The Committee on Judiciary was called to order at 8:00 a.m., on Tuesday, February 9, 1999. Chairman Bernie Anderson presided in Room 3138 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All Exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

COMMITTEE MEMBERS PRESENT:

Mr. Bernie Anderson, Chairman

Mr. Mark Manendo, Vice Chairman

Ms. Sharron Angle

Mr. Greg Brower

Ms. Barbara Buckley

Mr. John Carpenter

Mr. Jerry Claborn

Mr. Tom Collins

Mr. Don Gustavson

Mrs. Ellen Koivisto

Ms. Sheila Leslie

Ms. Kathy McClain

Mr. Dennis Nolan

Ms. Genie Ohrenschall

GUEST LEGISLATORS PRESENT:

Assemblyman Richard Perkins, District 23, Clark County

Assemblywoman Chris Giunchigliani, District 9, Clark County

Assemblyman Doug Bache, District 11, Clark County

STAFF MEMBERS PRESENT:

OTHERS PRESENT:

Chairman Anderson called the meeting to order and proceeded with the roll call. There was a quorum present.

Chairman Anderson announced he was changing the order of agenda items and was presenting the bills in a different order. The bills would be presented as follows: A.B. 22; A.B. 25; A.B. 17 and A.B. 21.

• BDR 5-1260 - Provides that provisions governing establishment of department of family, youth and juvenile services apply to county whose population is 100,000 or more.

Chairman Anderson gave a brief overview of the bill draft. He explained it dealt with employees of the juvenile services for counties of 100,000 or more, and broadened the scope of their responsibilities,

Chairman Anderson presented a letter from the Office of the Attorney General, in support of A.B. 22 (Exhibit C). The letter stated the office supported the provisions in the bill because this office defended the State of Nevada and its employees against civil rights actions filed by state inmates. The bill would require an inmate to pay all debts, before receiving any benefit from the lawsuit, and the Attorney General Office supported this provision.

Assemblywoman Cegavske addressed the committee and read from a prepared script. Exhibit D.

Assemblyman Hettrick requested to speak in favor of A.B. 22. He reminded the committee, in the last session, the committee had completed some of the work to reduce good time benefits as a forfeiture for individuals who sued the state. The problem with the program was those individuals who were incarcerated for a long period of time did not care about forfeiting their rights. Those were the individuals who had the time to spend looking at law books, which had been provided to them at taxpayers’ expense and had time to prepare lawsuits against the State of Nevada and who ultimately won judgements. He pointed out that would be an opportunity to not only take away good time credits, about which those individuals did not care, but to take away the monetary settlement, about which they did care. It would also benefit the individuals who should have received some of that money. As examples of those receiving benefits, he mentioned victims on restitution and the state defense, among others. He concluded his testimony by pointing out the bill was a great followup to the work the committee had done last session and encouraged the committee to pass A.B. 22.

Keith Monroe, Senior Deputy Attorney General, provided a letter to the committee in support of A.B. 22 (Exhibit C).

Assemblywoman Buckley questioned those testifying if they had figures on the number of judgements prisoners had received in civil actions against the State of Nevada.

Responding to the question, Mr. Monroe said a total monetary value of $105,000 had been paid out of the state tort claims fund in the last 3 years. Three of those judgements were for wrongful death cases and were very large figures. He stated one judgement was for $48,000, another for $38,000, and another for a little less than $10,000. Those three judgements made up the majority of the $105,000.

Ms. Buckley wanted to know if most of the judgements were for wrongful death. Mr. Monroe confirmed that was correct.

Ms. Buckley still emphasized her need for clarification, by repeating if most of the judgements were wrongful death, what happened in those cases? Was a prisoner killed? Mr. Monroe confirmed that was true.

Ms. Buckley asked that if under this bill a prisoner was killed, would the money go to restitution, then for fines, and then to pay the public defender’s office, and not to the family of the person who was killed?

Mr. Monroe pointed out the money would go to settle any outstanding debt the inmate had incurred. Most of the judgements would go toward restitution an inmate owed such as administrative assessment fees, fines, and expenses of the defense offered to the defendant. Those payments made up the majority of the judgements in those cases.

Ms. Buckley, responded it would make sense for the money to go to the victim, but in cases where an inmate was killed accidentally, it might be the families, widows, or husbands, who needed the money.

