|Senate Counsel & Research||State of Minnesota|
|S.F. No. 2824 - I-35W Bridge Collapse Victim Compensation
|Author:||Senator Ron Latz|
|Prepared by:||Kathleen Pontius, Senate Counsel (651/296-4394)|
|Date:||February 29, 2008|
This bill establishes a compensation and settlement process for victims of the I-35W bridge collapse. Victims who choose to use this compensation process would be entitled to recover for damages suffered as a result of the bridge collapse without regard to the establishment of any liability on the part of the state or a municipality of the state. As a condition of receiving a settlement payment under the process, a victim would be required to execute a release relieving the state, municipalities, and their employees from any liability for damages arising from the bridge collapse. Victims would still have the ability to pursue a claim in district court as an alternative to using the compensation process or to reject a settlement offer and proceed to district court.
This article retroactively increases the $300,000 cap on individual tort claims against the state to $400,000, effective August 1, 2007. This increase took effect on January 1, 2008, and the amendment changes the effective date to August 1, 2007. This would apply to bridge collapse claims as well as any other claims against the state arising during that period of time.
This article establishes the compensation process for bridge collapse victims and contains the appropriations.
Section 1 establishes the compensation process.
Subdivision 1, contains the legislative findings and rationale for the creation of the compensation process.
Subdivision 2 contains the definitions. It defines the terms "damages;" "emergency relief fund;" "municipality;" "panel;" "state;" and "victim." Damages would include those that are compensable under state tort law and damages for wrongful death compensable under the Minnesota wrongful death statute. Damages would not include punitive damages or attorney fees. "Victim" is defined as a natural person who was present on the bridge at the time of the collapse and would also include a parent or legal guardian of a minor; a legally appointed representative of a victim; or a surviving spouse or next of kin who would be entitled to bring a wrongful death action.
Subdivision 3 provides for the creation of a special master panel to consider claims; make offers of settlement; and enter into settlement agreements with victims. The Chief Justice of the Supreme Court will establish the panel, which must consist of three attorneys, at least one of whom is a retired judge. Nonjudicial members must have experience in legal issues involving the settlement of tort claims and the determination of damages. The state court administrator will be responsible for hiring employees and providing administrative support. The panel may adopt procedures, rules, and forms for performing its duties. Other provisions dealing with the administration of the panel are included.
Subdivision 4 lays out the basic procedure for considering claims, making offers of settlement, and entering into settlement agreements. In order to be eligible to receive an offer of settlement or enter into an agreement, a victim must file a claim with the panel by October 1, 2008. An offer of settlement must be made by April 1, 2009.
The amount of an offer of settlement must be based on total damages incurred by the victim, less a collateral source reduction; any payment made to the victim from the emergency relief fund; and any payments made or required to be made to the victim by a third-party tortfeasor under the terms of an existing settlement or other agreement or a final judgment in favor of the victim.
The amount of an offer of settlement must not exceed $400,000 per victim. However, total payments from the fund would not be subject to the $1,000,000 cap on state liability for tort claims arising out of a single occurrence but would be limited to the extent of the availability of appropriations for this purpose.
A victim who accepts a settlement offer must agree in writing to release the state, all municipalities, and their employees from any liability arising from the bridge collapse, and to cooperate in claims against third parties. Indemnification and subrogation rights of the state are also specified.
Subdivision 5 provides that an offer of settlement made to a victim is considered for all purposes to be an offer to settle a legal claim and a determination by the panel regarding an offer or settlement agreement is final and not subject to judicial review.
Subdivision 6 provides that records of the panel related to a claim filed by a victim; an offer of settlement; or rejection or acceptance of an offer are not accessible to the public, except for the name of the victim and the terms of any written settlement agreement between the victim and the state.
