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.