Chairman Anderson stated Ms. Buckley brought forth a perplexing issue for the committee. He requested information from Mr. Monroe regarding inmates who were serving a short sentence and a wrongful death occurred to one of them. He wanted to know if the Attorney General’s Office had figures on how long those inmates had been incarcerated before a wrongful death occurred and what happened to the distribution of dollars. He pursued that because he wanted to know what were the ramifications of the bill. He stressed the bill was well intended for victims of crime to be paid, but on the other hand if a wrongful death occurred by state action, maybe the state should not be in line for payment. He wanted to make sure that did not take place.

Mr. Monroe asked to address that point. In response to Ms. Buckley, he asked her to note in the bill it specified "if a defendant is awarded a judgement." In a wrongful death action it would be the defendant’s family who was awarded the judgement.

Ms. Buckley referred to her original question as to how much money was awarded. She wanted clarification on the point the majority of the money was awarded on wrongful death cases and whether the cause of action was related to the defendant’s death.

Mr. Monroe explained he should have been more precise on how much money was awarded. He reiterated that $105,000 was paid out of the state tort claims fund, of which approximately $75,000 was paid on wrongful death type action. That would leave approximately $25,000, but he did not have the exact figure. He pointed out it would be approximately $8,000 per year.

Chairman Anderson repeated his request for a report from the Attorney General’s Office on the exact amount of money paid out of the state tort claims fund.

Assemblyman Nolan had a question regarding the Attorney General’s philosophy on tort settlement, but first he wanted to make a statement regarding his experience with tort claims in the business world. He stated he had been involved in some accidental death claims, in which he felt the accident was not the primary cause of the death. However, it made more sense because of time and the cost factor to find a settlement. He then asked Mr. Monroe if the Attorney General’s Office would take the same action.

Mr. Monroe stated in the vast majority of inmate cases the office litigated and attempted to win the case. In some cases, when an inmate asked for $30,000 to go to trial, but offered to settle for $30, the office exercised its judgement and gave him the $30, rather than spending $5,000 to go to trial.

Captain Jim Nadeau, Washoe County Sheriff’s Department, came forward and stated he supported the bill.

Mr. Ben Graham, Clark County District Attorney’s Office, also came forward and stated he was in support of the bill.

Chairman Anderson asked Captain Nadeau if they had the same situation at the county jail level as they did at the prison level and did they have a mechanism in place for that situation?

Captain Nadeau related he was not aware of such a mechanism, and did not have statistical data to back up the amount of cases or any kind of a loss they had encountered. He repeated he was not aware of any mechanism for the county or the city jails to recover those same costs.

Chairman Anderson pointed out it would be the intent of the maker of the motion to provide it for county jails also.

Captain Nadeau stressed he believed section 2 of A.B. 22 was more specific to the state prison system, therefore would not apply to the county and city jails, but thought the initial section might cover the jails.

Chairman Anderson asked Mr. Carpenter if he was satisfied by the response from Captain Nadeau, and was he looking for the development of information from the district attorney’s offices? Mr. Carpenter responded affirmatively, and Chairman Anderson said it would require a response from Mr. Graham.

Captain Nadeau said he would contact their risk managers and provide the information to the committee.

Chairman Anderson requested Mr. Graham, through the District Attorneys Association, to develop a survey from the district attorneys and the risk managers of the sheriff’s offices, to reflect what the experience level had been relative to that type of lawsuit. He particularly wanted information regarding wrongful death.

Assemblywoman Ohrenschall questioned Mr. Monroe and Ms. Cegavske. She asked if it would be possible to insert a judicial discretion into the bill to look at concerns such as Ms. Buckley’s. She wanted it made clear in a true wrongful death situation, in which the state truly was negligent the judge would have the discretion to look at the financial needs of the survivors.

In reply to her question, Mr. Monroe thought, administratively it might work, but in response to Ms. Buckley’s comments wrongful death could fall outside of the bill, because it was directed to inmates who filed actions as opposed to inmate’s families who filed actions.

Ms. Ohrenschall argued an inmate might file an action and then die in the process, if he had an injury. She asked if he saw what she was saying? Mr. Monroe stated he understood what she was saying. If the inmate won judgment, it would be awarded against any outstanding debts he owed to the state.

Continuing, Ms. Ohrenschall emphasized her original question, if given that situation, did he think some discretion could be given to the judge to look at the financial needs of the survivors. Mr. Monroe thought it could be considered. He would be in favor of any money received from a lawsuit filed by an inmate to be paid to outstanding debts the inmate owed to his victims or to the State of Nevada.

