Limited Discovery; Expedited Calendaring. In a civil action for personal 01 injury or property damage involving less than $100,000 in claims the parties shall limit 02 discovery to that allowed under Rule 1(a)(1), District Court Rules, and shall avail 03 themselves of the expedited calendaring procedures allowed under Rule 4, District 04 Court Rules. 05 * Sec. 41. Rule 41(a), Alaska Rules of Civil Procedure, is amended by adding a new 06 paragraph to read: 07 (3) Settlement Information. If a voluntary dismissal under this rule 08 is the result of compromise or other settlement of the parties, the parties shall submit 09 to the Alaska Judicial Council the information required under AS 09.68.130. A notice 10 of dismissal made under (1)[a] of this subsection must be accompanied by a 11 certification signed by or on behalf of the plaintiff that the information required under 12 AS 09.68.130 has been submitted to the Alaska Judicial Council. A stipulation of 13 dismissal made under (1)[b] of this subsection must be accompanied by a certification 14 signed by or on behalf of all parties who have appeared in the action. The 15 requirements of this paragraph do not apply to the types of cases listed in 16 AS 09.68.130(c). 17 * Sec. 42. Rule 72.1(g), Alaska Rules of Civil Procedure, is amended to read: 18 (g) Discovery. Except by leave of court, no discovery may be conducted until 19 the report of the Panel has been filed or until 60 [80] days after selection of the Panel 20 [HAVE ELAPSED FROM THE DATE THE CASE IS AT ISSUE], whichever is first 21 to occur, unless discovery is further stayed for good cause by order of the court. 22 * Sec. 43. Rule 95(b), Alaska Rules of Civil Procedure, is amended to read: 23 (b) In addition to its authority under (a) of this rule and its power to punish 24 for contempt, a court may, after reasonable notice and an opportunity to show cause 25 to the contrary, and after hearing by the court, if requested, impose a fine not to 26 exceed $50,000.00 [$1,000.00] against any attorney who practices before it for failure 27 to comply with these rules or any rules promulgated by the supreme court. 28 * Sec. 44. Rule 95, Alaska Rules of Civil Procedure, is amended by adding a new 29 subsection to read: 30 (c) If the trier of fact determines that a party to a civil action involving 31 personal injury or property damage has intentionally made a false statement of a 01 material fact in connection with the prosecution or defense of a civil action, the court 02 shall enter judgment against the party making the false statement on the issue to which 03 the false statement relates. If the civil action involves multiple claims and the false 04 statement does not apply to all claims, the judgment required under this subsection 05 shall apply only to those claims to which the false statement relates. 06 * Sec. 45. Rule 1(a)(1), District Court Rules of Civil Procedure, is amended to read: 07 (1) The procedure in civil actions and proceedings before district judges 08 and magistrates shall be governed by the rules governing the procedure in the superior 09 court to the extent that such rules are applicable. However, in a civil action for 10 personal injury or property damage, unless otherwise agreed by all parties or 11 permitted by order of the court in exceptional cases and for good cause shown, 12 discovery shall be limited to the disclosures required under Civil Rule 26(a) and 13 to the taking by each party of the deposition of one or more opposing parties and 14 of one additional person who is not a party. 15 * Sec. 46. Rule 4, District Court Rules of Civil Procedure, is amended by adding a new 16 subsection to read: 17 (b) In a civil action for personal injury or property damage, unless otherwise 18 permitted by order of the court in exceptional cases and for good cause shown, all 19 parties shall file a memorandum to set the case for trial, as set out in Civil Rule 40(b), 20 no later than 180 days after service of the complaint on all parties to the case. The 21 memorandum shall contain a certification that each party has exchanged the 22 information described in Rule 26(a), Alaska Rules of Civil Procedure, and may state 23 their separate positions if they do not agree concerning information or estimates to be 24 provided in the memorandum. After the court satisfies itself that the information 25 described in Rule 26(a), Alaska Rules of Civil Procedure, has been disclosed, the court 26 shall set the case for trial as soon as practicable, but no sooner than 30 days after the 27 court makes the determination regarding disclosure. 