Tort Reform: Appeal Bond Cap in Alaska
Issue Overview: Upon completion of an action in the trial courts, Alaska requires a defendant to post an appeal bond in order to stay an adverse judgment while they appeal, and Alaska Courts have the authority to require the amount of the bond equal to or in excess of the size of the judgment. However, given the size of damage awards, 33 states have reconsidered their appeal bond cap requirements and have passed legislation that limits the amount of the appeal bond that the defendant must post to stay a judgment on appeal.
The appeal bond cap, given the escalation of damages, will ensure a defendant's due process right to an appeal while also protecting the financial interests of both the plaintiff and defendant throughout the course of the appeal. The legislation capping the amount of the appeal bond does not change the substantive law that guides the ultimate resolution of any litigation. Courts retain the authority to increase the bond requirement if it is shown that a defendant is dissipating his or her assets to avoid judgment.
NFIB Position: Support: Sixty-three percent of the 2007 Member Ballot responses supported this position.
Issue Status: Two bills have been introduced to limit the appeal; bond to the lesser of $5 million or 10 percent of the appellant's net worth. Senate Bill 48 sponsored by Sen. Charlie Huggins was referred to Judiciary then Finance, and House Bill 103 sponsored by Rep. John Coghill was referred to Judiciary.
Neither bill passed this year.
What to Do: Continue to talk to your legislators during the interim and during the election period. Remind them the cost of excessive litigation on the operations of your business and the cost of providing goods and services to Alaskans.
Please send a copy of all letters and e-mails on this important issue to Member Support Manager Stacy Jenkins, fax: 360-943-2456. With any grassroots questions on this or other issues, please contact Jenkins toll free at 866-307-2846.