Chairman Anderson, in calling for a work session on the bill, requested some suggested language relative to the questions Ms. Ohrenschall raised, as well as the information he had requested from those testifying. He requested the information be returned to the committee within 8 days.

Chairman Anderson closed the hearing on A.B. 22 and opened the hearing on A.B. 25.

Dr. Joel Glover, general dentist, representing the Nevada Dental Association and Mr. Bill Bradley, representing the Nevada Trial Lawyers Association were introduced to testify on A.B. 25.

Dr. Glover gave an overview of A.B. 25 by pointing out the bill became effective in 1995 with a sunset clause. The dental association and the trial lawyers have had the dental legal screening panel in effect since 1995. In reading statistical information to support his position on the "sunset clause"(Exhibit E) he pointed out there were no cases in 1995, eight cases in 1996, and a total of eight cases in 1997, four of which were referred to the panel. Two of those cases were dismissed, one case was terminated, and one case was withdrawn. In 1998, 13 cases were presented to the panel, 5 from the north and 8 from the south. He stated some of those cases were terminated and some went on to a hearing. Dr. Glover emphasized the dental association and the trial lawyers felt very strongly the panel was doing what it was designed to do. The existence of the panel kept frivolous and unwarranted cases out of the court system, but allowed cases with merit to be awarded to those people who deserved some type of recompense for malpractice. He referred to three large cases in the news last year but did not go into detail about the cases. In conclusion, he urged the committee to remove the "sunset clause."

Chairman Anderson requested a history of the medical screening panel and the addition of the dental screening panel in 1995.

Bill Bradley, a member of the Nevada Trial Lawyers Association, explained the screening panel was originated by the Nevada Legislature in 1987 in response to concerns about escalating malpractice premiums. He stated there was a significant dispute about the best way to address those escalating premiums. Several states had imposed caps on damages, eliminated certain defenses, or restricted attorney’s fees. He noted the 1987 legislature, rather than putting artificial limits on things, found it more appropriate to work for an alternative dispute resolution, which was called the Medical Legal Screening Panel. That panel was generally comprised of three lawyers and three physicians if a physician’s care was questioned, or three lawyers and three dentists if a dentist’s care was questioned. A written presentation was made and then reviewed by a panel of three lawyers and three doctors, who decided if there was medical negligence involved, or in the case of a dentist dental negligence, and if the finding was "a person was injured thereby." The second finding they could make was "no reasonable probability of medical negligence," and the third finding was "not able to decide." He pointed out there would be a bill presented later in the session that dealt with the third finding, "unable to decide," and whether that finding should be revealed to a jury. In referring to the other two findings, either a positive finding of medical negligence or no medical negligence, those could be told to a jury in a subsequent action. Mr. Bradley emphasized two goals, elimination of frivolous lawsuits and expediting the resolution of a meritorious case. He stated there was a debate held at each legislature if those goals were being attained, although he felt in the context of dental those goals were being attained.

Chairman Anderson questioned Mr. Bradley if he felt it would be advantageous to the screening board to have the "sunset clause" removed? In reply, Mr. Bradley indicated the board was carrying out its duties, but he would like to bring up an issue before the committee and let the committee decide what was the best approach to take, because there was a little problem. He thought the "sunset clause" should probably go away, but there may be a use for the "sunset clause" to draw attention to an issue to which he would refer later in his presentation.

Assemblyman Brower wanted clarification on the point if no negligence was found by the panel, that did not preclude the filing of a lawsuit, to which Mr. Bradley replied it did not.

Mr. Brower remarked if it meant it simply provided for a special instruction to be given to the jury in a subsequent suit. Mr. Bradley responded that was the first step but there was a subsequent instruction given to the jury. Then if the claimant was unsuccessful, there was a mandatory award of attorney’s fees.

Mr. Bradley asked if he could present the issue he had discussed earlier in his presentation, and Chairman Anderson asked him to proceed.

In opening his presentation, Mr. Bradley testified the one issue they were seeing in dental, which was of concern to both the trial lawyers and the dental association was dental peer review. He stated dentists had been well known throughout Nevada for conducting peer reviews. He called attention to the fact when dentists committed an error it was generally a mechanical problem that another qualified dentist could repair. He said it was usually $2,500 to $10,000 for repair work and the patient was returned to normal. He emphasized the Nevada Dental Association had done an excellent job of peer review in the past in those types of cases. He went on to explain the problem with those claims was they did not involve sufficient money to justify the involvement of an attorney and processing it through the screening panel. As an example, he pointed out the copying costs for a screening panel complaint was about $750. In the past, the dental association had done a very good job of peer reviewing those cases in that an injured patient brought it to the peer review, the peer review contacted the dentist, and a mediation was accomplished with that dentist.

