STAND. COM. REP. NO. 1342

Honolulu, Hawaii

RE:    H.B. No. 1316

       H.D. 2

       S.D. 1

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fifth State Legislature

Regular Session of 2009

State of Hawaii

Madam:

     Your Committee on Judiciary and Government Operations, to which was referred H.B. No. 1316, H.D. 2, entitled:

"A BILL FOR AN ACT RELATING TO TORTS,"

begs leave to report as follows:

     The purpose of this measure is to abolish joint and several liability for design professionals and public utilities in tort claims relating to the design and maintenance of public highways, except where the design professional or public utility's degree of negligence is twenty-five per cent or greater.

     Your Committee believes that this measure provides a degree of fairness in the judicial system for design professionals, since most design firms that work on public highway projects are small and the professional liability risk may outweigh their financial reward from the project.  However, your Committee remains cognizant of maintaining a sufficient deterrent from negligent or substandard design work.  In addition, your Committee believes that public utilities are not in the risk/reward situation as design professionals.

     Your Committee has amended this measure by:

     (1)  Deleting public utilities from coverage under this measure;

     (2)  Reducing the cap on the design professional's qualifying negligence from twenty-five to ten per cent, in order to be eligible under the terms of this measure;

     (3)  Requiring the design professional to meet the criteria under either of two situations, based upon the contract amount relating to the tort claim, the amount of gross revenue received by the design professional in the preceding year or years, and the coverage amounts of professional errors and omissions liability insurance, in order to be eligible under the terms of this measure;

     (4)  Defining "contract amount" for purposes of the amended measure; and

     (5)  Changing the effective date to July 1, 2050 to continue the discussions in this matter.

     As affirmed by the record of votes of the members of your Committee on Judiciary and Government Operations that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1316, H.D. 2, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 1316, H.D. 2, S.D. 1.

Respectfully submitted on behalf of the members of the Committee on Judiciary and Government Operations,

____________________________

BRIAN T. TANIGUCHI, Chair