Legislature(1993 - 1994)

04/14/1993 01:45 PM Senate JUD

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
 SENATOR TAYLOR returned SB 73 (LIABILITY OF DESIGN/                           
 CONSTRUCTION PROFESSIONALS) introduced by SENATOR KELLY, to                   
 committee and directed the teleconference for the bill,                       
 beginning with the Anchorage location to hear COLIN MAYNARD.                  
 MR. MAYNARD, representing the Alaska Society of Professional                  
 Engineers, testified in favor of the bill citing protection                   
 from the present indefinite period of liability.  He described                
 the extent of the suits that could be pursued during this                     
 period of liability due to changes in design or neglect by the                
 owner of the building in question.  MR. MAYNARD discussed why                 
 liability should be discontinued at the end of ten years                      
 unless there was proof of negligence by the design                            
 professionals.  He concluded his testimony by explaining why                  
 he thought the Statute of Repose was fair to all parties                      
 involved in the building profession.                                          
 Next, SENATOR TAYLOR invited DOUG GREEN to testify from                       
 Number 057                                                                    
 MR. GREEN, representing the Alaska Professional Design Council                
 and the American Institute of Architects, introduced himself                  
 as an architect in support of SB 73.  He reviewed testimony                   
 from previous years on the Statute of Repose defending the                    
 record of the design professionals in protecting the public                   
 and utilizing the most current codes and standard of care.                    
 MR. GREEN explained that having the Statute of Repose would                   
 not lower their current standard of attention.  He further                    
 explained the process involved in construction and the                        
 possible changes made to a project.  He described how the                     
 Statute of Repose would be of benefit to the State of Alaska                  
 and would have no fiscal impact to the legislation.                           
 Number 155                                                                    
 RUSS WINNER, an attorney from the Anchorage firm of WINNER &                  
 ASSOCIATES, was invited to testify.                                           
 MR. WINNER, representing the Alaska Academy of Trial Lawyers,                 
 testified in opposition to SB 73 for what he said were future                 
 victims of buildings that might collapse.  He predicted the                   
 occurrence of calamities for these future victims, and he                     
 described such occurrences as being unfair under the Statute                  
 of Repose.                                                                    
 MR. WINNER labeled it "special interest litigation" for the                   
 design professionals involved in construction projects and                    
 questioned the need for special treatment for architects and                  
 engineers.  He suggested it could be compared it to giving                    
 lawyers the same protection, which he said would also be                      
 unfair to the victims.                                                        
 MR. WINNER explained SB 73 was almost identical to a statute                  
 that was previously struck down as unconstitutional by the                    
 Alaska Supreme Court.  He reviewed the constitutional analysis                
 by the supreme court as well as the policy considerations that                
 were present both then and now.  He predicted the Alaska                      
 Supreme Court would strike the present legislation as also                    
 MR. WINNER said his view was shared by the attorney for the                   
 Division of Legal Services in a letter to REPRESENTATIVE BRIAN                
 PORTER regarding SB 73.  He reviewed the changes between the                  
 six-year Statute of Repose of the previously unconstitutional                 
 legislation to one of ten years in SB 73 which includes gross                 
 negligence as a causative factor.  MR. WINNER reiterated his                  
 objections to the current legislation as being identical to                   
 the previous statutes which he believed would be adjudged                     
 unconstitutional by the Alaska Supreme Court.                                 
 Number 239                                                                    
 MR. WINNER explained why he considered it inappropriate the                   
 legislature would consider a piece of legislation after                       
 receiving similar advice from attorneys.  He reviewed the                     
 concerns noted by the Alaska Supreme Court Case in Turner                    
 Construction Co., Inc. v. Scales, 752 P.2d 467 (Alaska 1988)                 
 when it struck down the earlier bill.  MR. WINNER quoted the                  
 court findings that the Statute of Repose violated the state                  
 constitution's equal protection clause.  He said it deprives                  
 innocent victims of a substantial right to recovery in court.                 
 MR. WINNER quoted the Turner court as finding the purpose of                
 the six-year Statute of Repose was to "encourage construction                 
 and avoid stale claims by shielding certain defendants from                   
 potential future liability."  MR. WINNER said he assumed that                 
 was the same purpose for SB 73, and he explained the court's                  
 determination this did not serve this purpose very well                       
 because of the multiple involvement of participants in a                      
 construction project - besides design professionals.  In                      
 addition, he explained how this affirmed the ruling of several                
 superior court judges, who had considered the statute in                      
 earlier cases.                                                                
 Number 273                                                                    
 MR. WINNER continued to review the infirmities he saw in SB
 73 such as the allocation of fault among parties to a piece                   
 of litigation after voters approved an initiative abolishing                  