Continuing his presentation, Mr. Bradley advised the committee membership in the Nevada Dental Association and the Nevada Trial Lawyers Association was not mandatory, but it was mandatory in the Nevada Bar Association. He said there was a small group of dentists, who did not belong to the dental association, so they did not submit themselves for peer review. Consequently, when one of their patients was injured, they had no recourse. He stated they should go to the dental board which might take action and probably would, but they were being directed toward the screening panel. If that happened, the administrator of the screening panel had to tell the individual the panel could not help. He emphasized a person would be ill advised to take a claim to the screening panel without hiring a lawyer. Mr. Bradley assured the committee a method was being established because of that small group of so called renegades, who were threatening the viability of the panel by refusing to participate in peer review.

Chairman Anderson questioned Mr. Bradley and Dr. Glover, by using A.B. 25 as a vehicle, were they suggesting the bill be amended to its original format.

Chairman Anderson consulted Ms. Lang and asked her opinion within the confines of A.B. 25 if the committee was restricted to only removing the sunset qualifications, or would they be allowed to amend it in such a way to go back to the original bill.

In response, Ms. Lang suggested the committee add some cleanup if it was dealing with the original bill.

Dr. Glover wanted to emphasize the problem presented to the committee by Mr. Bradley. There was a communications problem in the fact those doctors or dentists who would not submit to peer review, caused their patients to be lost in the shuffle. The patient’s complaint should go to the State Board of Dental Examiners where there was a written, legislated part of the Nevada Dental Practice Act on how claims should be handled. He suggested to the committee, one way to speed up the process would be to require, on acceptance of licensure, all licensees in the State of Nevada who practiced dentistry, must submit to peer review, regardless if they were members or not. That would all be done under the Nevada Dental Practice Act’s rules and regulations.

Chairman Anderson stated they were out of the committee’s ballpark now, to which Dr. Glover responded they could handle it now regarding the "sunset clause".

For clarification, Chairman Anderson asked if Dr. Glover and Mr. Bradley were asking for the committee to stay within the confines of the bill and not amend it in any way, but brought forth the concerns for the purpose of a possible bill draft in another committee.

In replying to Chairman Anderson, Mr. Bradley stated he wanted it reflected in the minutes of the meeting, the committee strongly suggested those dentists submit to a peer review and let them work with the Nevada Dental Board to see if it could be accomplished through rules and regulations.

Jim Jeppson, speaking for the commissioner of Insurance, testified the Commissioner was neutral on A.B. 25. He did want to express they were in agreement with the comments made by Mr. Bradley and Dr. Glover about certain claimants being left out or forced out of the process. He was referring to those people who had small claims for medical malpractice and either could not afford the expense of copying fees, the $350 filing fee, or their case was not attractive enough for an attorney to take. He pointed out if the solution Mr. Bradley and Dr. Glover proposed, which was to subject all dentists to peer review worked out, that might address the problem. He stated the administrator of the panel was located in Las Vegas, and he had proposed a threshold limit for claims submitted to the screening panel for dental malpractice. He pointed out a threshold of $3,000 to $5,000 might allow an injured party with small damages or small claims to go to justice court or small claims court. It then would allow substantive claims or claims for high damages to go to the screening panel for dental malpractice.

Chairman Anderson asked Mr. Jeppson if he happened to discuss with Dr. Glover any of the proposed amendments he might want for A.B. 25. Mr. Jeppson replied he had not had an opportunity to talk with any of the parties involved, but he intended to talk with them after the meeting.

Chairman Anderson stated it had been the Chair’s intent to process the bill, depending upon the desire of the committee. He asked Mr. Jeppson if he thought he could work out questions raised in the meeting or did he think his concerns might be more carefully examined through administrative procedures, rather than in the body of a bill like A.B. 25.

Mr. Jeppson stated they had no desire to interfere with the processing of the bill.

Chairman Anderson requested if there was anyone else who would like to testify in favor of A.B. 25. He then asked if there was anyone who would like to testify against the bill.

He then distributed a letter to the committee (Exhibit F) from Wanda Fischer, in which she expressed her concerns based upon experiences she had in Nevada in 1986. Chairman Anderson noted it was dated before the creation of the Medical Screening Panel.

Chairman Anderson closed the testimony on A.B. 25.

Chairman Anderson assigned the bill to Mr. Collins.