28 * Sec. 47. Rule 511, Alaska Rules of Appellate Procedure, is amended by adding a new 29 subsection to read: 30 (e) Settlement Information. If a dismissal under (a) or (b) of this rule is the 31 result of compromise or other settlement between the parties, the parties shall submit 01 to the Alaska Judicial Council the information required under AS 09.68.130. A 02 dismissal by agreement under (a) of this rule must be accompanied by a certification 03 signed by the attorneys of record for all parties that the information required under 04 AS 09.68.130 has been submitted to the Alaska Judicial Council. A dismissal by the 05 appellant or petitioner made under (b) of this rule must be accompanied by a 06 certification signed by the appellant's or petitioner's attorney of record. The 07 requirements of this subsection do not apply to the types of cases listed in 08 AS 09.68.130(c). 09 * Sec. 48. Rule 16.1(k)(4), Alaska Rules of Civil Procedure, is repealed. 10 * Sec. 49. AS 09.17.020(e), as enacted in sec. 10 of this Act, has the effect of amending 11 Rule 26, Alaska Rules of Civil Procedure, by limiting discovery in certain actions. 12 * Sec. 50. AS 09.17.020(j), as enacted by sec. 10 of this Act, has the effect of amending 13 Rule 58, Alaska Rules of Civil Procedure, by requiring the court to require that a certain 14 percentage of an award of punitive damages be deposited into the general fund. 15 * Sec. 51. AS 09.17.080(a), as amended by sec. 11 of this Act, has the effect of amending 16 Rule 49, Alaska Rules of Civil Procedure, by requiring the jury to answer the special 17 interrogatory listed in AS 09.17.080(a)(2) regarding the percentages of fault to be allocated 18 among the claimants, defendants, third-party defendants, persons who have been released from 19 liability, or other person who is potentially responsible for the damages. 20 * Sec. 52. AS 09.20.185, enacted by sec. 15 of this Act, has the effect of amending 21 Rule 702, Alaska Rules of Evidence, by requiring certain qualifications from a person 22 testifying as an expert witness. 23 * Sec. 53. AS 09.30.065, as amended by secs. 16 and 17 of this Act, has the effect of 24 amending Rules 68 and 82, Alaska Rules of Civil Procedure, by requiring the offeree to pay 25 costs and reasonable actual attorney fees on a sliding scale of percentages in certain cases, by 26 eliminating provisions relating to interest and by changing provisions related to attorney fee 27 awards. 28 * Sec. 54. AS 09.30.070(c), added by sec. 19 of this Act, has the effect of amending 29 Rule 58, Alaska Rules of Civil Procedure, by providing that prejudgment interest may not be 30 awarded for future economic or noneconomic damages or punitive damages. 31 * Sec. 55. ALTERNATIVE DISPUTE RESOLUTION. (a) It is the intent of this 01 legislation to create an alternative dispute resolution procedure within the existing civil 02 litigation system in order to promote the timely, inexpensive, and efficient resolution of civil 03 disputes. It is also the intent of this legislation that the Alaska Supreme Court implement the 04 alternative dispute resolution procedure not later than July 1, 1998. 05 (b) The Alaska Judicial Council shall consult with the Alaska Dispute Settlement 06 Association, review court sanctioned alternative dispute resolution programs in other states and 07 in the federal court system, and shall confer with and obtain the approval of the Alaska Court 08 System regarding the establishment of a program for alternative dispute resolution within the 09 Alaska Court System. The Alaska Judicial Council shall submit a proposed statute or rule 10 change, or both, and a report to the legislature by December 31, 1997. The proposed statute 11 or rule change and report must include specific types of programs, specific types of cases 12 within each program that are amenable to alternative dispute resolution, the cost to the parties 13 and to the Alaska Court System under these programs, and the qualifications of the neutral 14 parties, including nonlawyers, who will provide dispute resolution services under the program. 15 The work required under this section shall be completed for the amount of money appearing 16 on the fiscal note submitted by the Alaska Court System dated March 17, 1997. 17 (c) In this section, "alternative dispute resolution" is limited to arbitration, mediation, 18 and early neutral evaluation. 19 * Sec. 56. APPLICABILITY. This Act applies to all causes of action accruing on or after 20 the effective date of this Act. 21 * Sec. 57. SEVERABILITY. Under AS 01.10.030, if any provision of this Act or the 22 application of a provision of this Act to any person or circumstance is held invalid, the 23 remainder of this Act and the application to other persons shall not be affected.