 joint and several liability.  He said the Statute of Repose                   
 would shift liability to owners, lessees, and persons selling                 
 materials, and he claimed for that reason, SB 73 "stinks."                    
 SENATOR TAYLOR explained the committee was nearly out of time                 
 on the teleconference network, and he asked MR. WINNER to                     
 comment on a couple of proposed amendments to SB 73.                          
 MR. WINNER had suggested in a letter to SENATOR TAYLOR in a                   
 letter, in which he explained to the committee might, or might                
 not, enable SB 73 to pass the courts as statutes.  He said it                 
 would make the legislation less onerous to innocent victims.                  
 MR. WINNER also described a judicial committee, headed by                     
 JUDGE KARL JOHNSTON, Presiding Judge for the Third District,                  
 designated to look at major changes in the court system.  MR.                 
 WINNER suggested the outcome of the committee would be to                     
 dramatically shorten the discovery process and to "smoke out                  
 meritless lawsuits early in the process."  He also proposed                   
 it would reduce the need for legislation such as SB 73.                       
 Number 323                                                                    
 SENATOR TAYLOR requested MR. WINNER to address page 2, line                   
 24, *Sec. 2. ..., ACTIONS TO BE BROUGHT IN SIX YEARS, and                     
 asked why MR. WINNER did not propose amendments for that                      
 MR. WINNER thought the meat of the bill was in * Sec. 3, and                  
 SENATOR TAYLOR agreed with his explanation.                                   
 SENATOR TAYLOR checked the teleconference network for others                  
 wishing to testify on SB 73.  Hearing none, the teleconference                
 SENATOR LITTLE proposed splitting the recommendations from MR.                
 WINNER into two amendments and moved Amendment #1.                            
  Page 3, line 19, after ";":                                                  
   Delete "or"                                                                 
  Page 3, line 21, after "contract":                                           
   Insert "; or                                                                
    (4)  if the defect was not discovered or could                             
     not reasonably have been discovered by                                    
     the person bringing an action for       personal injury or propert   ert  
     the decedent in a wrongful death action,                                  
     within the period of time set out under                                   
     (a) of this section."                                                     
 SENATOR HALFORD objected to the amendment.  SENATOR TAYLOR                    
 asked SENATOR LITTLE to explain the amendment.                                
 Number 377                                                                    
 SENATOR LITTLE explained the merits of the amendment and urged                
 SENATOR TAYLOR defended the amendment, and it passed on a 3 -                 
  1 vote.                                                                      
 SENATOR LITTLE proposed Amendment #2 based on the letter from                 
 MR. WINNER as follows:                                                        
  Page 3, line 26,                                                             
   Insert a new subsection to Section 3:                                       
    "(e) If any person or entity is found immune                               
     from suit under this section, the finder                                  
     of fact in any section shall not consider                                 
     that person's or entity's actions or                                      
     failure to act for purposes of allocating                                 
     fault and damages pursuant to                                             
     AS 09.17.080."                                                            
 SENATOR HALFORD objected to the amendment.  SENATOR TAYLOR                    
 again asked SENATOR LITTLE to explain the amendment.                          
 SENATOR LITTLE thought it would encourage support for the                     
 SENATOR JACKO asked for SENATOR LITTLE'S understanding of the                 
 SENATOR LITTLE deferred to SENATOR TAYLOR who said it was less                
 onerous to the sponsors than the first amendment which he                     
 thought might have some open ended aspects.  He explained                     
 Amendment #2 answers the questions he had previously raised                   
 about protection for those involved in the design and                         
 construction of a building when the fault lies elsewhere in                   
 the construction of the building - such as a faulty hidden                    
 SENATOR LITTLE said the amendment allowed the liability to be                 
 apportioned to those at fault.                                                
 Number 425                                                                    
 SENATOR TAYLOR and SENATOR HALFORD did not agree, saying it                   
 would transfer the fault.  SENATOR LITTLE thought that was a                  
 correct assessment.  SENATOR TAYLOR described a circumstance                  
 under which the amendment would apply, and SENATOR HALFORD                    
 said it might be transferred to someone not at fault.  There                  
 ensued a general discussion among the committee members as to                 
 fault in the construction.                                                    
 SENATOR LITTLE offered to withdraw the amendment, but SENATOR                 
 TAYLOR urged the amendment be offered to committee.                           
 Number 483                                                                    
 SENATOR TAYLOR offered Amendment #2 which carried.                            
 The discussion continued with SENATOR JACKO asking if it would                
 apply to bridges.  SENATOR TAYLOR said it would.                              
 SENATOR HALFORD moved to pass CS FOR SENATE BILL NO. 73(JUD)                  
 from committee with individual recommendations.  SENATOR                      
 LITTLE objected, and it passed on a 3 - 1 vote.                               

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