Minutes of Committee Meeting on November 12, 1999

The Legislative Committee met at the offices of the Washington State Bar Association, Seattle, Washington. The meeting was called to order by Chair John Cary at 9:30 a.m. Present were committee members identified on the attendance sheet attached.

Also present were Legislative Representative John Fattorini, Gail Stone, WSBA Governor Darrell Graves, and, during the morning session, various representatives of lawyer organizations having legislative agendas, including the Attorney General's office, the Board for Judicial Administration, the District and Municipal Judges Association, the Washington Association of Criminal Defense Lawyers, WSTLA, Washington Association of Counties, Washington Association of Prosecuting Attorneys, King County Law Library, County Clerks' Association, Northwest Women's Law Center, and King County Bar Association Legislation Committee.

Committee Vice Chair Keith G. Baldwin kept minutes of the meeting and humbly apologizes in advance for any mischaracterizations of legislative positions allegedly taken by any interest group represented at the meeting.

The morning session of the meeting was introduced by Mr. Cary as an opportunity for the Legislative Committee to hear from other groups of lawyers and public agencies who sponsor and promote legislation with the purpose of improving communications and, where appropriate, organizing joint action between the committee and those groups.

Mr. Cary summarized the legislative proposals to date on which the Legislative Committee has voted to recommend positions to the WSBA Board of Governors.

John Fattorini was asked about the likely legislative reaction to the passage of Initiative 695. He characterized the legislative leadership as being in a somewhat reactive mode. There will be new efforts to expand the reach of the business and occupation tax. Funding for civil legal services will be affected. Mandatory arbitration may be adversely affected. How the Governor and the Legislature will respond to the fiscal challenge is still up in the air, but there is no immediate support for using the budget surplus to make up for losses due to I-695.

Reports of lawyer and public agency legislative groups:

Attorney General: Melissa DeGraff and Brian Moran identified four legislative proposals: (1) Increasing the authority of the AG to bring actions for domestic violence against legal guardians of vulnerable adults; (2) Changing the hearsay rule to allow elder hearsay; (3) Creating the crime of 3d Degree Criminal Mistreatment for negligence by a parent of a child or guardian of a dependent person in withholding the basic necessities of life; and (4) Enhancing penalties for crimes against vulnerable adults

Board for Judicial Administration: Chuck Foster identified three legislative priorities: (1) Permitting any full-time elected judge to be appointed pro tem in any state court without the consent of the parties; (2) Extending the authority of Superior and Municipal Court judges to serve on judicial committees within the scope of their employment; (3) Reviewing and responding to the court reform package promulgated by Justice Talmadge, which does not have the BJA's endorsement.

District & Municipal Judges Association: Hon. Linda Thompson identified three issues of interest to her organization: (1) The Talmadge proposals applicable to municipal court judges; (2) Pay scales for municipal court judges; and (3) Liability of probation officers.

Washington Association of Criminal Defense Lawyers: Sherry Appleton reported that her association will support legislation (1) to eliminate second degree assault and second degree robbery from the "three strikes" bill; (2) to pass a first time drug offender waiver bill that would provide 0-90 day jail sentences or treatment programs for such offenders and avoid prison terms; (3) promulgated by the Quakers that would require a 20-year fiscal impact report on any bills that would add new crimes to the statutes; (4) providing for misdemeanor expungement and vacation under certain circumstances; (5) to adopt child interview protocols; and (6) providing more funding for indigent defense.

WSTLA: Michael Temple reported that WSTLA will attempt to respond to changes brought about by I-695. He characterized the King County judges proposal to do away with mandatory arbitration as short-sighted and will be meeting with the judges next week to review the proposal. WSTLA is also supporting legislation penalizing bad faith denials of coverage by insurance companies in connection with first-party claims. Finally, WSTLA will also work for continuing funding of drug courts as an effective money saving operation in the court system.

Washington State Association of Counties: Mike Shaw presented a report that was deeply colored by the passage of I-695. He advised that the initiative actually hurts the big counties the least, and stated that the goal of the counties for the coming years would be to stay afloat. County officers are in a state of depression, and no one really has a plan yet for how to cope. They await a plan from the Governor.

Washington Association of Prosecuting Attorneys: A representative of this organization identified the "Hertog issue" as of primary concern. The Hertog case imposes liability on counties and cities for acts of people who are on the probation caseload. The association would like to legislate reasonable standards for counties and cities which choose to have probation departments so that liability will be controllable. The Association would also appreciate support from the bar for an initiative to form a task force to examine what governmental units should provide which services, linking tax revenues to governmental burdens. This issue is heavily impacted by I-695. No draft bills have been produced yet on either of the above initiatives.

King County Law Library: Jean Holcomb reported on the I-695 impacts and likely impacts on library operations. A filing fee surcharge failed last session in committee. User fees and increases in fines and other fees are being considered.

Association of County Clerks: A representative reported that two "cleanup" bills will be presented this session: One would provide for credit card payments for fees and fines. The other would support the task force on local government funding, described two paragraphs above.

Northwest Women's Law Center: Lisa Stone reported the priorities of the Center are (1) public health ramifications of I-695; (2) procedures applicable in family law cases when custodial parents relocate out of state; (3) permitting victims of stalking or domestic violence who have to leave their jobs for their personal safety to be eligible for unemployment compensation; and (4) providing insurance coverage for contraceptive prescriptions.

King County Bar Association Legislation Committee: A representative of the committee reported that the amendments to UCC Article 9, although worth supporting in general, have some controversial aspects, and that the committee may undertake an analysis of the amendments in order to mitigate some of the differences between consumer interests and banking interests. The committee may also study the Uniform Electronic Transfer Act, the Uniform Computer Information Transfer Act. The termination of mandatory arbitration is a major issue for KCBA.

