Legislature(2003 - 2004)
04/27/2004 08:15 AM Senate JUD
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
CSHB 227(JUD)-DISTRICT COURTS & SMALL CLAIMS
MS. VANESSA TONDINI, staff to the House Judiciary Committee,
explained that CSHB 227(JUD) makes necessary changes to the
current jurisdiction of both small claims and district courts.
The jurisdictional limit for district courts was last raised in
1990 from $35,000 to $50,000. CSHB 227(JUD) will raise that
limit to $100,000, allowing for inflation and increased
flexibility for litigants. The jurisdictional limit on small
claims court and magistrate court was last raised in 1997 from
$5,000 to $7,500. Small claims court offers many advantages over
district court to litigants, including less formal discovery
requirements, lower filing fees and relaxed evidentiary rules.
CSHB 227(JUD) raises that limit to $10,000 and removes
prohibitions against district court hearing claims for false
imprisonment, libel, slander and malicious prosecution because
district court judges are well qualified to hear those kinds of
cases. Last, CSHB 227(JUD) will expand small claims jurisdiction
over out-of-state defendants. Current law only allows small
claims actions against out-of-state defendants under the
landlord/tenant act and certain other statutes that authorize
service of process against owners or operators of motor vehicles
involved in accidents in Alaska. CSHB 227(JUD) will allow small
claims jurisdiction over out-of-state defendants under
traditional long-arm principles.
CHAIR SEEKINS welcomed Representative McGuire.
REPRESENTATIVE LESIL McGUIRE, sponsor of HB 227, added that this
legislation is strongly supported by the business community. The
Alaska State Chamber of Commerce has formally backed this bill
as this will allow businesses to go pro se and avoid high
litigation costs for small cases.
CHAIR SEEKINS stated that he would prefer to increase the
jurisdiction of the small claims courts to $20,000.
MR. DOUG WOOLIVER, Administrative Attorney, Alaska Court System,
stated a neutral position on the bill and noted pros and cons to
raising the jurisdictional limit of the small claims courts. One
concern of judges is that the informality that allows pro se
litigants to better access the courts can lead to unjust results
because of the trade-off between speed, efficiency and lower
costs, and thoroughness and due process. The higher the
jurisdictional limit gets, the less faith judges have that the
process leads to just results, especially when an experienced
litigant faces an inexperienced litigant.
MR. WOOLIVER noted on the other hand, small claims courts are
known as the "people's court" because small claims can be
disputed quickly and with less expense. The Alaska Court System
(ACS), like court systems nationwide, has seen an increase in
pro se litigants. The ACS has made a lot of changes to better
accommodate pro se litigants; CSHB 227(JUD) will be another.
Raising the jurisdictional limit of small claims courts will
make those courts more accessible to people who choose to
represent themselves. He repeated that although there is a
trade-off, the ACS is comfortable with that trade-off with the
limits provided in CSHB 227(JUD).
SENATOR HOLLIS FRENCH asked for an estimate of the number of
cases that could fall in the upper jurisdictional limit.
MR. WOOLIVER said the ACS hears about 10,000 to 12,000 small
claims cases per year statewide, but it does not have a breakout
of the claims by dollar amount. He noted that last two times the
jurisdictional limit was raised, the ACS did not see the number
of filings increase, which suggests that the bulk of the cases
are not at the upper limit.
SENATOR FRENCH asked if CSHB 227(JUD) will change the
jurisdictional limit of the superior court.
MR. WOOLIVER said it will in the sense that right now the
jurisdictional limit of the superior court begins at $50,000;
that number would begin at $100,000. He explained that a person
who wants to take a case to superior court will have to plead
damages in excess of $100,000. Currently, most superior court
damage awards are less than $50,000, so those cases
theoretically could have been brought in district court. This
bill is unlikely to affect pleading decisions but it will allow
people to choose district court, which has less formal discovery
requirements.
CHAIR SEEKINS asked if the judge in a small claims action often
asks questions to get the facts.
MR. WOOLIVER affirmed that is the case.
CHAIR SEEKINS then asked if that is not necessarily the case in
a district court formal action.
MR. WOOLIVER said that is true and that district court cases use
more formal discovery.
CHAIR SEEKINS asked about the attitude of judges across the
state toward having more informal hearings during which they can
ask questions.
MR. WOOLIVER said he has not discussed that specific issue with
them, but when the idea of raising the jurisdictional limit to
$10,000 was discussed, judges were split close to 50/50 about
whether that amount was too high and whether the process and
their role in it was adequate for that amount.
CHAIR SEEKINS said from personal experience, he learned that
some judges really like it because they feel they can ask the
questions they want to ask that they are restrained from asking
during a more formal hearing.
There being no further questions or participants, CHAIR SEEKINS
closed public testimony.
SENATOR OGAN moved CSHB 227(JUD) from committee with individual
recommendations and its attached fiscal note.
CHAIR SEEKINS announced that without objection, CSHB 227(JUD)
moved from committee.
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