Times Staff Writer

Woody Allen's "Hannah and Her Sisters" has been named best picture of 1986 by the Los Angeles Film Critics Assn. and Allen's script for that movie was the group's choice as best screenplay. But the best director award went to David Lynch, for the much-debated "Blue Velvet."

"Hannah" and "Blue Velvet" dominated the voting. "Blue Velvet," which managed to mix sadomasochism and Rotary Club Americana, was runner-up to "Hannah" in the best picture and screenplay categories while Allen finished second behind Lynch for best director.

Dianne Wiest was named best supporting actress for her work in "Hannah," while Dennis Hopper, who ranged from a gas-sniffing sociopath in "Blue Velvet" to an alcoholic parent in "Hoosiers," won as best supporting actor.

Wiest actually tied for best supporting actress with Kathy Tyson, who played the high-priced call girl opposite Bob Hoskins' cockney parolee in "Mona Lisa." Hoskins beat out Dexter Gordon, of " 'Round Midnight," for best actor.

The biggest surprise in the major categories was the selection of Sandrine Bonnaire as best actress for "Vagabond." "Vagabond," from France, was also chosen as best foreign film over England's "My Beautiful Laundrette."

John Cassavetes won the award for lifetime achievement while Spike Lee, whose black comedy "She's Gotta Have It" has been one of the hits of the film festival circuit, won the New Generation award.

Special awards were voted for Chuck Workman and the Directors Guild of America for the six-minute short "Precious Images" and to Rafigh Pooya for his "venturesome film programming" at the Fox International theater in Venice.

The Los Angeles critics joined and broadened the colorization battle, issuing a resolution opposing the alteration of films by editing, computer coloring or panning and scanning, the process by which big-screen images are routinely down-sized for home video and television viewing.

The rundown of winners and runner-ups:

Best Picture--"Hannah and Her Sisters," "Blue Velvet."

Best Director--David Lynch ("Blue Velvet"), Woody Allen ("Hannah and Her Sisters").

Best Actor--Bob Hoskins ("Mona Lisa"), Dexter Gordon (" 'Round Midnight").

Best Actress--Sandrine Bonnaire ("Vagabond"), Marlee Matlin ("Children of a Lesser God").

Best Supporting Actor--Dennis Hopper ("Blue Velvet" and "Hoosiers"), Michael Caine ("Hannah and Her Sisters" and "Mona Lisa").

Best Supporting Actress--Tie: Dianne Wiest ("Hannah and Her Sisters") and Kathy Tyson ("Mona Lisa").

Best Screenplay--Woody Allen ("Hannah and Her Sisters"), David Lynch ("Blue Velvet").

Best Cinematography--Chris Menges ("The Mission"), Bruno d'Keyzer (" 'Round Midnight").

Best Score--Herbie Hancock, Dexter Gordon and Ensemble (" 'Round Midnight"), Ennio Morricone ("The Mission").

Best Foreign Film--"Vagabond" (France), "My Beautiful Laundrette" (England).

Experimental Film Award--Nina Menkes, Magdalena Viraga, Jonas Menkes ("He Stands in the Desert Counting the Seconds of His Life").

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