1. Gifts of Separate Property: A subcommittee of the committee, headed by Peter Karademos, reported on progress in reviewing this bill, proposed by the Consumer Protection Committee of the WSBA, to amend RCW 49.60.176 and RCW 26.16.055. The bill would make it an unfair banking practice to require a borrower and his/her spouse, as a condition of obtaining a loan, to deed any separate property either might own to the marital community. Comments were solicited from a number of sections and committees within the bar. The Family Law Section has expressed its concern that such deeds, if routinely required, would unnecessarily interfere with the application of the law to separate and community property. The section thinks that there is a problem but does not like any of the solutions proposed to date and wants more time to work on the issue. A representative of the Real Property, Probate and Trust Section previously expressed concern about unintended consequences of such deeds. The chair of the Financial Institutions Committee of the Business Law Section previously reported that the practice is not prevalent in the banking industry. On motion made and seconded, the committee passed by unanimous voice vote a resolution tabling further discussion and action on this proposal. The chair of the Legislative Committee is to communicate the committee's action by letter to the parties interested in the bill.

2. Estate and Gift Tax Committee Proposals:

Al Montgomery presented three legislative proposals:

(1) To amend RCW 11.86.051 to provide for disclaimers of interest in certain assets where the disclaimant already owned an interest in the asset (as by community property, joint tenancy with right of survivorship, or otherwise) and providing that any benefit or use of the asset will be deemed to be the use of the portion of the asset already owned by the disclaimant.

This amendment would eliminate a probate and tax trap which arises only with respect to certain types of assets which are capable of being jointly owned in undivided interests.

(2) To amend RCW 11.02.005 to provide for construction of obsolete references to Section 2033A of the Internal Revenue Code in wills, trusts and other instruments to refer to the appropriate section of the Code, section 2057.

(3) To amend RCW 83.110 (the Washington Estate Tax Apportionment Statute) relating to new IRC section 2057 (the deduction for Qualified Family Owned Business Interests) and eliminating references to the now repealed federal retirement account excise tax (former IRC section 4980A).

Upon consideration and recognition of the expertise of the Estate & Gift Tax Committee in preparing the amendments, upon motion made and seconded, the Committee approved by unanimous voice vote a resolution directed to the Board of Governors recommending sponsorship of the three proposals.

3. Environmental Hearings Office Attorneys' Fees:

Hon. William Harrison, ALJ with the Environmental Hearings Office, appeared in support of a proposal that would institutionalize by statute a recent court ruling that insulates certain administrative agencies, acting as adjudicative boards from liability for attorneys' fees awards in favor of prevailing parties on appeal.

The Committee reviewed the proposed language of the proposal. It was commented that the Administrative Law Section has not yet commented on the proposal. There was discussion whether the Committee should take a position before receiving such comment. After significant discussion in which the competing interests of Section review and timely action were fully briefed, it was moved, seconded and approved by unanimous voice vote that the Committee recommend to the Board of Governors that the Association support this proposal, subject to review and endorsement by the Administrative Law Section and the Access to Justice Committee, and further subject to a change in the wording of one portion of the statute as follows:

[Section 4.84.340, Section 2: Notwithstanding the provisions of RCW 4.84.350, no fees or other expense shall be awarded against an administrative tribunal for actions taken solely as an adjudicative body.]

4. Assisting Pro Se Litigants in Guardianship and Probate Proceedings:

Michael Longyear on behalf of the Elder Law Section of the King County Bar Association presented proposed legislation permitting counties to create a position of Facilitator to assist pro se litigants in guardianship and probate proceedings, to be funded from increases in court filing fees of up to $10.

There was substantial discussion recognizing the merits of providing for such Facilitators, as there is a real need to assist pro se litigants, most of whom are elderly and lacking in resources to hire lawyers. Currently, the courts and their administrative staffs are required to meet that need, taking them away from their primary activities and interfering with the administration of justice.

The funding mechanism was considered troublesome, particularly in view of I-695 and the competing interests looking for funding through filing fee increases. This proposal, however meritorious, will end up competing with other worthy activities for the same dollars. It was remarked that this proposal, other than the funding provision, deserves bar support because it demonstrates that the bar is responsive to the needs of litigants who might not find assistance elsewhere, and statutory authority is required in order for the Facilitator position not to run afoul of restrictions on unauthorized practice of law.

On motion made and seconded, the Committee approved by voice vote a resolution recommending to the Board of Governors that the Association support the portion of this proposal authorizing counties to appoint courthouse facilitators to provide basic services to pro se parties in guardianship and probate cases, but not to support the portion relating to funding the positions out of increases in filing fees.

5. Mandatory Arbitration

Michelle Radosevich presented the summary of a special subcommittee of the Committee appointed to review the proposed legislation from the Consumer Protection Committee, particularly the subsections of the bill related to offers of compromise and the award of attorneys' fees and costs to a non-appealing party who makes an offer of compromise after an arbitration award and who prevails following an appeal for a trial de novo. It was reported that the Litigation Section of the WSBA declined to take a position on the attorneys' fees issue last year and would probably so decline this year because the Section represents both plaintiffs' lawyers and defense lawyers and the two groups did not necessarily agree on the merits of this legislation.

The Board of Governors had adopted a resolution supporting this legislation last year. Upon motion made and seconded, the Committee approved by unanimous voice vote a resolution recommending to the Board of Governors that the Association support this legislative proposal, subject to edits clarifying the language concerning attorneys' fees and costs awards.

There being no further business before the Committee, the meeting was adjourned at approximately 3:15 p.m.

Respectfully submitted,

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John Cary, Chair
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Keith G. Baldwin, Vice Chair