Chairman Anderson opened the hearing on A.B. 17, and introduced Assemblyman Richard Perkins, author of the bill.

Mr. Perkins explained A.B. 17 was not only his bill, but there was a similar piece of legislation coming from the Senate Minority Leader. He gave a history of the bill. He explained how after years in law enforcement, he questioned why there was a law where somebody was injured in a criminal act and they lived longer than a year and a day no enforcement action could be taken. Mr. Perkins highlighted the most recent story of Chris Trickle who was a victim in a shooting in Las Vegas. He noted the family was supposed to appear with him at the meeting of the committee, but would testify in support of the Senate bill. He went on to explain how Mr. Trickle was shot and lived longer than a year and a day. They had not found the person who shot him, but if they had, under the current law that person could not be charged with murder or manslaughter. That was why he brought forward A.B. 17. He explained the bill would repeal that provision, and there would no longer be the year and a day rule. He stressed the point that law had been on the books across the country but most states had already repealed the provision. Many years ago they were unable to tell after a given period of time, if that particular criminal act actually caused or was the proximate cause of the person’s death. Concluding, Mr. Perkins indicated with today’s medical science it was easier to determine cause of death.

Mr. Carpenter was concerned whether the bill would cover all situations, because in the repeal section it only covered murder and manslaughter.

Mr. Perkins responded, as he understood the bill it would encompass all situations. But truly the only situation of consequence was if the person died from a criminal act, than it was murder or manslaughter. He pointed out the first section of the bill talked more directly about a duel which had not been encountered recently, but the repeal section got to the heart of every day life.

Chairman Anderson stated the bill seemed to deal predominately, both in section one and in later sections, with misdemeanors relative to somebody who issued a challenge. He asked for an opinion from Ms. Lang if she thought it would take care of the other things used for first degree manslaughter not listed in the bill, such as a motor vehicle.

In response Ms. Lang stated A.B. 17 was drafted to take out all references to a year and a day, so if it was not in there it would not apply to the other sections.

Assemblyman Collins pointed out the "vicious dog thing" in the 1993 session, and stated they were in a quandary over it, because they did not have a cure for it and did not know what happened to the elderly person. He then stated he did not understand Ms. Lang’s explanation on a year and a day and questioned if it would cover any death related to a criminal act.

Ms. Lang responded it would go under the statute of limitations, but pointed out there was not a statute of limitations for murder. Therefore, she suggested taking out all references to a year and a day, so it would not apply in any situation.

Mr. Collins had a followup question where he asked if there was a rapid and speedy trial and the person was convicted of assault or battery or something similar and 6 months later the victim died, was it double jeopardy? He supported A.B. 17 but wanted to make sure they did not make a mistake and lose it all.

Chairman Anderson asked if he could refer that question to the legal staff accompanying Mr. Perkins. Mr. Perkins agreed.

Ben Graham, representing the Nevada District Attorneys Association, addressed the issue of the need for change. He called attention to the fact he had taught criminal law at the university level for over 20 years and there was a page and one-half dealing with the year and a day rule. He usually told the students, "here it is kids, let’s skip it," because it had not been an issue until recently. He said Mr. Perkins put it very well, that in "olden times" after a year and a day, who knew what the cause of death was. He recalled in the last session, the statute of limitations was removed on sexual assault under certain circumstances and referred to Ms. Lang’s statement there was not a statute of limitation on homicide. His opinion was it was a natural evolution of that, because if the person did not die after a year and a day, the homicide statute would be tolled. The important thing to remember from a defense and prosecution standpoint was the State of Nevada was still required to prove each and every element beyond a reasonable doubt, which was causation. They did not remove "injured, die thereof," so it still had to be expert testimony that the original cause of action arose with whatever the original injury was and there was no superceding or intervening cause. He referred to the issue Mr. Collins raised, by stating it could potentially happen. However, where you had a person who was severely injured and the year and a day provision was removed, he felt prosecution could be deferred until a determination was made whether the person was going to survive or not. Mr. Graham concluded his statements by expressing he was in support of A.B. 17.

Mr. Brower wanted clarification on the double jeopardy issue. Referring to the following example, if there was a battery and the charge was attempted murder and the defendant was convicted of attempted murder and later the victim died, could the convict then be charged with murder.