Subdivision 7 provides that a victim may elect not to file a claim with the panel or not to accept an offer of settlement. A victim who elects not to file a claim or accept an offer of settlement has not waived any legal rights that may be asserted against the state or a municipality and may proceed with a claim in district court. If a victim elects not to accept an offer, the state or a municipality may not use data provided by the victim to the panel in subsequent legal proceedings, although the information may be obtained through discovery or other legal processes.
Section 2 contains provisions addressing the legal effect of the compensation process and its relationship to other law.
Subdivision 1 provides that the establishment of the compensation process and the emergency relief fund, and an offer of settlement or settlement agreement, is not an admission of liability and does not establish a duty to compensate victims. The creation and funding of the process or an offer of settlement or settlement agreement is not admissible in any legal proceeding to establish liability or a legal duty.
Subdivision 2 provides that payments made under the process and from the emergency relief fund are intended to supplement and be in addition to any payments required to be made by a third party under other law. Payments are not a collateral source for purposes of specified statutes or any other law that provides for reducing a damage award or the amount of benefits recoverable by a victim from a third party.
Subdivision 3 addresses issues related to payments from other sources. A person required to make payments to a victim may not eliminate or reduce those payments as a result of compensation paid to the victim under the special compensation process or from the emergency relief fund or as a result of the victim's release of claims. The obligation of any person other than the state to make payments to a victim would be considered primary as compared to any payment made or to be made under the special compensation process or from the emergency relief fund. A list of specific persons who would be covered by this subdivision and subdivision 4 would include reparation obligors; health plan companies; insurance companies; self-insured pools of political subdivisions; risk retention groups; joint self-insurance plans; workers' compensation insurers; the Minnesota Life and Health Insurance Guarantee Association; the Minnesota Insurance Guarantee Association; the Minnesota Joint Underwriting Association; all insurers providing credit life, credit accident and health, and credit involuntary unemployment insurance; the Minnesota Unemployment Insurance Program; coverage offered by the state under medical assistance, general assistance medical care, and MinnesotaCare; and any other plan providing health, life, disability income, or long-term care coverage.
Subdivision 4, paragraph (a), provides that a person who has paid benefits or compensation to or on behalf of a victim does not have a right to recover those amounts by either making a claim, or recovering from payments made, under the compensation process or from the emergency relief fund. Paragraph (b) provides that following a settlement agreement under section 1, any person claiming a subrogation interest against the amount paid by the state has 60 days in which to provide notice to the state and the victim of its intent to assert its interest, during which time the Commissioner of Finance must not make the payment. The subrogation claim is waived if notice is not provided. If no notice is received, the Commissioner of Finance must make the payment. If a notice is received, the funds remain in escrow until resolution of the issue. Any payment to a victim against which a subrogation claim is successfully asserted immediately reverts to the state for further deliberation as to the manner in which to distribute the payment.
Subdivision 5 provides that the state is entitled to recover from any third party for payments made from the emergency relief fund or under the compensation process to the extent the third party caused or contributed to the bridge collapse. The state is also subrogated to all potential claims against third parties of a victim receiving a payment to the extent those claims relate to the bridge collapse. The state's subrogation right is limited to the amount paid to the victim and is in addition to other remedies, claims, and rights relating to the bridge collapse that the state may have against other persons for the recovery of money.
Subdivision 6 specifies that payments made to victims are not to be considered in calculating the limit on tort claims in civil actions against the state arising out of the bridge collapse (this is a reference to the $1,000,000 cap on claims arising out of a single occurrence) or against a municipality.
Sections 3 contains the appropriations. Paragraph (a) makes an appropriation from an unspecified fund to make payments under settlement agreements entered into by the panel. This appropriation would be available until June 30, 2010. Language is included specifying that the Legislature intends to fully fund the settlement agreements. If the appropriation appears to be insufficient, the Commissioner of Finance must report the estimated amount of the insufficiency and an estimated date when appropriations will be exhausted to the chairs of the Senate Finance and House Ways and Means Committees. Paragraph (b) contains a separate appropriation from the general fund for administrative costs, which would be available until June 30, 2009.
Immediate effective dates are included for this article.
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