Lawmakers Pass 9 Measures on Liability Limits

Following up on voter approval of Proposition 51 last year, the Senate on Tuesday passed eight bills aimed at protecting governments, public officials and corporate directors from liability lawsuits and multimillion-dollar judgments.

A short time later, the Assembly passed the ninth bill in a delicately balanced legislative package, known collectively as “tort reform.”

The package is the product of a compromise between California’s local governments and the legal profession, two groups that have been at odds for years over attempts by cities and counties to limit their exposure to lawsuits filed by injured parties.

“This will mean substantial improvement in the civil justice system and will help public agencies avoid unnecessary and expensive litigation,” said Sen. Bill Lockyer (D-Hayward), who guided the package through the Senate.

Proposition 51, the “deep-pockets” initiative on the June, 1986, ballot, limited “pain and suffering” awards in cases involving more than one defendant.

The package focuses on protecting governments against lawsuits resulting from injuries or damages where public agencies or their employees are at least partly to blame.

One bill would make it more difficult for victims or their heirs to sue the government for accidents resulting from natural conditions on public beaches, such as riptides and submerged rocks.

The measure would overturn a 1982 state appellate court decision that made such suits easier for victims to pursue if the government had placed warning signs, lifeguards or other protections on the beaches, reasoning that in so doing the government had accepted responsibility by altering the natural condition of the land.

More Difficult

Another bill in the package would make it more difficult for homeowners to collect money from the government for damage caused by landslides, if the homeowners themselves were at least partially at fault.

Two other bills would protect governments from liability for accidents involving cars fleeing police and would provide that government employees could not be considered negligent simply because they violated their agencies’ rules for proper conduct.

The package would also allow public entities to spread payment of large, court-awarded damages over as long as 10 years and would reduce damage awards by any amount already covered by a victim’s own insurance. Under another bill, local public officials could not be forced to pay damages for the acts of their agencies unless the officials themselves were proven to have acted negligently.

Two measures in the package that do not affect government would limit the liability of for-profit and nonprofit corporation directors for actions taken by the corporation but not the responsibility of the directors themselves.

The measure protecting nonprofit directors still was pending in the Assembly.

Lobbied Heavily

City and county officials who have lobbied heavily for the package argue that without it, governments will be forced to take actions to protect themselves and their agencies financially. But, they warn, this would result in substantially reduced services for citizens.

Coastal city officials, for instance, point out that without the beach liability measure, their cities could minimize their risk by removing lifeguards and warning signs from the beaches.

“This is the kind of tort reform that is essential for cities and counties,” Sen. Marian Bergeson (R-Newport Beach) said of the package. “They’ve been trying to get these issues through in separate bills for years and they’ve had sound resistance from the California trial lawyers.”

Three of the eight bills passed by the Senate--those involving beach liability, agency procedures and liability for landslides--went to Gov. George Deukmejian, who has taken no position on the package. The five other measures were returned to the Assembly for approval of Senate amendments.

The bills are written so that the entire package will fail unless each of the measure is passed and signed into law by the end of this year. Lockyer predicted Tuesday that the Legislature will also send the governor a single omnibus bill incorporating the elements of all the measures.

Action on these measures is expected to stimulate ongoing negotiations between the trial lawyers and the business, professional and insurance interests who were behind the deep-pockets initiative.

Though usually opposed to limiting the rights of plaintiffs, the trial lawyers agreed to the public liability package, in part, as a way to split local governments from the rest of the tort-reform coalition, which is considering another ballot initiative.