Mr. Graham responded by pointing out how double jeopardy was fairly technical. There was an argument if a person was being punished for the same acts and had already been found guilty or not guilty, there would have to be some other elements separate from that on which they were prosecuted, before they could charge the person a second time. He felt from a defense standpoint an argument could be made the person could not be retried, if they had already pled guilty on a lesser charge for the acts that led to the death. As he had indicated, he did not feel it was a significant deterrent to amend A.B. 17. Regarding the Chris Trickle shooting, he repeated an earlier statement by Mr. Perkins that they still did not have a suspect today, much like the rape victim mentioned in earlier testimony. He pointed out if the bill passed and was enacted after October 1, 1999, and a suspect were to develop even 2 to 3 years later, he could still be prosecuted.

Mr. Carpenter asked Mr. Graham if he thought the bill could become effective on July 1, 1999, after passage and approval. For clarification, Chairman Anderson asked Mr. Carpenter if it was his desire after passage, the bill go into effect immediately, instead of waiting for the traditional October 1 date. Mr. Carpenter stated it was his desire. He felt it could help in certain situations, so he wanted it on the books as soon as possible.

With no further questions for Mr. Graham, Chairman Anderson introduced Lt. Stan Olson with the Las Vegas Metropolitan Police Department and the Nevada Sheriffs and Chiefs Association.

Lt. Olson opened his testimony by stating they supported A.B. 17. He proceeded to explain how metro had drafted its own legislation exactly like the bill being discussed. When they saw there were two other bills being presented they withdrew theirs. He pointed out it was the Las Vegas Metropolitan Police that dealt with the Chris Trickle killing. He emphasized since he started police work in 1971, if a person was shot in a certain way he was not expected to live and most likely did not live. Today it was significantly different and medical technology had advanced to the point where a delayed death could occur, and that was why amending NRS 200.410 would be beneficial to law enforcement.

Mr. Collins asked if prosecutors throughout Nevada would have the leverage to ask for a plea bargain before the person died.

In responding to Mr. Collins Chairman Anderson noted that was a hypothetical question, but referred to testimony the committee had heard earlier, ninety percent of cases that came before the district attorney were plea bargained down to a lesser charge. He asked if that could become another weapon in the arsenal, observing it could be held over a person’s head forever, or they could take the deal now.

Mr. Graham testified he had not thought of that option, but would seriously consider it.

Chairman Anderson closed the testimony on A.B. 17 and brought it back to the committee.

Chairman Anderson informed the committee the Senate was processing a similar piece of legislation and it was the Chair’s intent to amend Assemblyman Perkins’ name into the Senate bill. The committee would amend into the bill the question of the effective date on passage and approval, if it had not already been addressed in the Senate bill. He emphasized the committee could move forward on their own, regardless of what the Senate did. They could also amend the bill, and bring it back, and hold it in committee awaiting arrival of the Senate bill, in which case it would need to be amended again to include Mr. Perkins’ name.

Mr. Carpenter questioned if it was right to give the Senate credit when it was processed first in the Assembly Judiciary Committee. Chairman Anderson stated Mr. Perkins had preferred the committee wait for the Senate bill to come forward before processing A.B. 17. He noted the committee would allow the Senate a fair amount of time, and if they did not pass their bill, they would send A.B. 17.

Chairman Anderson closed the hearing on A.B. 17 and called a 5-minute recess while the secretary contacted two legislators who would testify on the next bill.

Chairman Anderson called the meeting to order and indicated there was a quorum present.

Chairman Anderson opened the hearing on A.B. 21, and reminded the committee it was the 13^th piece of legislation requested in the last session.

Assemblywoman Chris Giunchigliani and Assemblyman Doug Bache were called to introduce A.B. 21.

Mr. Bache explained he and Ms. Giunchigliani had introduced the bill in the previous session as A.B. 580. The bill had been amended and passed out of the Committee on Judiciary which specifically dealt with the common interest associations to provide secret ballots for election to those boards.

Ms. Giunchigliani felt A.B. 21 closed a simple loophole with which they had dealt when they were discussing the homeowners association language. She stated she had been contacted by several homeowners association members who were uncomfortable and felt there was no process for a secret ballot. She mentioned sometimes when a person voted within a confined area there was a feeling of discomfort about bickering with neighbor. What the bill attempted to do was take into consideration, upon request a secret ballot be allowed for the voting. There would be an amendment brought to the committee, which qualified that you needed to have a quorum of those present in order to participate. She declared that would be satisfactory and accepted by them with consideration by the committee.

Ms. Buckley commented after she heard Ms. Giunchigliani’s bill in the Committee on Judiciary last session, she had the opportunity to hear Senator Schneider’s bill in the Committee on Commerce and Labor, had kept up with all the homeowners association complaints in the newspapers. She noted there appeared to be a number of board members, once they were elected, to whom a little power went to their head and mayhem resulted. Her question for Ms. Giunchigliani was the secret ballot supposed to be for elections only or could it be for every decision. She commented if it were for every decision, would some of those board members "go a little nuts." Ms. Giunchigliani responded it was only for elections. She stressed part of their concern was they did not want a secret ballot on every issue. Ms. Buckley expressed she just wanted to make sure it was made clear.

Chairman Anderson asked for clarification for the record it was not applied to every type of board, but only those in common interest associations?

Ms. Buckley said that was not the case, but had occurred just by its inclusion in chapter 116. She meant her statement specific to the secret ballot for the election of officers. If there was an additional amendment offered by another person, maybe that could be included.

Assemblywoman McClain explained she belonged to a homeowner’s association with 500 units. She asked Ms. Giunchigliani if she was proposing an amendment to have a quorum, was she talking about the entire membership, because those were the people who elected the officers. She continued it might be a little difficult to practice.

Ms. Giunchigliani indicated the Hughes Corporation would be testifying and would clarify that point. On page 1, line 5 of A.B. 21 after the word association, she wanted inserted "and has determined that a quorum is present to conduct official business." She stated that was the amendment they would bring forward.

Mr. Collins explained he had 20 some homeowner’s associations in his district. Some bylaws allowed both secret and open votes, depending on the rules in their particular association. The quorum issue got reduced each time there was not a quorum at a meeting. He emphasized the way the homeowner’s association rules were written if a quorum was not present, they could reschedule a meeting with a lower percentage required for a quorum. Subsequent meetings were rescheduled until they actually had enough members present to have a vote. He asked for clarification on the request all had the right for a secret ballot, whether it was already in their rules or not.

Ms. Giunchigliani stated that was correct and pointed out in regard to the homeowners’ legislation from last session, the issue was never resolved. She said she still received phone calls from members of homeowners associations in regard to the election of officers that they want it by secret ballot.

Assembly Gustavson addressed Ms. Giunchigliani by stating he too belonged to a homeowners association and was past president of one. He noted in his association rules the officers were elected by the board, but the board members were elected by the association that was done at a polling place not a meeting and it was done by secret ballot. He asked if a meeting was required in order to elect the officers or board members. He called attention to the fact not all associations agreed, because they would never have a quorum at those meetings, as most association members rarely attended.

Chairman Anderson articulated if a homeowners association had a provision in their bylaws that voting took place by secret ballot in the community house, over a period of 3 days, and it was open balloting time for the members of the association, was Mr. Gustavson concerned it could preclude that kind of balloting from taking place.

Ms. Giunchigliani asserted the word meeting was a general term. She thought all it said was, for the purpose of electing the board members it was a secret ballot issue. She was not trying to get into how the elections were held.

Chairman Anderson stated the amendment coming forward from those testifying could possibly clarify part of the issue. If it did not, he would make sure they received a clarification from legal.

In reference to section 1, number 2, of A.B. 21 on counting the ballots, Mr. Gustavson asked if the members should be concerned if only one person counted the ballots. He pointed out, according to the bill the secretary shall count the ballots.

Ms. Guinchigliani referred to last session in response to the question. She understood the secretary was generally charged with counting the ballots and she assumed that was why the language was put in the bill. She added if an association’s bylaws designated an election committee or something along those lines the committee might want to consider inserting it. She felt there should not be a restriction to their bylaws concerning who counts the ballots.

Chairman Anderson asked Mr. Gustavson if he thought the language of lines seven and eight of A.B. 21, which stated the president could appoint tellers to count would take care of that question.

Mr. Gustavson still emphasized his concern. He pointed out by using the word "or" it opened it up to be interpreted either way, and if the board decided the secretary only should count the ballots it might raise some questions.

Mr. Collins addressed Mr. Gustavson’s concerns by stating when ballots were taken there was an ombudsman who handled homeowners associations who could come and verify the election, if there was a challenge. There was already a process in place to challenge an election in the homeowner’s law.

Chairman Anderson stressed that was why the particular piece of legislation was needed. It closed the gap as to whether there was a secret ballot or not a secret ballot. He pointed out Mr. Schneider’s bill took care of most of the questions, but there was still one little area that needed to be tight, referring to secret ballots.

Ms. McClain repeated she was still confused about whether they were referring to the election of board members or the election of the officers of the board. Ms. Giunchigliani stated their intent was the election of the board.

Assemblyman Nolan explained how some homeowners associations were small. He had been president of an association with eight homes, and he said he would never do it again. He stated he now lived in an area where there was an association and thought that was a "meritorious piece of legislation". He said he had the same concern regarding counting the ballots, because in the association to which the referred the secretary was the president’s wife. In referring to line eight of A.B. 21, he suggested using language like "the board would validate the count or the vote," something to that effect.

In referring to line seven of the bill, Ms. Giunchigliani suggested deleting the words "secretary shall count" and replacing it with "the president shall appoint tellers to count, unless bylaws had a different requirement", or something along those lines.

Chairman Anderson requested Ms. Lang work on some language for the committee, referring to the words "secretary shall". Drop the reference to the secretary and make those types of secret ballots to go before a board. He stressed he was concerned someone be responsible for the conduct of the election to make sure it was done correctly. Generally it was the secretary or someone who was the commissioner of elections. He suggested creating a position in every homeowners association which could be a potential out.

Assemblyman Manendo suggested they refer to board member elections only, and not approve the lawn being cut or similar items.

Bill Gregory, speaking for the Howard Hughes Corporation, stated the amendment might not be needed anymore since it was clarified it was only for the election of directors to the board. It was his understanding no election of directors to homeowners association boards could take place without a quorum present, either with members at a meeting, through proxy, or through ballots sent in. He stated they could be redundant with their request for an amendment given it had already been clarified it was only for the election of board members.

Chairman Anderson asked for help in clarifying a question posed by Mr. Gustavson referring to the process of elections in one of those common interest groups. If they held an election over a window of time, would it prohibit that type of election from taking place. Mr. Bradley did not think it would prohibit it, but he would get clarification for the committee.

Chairman Anderson asked if he was familiar with any homeowners associations that did a window of time for bylaw changes or other kinds of elections of officers. Mr. Bradley stated he was on the board of his homeowners association and all the elections in which he had participated had been in person, but said there could be some associations that did it over a period of time, and he would get some clarification.

Chairman Anderson explained how several organizations to which he belonged conducted their elections by mail-in ballot and large corporations voted by proxy if the person was a stockholder in that corporation. Gary Milliken, representing the Community Associations Institute, explained how the homeowners association to which he belonged voted by mail, by proxy, and by a meeting. He said there was a time line involved. Chairman Anderson asked if he thought the bill would restrict the ability to do so. Mr. Milliken answered that it would not.

Ms. McClain noted her homeowners association voted in the same manner as Mr. Milliken’s, but she was now concerned if a quorum was required for electing board members.

In response to Ms. McClain’s concerns, Mr. Milliken mentioned the association to which he belonged required a quorum for the election to be finalized. He clarified it was a majority of the members who must cast a ballot before it was finalized.

Chairman Anderson interjected what was required would give way to the local bylaws. He observed if there was a majority, then the election was valid. Any number less than the number participating in the balloting the election was not considered legitimate and they would have to meet again. He referred to Mr. Collins’ statement where he elaborated on several different methods in which the necessity of a quorum becomes a lesser number. He was a little curious about that statement, but did not want to pursue it because he did not see how you could get less than a majority of the homeowners in such a group.

Mr. Milliken noted they voted five times in his homeowners association before they got a majority.

Chairman Anderson queried Ms. Giunchigliani and Mr. Bache if they wanted to draft an amendment or did they feel they were ready to move forward.

If the Chair was in agreement, she and Mr. Bache would write up something and give it to him or to Ms. Lang, and have it brought back to the committee for consideration.

Chairman Anderson closed the hearing on A.B. 21, and brought it back to committee. He requested Ms. Lang work with Ms. Giunchigliani and Mr. Bache in drafting a potential amendment. He asked Mr. Williams to schedule it for an upcoming work session.

While going through the statutes of the current homeowner’s law, Mr. Collins requested the language include that which explained the quorum and the reduction of quorum members for voting, so it would be clear in the work session.

Chairman Anderson requested Mr. Williams’ staff research the earlier bill, so procedural questions that might arise would be clarified for the use of the committee. He asked for the research to be distributed to the committee prior to the work session.

Chairman Anderson recommended the committee reschedule the Nevada Department of Prisons presentation.

The meeting was adjourned at 10 a.m.

RESPECTFULLY SUBMITTED:

Chris Casey,

Committee Secretary

APPROVED BY:

Assemblyman Bernie Anderson, Chairman

DATE: