SPEAKERS CONTENTS INSERTS
Page 1 TOP OF DOCVOLUNTEER LIABILITY LEGISLATION
WEDNESDAY, APRIL 23, 1997
House of Representatives,
Committee on the Judiciary,
The committee met, pursuant to notice, at 10:22 a.m., in room 2141, Rayburn House Office Building, Hon. Henry J. Hyde (chairman of the committee) presiding.
Present: Representatives Henry J. Hyde, George W. Gekas, Bob Goodlatte, Asa Hutchinson, Edward A. Pease, John Conyers, Jr., Robert C. Scott, Sheila Jackson Lee, and William D. Delahunt.
Also present: Diana Schacht, deputy staff director-counsel; Kenny Prater, clerk; and Perry Apelbaum, minority chief counsel.
OPENING STATEMENT OF CHAIRMAN HYDE
Mr. HYDE. The committee will come to order.
Good morning, and welcome to what promises to be a very interesting and lively discussion of the problems associated with the legal liability of volunteers and the associations for which they provide services. We as a society are giving by nature. Clearly Americans have taken to heart the notion that we all bear some responsibility for our society and for the less fortunate. We recognize that in order to enrich our society, we must foster the arts, religion, education, and such other worthy causes with our contributions.
Charitable donations are one way in which we show our support for these causes, but an equally important asset we contribute is our time. For many the donation of cash is an economic impossibility. On the other hand, those people often have skills, which are just as essential to serving the community as the funding nonprofits receive. Those rich in time but not in cash have a valuable contribution to make, one we should encourage and facilitate.
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I might add parenthetically that giving of your time really is more important than giving money, because money can be replaced; time cannot be replaced. It is the one gift you have that is irreplaceable, so, in that sense, more significant.
Unfortunately, over the past two decades, our legal liability system has become more and more of a deterrent to people who would otherwise give of themselves. Most volunteers in many States are fully liable for any harm they cause as a volunteer, and only about half the States protect volunteers other than officers and directors of a nonprofit organization. This means before deciding to volunteer, individuals have to consider whether they are willing to risk liability which would threaten the financial security of their family.
As you can imagine, the tradeoffs involved in that calculation frequently discourage the volunteer. In fact, frightened by well-publicized cases where volunteers have been sued, one in seven nonprofit organizations whose officers were polled by the Gallup organization reported they had eliminated certain worthwhile programs simply because they could be breeding grounds for litigation.
The problem is not that volunteers have been sued successfully in large numbers, but they are named in so many lawsuits. Ultimately the volunteer defendants in most cases are found not liable, and for good reason. However, the cost of legal defense can be staggering, and the mental anguish a volunteer suffers when sued for exorbitant amounts of damages cannot be measured.
In addition to inhibiting people from volunteering, fear of high-stakes lawsuits arising from volunteer efforts has led to the scarcity and ballooning expense of insurance to protect against potential verdicts. Between 1984 and 1989, the cost of liability insurance for local Little League Baseball programs shot up from $75 to $795 a year. Nationally the Little League's biggest cost isn't bats and balls, but legal and insurance costs associated with liability. This means associations must spend more of their resources paying overhead and less in actually providing programs for which they are created. Or put another way, in order to provide the same level of services, they must raise substantially more money.
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The signal this all gives is that volunteerism does not pay. This is absolutely 180 degrees from the message we should be delivering. Volunteers provide services which fill large gaps in government programs for the truly needy, gaps which will increase over the next decade.
As both Federal and State governments make fiscal responsibility and balanced budgets the cornerstone of public policy, nonprofit organizations and the volunteers they utilize will play an even larger role. Besides, it is the volunteers that we owe a great deal of gratitude for our social cohesion, the sense of community in America. Giving money to help the needy is laudable, but it cannot replace the sense of personal connection that comes from being the person who ladles the soup at a food bank, or hugs and feeds the AIDS baby, or helps a recent immigrant obtain rights under our laws.
[The bills, H.R. 911 and H.R. 1167, follow:]
INSERT OFFSET RING FOLIOS 1 TO 16 HERE
Mr. HYDE. Our hearing today will explore the ways in which the threat of legal liability affects the decision of individuals to volunteer and the ability of the nonprofit organizations to provide beneficial services to the community. We will also discuss several legislative proposals to limit liability of volunteers and nonprofit organizations. I look forward to the testimony, and I turn to our ranking member, Mr. Conyers, for an opening statement.
Mr. CONYERS. Good morning and thank you, Mr. Chairman. I also would like to extend a personal welcome to the Speaker of the House, who graces the podium, and all of the Members of the Senate who have given their precious time to join us, and, of course, the author of the legislation, John Porter. We are delighted to have you all here, and applaud your concern for this very important subject.
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I am in the midst of conferring with the head of one very charitable organization, the United Negro College Fund, headed by our former colleague Bill Gray. I am also calling the Black United Front in Michigan; the NAACP, National Association for the Advancement of Colored People; the Red Cross; the Goodwill; and a number of other organizations that function in and around metropolitan Detroit to determine their understanding and support and the nature of the problem that is being remedied here. And I look forward to being able to report back to this committee before these hearings are concluded today.
Obviously volunteer activity is almost an unwritten parent of the American democratic process, isn't it? I mean, much of the things we do depend on people helping other people without compensation in nonprofit organizations, doing things that will make the community, the individual, the health or some other good and welfare aspect a better situation. And it is in that sense, I think, that we all repair to the hearing today to find out how we can improve this, the playing field, and the conditions under which volunteers and organizations work.
And so to the extent that this is, in fact, the object of the bill's author, and John Porter has testified before this committee in another Congress on this matter, we are very pleased to have him here again.
Another thing, Chairman Hyde, that I am reviewing, is the reasons that this legislation did not come to a more successful conclusion when it had been brought forward, probably at least a couple times. My razor-sharp, computerlike memory isn't so razor-sharp or computerlike anymore, and I can't quite really recall what happened at the rush of the close of a season where we have dozens and dozens of pieces of legislation hanging out there.
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There is a part of this matter that I would like to ask all of our witnesses and all of our colleagues to pay close attention to, and that is the insurance aspect of it. As you recall, insurance companies are exempted from antitrust laws by virtue of the provisions in the McCarran-Ferguson Act, and as such, one of the questions that inevitably arise in hearings of this kind, gentlemen, is the fact that insurance companies are charging rather outrageous rates of insurance. We want to know about that and to what extent that is a factor in any kind of problems that might be existing.
Now, my staff tells me that there are laws on each of the States of the Union to protect volunteers. They do not follow all of them to the Porter version that is before us today, but there are laws, and some of them, in fact, do vary, and we want to examine how that happens.
And while you are at it, distinguished witnesses, you may want to explain to me this nationalization of legislation process that the Speaker anticipated that I would raise, no doubt, that seems to be going on among the conservatives of all things. I mean, we are the ones--and I particularly have received innumerable lectures about the harms of the Federal legislation that tries to cut one size to fit all, and today it seems to me that is exactly what you are trying to do; that for some reason the States and their representatives and their wisdom are not possessed of the legislative intelligence that we are, and so therefore, just to make it simple for you folks in the several States, we are going to pass the law for you and preempt all of your laws at the same time, and we do this for your benefit. We understand that you are well-intentioned, but we here possess superior wisdom, and, therefore, it is our decision that this subject matter requires that the National Government act for all of--each and every one of the 50 States of the Union.
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I don't agree. As a matter of fact, I used to deny when I was lectured about it, that that wasn't my intention. So, please, explain to me how we can support the independence of the States, the rights of the States to make their own decisions, the importance of people tailoring remedies to fit their own particular conclusion and have some form of consistency.
And there are some policy arguments that need to be addressed. I will only raise them by name, but the survey of one study that we have says that every State now has a law pertaining specifically to legal liability to some types of volunteers. Half of such laws protect volunteers, in addition to directors and officers. So, therefore, States do not need to be encouraged by the provisions under the Porter bill, which provide States enacting similar legislation with an additional 1 percent fiscal allotment to carry out social services block grant programs.
Moreover, if uniformity is the true objective, the bill might want to provide--and I hate to be suggesting reasons how to approve a bill that I haven't decided how I am going to come down on yet, but if it is destined in the stars that we should have this Federal law, might we not want to provide for two-way preemption of State laws benefiting both victims as well as the defendants? There have been arguments put forward that rather than create uniformity and predictability, we are rather likely to cause years of uncertainty and unpredictability, increasing the flow of litigation, which this committee particularly abhors. And so there may not be justification for mandating different treatments for persons harmed by the negligence committed by nonprofits as that compared to private entities.
So those are some of the questions that, of course, the committee and its witnesses will get into. I am again very honored and pleased to see so many of our distinguished colleagues and the Speaker himself here. I thank you, Mr. Hyde.
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Mr. HYDE. I thank the gentleman, and the other members, if they have opening statements, the Chair would request you offer them for the record. We have several witnesses, so I would like to move along.
The composition for our first panel is an indication of the strong bicameral support that volunteer liability limitation proposals have generated. Many of the Members on the panel have been engaged in this issue for several Congresses.
We begin with the testimony from the Speaker of the House, Newt Gingrich. We appreciate the contribution of the Speaker on this subject and the signal his participation gives of the leadership's commitment to our goals.
Following the Speaker we will hear from four of our distinguished Senate colleagues: Senator Paul Coverdell of Georgia, Senator Mitch McConnell of Kentucky, Senator John Ashcroft, and Senator Rick Santorum of Pennsylvania.
Wrapping up the panel will be my good friend and colleague John Porter, author of H.R. 911 and longtime leader in the fight to obtain fair legal liability rules for volunteers and nonprofit organizations. It is due largely to John Porter's perseverance that we are here today.
Gentlemen, I ask you to try to contain your oral presentation to 5 minutes. Your written testimony will be inserted in the record in its entirety.
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STATEMENT OF HON. NEWT GINGRICH, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF GEORGIA, AND SPEAKER OF THE HOUSE OF REPRESENTATIVES
Mr. GINGRICH. I thank the chairman for recognizing, I thank the distinguished ranking member for having noted our presence here and the importance of this issue. Let me just say that when in 1989 11 percent of the people surveyed who had not volunteered said that legal liability was a reason they had not volunteered, it gives you some indication of the human cost to America of discouraging people from being involved.
That was 1989. The situation has gotten worse since then. The examples of outlandish cases have gotten worse. One case, for example, is a Little League organization that was sued by a woman who was hit by a ball that her own daughter failed to catch. The Little League decided to settle the case for $10,000 rather than face the threat of excessive punitive damage awards.
The number one expense for Little Leagues nationally is not baseballs and bats, but legal and insurance costs associated with liability. And our view, I think, is in part that while we, as a general principle, prefer decentralization, and as a general principle we believe things can best happen at the State level, Little League is a national organization. Boy Scouts and Girl Scouts are national organizations. A troop that meets in Columbia, GA, may go to Phoenix City, AL, on a field trip. So there is a legitimate concern.
Congressman John Porter moves toward that in H.R. 911. Congressman Bob Inglis will go further in H.R. 1167. But the principle in volunteer protection and the principle that the legal system today has gone much too far in the direction of making it easy for trial lawyers to file suits without merit in order to extort agreements outside court because it is too expensive and too dangerous to go to court is a principle that I think most volunteer organizations agree with. I think they feel they are, in fact, having to divert resources away from serving the people they want to serve. They are losing volunteers to a fear that they might be sued or might be vulnerable.
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Someone as conservative and committed to the State's position as Gov. John Engler encouraged us to move this bill and associate it with the Philadelphia conference. The fact that the Volunteer Summit in Philadelphia is getting the national coverage it is getting, you have Presidents of both parties working with Colin Powell to put that together, tells you something about the national desire to have more volunteers and more involvement.
So I simply came today to say on behalf of many people--I work with Habitat for Humanity, I work with Earning By Learning, I just did a fundraiser Friday for Big Brothers and Big Sisters--I try to encourage volunteers, as many volunteers as possible, and I think if you will check with the volunteer community, they will tell you that predatory trial lawyers engaged in filing claims that are primarily designed to negotiate agreements are a major cost, that the threat of those lawsuits are a major inhibition against volunteers, and the cost both of legal service and of insurance is a significant drain on their budgets.
We think that is wrong. That is not the America written about in ''Democracy in America.'' That is not the kind of volunteerism we want. And I simply came today to assure the committee that the leadership of the House is delighted you are moving this bill, and we look forward to seeing the bill you produce, and we will do all we can to schedule it and get it passed, and my hope is the President will announce in Philadelphia that he will sign this bill when it gets to his desk. Thank you.
Mr. HYDE. Thank you, Mr. Speaker.
And I might add for the Senators, if you wish, when you finish testifying, we will not have questions of this panel so you can go about our other important duties.
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And next, Senator Paul Coverdell of the State of Georgia.
STATEMENT OF HON. PAUL COVERDELL, A SENATOR IN CONGRESS FROM THE STATE OF GEORGIA
Mr. COVERDELL. Thank you, Mr. Chairman and Members of the Judiciary Committee, for affording me the opportunity to testify before you today.
First I would like to compliment Congressman Porter for his long record of leadership on this issue of volunteer protection, as well as Congressman Inglis. In the Senate Senator McConnell has been a strong advocate of reform in this area, and I am proud to join with him, Senator Santorum and Senator Ashcroft, who will testify today, and the other cosponsors of S. 544, the Volunteer Protection Act of 1997.
Mr. Chairman, in just a few days, on April 27 through 29, the President's Summit for America's Future will assemble in Philadelphia, cochaired by President Clinton and President Bush, joined by Gen. Colin Powell as well as other leaders. They will issue a call to action asking Americans to volunteer their time and efforts in community service. This is in the best tradition of America. Yet many who would heed that call will not do so, not because they lack the desire or the ability to help, but because they, quite frankly, fear risk of liability in a society that seems too often to resemble a lawsuit lottery.
In a recent Gallup study, 1 in 6 volunteers reported withholding their services for fear of being sued. About 1 in 10 nonprofit groups report the resignation of a volunteer over the threat of liability. This is why we have introduced the Volunteer Protection Act.
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While the House and Senate bills may not be identical, we agree on many major points. Briefly, Mr. Chairman, our bill provides that no volunteer of a nonprofit organization or governmental entity shall be liable for harm caused by the volunteer's acts or omissions on behalf of the organization. To enjoy this protection, the volunteer must be acting within the scope of his or her responsibilities in the organization and must not cause harm by willful or criminal misconduct, gross negligence, or reckless misconduct.
It is also important to note that the protection from liability does not extend in our legislation to misconduct involving violent crimes, hate crimes, sex crimes, or civil rights violations. It does not apply where the defendant was under the influence of drugs or alcohol. It is intended to protect volunteers who make a simple, honest mistake.
Nonprofit organizations will continue to have the duty to properly screen, train, and supervise their volunteers. The organization's liability is not affected. However, this bill requires clear and convincing evidence of gross negligence before punitive damages may be awarded against a volunteer, nonprofit organization, or governmental entity because of a volunteer's actions. And it also establishes a rule of proportionate liability, rather than joint and several liability, in suits based on the action of a volunteer.
Others who testify today will address the personal impact of volunteer lawsuits in more detail, so I will not belabor the point. Their statements will be far more eloquent than mine, but here is one example that we are trying to prevent. A gentleman was a volunteer with the Mountain Rescue in California. Often at great risks to themselves, he and others rescued climbers in the mountain ranges of California and Nevada. One night in 1983, this gentleman and his team helped paramedics aid a man who had fallen from a boulder and injured his spine, then coordinated a helicopter lift to the hospital. Injuries sustained in the fall rendered the man a quadriplegic, so he sued the rescuers for $12 million in damages. You put your life on the line to save others, and for thanks you face ruin in lawsuits. You have to come to ask yourself whether it might be better to stay home and not get involved.
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Mr. Chairman, in putting this bill together, we were mindful of the concerns about federalism. To address those concerns that were addressed by the gentleman from Michigan, we gave States flexibility to impose conditions to make exceptions to the granting of liability protection, and we allow States to affirmatively opt out of this law for cases where both plaintiff and defendant are citizens of the State.
Mr. Chairman, the Volunteer Protection Act will encourage the spirit of civil involvement and volunteerism that are so crucial to a healthy, civil society and stronger communities.
I thank you, Mr. Chairman, for your leadership in moving the legislation forward, and I would ask that the letter that I have received from the Little League Baseball be inserted in the record as part of my testimony.
Mr. HYDE. I thank the gentleman for his testimony.
[The letter follows:]
Little League Baseball, Inc.
Williamsport, PA, April 22, 1997.
Hon. PAUL D. COVERDELL,
Senate Russell Office Building, Washington, DC.
DEAR SENATOR COVERDELL: On behalf of the 1,000,000 annual Little League Baseball volunteers, I am writing to express Little League Baseball's support for the ''Volunteer Protection Act.''
Page 13 PREV PAGE TOP OF DOC Little League Baseball, played in 6,800 communities in all 50 states, exists today with volunteerism as its foundation strength. Each year this corps of 1,000,000 adult volunteers, mostly mothers and fathers who consider Little league as a healthy activity which strengthens families, give freely of their time to provide an athletic arena in which their children will learn valuable leadership lessons. To let this volunteer spirit erode or be eliminated through frivolous and expensive litigation would be a grave injustice to the present and future generations.
The time is now to reduce the chilling effect of liability exposure for those who donate their time and services to Little League Baseball or any non-profit, charitable institution. If protection from nuisance suits is not provided, every community is at risk of losing those very people whose community service will mold the leaders of tomorrow.
We thank you and your colleagues for giving this important issue the attention it needs.
STEPHEN D. KEENER,
President and Chief Executive Officer.
Mr. HYDE. And next the Senator from Kentucky, Senator Mitch McConnell.
STATEMENT OF HON. MITCH McCONNELL, A SENATOR IN CONGRESS FROM THE STATE OF KENTUCKY
Mr. MCCONNELL. Thank you, Mr. Chairman. I will make myself very popular by saying I can complete my comments in under 5 minutes. I would like to ask my complete statement be made a part of the record.
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Mr. HYDE. Under those terms, by all means.
Mr. MCCONNELL. Let me address the issue Congressman Conyers made, the federalism issue. We all know notions of federalism have been employed from time to time in our history to avoid dealing with national issues. We heard arguments of States' rights during the 1960s when we were trying to pass civil rights legislation. We heard arguments of States' rights during that same decade when the voting rights bill was working its way through the Congress.
As a practical matter, federalism is important in America, but we shouldn't use it as an excuse not to deal with national problems. So I really think it gets down to whether we think this is a national problem or not.
My view is the litigation craze in this country is a national problem. It affects products, it affects volunteers, it affects automobile insurance, it affects the broad array of American life. I think that it is clearly a national epidemic, a national problem. We have three times per capita, and it could be that this is a reason, and I say this as a lawyer myself, we have three times per capita the number of lawyers in the United Kingdom, 20 times per capita the number of lawyers they have in Japan. Our action of first resort in this country in every dispute seems to be to get yourself a lawyer. This is a national problem that I think cries out for a national solution.
Now, the bill before us today deals only with a tiny portion of this national problem, but a very important part of the problem. We were at a press conference in this very room before the hearing started, and Terry Orr, former Redskins player, was there talking about his own experience in working with kids in youth sports. And he talked not so much about the liability insurance premium problem, although we have a number of witnesses you will hear from about that, how much it costs you financially, he talked about the irritation and aggravation of having, every time you sat down to talk about the next program, people were going to say, can I do this with without getting sued.
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So it is not just a question of how much liability insurance premiums are, it is also the fact that it has permeated American life. It is now a factor in virtually everything we do in this country, up to and including volunteering our time to help children.
So Mr. Chairman, I enthusiastically support this bill. I was the principal sponsor of it in the Senate last year, Senator Coverdell is carrying the ball this year. It has not passed for a variety of reasons, but it seems the time now is right. I commend you for your interest in this, and we hope the bill will speedily pass the House of Representatives. Thank you very much.
Mr. HYDE. Thank you very much.
Senator John Ashcroft of Missouri.
STATEMENT OF HON. JOHN ASHCROFT, A SENATOR IN CONGRESS FROM THE STATE OF MISSOURI
Mr. ASHCROFT. Thank you, Mr. Chairman, and I am pleased to add my thanks to you and Congressman Porter for advancing this opportunity to improve the quality of life in America.
The quality of American life was documented 150 years ago by Alexis de Tocqueville, who observed, and I quote, Americans of all ages, all stations of life are forever forming associations. These were associations to help one another. And when we impair our ability to help one another by opposing inappropriate and undue liability, we strike at the very heart and character of what America is all about.
Page 16 PREV PAGE TOP OF DOC So it is important, appropriate, and, I think, efficient for us to be discussing this as our former Presidents, along with Colin Powell and President Clinton, prepare for the Summit for America's Future in Philadelphia.
This goes to the heart of who we are. The idea that those who would hold themselves out to help their fellow citizens would have to offer as a potential the well-being of their own families because of the opportunity or potential for legal liability is an idea that is offensive. An example, a Boy Scout in a scouting unit in the Cascade Pacific Council suffered a paralyzing injury in a game of touch football. Several adults volunteered to supervise the trip. The youth filed a personal injury suit alleging the Boy Scouts and the volunteers were negligent for failing to supervise him adequately. The judgment was for $7 million. Oregon law caused the judgment to be reduced to around $4 million, but how many Boy Scout volunteers can afford to have that kind of exposure? I was a Boy Scout, I remember playing touch football. We played worse than that. It is the nature of boys. We played fox over the hill. You just had to run from one line to another line without getting knocked down, tackled or beat up.
I don't think we can change human nature, but we ought to change this system which is pernicious and invades the capacity of individuals to volunteer. The Gallup data has been cited effectively with clearly one out of six volunteers withholding services in some nature because they felt they had potential for exposure.
Earlier this month I introduced a Liability Reform for Volunteer Services Act, Senate bill 514, to try and address this same problem, and I believe it is something we should address and work together on. I thank you for making this an element of priority, I thank the Speaker, and I thank Congressman Porter for his outstanding work here. It is a way for us to restore and build the character which defines America as a community.
Page 17 PREV PAGE TOP OF DOC Mr. HYDE. Thank you, Senator.
Senator Rick Santorum of Pennsylvania.
STATEMENT OF HON. RICK SANTORUM, A SENATOR IN CONGRESS FROM THE STATE OF PENNSYLVANIA
Mr. SANTORUM. Thank you, Mr. Chairman. I, too, want to congratulate Congressman Porter and Senator Coverdell and others for their work on this issue. We in my office and I have been talking to a lot of nonprofit organizations in Pennsylvania as well as across the country to ask them what their concerns are, and obviously their number one concern has to deal with this issue of volunteerism and volunteer liability, and I think it is terrific that you folks are moving forward and this appears to be headed in a positive direction.
I wanted to share for the committee's consideration some other ideas that these volunteer organizations shared with me as to other concerns they have in the area of legal liability. As a matter of fact, I have introduced a series of bills in the Senate, S. 563 through S. 566, that address these other issues that were brought to our attention. I would appreciate the committee's consideration.
They expressed concern to me about the liability of people who want to donate equipment to nonprofit organizations, and that a lot of organizations need computer equipment or other kinds of things that are necessary to operate their business or their nonprofit mission. It would be much easier for them to get that kind of equipment donated if we had a definite liability standard other than just negligence. So we have introduced a bill to do this that has a gross negligence standard, like the volunteer bill.
Page 18 PREV PAGE TOP OF DOC The next has to do with companies providing facility tours. You all know if you have kids, as I do, facility tours are a thing of the past. Companies that do any kind of industrial work don't let kids go in there. I remember when I was a kid growing up in Butler, PA, I was in Junior Achievement and sponsored by Armco, the steel company in Butler, and one of the great thrills I had was to go and tour the plant and see how they made steel. My dad was not a steelworker, but most of my friends' dads were, and I had no idea how you made steel and what they did.
I think it is important to be a part of the community, to know what the community does, what the people in your community do, how they work, how they make a living. We have basically shut the doors to allowing children to understand what goes on within our own communities and what our dads do, what our moms do, what our neighbors do. That is a sad fact, and again, I think this is an opportunity for us to open the doors again, to let young people in particular know what goes on within their community.
Third, we talked to the foster grandparents program, one in particular that is interested in this, was the availability of cars, vans, and aircraft. Companies won't lend them out and give them to volunteer organizations because they are afraid of the liability that goes with that.
And finally, we have another provision having to do with meeting facilities. In a lot of towns, there aren't a lot of meeting facilities. Particularly in Pennsylvania we have a large rural population. There just aren't a lot of community places to meet, but you do find these in businesses, in offices, and businesses are afraid to let charities come at night because they are afraid they will get sued. So what we have is another barrier to participation because there is no place for these folks to meet and work on community projects.
Page 19 PREV PAGE TOP OF DOC We hope the commitment in moving this bill forward also looks at some other things we can do to help the volunteer spirit and to help nonprofit organizations in the community thrive and even do their job more efficiently, and my time is up, and I thank the chairman for the opportunity.
Mr. HYDE. Thank you very much, Senator Santorum.
And lastly, the distinguished chief sponsor of this legislation, Congressman John Porter of Illinois.
STATEMENT OF HON. JOHN EDWARD PORTER, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS
Mr. PORTER. Mr. Chairman, let me say what a great pleasure it is to see you in the chair there, and let me also at the beginning thank the Speaker of the House for providing the leadership on this; Senator Mitch McConnell, who was the Senate sponsor in the last Senate; Senator Paul Coverdell in this Senate; and our colleagues Rick Santorum and John Ashcroft as well. It indicates to me the very strong support that exists in the Senate, as well as the House, for this legislation.
Let me say, Mr. Chairman, that this is bipartisan legislation. I have introduced it in every Congress since 1986, and in every Congress it has had at least 200, almost always over half the House, as cosponsors, and of that number, 30 to 40 percent have been members of the Democratic Party, as well as Republicans.
I would also tell the Chair that we managed to offer the entire bill as an amendment to the National Service Act. I believe the year was 1993, finally got it to a vote on the House floor. The vote was 422 to 0. There wasn't one single Member who didn't want to vote for the legislation. Now, it took Chairman Jack Brooks about 5 minutes to strip it out in conference, but on the floor of the House, the support for this legislation was extremely strong.
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The purpose of the legislation is not to provide some reduction in insurance rates for anyone. The purpose of the legislation is to keep volunteers coming forward in America and to not allow them to be chilled from the fear of ending up in a lawsuit, having to be dragged to court and to defend their house or their assets or their farm. It is a very, very straightforward piece of legislation.
The bottom line is that very few volunteers ever have judgments taken against them. The judgments are almost always taken against the organization that they serve, as they should be, but volunteers have to hire an attorney, go to court and be dismissed out of a lawsuit. The fear of having to pay those attorneys' fees and being involved in those kinds of matters, I think, turns a lot of people away from volunteer activity.
So what the legislation would do would be to help make it clear that what volunteers are there to do is to help other people, and they are not there to end up being dragged into court. The injured party in every case would be fully protected through the insurance that is carried by the organization that they serve, and I should say that the volunteer would remain liable if they were engaged in willful or wanton activity.
Finally, Mr. Chairman, let me say that if anyone sat down and read the list of organizations that support this legislation, they would understand how important it is to this country. I want to do that for a second. The American Association of University Women, the American Council on Education, the American Dental Association, the American Diabetes Association, the American Hospital Association, the American Medical Association, the American Red Cross, the American Symphony League, B'nai B'rith, Big Brothers Big Sisters, the Boys Club of America, the General Federation of Women's Clubs, the Girl Scout Council USA, Little League, National Easter Seals Society, National PTA, National Safety Council, Salvation Army, Save the Children, the National Multiple Sclerosis Society, the United Way, Women in Executive Service, YMCA, YWCA. It goes on and on and on.
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And I believe that the time for this legislation has come and that this Congress ought to pass it, send it to the President and insist that he sign it. We need to protect volunteers. We need to have them keep coming forward. It is time to provide that protection to them. Thank you very much, Mr. Chairman.
PREPARED STATEMENT OF HON. JOHN EDWARD PORTER, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS
Mr. Chairman, I thank you for the opportunity to testify on behalf of America's volunteers. In the spirit of the bipartisan volunteer summit this coming weekend, this hearing on volunteer liability could not be more timely. As Spring approaches, countless parents will be spending weekends as coaches for Little League, trying to nurture the next Babe Ruth or Jackie Robinson. Elsewhere, YMCA board members might be conducting a business meeting, while the directors of a local babysitting cooperative plan the month's child care schedule.
These people are volunteers and unsung heroes. All too often, we take their service for granted. Wherever there is a human need in America, chances are there is a volunteer group ready to meet it.
Over 90 million Americans devote their time and energy to our communities, schools, and our local governments. The talents of these individuals are absolutely vital to American society. Without volunteers' dedication and commitment to service, many of our nation's needs would go unmet. I believe that the spirit of volunteerism should be encouraged, and it is my hope that every American would be motivated to engage in community service.
Unfortunately, in this litigious age, volunteers and the organizations they serve face liability problems. One of the most widely reported horror stories involved Little League coaches in Runnymeade, New Jersey, who were sued when a fly ball injured a young player in the outfield. The central allegation in the cause of action was the boy was a born infielder, not an outfielder, and the coaches knew it. This case settled for $25,000. A few highly publicized cases, such as this one, have forced individuals to weigh liability risks against their desire to serve.
Page 22 PREV PAGE TOP OF DOC However, direct service volunteers, like Little League coaches or Big Brothers Big Sisters volunteers or Red Cross nurses, are not the only ones being drawn into litigation. More common, perhaps, are suits against volunteers serving on boards of directors of non-profit organizations. Frequently, charitable organizations will seek out established and esteemed members of the community to serve on their boards. Such individuals help to lend visibility to the good works of the charity and, quite frankly, can be helpful in the fundraising so vital to any non-profit organization. As a result, however, they are also easy targets for a lawsuit.
More serious perhaps than these individual suits and the problems they have created for the particular defendants involved, is the public perception of volunteering as a risky undertaking. Even though volunteers have not been sued successfully in large numbers, volunteers have been named in many lawsuits and the costs of legal defense can be staggering. This fear of lawsuits has affected volunteer programs nationwide by discouraging individuals from coming forward to pledge their time for good causes.
In a Gallup survey (1988), one in twenty organizations reported being sued on a directors and of ricers liability question. This may be a small percentage, however, if 5% of not-for-profits are sued, this ultimately causes a chilling effect in volunteerism. A larger proportion (14%) have eliminated programs they believed would expose the organization at risk. In fact, 16% of the board members report they have withheld their services to an organization out of fear of liability.
Volunteer liability has also curtailed worthwhile programs for lack of affordable insurance. The Volunteer Protection Act does not solve the increased insurance rates, it protects our nation's volunteers. Our nation needs volunteers, and we cannot allow this to continue.
Back in 1986, I first introduced legislation to address this issue, the Volunteer Protection Act. I secured a bill number for the bill--H.R. 911--to indicate the emergency situation facing volunteers. In a nutshell, this bill would shield volunteers from being sued except in cases of willful or wanton misconduct. The idea here is that if litigation must arise from the volunteer activity, the nonprofit organization itself should be named, not individual volunteers.
Page 23 PREV PAGE TOP OF DOC H.R. 911 outlines a model law and provides states with the guidelines for effective volunteer protection laws. Under my legislation, states may require volunteer organizations to undertake ''risk management'' training or procedures, may stipulate that the protection does not apply to anyone driving a vehicle, and they may require that qualifying organizations demonstrate sufficient assets or insurance to compensate an injured person. However, the individual volunteer, acting in good faith, would not be liable.
Of course, volunteer protection does not provide immunity to drunk drivers and other bad actors. Volunteers who behave willfully or wantonly would continue to be held liable for their misdeeds. Only ''simple negligence'' is protected.
Over the years, the Volunteer Protection Act has gained widespread support from hundreds of nonprofit and volunteer-dependent organizations. The list reads like a ''who's who'' of charitable and volunteer service--Big Brothers Big Sisters of America, the American Heart Association, American Red Cross, Girl Scouts Council USA, Little League, National Easter Seal Society, National PTA, the Salvation Army, the United Way ... and many, many others. The level of attention received by the legislation has also helped to promote state action on volunteer protection laws in 36 states. In the last four Congresses, it has enjoyed the bipartisan support of over 200 Members of Congress.
These nationally-treasured charities and nonprofits understand that volunteers are central to our way of life, and they must be encouraged, not deterred, from their devotion to service. We have an obligation to protect and support those volunteers who meet so many needs and whose personal service reminds us of what it means to be a member of the American family.
Throughout our history, whether coaching baseball or giving comfort to disaster victims, the men and women who volunteer to meet these needs have made us a better nation. Now, they need our help. Just as aspiring major leaguers need Little League coaches, America needs its volunteers. Let us give them the protection they deserve.
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Mr. HYDE. Thank you, Mr. Porter. I understand you have an appointment with an important personage, the Dalai Lama, so I wanted to say that for the record. Thank you very much.
The next panel will please step forward, and we are delighted to have with us Lynn Swann, the national spokesman for Big Brothers/Big Sisters of America, a role he has played since 1980. Of course, Mr. Swann is no stranger to us. He was a vital player for the Pittsburgh Steelers, during which time they won four Super Bowls. He was named to the All-Rookie Team in 1974, All Pro in 1975, most valuable player of Super Bowl X in 1976, and was selected National Football League Man of the Year in 1981. In later years he has become familiar to us through his broadcasting career with ABC Sports. Since 1983, he has broadcast a variety of events as host, reporter, and analyst.
What many of you may not know is Lynn Swann is an active community volunteer. He sits on several boards of directors and is a spokesperson for several national organizations, including Big Brothers Big Sisters of America. He has received numerous honors for outstanding service and contributions to the continued growth and development of our Nation's young people, and he has provided over 80 scholarships to the Pittsburgh Ballet Theatre School for children between the ages of 10 and 18.
Terry Orr is a former Washington Redskin with a professional athletic career that spanned over 9 years and two Super Bowl victories. By the way, I got a glance at a Super Bowl ring that frankly would choke a water buffalo. I am not sure I could lift my hand if it was on it, but it is beautiful and well-deserved.
For the last 2 years, Mr. Orr has hosted a weekly television show on ''Home Team Sports.'' He is a member of the Redskins radio network covering games on WJFK.
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Terry Orr has made a commitment to the community in many ways. He is on the board of directors for the Northern Virginia Community College and the Black History Foundation. He is involved with a number of charities, including Easter Seals, Make a Wish Foundation and World Team Sports.
Our third witness will be Mr. Conrad Teitell, a partner in the firm of Cummings & Lockwood, and adjunct visiting professor at the University of Miami Law School. He is the author of a five-volume treatise, ''Philanthropy and Taxation,'' and has lectured extensively on philanthropy and estate planning. Mr. Teitell holds a law degree form Columbia University Law School and an LL.M. from New York University Law School.
Welcome, gentlemen, and we will begin with Mr. Swann.
STATEMENT OF LYNN SWANN, IMMEDIATE PART PRESIDENT, BIG BROTHERS BIG SISTERS OF AMERICA
Mr. SWANN. Mr. Chairman, thank you very much. It is an honor for me to be here to represent Big Brothers and Big Sisters of America because of the work they have done for more than 90 years in one-to-one mentoring of young children in over 500 agencies across the United States in all 50 States.
I have a statement that obviously is written and will ask to be part of the record.
I would just like to talk from a personal standpoint to say that while I played professional football for 9 years and played for the University of Southern California, I began playing Little League baseball when I was 8 years old. I began playing Pop Warner football when I was 12. All of the men who coached on those teams were indeed volunteers.
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Through those young years, through those organizations, I learned the importance of discipline, competition, working hard to reach a goal, maintaining yourself in a strong state of physical ability to participate in those sports. All of these lessons allowed me to go on and get a scholarship, to earn a scholarship to the University of California. Had it not been for those athletic skills I possessed, I would not have been able to get that kind of education here in this country. Those skills, the education at USC allowed me to go one step further and play professional football.
If you look at all the sports teams we have in this country, all the athletes participating in any kind of sport, and think back to the recreation departments, the Little Leagues, all the organizations and all the volunteers, how many of those men and women who have had the opportunity to gain a scholarship to go to college, how many of those people today would be successful in their chosen field of professional sports had they not had those organizations when they were children and those volunteers that taught those early lessons. Certainly I would not be sitting before you this morning if I had not had those volunteers.
There is a stronger and stronger need for more people to volunteer. As our Government has decided to pull back and that less government is better, they have called on our private citizens, they have called on the private sector, corporations, to be more involved. They have asked them to give more money, to give more time, to give more services, to give more assets, to give their own individual talents. How can we as a government ask them to give more and we take away what they need? We take away the volunteer.
We place a sword of danger upon their heads by this unnecessary liability.
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It is important that we realize that without this volunteer segment of our society, there are so many things that would not be addressed, so many things would not be changed. Under Big Brothers Big Sisters of America, we have over 100,000 matches, and under the auspices of the President's Summit for America's Future, we have decided to restate our goals of matching 200,000 children by the year 2000. And that is a strong number; it is a very strong number.
Through a study that was conducted by PPV, Public/Private Ventures we have learned about our organization that we do make a great difference, and the study that took over 18 months, over 1,000 matches--some of them matched, some of them unmatched--in our organization. A match lasts a minimum of 1 year.
Here are some interesting numbers: 46 percent of the kids were less likely to be involved in using illegal drugs; 27 percent were less likely to be begin using alcohol; 52 percent were less likely to skip school; and relationships with adults have improved.
This is why we need our volunteers. We make a difference. When we can have this kind of impact on children across America, we need to get more volunteers involved, have them active volunteers to show them what a productive, disciplined lifestyle can be. And without these volunteers, we have no hope of getting that message across to our young people.
We urge that H.R. 911 be passed. It is important to the youth of America. Thank you.
Mr. HYDE. Thank you, Mr. Swann.
Page 28 PREV PAGE TOP OF DOC [The prepared statement of Mr. Swann follows:]
PREPARED STATEMENT OF LYNN SWANN, IMMEDIATE PAST PRESIDENT, BIG BROTHERS BIG SISTERS OF AMERICA
Thank you, Chairman Hyde, for providing Big Brothers Big Sisters of America, whom I represent today, with the opportunity to share our views on pending legislation covering volunteer liability.
Big Brothers Big Sisters of America has been in operation for over ninety years. The Big Brothers Big Sisters federation is comprised of over 500 agencies located throughout the United States. The federation, through its volunteers, serves approximately 100,000 children and families per year.
Over ninety percent (90%) of the funding for Big Brothers Big Sisters programs comes from private sector sources--individuals, corporations and foundations. Less than ten percent of Big Brothers Big Sisters' funding comes from public sector sources.
The Big Brothers Big Sisters program matches at-risk children with responsible adult volunteers. The result of these matches are one-to-one relationships which are monitored and nurtured by trained social workers. Big Brothers Big Sisters volunteers must spend a minimum of four hours per week for one year with their match whom we call their ''little.'' Over ninety of children served in our program come from single parent homes.
These one-to-one relationships, formed among strangers, are not intended to produce a specific outcome. Children referred to our program are in need of adult friendship and support. We advise our volunteers to have fun with their ''littlest'' Many Big Brother Big Sister relationships last much longer than one year--they last a lifetime. Many little brothers and little sisters grow up to become big brothers and big sisters.
In 1992, the Big Brothers Big Sisters program was the subject of the most comprehensive evaluation of any youth service program While the objective of our service is to enable volunteers to provide adult support to children at risk, the evaluation showed exceptional results in a number of areas which have frustrated policy-makers.
Page 29 PREV PAGE TOP OF DOC The three-year, multi-million evaluation was conducted by the firm of Public/Private Ventures (P/PV). They studied and tracked approximately 1000 boys and girls, with ages ranging from 10 to 16, involved in Big Brothers Big Sisters programs in seven states. Half of these children were matched with adult volunteers, and half had been referred to our program but were not yet matched. After eighteen months, P/PV discovered that, as a result of the work of Big Brother and Big Sister volunteers, ''littles'' were: 46% less likely to begin using illegal drugs; 27% less likely to begin using alcohol; 52% less likely to skip school; less likely to hit someone; more confident of their performance in schoolwork; and getting along better with their families.
These results show the dramatic impact that responsible adult volunteers, who engage in a sustained and supported relationship with children at risk, can have in our society. While many youth service organizations have their own definition of ''mentoring,'' this study showed that the one-to-one model of mentoring--using committed volunteers and developing sustained relationships--can reduce juvenile drug use and crime, can improve academic performance, and can contribute to stronger families. There is no federal program which can claim these results.
The Big Brothers Big Sisters program has among the highest standards for volunteers in the youth service community. Our volunteers are trusted with children in an unsupervised setting. As stated earlier, our volunteers are expected to meet with their ''little'' at least once per week for at least one year. Big Brothers Big Sisters volunteers make an intensive commitment to their ''little.'' These volunteers, and their counterparts in churches, YMCA's and Boys and Girls Clubs, are the thread in the civic fabric which binds our diverse society.
In order to ensure that Big Brother Big Sister volunteers are responsible and committed, our program requires extensive screening including a criminal background check. Through this screening we learn that many prospective volunteers are either unwilling or unable to make the substantial there commitment required by our program. These prospective volunteers are referred to less intensive youth service programs.
Page 30 PREV PAGE TOP OF DOC Our agencies are considered leaders in youth service risk-management. Our program has been dealing with difficult issues such as child sexual abuse for nearly a century. Big Brothers Big Sisters ''Standards of Required Procedure'' are considered a model hi the youth service field.
For all of our success. which is largely attributable to the work of our volunteers, we have 40,000 children waiting to be matched at any given time. Our nation has an additional, estimated two million children living in single parent homes who would benefit from our service. While the United States Marines spend hundreds of millions of dollars recruiting ''A Few Good Men,'' our program must rely on donated public service advertising and word-of-mouth to attract ''A Few Good Volunteers.''
In the late 1980's the Big Brothers Big Sisters federation endorsed H.R. 911. At that time, a series of high visibility law suits against direct service volunteers had dampened enthusiasm for volunteering in our program. Our standards for volunteer service were already among the highest in the nation We could not afford to lose prospective, high quality volunteers due to liability fears.
Since the 1980's many States have adopted volunteer liability laws, but these laws are most likely to cover the actions of directors and officers and not direct service volunteers. These State laws, like recent federal laws limiting volunteer liability, respond to specific concerns. These laws rarely address the issue of volunteer liability in a comprehensive and consistent manner. H.R. 911 encourages States to do so. To the extent that liability concerns are or will be a barrier to volunteering, H.R. 911 encourages States to act responsibly and quickly to reduce that barrier.
Because Big Brothers Big Sisters of America is a social service agency, we are not only concerned about the needs of children at risk, we are concerned about reducing the likelihood of volunteer negligence and consequently about victims of volunteer negligence. Our agencies screen, train and manage volunteers so that they are accountable and responsible--to prevent volunteer negligence from occurring at all. Many other national volunteer-dependent organizations also have strong risk-management programs for their volunteers, and most have the necessary insurance to cover the actions of their volunteers. Unfortunately, not all youth service agencies have the experience or resources to manage the risks of volunteers. H.R. 911 encourages States to provide guidance to agencies lacking the experience and resources to manage volunteer risk.
Page 31 PREV PAGE TOP OF DOC The Volunteer Protection Act, in the form of H.R. 911, balances the need to reduce barriers to volunteering with the need to appropriately compensate victims of volunteer negligence. It accomplishes this by encouraging States to limit volunteer's liability for ''simple negligence,'' and by encouraging, States to ensure that volunteers are properly trained and managed H.R. 911 does not encourage States to reduce the responsibility of volunteer-dependent organizations for the actions of their volunteers. In fact, H.R. 911 provides States the flexibility to require volunteer-dependent organizations to carry necessary insurance to cover the actions of their volunteers, and to implement volunteer risk management practices It is important to note that H.R. 911 does not encourage States to limit volunteer's liability related to 'willful'' acts, just as liability insurance does not cover intentional wrong
In the view of many national volunteer-dependent organizations, the most productive outcome of H.R. 911 will be the prompting of State legislatures to address the issue of volunteer liability in a comprehensive and consistent manner. One outcome of passage of this legislation is that volunteers engaged in similar activities in different States will be treated consistently under civil justice laws. Passage of this legislation will very likely help encourage prospective volunteers throughout the nation to come forward to offer their services. We view this legislation as a non-controversial volunteer incentive bill, not as a controversial tort reform bill We urge the Committee to share this view as it considers this legislation.
As this bill moves through the Committee process, Big Brothers Big Sisters of America and several other national nonprofit organizations may have specific recommendations on adjustments to H.R. 911. We ask that the Committee carefully consider the interests and needs of organizations like ours which rely on volunteers.
It is these volunteers, the ''good Samaritans'' in our society, who are and should remain the focus of our attention. We look forward to this bill, and our nation's volunteers, receiving strong, bi-partisan support. We also look forward to the long-awaited celebration of this bill being signed into law.
Page 32 PREV PAGE TOP OF DOC Thank you for the opportunity to appear today.
BIG BROTHERS BIG SISTERS OF AMERICA SCHEDULE OF FEDERAL FINANCIAL AWARDS
Corporation for National Service--learn and service; 1995, $170,000; 1996, $158,000.
Mr. HYDE. And next, from Conrad Teitell.
STATEMENT OF CONRAD TEITELL, ESQ., CUMMINGS & LOCKWOOD, ON BEHALF OF THE AMERICAN COUNCIL ON GIFT ANNUITIES
Mr. TEITELL. Mr. Chairman, members of the committee, I am the volunteer lawyer for the American Council on Gift Annuities and have been a volunteer lawyer since 1968 for that national educational organization. The council is sponsored by over 1,900 charities nationwide of every type and stripe.
Why are we all gathered in this room today? Congressman Porter mentioned the Salvation Army. Let's go back to 1912, London, England, Royal Albert Hall. The last public words of Gen. William Booth, the founder of the Salvation Army. And he said, ''While women weep, I will fight. While little children go hungry, I will fight. While men go to prison, in and out, in and out, I will fight. While there is one lost little girl on the street, while there is one soul without the light of God, I will fight. I will fight. I will fight until the very end.''
Now, those words shortly before General Booth's death could very well have been spoken this morning. And very important in that fight in our country are the volunteers who day in and day out are involved in that fight. Being involved in that fight can, however, be risky, dangerous to one's wealth.
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Let me give you some personal testimony. I don't have much wealth, but what I do have is at the moment in danger because I am a volunteer. I am a volunteer lawyer for the--as I mentioned--the American Council on Gift Annuities, and my name appears on the letterhead of that organization. And a plaintiff decided to sue the organization in a lawsuit involving multi-, multi-, multi-millions of dollars in damages, if successful.
I am on the letterhead. I am a defendant in that lawsuit. The legal papers, so far, in that lawsuit are higher than this table, and the legal fees, in my view, are reaching close to the ceiling.
Now, I continue to volunteer, and I volunteer for other groups, but I must admit to you in some quiet moments when I would rather be thinking about pleasanter things, I kind of worry about my house, my savings, my pension plan.
Therefore, it is important not just for me, but for all the volunteers in America, to pass the Volunteer Protection Act.
I began in England by quoting William Booth. Let me end in England and in the United States by paraphrasing the words of another Englishman, Winston Churchill: Our American volunteers give their blood. Our American volunteers give their sweat. Our American volunteers give their toil. Our American volunteers give their tears.
I hope this committee will favorably report out, and the Congress of the United States will enact H.R. 911, the Volunteer Protection Act. Let's win this one for the ''giver.''
Page 34 PREV PAGE TOP OF DOC Mr. GEKAS [presiding]. We thank Mr. Teitell.
We switch to recognize Mr. Orr.
STATEMENT OF TERRY ORR, THE ORR CO.
Mr. ORR. Thank you, Mr. Chairman. I would like to say now abideth faith, hope, charity, these three, but the greatest of these is charity. That is 1 Corinthians 13:13.
Scholarly, the word ''charity''; a lot of scholars would say that charity loses its meaning that it comes from agape love, which I think from a volunteer standpoint is really why people go out and do charitable things.
For me personally, I just really want to share two things that by being here today really affect me, that transcend the lines, that affect all volunteers. I mentioned earlier that, being a past commissioner of my son's T-ball league and coaching, presently we have a thing that to raise money--and most of it goes, because we had a gentleman donate a lot of the land for our fields, but a lot of the money that we have to raise and what--we have an annual Bat-a-thon--is going for liability protection. For us personally, we pay about $65 per child to play Little League Baseball. To some, that may not sound like a lot, but to others it is a whole lot.
And for this past year, when the board was getting together and putting our groups together and deciding on how are we going to approach this baseball season, the main thing and the emphasis of all the directors and everyone involved was, how are we going to make our Bat-a-thon successful? We got away from let's have fun, it is for the kids, these are the things that are involved. Our main issue was, how can we raise and make our Bat-a-thon successful so we can raise some money to pay for our liability coverage?
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And so we took even a step further and now we have a Bat-a-thon coordinator. So now we have taken that a step further, and we have two members of every baseball team as its own team coordinator just to make sure that our Bat-a-thon is a success. Not so much that the kids can go out and have fun, not so much in--the main emphasis is to lower our fees so we can play baseball.
So personally, I think that when I am involved with an organization and it is as American as apple pie, Little League Baseball, and our main emphasis is on how are we going to raise enough money for our coverage, I think something needs to be done.
Second--the second issue from a personal standpoint is, I have started and have paperwork and am qualifying for the tax ID's and all of those things for my own personal foundation; and something that really disturbed me was that from the foundation being formed--it is myself and two of my friends as directors, getting the thing started. One of the things that bothers me is that a personal friend, and a client of mine actually, when I sent the information over to him and he had the opportunity to read it and started looking at all of the things that he may be exposed to, sat down and said, ''Wait a minute, this is a great idea and these are some great things that you are doing. We can go to dinner and hang out and do all the things that you do for my own personal basis, but my advisors have been saying that I don't even know if I want to be a director on your foundation.'' And this is a close personal friend of mine.
I think the issue goes further when you have friends and clients that are sitting down and saying, we can do everything else but be involved in a charitable event together.
Thank you very much for your time.
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Mr. HYDE [presiding]. Thank you, Mr. Orr.
Mr. CONYERS. Thank you, Mr. Chairman. I want to join you in welcoming our distinguished friends on the panel. I remember the Pittsburgh Steelers in their heyday, and also the Redskins. Not too bad a time when you think about their glory years. And I welcome your testimony, gentlemen, and commend you.
Mr. HYDE. Thank you for not mentioning the Chicago Bears.
Mr. CONYERS. No, not in the same breath with the teams that these guys played on.
But, you know, a lot of your former colleagues are doing what you are doing. They are volunteering their time. Isaiah Thomas has been doing a lot of work, when he was in Detroit with the Pistons; and Grant Hill and Michael Jordan. And I think, don't you, that most athletes are on to helping kids and taking their role-model status as far as they can in terms of keeping them on the right track? Don't you think that is customary in your field?
Mr. SWANN. I don't view it as necessarily customary, but I do think that a majority of the athletes take it as a responsibility, and that young people watch them and want to emulate them, so they want to hold themselves to a higher level. But at the same time, when we look at volunteers, we are talking about people who are doing very normal, average everyday things who are not necessarily those people who are professional athletes.
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Professional athletes may have the additional time because they have an off season, and if they are not Michael Jordan, then every moment is not used making commercials or working for some company, but they have time in the off season to volunteer and spend more time with their own families and others. They have the financial resources, making a higher-than-average income, in helping organizations and using their skills to become a coach. I understand the appeal of athletics, but I think we want to use the platform of celebrity status and the fact that we won Super Bowls, people know who we are, to follow the lead and do things on an everyday basis.
We want the persons working in the community, who you know as the custodian at the school or the secretary in the office, or who you know as the teacher who goes out and does far more--the man who is the garbage collector, but does that job extraordinarily well and volunteers his time and who has less to offer in terms of financial resources, but also the same risk in terms of having to lose that if he is sued because he volunteers.
And those are the issues, I think, we are trying to address. The late Senator Heinz in Pennsylvania, who was a personal friend, his family had a motto and that motto was to do a common thing uncommonly well. We just ask that most Americans take the time to determine what the common thing they can do is, to do it uncommonly well and to share with their community.
Mr. CONYERS. Thank you.
Mr. Orr, welcome.
Mr. ORR. Thank you very much. I just wanted to kind of reiterate what Mr. Swann was saying and make this very brief in that the main issue is that from a lot of my former colleagues that are out and trying to do different things now and taking their name to another level, my father always made it clear to me that no one can take away your good name, make sure that you don't give it away.
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What happens with what is going on now is that it transcends that, yes, no one can take away your good name, but they may take away everything that your good name was able to help you possess. That is the main reason, from the volunteer standpoint, that there is that fear factor of what is going to happen for all of the good things that I have done to build up and take it to a new level, and now it is just going to be taken away because I moved a kid from third base to first base, and he got hit in the face with a ball.
Mr. CONYERS. Thank you very much. I am going to ask the Chairman, Mr. Hyde, to let me hold a press conference here tomorrow, too, and I would like you guys to join me on this same subject. Would you be willing to do that, both of you? Mine would be a miniconference. I won't have the Speaker of the House to join me on mine. If you can.
Mr. SWANN. I, unfortunately, sir, will not be able to. I have to go back to Pittsburgh, and I have meetings tomorrow.
Mr. CONYERS. OK. We will get your statement.
Mr. Teitell, you were here when the Speaker referred to predatory lawyers, were you not?
Mr. TEITELL. Yes, sir, I was.
Mr. CONYERS. You didn't take any umbrage?
Page 39 PREV PAGE TOP OF DOC Mr. TEITELL. Sir, my game is law, not football, but unfortunately some of my fellow lawyers are big game hunters and small people can be trapped by them. It is not always the end result, as the chairman mentioned, it is the fear.
And also again, as in my personal testimony, I am a defendant because I was on a letterhead and my potential liability is great; and I am involved in a major lawsuit.
Mr. CONYERS. So you feel there are a lot of predatory lawyers out there?
Mr. TEITELL. There are a lot of fine lawyers and there are some predatory lawyers. There are good and bad people in every profession.
Mr. CONYERS. So I didn't take any offense and you didn't either when the Speaker referred to predatory lawyers?
Mr. TEITELL. No, I didn't.
Mr. CONYERS. Right. The suit that you are referring to several times is an antitrust suit, isn't it?
Mr. TEITELL. That is correct.
Mr. CONYERS. That is not covered in this legislation, is it? The answer is no.
Mr. TEITELL. Perhaps you would amend the legislation.
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Mr. CONYERS. Well, we might want to do that. Would you recommend that we consider doing that?
Mr. TEITELL. I don't think that the legislation should get bogged down in that.
Mr. CONYERS. OK. You don't want us to do that. Fine. Now----
Mr. TEITELL. However, sir, there is legislation that the Congress passed that would have dismissed the lawsuit, and it was passed unanimously by both the House and the Senate and signed by the President, but the district court and the Fifth Circuit Court of Appeals has said that Congress didn't fix the problem, and we are coming back to the Congress and ask for a refinement in the legislation to fix the problem. So rather than amend this legislation we would ask to you amend the prior legislation.
Mr. CONYERS. We will be happy to.
Mr. TEITELL. Thank you.
Mr. CONYERS. You are more than welcome. And I will remember that you are not a predatory lawyer when that suit comes down, when that comes back to us.
Now, let me just ask you, though, then why are you here if the lawsuit that you keep rapping about doesn't have anything to do with the bill?
Page 41 PREV PAGE TOP OF DOC Mr. TEITELL. To answer your question, since 1964, as a lawyer specializing in the tax law as it encourages people to make charitable contributions, I have worked with colleges, hospitals, churches, the Salvation Army nationwide. I know the staff members and the volunteers----
Mr. CONYERS. But you didn't cite any examples of that. You kept talking about your antitrust case. You know what, you were fooling a lot of people here who didn't know that was an antitrust suit.
Mr. TEITELL. Sir, that was certainly not my intent.
Mr. CONYERS. I know. I know how lawyers operate. They never mean to do it.
Mr. Swann, let me ask you something. You were telling us about all the volunteers that influenced your life, and I was very pleased about it because I had a lot of mentors. Although I don't look like it, I liked sports and tried to participate myself. But did any of them ever get sued?
Mr. SWANN. There was not a lawsuit in any of the teams that I participated on brought against the volunteers. There were some interesting concepts in terms of how we worked out. We had a current Marine captain who was in charge of our conditioning, and one of his, shall we say, ''disciplinary forms'' if you were late was that you had to sometimes run or sometimes do pushups, but he brought along a flak jacket so you are a little boy running around with this heavier weight and would do the pushups.
Page 42 PREV PAGE TOP OF DOC While no one at that time attempted to bring a lawsuit because their children were moved from position to position, that--certainly in our society today, should a parent decide that they did not like your methods of training, and they asked you to document that method of training and support why you think that is necessary for a person at that age, if you could not, then you might be liable for a lawsuit.
Mr. CONYERS. You are really good. So the answer was no?
Mr. SWANN. The answer was no under those specific circumstances, but I don't want my good fortune as a young man should preclude someone else from volunteering.
Mr. CONYERS. Terry, do you remember when all the people were helping you out and all the volunteers, did you ever know of anybody getting sued?
Mr. ORR. Not to my knowledge; and I grew up in Texas, so things that have happened back there since, I wouldn't be privy to.
Mr. CONYERS. I want to thank all of you for coming, and thank you very much, Mr. Chairman.
Mr. HYDE. Thank you, Mr. Conyers.
Mr. MCCOLLUM. I have not been here for a while.
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Mr. HYDE. I know, but the old system of trying to find out who got here first and who got here second is not my cup of tea.
Mr. MCCOLLUM. Thank you, Mr. Chairman.
Let me do this. I will make one comment and then I will yield to Mr. Gekas.
Mr. HYDE. It is not obligatory that you ask questions.
Mr. MCCOLLUM. I apologize for being late. I am a prime sponsor of this legislation and I am very committed to it.
It is clear that you are here to represent what is right about the changes that need to be made in the law. If we are going to have volunteer--and we see General Powell and his volunteer summit coming up; we are having congressional awards every year, those participating in those for young people to do--all the people involved need to know that they can do that without threat of liability and litigation and lawsuits. So your coming today to give examples and to give the testimony is really appreciated.
Since I was here late and I didn't get to hear your testimony, I will yield to Mr. Gekas.
Mr. GEKAS. I thank the gentleman. I met Mr. Swann--he doesn't remember--in Williamsport during the final game of one of the internationally recognized Little League championships, when he was with the Wide World of Sports along with Johnny Bench and, I guess, Palmer, the pitcher from Baltimore.
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Mr. SWANN. Jim Palmer.
Mr. GEKAS. Jim Palmer. And we noted, all of us together in different functions, that Lynn Swann was participating even then. Although he was there as a professional broadcaster, he was also participating in very important community events built around the Little League, which themselves bred the concept of volunteerism, banquets and other functions, always with Lynn Swann there granting autographs to hundreds of kids--not selling the autographs, but giving the autographs--and inspiring that type of leadership that we want our kids to be able to emulate.
Lynn will remember that for one game, the championship game and Little League at Williamsport, I happened to represent that area at one time, something like 2,000 volunteers were involved, all from the community. They housed youngsters from Japan and Korea and Saudi Arabia and all over the place. They provided commissaries, they provided after-game activities of all types. Lynn was involved in all of it.
If there was ever an eloquent witness to what volunteerism means, it is someone who attended a Williamsport Little League championship game. Lynn Swann has more than the ordinary credentials for appearing as a witness here.
I would ask the witnesses to ponder another situation which they may not have considered, and I say the same to the members. We had a hearing a--last year, I guess it was, in my committee in which the volunteers who go from State to State to help in hurricanes and tornadoes and all kinds of emergency situations that arise--I remember from my own community, some 200 firefighters went to a point in South Carolina to help out in a hurricane. They do so in the face of the big winds, in the face of the possible liability that can ensue for their volunteer efforts.
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That seems unseemly. I want to make sure that when we further develop this legislation that those kinds of situations are covered.
Does anyone have a comment on questions of volunteers, outside of brothers and sisters and the sports world, where they might see that this could encounter problems?
Mr. ORR. I would make a comment that addresses more the issue of traveling from State to State, but it really kind of stays along the sports issue. I know myself--and Mr. Swann, I am sure, probably does the same thing as far as traveling in different States to volunteer your time at event--different events.
So I would say that it is very important from the standpoint of the legislation that if I am going to California to participate in a pickup basketball game that I am at a different risk, even though I am a resident of Virginia, to see it addresses the same issues although it is staying within the sports realm.
Mr. GEKAS. I thank the gentleman. I have no further questions.
Mr. HYDE. I thank the gentleman.
The gentleman from Virginia, Mr. Scott.
Mr. SCOTT. Thank you, Mr. Chairman.
Page 46 PREV PAGE TOP OF DOC Mr. Swann, I would just like to say that another bill that we are going to be considering this week is the Juvenile Justice and Delinquency Protection Act, and in many of the hearings that the gentleman from Florida, Mr. McCollum, had and the subcommittee chairman has had on the Education Committee that I serve on, one of the biggest variables in reducing crime and the chances that a young person will get into crime--one of the biggest variables is whether or not they had a specific individual that cared about them. And the Big Brothers Big Sisters model is exactly the kind of thing that we need a lot more of, and I congratulate you for your work in selecting that charity to spend so much of your time on.
Has Big Brothers Big Sisters been sued? Do you have any citations that we can look at as to how many suits have been against the organization?
Mr. SWANN. I don't have a specific number, but in the area of lawsuits, I think at the current moment nationally there is one or maybe two lawsuits pending. But these kinds of lawsuits that are pending would not be covered under H.R. 911 and should not be.
Certainly when we match a young boy or girl with an adult, we do as much at the law allows in terms of a background check. We were very happy that when the Child Protection Act was passed that was to create a national database of people convicted of criminal acts against children so that we could draw on that resource.
The lawsuits that are now in court against Big Brothers Big Sisters are those in the area of abuse to children, child abuse; and we always prosecute those cases to the fullest extent. We do not negotiate those and they will not come under H.R. 911.
Page 47 PREV PAGE TOP OF DOC Mr. SCOTT. For the volunteers working in good faith, you would want them immunized, and the bill does not immunize the organization; is that accurate?
Mr. SWANN. That is accurate.
Mr. SCOTT. And you don't have--you are not suggesting that the organization be immunized; you want the volunteers?
Mr. SWANN. When I was board president, I suggested that whenever there was a case of this nature that we under no circumstances ever sweep this under the carpet, that we bring it to light and take it to court. We are in the business of helping children and protecting them.
Mr. SCOTT. I am talking about the ones that would be covered by the bill. You are asking for immunity for volunteers working in good faith?
Mr. SWANN. That is correct.
Mr. SCOTT. But not for the organization itself to be immunized against lawsuits, because the organizations are not----
Mr. SWANN. That is correct.
Mr. SCOTT [continuing]. Are not granted any protection. It is the volunteers, so that the injured party would have recourse. But the volunteers would not have a reason to not come forward because they would have protection. The injured party would have recourse.
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Mr. SWANN. Absolutely.
Mr. SCOTT. Mr. Teitell, do you know of any case--did you say you represented a number of different organizations?
Mr. TEITELL. That is correct.
Sir, it is not just the number of cases that have been brought; it is really the shadow of the threat of the case. You just hear about a few cases, and others say, I don't want to have the risk of being sued. I know the very organization--the American Council on Gift Annuities is made up of people who work for colleges, universities and hospitals, and because they were volunteers, their charities were sued; and others now will be discouraged because some people were sued in their individual capacities.
Mr. SCOTT. When the States had passed many of these lawsuits immunizing directors and volunteers are you aware of any insurance costs that went down?
Mr. TEITELL. I am not aware of that. I have no knowledge either way.
Mr. SCOTT. Mr. Chairman, I thank you. And I congratulate all the witnesses for the work you do.
Mr. Orr, the volunteer efforts that you have, thank you.
Page 49 PREV PAGE TOP OF DOC Mr. HYDE. Thank you, Mr. Scott.
The gentleman from Indiana, Mr. Pease.
Mr. PEASE. Thank you, Mr. Chairman. I will have a question for the next panel because it is more focused on the testimony of one of the potential witnesses. I just want to say, I appreciate very much the work that you are doing in this field, as well.
Mr. Teitell, you and I met a number of years ago when I was general counsel for a university, and I listened to one of your programs that was extremely helpful to us. But my questions today are on another matter, and I will wait for the next panel.
Mr. HYDE. Thank you.
The gentleman from Massachusetts, Mr. Delahunt.
Mr. DELAHUNT. I just have two questions, Mr. Chairman. One I direct to Mr. Swann.
How did you think the Patriots did in the recent NFL draft?
Mr. SWANN. It is my professional opinion that it is not the draft that will be of concern for the New England Patriots but the transition of the head coach in getting adjusted to the weather in Massachusetts.
Mr. DELAHUNT. Thank you very much, Mr. Swann.
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I would address this to all of you, but I guess specifically to Mr. Teitell. What I think I am hearing here today is that the problem, as you perceive it--and I think it is very hard to measure it, because I don't hear any hard statistics or data. I mean, I don't think anybody has that available to them. But what you are suggesting is that--let me rephrase.
Is the problem that the threat of lawsuits deters volunteerism, or is it that after people volunteer, they start to reflect and think about the exposure that they might have? Because my own experience is that volunteerism is alive and well in America today. I mean, people, I think, their impulse is not to think first about the exposure to a lawsuit, but rather to get involved in the community.
Mr. TEITELL. It is alive and well, but of course it can be better. I am not a litigator, but just a plain old estate planning lawyer, when clients come into my office----
Mr. DELAHUNT. You are an estate planning lawyer?
Mr. TEITELL. Yes, sir.
Mr. DELAHUNT. Then you certainly know the predatory lawyers that Mr. Conyers was talking about.
Mr. TEITELL. One of the things we ask is, do you serve on any boards? Are you a volunteer? Do you have insurance for this? Are you covered? We want our clients to have all of the facts. And we encourage them to make charitable gifts and also to volunteer, but we want them to be protected and know what the risks are.
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Mr. DELAHUNT. Thank you. That is all the questions I have.
Mr. HYDE. Well, before I let this excellent panel--oh, I am sorry, Ms. Jackson Lee is here.
Ms. Jackson Lee.
Ms. JACKSON LEE. Thank you very much, Mr. Chairman. And I thank the panel for its presentation.
I am a friend, if you will, of the legislation to the extent that I certainly know the sense of where it has come from. Being a board member of both the Sam Houston Area Council of the Boy Scouts of America, and the Regional Council, I am sensitive to the concerns.
I do think, however, even in its long journey to attempting to be passed, this particular legislation can and would necessitate some tinkering to make sure that we are responding to the issues.
For example, I would imagine in your quest for this coverage, Mr. Swann, you would not want to see organizations like the Ku Klux Klan be exempted from being subject to liability based upon any acts that would deprive the rights of another citizen. Would you want them to be included?
Mr. SWANN. No.
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Mr. TEITELL. Of course, none of us would want them to be included and they are not an organization that could possibly be included----
Ms. JACKSON LEE. Mr. Teitell, I didn't ask you the question. If you don't mind, let Mr. Swann finish. I would appreciate it.
Mr. SWANN. Certainly, I would not see that being the case. And I don't know to what extent the Ku Klux Klan is strictly involved in terms of children.
Ms. JACKSON LEE. It is a 501(c)(3), so it is a nonprofit, and it would have the opportunity to seek coverage under this particular legislation. And I think that it is important that we be assured that that not be the case, and other such groups.
I did hear the presentation of one of the previous speakers who indicated that hate groups involved in deprivation of civil rights would not be included, but that is something that we would have to reconfirm. But that is, in essence, the tinkering that we would have to do to be assured that individuals who were damaged by such groups would not be covered.
You would not want them to be covered under those circumstances?
Mr. SWANN. I would not want them to be covered under those circumstances.
Ms. JACKSON LEE. In your general perspective, Mr. Swann--and I, again, if it is somewhat sensitive and I know that this is not the right time, but in addition to my board memberships, which were many, as I am sure is true for many in this room, I am really thinking of the day-to-day volunteers.
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Those of us who sit on the boards get great excitement from the day-to-day volunteers, and I am happy to say that I participate with the day-to-day volunteers. These are the folks who are the coaches and the Big Brothers or Big Sisters. So in that sense, do you really see a diminishing of those kinds of volunteers?
In fact, I see a rebirth. I see a quest to bring in throngs, a new attitude in our secondary and primary schools.
Can you really say to me that Americans take a lot of time and pause about the question of liability when they think about volunteering in our community? Those who build houses, those who do trash cleanups, those who do the Race for a Cure. Do they really think about those kinds of things?
Mr. SWANN. I would have to honestly say I believe they do. We at Big Brothers Big Sisters of America have an extensive background check, as much as we can, in terms of who we use as volunteers. There is a commitment of time, more so than there is a commitment of resources. We do the background checks and our volunteers look and see what that commitment is and see what their liability is.
There are many people who decide not to go through the process because they feel like that commitment and that liability would be too much. We are asking them to take the place of a parent in many cases and take that child out and expose them to a variety of things. If I, as a Big Brother, took my little brother out and we were in-line skating and I was trying to teach him how to skate, and he was to fall and have an accident, I am liable. And that is the kind of thing.
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You would not take a mother and father and sue them. The other parent would not sue them because they took their child out and tried to teach them how to ride a bicycle or coached them in Little League and there was an accident. But a Big Brother Big Sister, you could. In the inner-city schools and areas of our community there are fewer and fewer kids playing baseball because there are fewer and fewer people volunteering, and they are not volunteering because the insurance costs are high, it is difficult to field the teams and difficult to find the volunteers to come and coach the teams.
Ms. JACKSON LEE. I would like to see statistics on that. I vigorously disagree with you. Maybe it varies in different communities and I would say that communities need to themselves reinvest in energizing their volunteer component. It certainly is not a problem in a lot of parts of Texas. I don't think it is a problem across the board.
And I might say that I think this effort that will be waged first by President Clinton--it is his call to those who will be joining him, including General Powell and, of course, Ford and Carter--is a statement to the effect that this country enjoys volunteerism. So I appreciate what you are saying. If your office or the Big Brothers Big Sisters has some statistics for us, I would welcome them greatly.
Mr. Chairman, would you indulge me to have--Mr. Teitell wanted to answer the question, and Mr. Teitell, please answer the question as to your thoughts on the Ku Klux Klan in terms of its coverage under this.
But also might I say that it helps me to understand that you are in estates and annuities because you are talking about volunteers and board members who have enormous assets--not to in any way diminish that volunteerism.
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Please distinguish that from the average person that just goes out and coaches a team or goes out and participates in a trash cleanup. That is not the bulk of the volunteerism in America. It is the charitable part of volunteerism, it is people giving money and sitting on boards, and it may be major boards, so they are sensitive to their personal assets. I think that is something certainly to be considered.
But as a board member, I remember board liability insurance which covered those of us who sit on boards. So I really think there should be some distinguishing between the average fellow that goes out and says, I want to help this community. There are a lot of Americans who will still do that.
What is your response to the Ku Klux Klan--and I would like to have my opening statement submitted for the record, that I have just summarized in my remarks--Mr. Teitell?
Mr. TEITELL. Obviously, no one wants to protect the Ku Klux Klan or any similar organization, and my understanding is they are in no way, shape or form covered by this legislation because it applies to organizations exempt--tax exempt under section 501(c)(3) of the Code, and that organization is not a tax-exempt organization.
Ms. JACKSON LEE. We are still exploring that. There are aspects of their work that may be covered under that, and we need to be careful to be assured that that is not the case.
Mr. TEITELL. Absolutely.
Page 56 PREV PAGE TOP OF DOC Ms. JACKSON LEE. Mr. Orr, in the course of your activities, again, do you see a diminishing--I am from Texas and you are from Texas--of the general spirit of Americans, of desiring to be volunteers and helping to be change-makers in young people's lives?
Mr. ORR. I think from all the involvement that I have been participating in, it kind of goes in phases. It looks good on the surface, I am going to go out there; and then when I have to pull teeth to get parents to say, I am going to be a coach or an umpire. Once they find out and read the fine print, that is where you are seeing the big dropoff.
On the surface, it looks very good and it is exciting because everybody wants to help to a certain extent. At least they want to give the appearance that they are helping. And then, when you get down to the bare-bone facts of, here, I need you to sign this waiver or sign off on this card, that is when we are seeing the big--at least for me personally, the slowdown as far as volunteerism.
Ms. JACKSON LEE. If there were individual States that had their provisions, would you feel comfortable that those States could handle their own coverage or their own exemptions if individual States already enacted such laws and if we passed a Federal law that it should be in the context of encouraging the States to do so? But if States already had those laws, would that be satisfactory for you?
Mr. ORR. I would have to say from a personal standpoint I am not real excited about any kind of stepping into what the States are doing. But if the State law is adequate, I would see no problem with leaving it the way that it is. But if those State laws are not up to speed with what can be improved, then they do need to be changed.
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Ms. JACKSON LEE. Mr. Chairman, I ask unanimous consent for my opening statement to be submitted into the record.
Mr. HYDE. Without objection.
[The prepared statement of Ms. Jackson Lee follows:]
PREPARED STATEMENT OF HON. SHEILA JACKSON LEE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS
Mr. Chairman, I support the concept Volunteer Tort Liability Legislation. The purpose of this Act is to promote the interests of social service program beneficiaries and taxpayers and to sustain the availability of programs and nonprofit organizations and government agencies that depend on volunteer contributions. As a result, H.R. 911 encourages the States to enact legislation to grant immunity from personal civil liability, under certain circumstances, to volunteers working on behalf of nonprofit organizations and government entities.
In 1996, the Nonprofit Risk Management Center and the American Bar Association published an analysis of State Liability Laws for Charitable Organizations and Volunteers. There findings revealed that, prior to the last decade, the number of lawsuits filed against volunteers might have been counted on one hand, perhaps with fingers left over. Although the law permitted suits against volunteers, in practice no one sued them and volunteers had little reason to worry about personal liability. In the mid-1980s, that changed. More volunteers were sued and those suits attracted national media attention. Thus, many individuals were deterred from volunteering their services to nonprofit organizations. The nonprofit organizations that thrive on the services of volunteers have been hurt by the drastic reduction of volunteers who are scared away because of the rising threat of suits. Since 1986, at least 20 states have passed some form of volunteer-immunity legislation. However, all of this legislation has given a false impression that volunteers nationwide are immune from suit. To the contrary, many volunteers remain fully liable for any harm they cause and all volunteers remain liable for some actions. Furthermore, some state laws exclude gross negligence or some other category of error above negligence. A few laws even permit suits based on negligence, which nullifies the purpose for which they are offered. Some of the state laws are confusingly worded, exceptionally complicated, designed for profit-making corporations, or otherwise problematic. Even the very best laws require a careful analysis to determine which volunteers they cover and what exceptions they contain.
Page 58 PREV PAGE TOP OF DOC The goal of H.R. 911 is to establish volunteer protection laws that are not confusing and are easily applicable in a judicial proceeding. However, this Bill also states that nothing in this Act shall be construed to preempt the laws of any State governing tort liability actions. Mr. Chairman, volunteers are essential to the every day workings of nonprofit service organizations. It is important that we provide protection to these good Samaritans.
Mr. HYDE. Does the gentleman from Virginia, Mr. Goodlatte, have any questions?
Mr. GOODLATTE. No, Mr. Chairman. I will pass.
Mr. HYDE. Thank you.
Before I release this excellent panel, I will share very briefly two experiences I had. Once I saw a man hit by a car in an intersection in Chicago. And I saw a doctor--M.D. office on the corner, and I ran up the stairs to get him and he would not come down. He wasn't going to get involved and get sued for malpractice by moving this poor guy; and for all I know, he may have died for lack of prompt medical care. But this guy was not going to volunteer because he was asking for litigation.
Secondly, I defended a high school and two football coaches who were sued by a young man's father. He was injured in a fumble recovery drill where he hit his elbow on the ground, it transmitted and broke his collarbone. The collarbone was subsequently removed, and this young man was a wrestler and he sued for the moon.
Unfortunately, we got films of his wrestling as a freshman after his injury and he made the mistake, his lawyer did, of suing the coaches. If he just sued the school under respondeat superior, a term that you are familiar with Ms. Jackson Lee, he may have recovered. But when you sue the coaches, the volunteers, why, he didn't recover.
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With that little history lesson, I thank you all very much.
Ms. JACKSON LEE. Mr. Chairman, may I ask your indulgence for a second. I think what you have evidenced is that we can all come together and work to find a positive resolution to the issues before us. Might I, as you are an esteemed and honored counselor at the bar, please acknowledge that I have rarely seen predator attorneys. I have seen volunteers, have seen attorneys who have extended themselves, contributed to being parts of community activity, and I would like to clear the record.
Mr. HYDE. I would stipulate that you have seen few predator lawyers. I have seen plenty.
Ms. JACKSON LEE. None, Mr. Chairman, if my statement can say that I have seen none; and I have seen well-intentioned attorneys who are working very hard to make this a better place to live.
Thank you, Mr. Chairman.
Mr. HYDE. I thank the gentlewoman and thank the panel for your great contribution.
Our final panel, we have an excellent group of individuals who will speak to how our current volunteer liability system affects the provision of services through nonprofit organizations. First, we will hear from Robert Goodwin, president and CEO of the Points of Light Foundation.
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Prior to joining the foundation, Mr. Goodwin served as Executive Director of the U.S. Department of Education's White House Initiative on Historically Black Colleges and Universities. He was also assistant deputy chancellor for external affairs at Texas A&M University. I have a grandson at Texas A&M.
I would like to note that the Points of Light Foundation is one of the organizers of the President's Summit for America's Future, which opens this weekend in Philadelphia.
John Graham, CEO of the American Diabetes Association, appears before us for the second time to talk about volunteer liability issues. We were happy to have him testify at our hearing last year and we do welcome him again.
Prior to joining the American Diabetes Association, Mr. Graham served the Boy Scouts of America for 9 years. He also appears today on behalf of the American Society of Association Executives.
Habitat for Humanity International is ably represented here by the managing director of its Washington office, Dr. Thomas Jones. Habitat for Humanity has 1,347 affiliates in all 50 States and the District of Columbia. Dr. Jones has earned the master of divinity, master of theology and doctor of ministry degrees and has served as pastor of large Presbyterian congregations around the country.
Following will be Fred Hanzalek representing the American Society of Mechanical Engineers. Mr. Hanzalek is a graduate of the University of Louisville, holds a master of science degree from Columbia University. He is retired from a career at Combustion Engineering and serves as the State government relations coordinator for Connecticut for the American Society of Mechanical Engineers.
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Prof. Andrew Popper of the Washington College of Law, at the American University will testify from his perspective as a professor of torts. He received his law degree from the De Paul University School of Law and an LL.M. from the National Law Center of the George Washington University.
Finally, Charles Tremper, senior vice president of the American Association of Homes and Services for the Aging, will be here to describe the State experience with volunteer liability reform and the successes and failures of those efforts.
He is the founding executive director of the nonprofit Risk Management Center and has spent 10 years researching and analyzing volunteer liability issues.
Again, with my gratitude, I ask the witnesses to keep their oral presentations to 5 minutes, if possible. All of your written testimony will be inserted in full in the record. And with that, we begin with Mr. Goodwin.
STATEMENT OF ROBERT K. GOODWIN, PRESIDENT AND CEO, THE POINTS OF LIGHTS FOUNDATION
Mr. GOODWIN. Mr. Chairman, thank you, and I will be brief, and I ask your indulgence if I slip away before the questions are completed to appear in a program with General Powell related to the President's summit just momentarily.
I am here as a volunteer and as president of the Points of Light Foundation, and our mission is to engage more people more effectively in direct and consequential services aimed at solving some of our Nation's most serious social problems. And so promoting volunteering is what the Points of Light Foundation is all about.
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We are looking forward to a watershed event in Philadelphia, and we do think that there will be an increased interest on the part of average citizens in reaching into the community to do the kinds of good works that were represented by other panelists.
I want to draw your attention to a subtle distinction that we want noted for the record that among the two bills that are being considered by this committee. While both bills offer much-needed relief from personal liability of volunteers, the bills differ primarily in their approach to the State law preemption that Ms. Jackson Lee made reference to. On behalf of the Points of Light Foundation, while we would support either approach as advancing the necessary protection and establishing a uniform, nationwide liability baseline, the outright preemption approach would appear to do that more clearly at no cost to the Federal Government. Therefore, we would more vigorously support the Inglis bill.
You should be aware that support for liability protection is not uniform throughout the nonprofit sector. There is concern of whether or not harm would come to the organization if it were exposed, and while the volunteer might be protected, that the organization might be under greater jeopardy.
And so I would hope that this body would continue to look at this issue and discover ways that might have the desired effect of unleashing this volunteer and civic power that we all know must be unleashed if we are to curb our most serious social problems. And I join with those at this table in saying that we believe either version of the bill will go a long way toward helping to reduce the barriers that do exist and primarily because of the threat of legal action.
Page 63 PREV PAGE TOP OF DOC Thank you.
[The prepared statement of Mr. Goodwin follows:]
PREPARED STATEMENT OF ROBERT K. GOODWIN, PRESIDENT AND CEO, THE POINTS OF LIGHT FOUNDATION
Mr. Chairman, distinguished members of the Judiciary Committee, it is indeed an honor and a pleasure to have this opportunity to testify before you today concerning the need for volunteer liability protection. Thank you for inviting me.
THE POINTS OF LIGHT FOUNDATION
I am here both as a volunteer and as President and CEO of the Points of Light Foundation. Our mission at the Points of Light Foundation is ''to engage more people, more effectively, in volunteer community service to help solve serious social problems.''
Volunteerism is what the Points of Light Foundation is all about. The Foundation carries out its mission through a wide variety of outreach programs which encompass virtually every aspect of national and community volunteer involvement. The Foundation is affiliated with over 500 volunteer centers throughout the United States and serves as the primary national training and support organization for our country's volunteer centers, as well as for corporate, youth and community volunteer programs.
THE NEED FOR VOLUNTEER LIABILITY PROTECTION
As President of the Foundation, I have had the opportunity to speak with literally thousands of dedicated volunteers from all walks of life. I can assure you that the issue of volunteer liability is of paramount interest to them and of equal concern to the volunteer management organizations which coordinate their efforts. Based on my own experience and discussions with the volunteer community, I would like to offer a few of the reasons why volunteer liability protection is needed:
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Volunteers have been deterred from offering their services due to liability concerns. In fact, almost half of the officers of nonprofit organizations have reported drop-offs in their volunteer rosters.
Volunteers, nonprofit organizations, and government entities have faced increased liability insurance costs due to unwarranted litigation. One example is the cost of liability insurance to local Little Leagues which rose over 1000% in just five years throughout the mid to late 1980's.
Nonprofit organizations and government entities have been adversely affected by the resulting withdrawal of volunteer assets. Nearly 16% of the nonprofit organizations studied in a 1988 Gallup poll indicated they had curtailed their activities due to fear of lawsuits. Similarly, 14% had eliminated altogether programs they believed vulnerable to suit.
There is no consistency among our states with regard to volunteer liability statutes, and that lack of consistency has led to confusion in the volunteer community. Many volunteers are unaware that they may be held personally liable for even inadvertent harms resulting from their volunteer efforts. They operate under the mistaken belief that ''Good Samaritan'' laws protect them from frivolous law suits. Unfortunately, they are wrong.
Finally, of those volunteers who are aware of the liability potential, many avoid volunteering for those ''high risk'' activities which often serve the neediest in our society.
H.R. 911 AND H.R. 1167
I understand that there are two bills currently before the House concerning the issue of volunteer liability, H.R. 911 and H.R. 1167. Both bills offer much-needed relief from personal liability for volunteers of nonprofit or governmental entities who are acting within the scope of their duties, except in cases of willful or flagrant misconduct. The bills differ primarily in their approach to state law preemption.
On behalf of the Points of Light Foundation, I can assure you that while we would support either approach as advancing the necessary protection and establishing a uniform nationwide liability baseline, the outright preemption approach would appear to do that more clearly, and at no cost to the federal government. Therefore, we would more vigorously support the Inglis bill.
Page 65 PREV PAGE TOP OF DOC You should be aware, however, that support for volunteer liability protection is not uniform throughout the nonprofit community. There are some nonprofits which depend on volunteers to accomplish much of their mission who, while generally supporting initiatives to reduce volunteer liability risks, are concerned that by limiting personal liability we will increase the likelihood of litigation against parent nonprofit organizations. Unfortunately, in today's litigious society that is a valid concern and one which is best handled by organizational liability insurance. Toward that end, neither H.R. 911 nor H.R. 1167 remove organizational liability or the need for organizational liability insurance--insurance that is necessary to protect the unfortunate victims of hapless accidents or innocent errors.
THE OPPONENTS' ARGUMENTS
Those outside the nonprofit community have voiced their opposition to volunteer liability protection by citing statistics which show an increase in volunteering nationwide. They contend that if volunteerism is on the rise, volunteers must not be overly concerned with liability issues. To the contrary, as one who spends his life with this community, I can tell you that informed volunteers are very much aware of the risks, but that individual decisions on whether (and how best) to volunteer are based on many factors beyond liability concerns.
A majority of the volunteers with whom I come in contact serve despite the liability risks. However, high risk volunteer activities, often those intended to help the neediest, frequently suffer. Individuals who continue to volunteer do so because of a desire to become locally involved, to give something back to their community, and to help others less fortunate. For those who continue to volunteer, the concern over the possibility of a frivolous law suit is not diminished; it is just overcome by a sense of doing what is right and meeting community needs.
Page 66 PREV PAGE TOP OF DOC Notwithstanding the risks involved, most Americans recognize that volunteering plays a vital role in the fabric of our society. A January 1997 nationwide survey conducted for the Points of Light Foundation found that 84% of American adults agree that connecting with others and working together through volunteer service can bridge the differences that separate people and help solve community problems. Toward that end, there are two initiatives currently being sponsored by the Points of Light Foundation to enhance volunteer service. They are our ''Connect America'' program and the Presidents' Summit for America's Future.
''Connect America'' is a collaborative effort of national and local nonprofit organizations, civic associations, business and government entities dedicated to fighting back against disconnection by expanding and involving interested volunteers with appropriate service activities in their home towns. Working with our partners who include the Big Brothers/Big Sisters of America, the Camp Fire Boys and Girls, the Child Welfare League, the W.K. Kellogg Foundation and Shell Oil, among others, we are striving to connect individuals and organizations through service to bridge cultural differences and better our communities.
THE PRESIDENTS' SUMMIT FOR AMERICA'S FUTURE
A second major undertaking of the Points of Light Foundation is its cosponsorship (along with the corporation for National Service) of the upcoming Presidents' Summit For America's Future. On January 24th Presidents Clinton and Bush joined at the White House to announce their co-chairmanship of this historic event. Lee meeting, which will take place in Philadelphia next week, will be led by retired General Colin Powell, with former Secretary of Housing and Urban Development Henry Cisneros and former first-daughter Linda Johnson Robb serving as vice-chairs. Together with other former Presidents and first Ladies and hundreds of community leaders from around our nation, we will join in a three-day call to action on behalf of America's children and youth.
Page 67 PREV PAGE TOP OF DOC The goal of the President's Summit is to renew in each of us the sense of civic responsibility central to our nation's successful past and promising future. It will focus on developing private, nonprofit and public sector resources to give America's youth the tools to lead healthy and productive lives. Drawing on concrete commitments of time and resources from business, labor, religious, educational and volunteer communities, the Summit's goal is to help create the conditions for American children and youth to succeed in the year 2000 and beyond.
We must bear in mind, however, that the success of these initiatives, the commitments to serve which they have and will produce, and the viability of countless of thousands of other volunteer efforts throughout the country will depend on the support of local volunteers--volunteers from every social, racial, ethnic and economic walk of life.
It is true that many volunteers will step up to the plate regardless of the outcome of the pending liability protection bills. But make no mistake about it, more volunteers will heed the call and their activities will include more assistance to those most greatly in need if the threat of frivolous law suits is curtailed. We owe it to the backbone of our society, our volunteers, to provide no less.
Mr. Chairman, that concludes my prepared statement. I will be happy to answer any questions you, or the committee, might have.
Mr. HYDE. Mr. John Graham IV, chief executive officer of the American Diabetes Association.
STATEMENT OF JOHN H. GRAHAM, IV, CEO, AMERICAN DIABETES ASSOCIATION, ON BEHALF OF THE AMERICAN SOCIETY OF ASSOCIATION EXECUTIVES AND THE NATIONAL COALITION FOR VOLUNTEER PROTECTION
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Mr. GRAHAM. Mr. Chairman and distinguished committee members, my name is John Graham. I am appearing before the committee on behalf of a variety of organizations. Principally, I am the chief executive of the American Diabetes Association, an organization representing more than 1 million volunteers.
I am also here on behalf of the American Society of Association Executives, an organization representing more than 23,500 individuals from more than 11,000 national, State, and local trade, professional and philanthropic organizations.
As a member of ASAE's board of directors, I can report that these associations are completely dependent on volunteers who serve on their boards and committees who perform direct-service functions.
Because the American Diabetes Association and ASAE represent organizations that rely so heavily on volunteers, we are both founding members of the National Coalition for Volunteer Protection. This coalition was formed in 1987 by more than 100 volunteer-dependent organizations in order to enhance the awareness of volunteerism and to address the threats to volunteerism in America.
The National Coalition for Volunteer Protection continues to coordinate and generate support for the passage of volunteer protection legislation. As of April 18, 1997, this coalition represents more than 300 National, State and local volunteer dependent groups. These groups collectively utilize tens of millions of volunteers.
Page 69 PREV PAGE TOP OF DOC I thank the committee for conducting this hearing on the critical issue of volunteer protection. More specifically, I am pleased that the committee is considering H.R. 911 and 1167. This committee must address a number of important issues, and I am heartened that the subcommittee recognizes the degree to which volunteerism has suffered due to liability concerns. The timing of these hearings could not have been more appropriate with the Nation's attention set to focus on the President's Summit for America's Future later in the week.
I will focus my testimony on the effect that the liability crisis has had on volunteer participation in charitable organizations and trade associations, primarily groups with IRS designations 501(c)(3) and 501(c)(6).
We have seen recently that otherwise qualified and willing individuals are withholding their services out of fear of liability and confusion concerning the different volunteer protection laws on the books in many States. These are individuals who would help house and feed the homeless, who would treat and support the elderly, and would clothe and care for the poor.
As the excitement surrounding the President's Summit for America's Future shows, the country has grown reliant on the service of volunteers. Volunteers provide services which fill large gaps in public and private programs for the needy, gaps which will no doubt continue to increase over the next decade. As both Federal and State governments make fiscal responsibility and balanced budgets the cornerstone of public policy, nonprofit organizations and the volunteers they utilize will play an even larger role.
Nonprofit organizations must mobilize volunteers by drawing on their members' special talents to meet needs. For example, associations unite their members' talents and help alleviate hunger, educate the public about alcohol abuse and drug abuse, promote literacy and other educational programs, find missing children, improve the concern of health care facilities, give eye care to the poor, offer medical aid to the homeless, teach fire safety and aid victims of natural disasters.
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In a 1990 study by the Hudson Institute, which covered 5,500 associations, volunteer time was conservatively estimated at $3.3 billion per year. The time was valued at $10 an hour in that particular survey.
It is no coincidence that the issue of protecting volunteers has followed massive increases in both the size of litigation claims and the cost of liability insurance. Many States have acted to protect volunteers from negligence lawsuits and to reduce liability insurance costs for nonprofits. All 50 States have passed laws limiting the liabilities of directors and officers of nonprofits. Several States have properly instituted nonprofit risk management programs or risk pools to stabilize liability insurance premiums. Some of these laws, however are dangerously limited.
For example, Indiana's law names fraternity and sorority volunteers only. While each State has different volunteer needs, we firmly support a Federal effort to design consistent and comprehensive guidelines for State volunteer liability standards. This problem is not being corrected but rather exacerbated by States who provide limited liability for select groups.
In an effort to save time and because my testimony is in the record and submitted, I would like to mention, because a number of issues have been raised around the data, in 1988, a Gallup study offered some insight into the extent of the volunteer liability issue. Some of the--most of the facts regarding volunteer liability have not changed since 1988. We believe that the findings of the study would be similar if undertaken today.
According to the study, approximately 1 in 10 nonprofit organizations have experienced the resignation of a volunteer due to liability concerns. If this figure were multiplied by the number of nonprofit organizations in America, 600,000, then that would mean that 48,000 volunteers would have been lost over the past few years strictly due to liability concerns. These are volunteers that resign, and resignation is a drastic measure.
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Secondly, one in six volunteers report withholding their services due to fear of exposure to liability suits. Then, as many as 100,000 American volunteers have declined to serve due to the fear of exposure to lawsuits. This is an extraordinary figure.
This survey highlighted the increased cost of liability insurance premiums to associations in recent years. The average reported increase is 155 percent; one in eight organizations reported an increase of more than 300 percent.
This study revealed the large extent to which the threat of lawsuits, and the prohibitive cost of liability insurance, have a negative effect on volunteer participation in charitable organizations and associations. The Gallup study provides hard data demonstrating the degree to which tax organizations have been devastated by the liability crisis.
I thank the committee for the opportunity to testify once again.
Mr. HYDE. Thank you.
[The prepared statement of Mr. Graham follows:]
PREPARED STATEMENT OF JOHN H. GRAHAM IV, CHIEF EXECUTIVE OFFICER, AMERICAN DIABETES ASSOCIATION, ON BEHALF OF THE AMERICAN SOCIETY OF ASSOCIATION EXECUTIVES AND THE NATIONAL COALITION FOR VOLUNTEER PROTECTION
Mr. Chairman, and distinguished Committee members, my name is John H. Graham IV, and I am appearing before this Committee on behalf of a variety of organizations. Principally, I am the Chief Executive Officer of the American Diabetes Association, an organization representing more than 1 million volunteers.
Page 72 PREV PAGE TOP OF DOC I am also here on behalf of the American Society of Association Executives (ASAE), an organization representing more than 23,500 individuals from more than 11,000 national, state and local trade and professional associations. As a member of ASAE's board of directors, I can report that these associations are completely dependent upon volunteers who serve on their boards and committees and who perform direct service functions.
Because the American Diabetes Association and ASAE represent organizations that rely so heavily on volunteers, we are both founding members of the National Coalition for Volunteer Protection. This coalition was formed in 1987 by more than 100 volunteer-dependent organizations in order to enhance the awareness of voluntarism, and to address the threats to voluntarism in America.
The National Coalition for Volunteer Protection continues to coordinate and generate support for the passage of volunteer protection legislation. As of April 18, 1997, this coalition represents more than 300 national, state and local volunteer-dependent groups. These groups collectively utilize tens of millions of volunteers.
I thank the Committee for conducting this hearing on the critical issue of volunteer protection. More specifically, I am pleased that the Committee is considering H.R. 911 and H.R. 1167. This Committee must address a number of important issues, and I am heartened that the Committee recognizes the degree to which voluntarism has suffered due to liability concerns. The timing of these hearings could not have been more appropriate, with the nation's attention set to focus on the ''Presidents' Summit for America's Future'' later this week.
I will focus my testimony on the effect that the liability crisis has had on volunteer participation in charitable organizations and trade associations primarily groups with the IRS designation of 501(c)(3) and (c)(6).
We have seen recently that otherwise qualified and willing individuals are withholding their services out of fear of liability and confusion concerning the different volunteer protection laws on the books in many states. These are individuals who would help house and feed the homeless, who would treat and support the elderly, and who would clothe and care for the poor.
Page 73 PREV PAGE TOP OF DOC As excitement surrounding the Presidents' Summit for America's Future shows, the country has grown increasingly reliant on the services of volunteers. Volunteers provide services which fill large gaps in government and private programs for the needy gaps which will no doubt continue to increase over the next decade. As both federal and state governments make fiscal responsibility and balanced budgets the cornerstone of public policy, nonprofit organizations and the volunteers they utilize will play an even larger role.
Nonprofit organizations mobilize volunteers by drawing on their members' special talents to meet social or economic needs. For example, associations unite their members' talents and help alleviate hunger, educate the public about alcohol and drug abuse, promote literacy and other educational programs, find missing children, improve the condition of health care facilities, give eye care to the poor, offer medical aid to the homeless, teach fire safety, and aid victims of natural disasters. In a 1990 study by the Hudson Institute, which covered 5,500 associations, volunteer time was conservatively estimated to total $3.3 billion per year (time was valued at $10 per hour).
It's no coincidence that the issue of protecting volunteers has followed massive increases in both the size of litigation claims and the cost of liability insurance. As the size of claims rise--along with the number of defendants named in each lawsuit--insurers point their fingers at the tort system. And, conversely, as liability insurance premiums rise, plaintiff attorneys scream for federal regulation of the insurance industry.
The National Coalition for Volunteer Protection is a relatively tiny player in this policy battle. We are funded at a minimal level by volunteer-dependent organizations. But what we lack in dollars, we make up for in numbers. We are working to win this important battle with the help of the millions of American volunteers who we represent.
Many states have acted to both protect volunteers from negligence lawsuits and to reduce liability insurance costs for nonprofits. All 50 states have passed laws limiting the liability of directors and officers of nonprofit organizations. Several states have properly instituted nonprofit risk management programs and/or risk pools to stabilize liability insurance premiums.
Page 74 PREV PAGE TOP OF DOC Some of these state laws, however, are dangerously limited. For example, Indiana's law names fraternity and sorority volunteers. While each state has different volunteer needs, we firmly support a federal effort to design consistent and comprehensive guidelines for state volunteer liability standards. This problem is not being corrected, rather it is being exacerbated by states which provide limited liability for select groups.
We realize that the two bills being considered by this Committee approach the issue of state laws differently. We believe that both H.R. 911, with its provision encouraging states to adopt the legislation through increased Social Services Block Grants, and H.R. 1167, with its preemption provision, will achieve the ultimate goal of uniform and adequate protection of volunteers from liability.
A 1988 Gallup study offers some insight into the extent of the volunteer liability issue. Since most of the facts regarding volunteer liability have not changed since 1988, we believe that the findings of the study would be similar if undertaken today.
The study, ''The Liability Crisis and the Use of Volunteers by Nonprofit Associations,'' was released by the Gallup Organization in January 1988. The study was sponsored by the American Society of Association Executives and funded by the Gannett Foundation. This study also concentrated on director and officers liability. The results of this study revealed very interesting data on the effect of this crisis on direct service volunteers. According to the study:
Approximately one in ten nonprofit organizations have experienced the resignation of a volunteer due to liability concerns. If this figure were multiplied by the number of nonprofit organizations in America (600,000), then it would mean that 48,000 volunteers would have been lost during the past few years strictly due to liability concerns. Remember: these volunteers resigned. Resignation is a very drastic measure.
One in six volunteers report withholding their services due to fear of exposure to liability suits. If this figure is applied to the number of nonprofit groups, then as many as 100,000 American volunteers have declined to serve due to fear of exposure to lawsuits. This is an extraordinary figure.
Page 75 PREV PAGE TOP OF DOC This survey also highlighted the increased cost of liability insurance premiums for associations in recent years. The average reported increase in the past three years is 155 percent, and one in eight organizations reported an increase of more than 300 percent.
This study revealed the large extent to which the threat of lawsuits, and the prohibitive cost of liability insurance, have a negative effect on volunteer participation in charitable organizations and associations. The Gallup study provides hard data which demonstrates the degree to which tax-exempt organizations have been damaged by the liability crisis.
This is not an imaginary problem as opponents of this legislation may suggest; this is a very real problem and it is eroding voluntarism in America. I know from my personal experience as a volunteer leader and as a direct service volunteer that many potential volunteers avoid making a personal commitment to serve nonprofit charitable organizations and associations in order to avoid personal risk.
Recent reports of high-damage lawsuits have certainly served to repel would-be volunteers from working for tax-exempt organizations. Recently, volunteers for a mountain rescue team, for the Boy Scouts, and for little league sports teams have been brought into court by plaintiffs seeking large sums sometimes in the millions of dollars--from the volunteers. And even if the ultimate result is a court victory in favor of the volunteer, even the time and money needed to successfully defend such a lawsuit is far too high a price for our nation's volunteers to pay for actions which were neither intentionally nor willfully negligent.
Mr. Chairman, Committee members, it's time we stop scaring away our nation's most precious resource--its volunteers. Both H.R. 911 and H.R. 1167 address our concerns about establishing a uniform standard of protection from liability for volunteers, and we support both proposals. With the Presidents' Summit for America's Future just around the corner, we urge that you act quickly to show your support for our nation's volunteers.
We support the approach of both H.R. 911 and H.R. 1167 because they cover all who volunteer for tax-exempt organizations. The bills do not single out certain types of volunteers for immunity. Volunteers should be treated equally whether they are Boy Scout leaders, Little League coaches, instructors working in literacy classes, or engineers providing services during natural disasters. H.R. 911 and H.R. 1167 would do just that.
Page 76 PREV PAGE TOP OF DOC We look forward to working with the members of this Committee to complete the design of a fair and balanced bill. As you are well aware, volunteer protection legislation has been introduced in every Congress since 1987, and each time it has gained significant support from both sides of the aisle. We hope to help you continue your work toward making federal volunteer protection legislation a reality.
Literally tens of millions of American volunteers are following this legislation. They will be grateful when you report a volunteer protection bill from your Committee. On behalf of those volunteers, and on behalf of volunteer-driven organizations throughout the country, I thank you for the opportunity to testify today. I welcome any questions you may have.
Mr. HYDE. Next, Dr. Thomas Jones, managing director of the Washington Office, Habitat for Humanity.
STATEMENT OF DR. THOMAS L. JONES, MANAGING DIRECTOR, WASHINGTON OFFICE, HABITAT FOR HUMANITY
Dr. JONES. Thank you, Mr. Chairman.
Personally, and on behalf of the entire leadership of Habitat for Humanity and its literally hundreds of thousands of volunteers across the country, I want to express respectful gratitude for your consideration of the vital subject of volunteerism in our Nation.
We do appreciate the truth that we can count many of you, Mr. Chairman, and your colleagues as Habitat for Humanity volunteers who have and do build houses and serve as volunteers in many other ways across the country. Within the next 2 months we are going to provide the opportunity for every one of your colleagues, Mr. Chairman, Members of Congress, to build ''The House That Congress Built'' here in Anacostia; and we don't want you to have any liability fears to keep you from doing that. By this time next year, as part of National Homeownership Week, we hope to have a ''House That Congress Built'' in every congressional district in the United States with Members of Congress as volunteers participating.
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No words can adequately convey the absolute necessity of and the thread of volunteerism in our great Nation. Volunteers serve in countless important ways doing necessary tasks which truly make our Nation great. And in the case of Habitat for Humanity, volunteers build houses with persons who in no other way could participate in the American dream of owning their own homes and all that that includes in other areas of life.
Habitat for Humanity would not exist apart from the huge volunteer involvement over the past two decades. The expression of the value of service through volunteerism has been central in every chapter of the positive development of our country. Habitat for Humanity epitomizes and expresses the spirit of volunteerism in our whole society.
Habitat truly is a voluntary movement. It began in Americus, GA, in 1976. Habitat for Humanity, as you said, Mr. Chairman, now has 1,347 affiliates across the United States in all 50 States and the District of Columbia. Each affiliate has 501(c)(3) status with its own locally elected board. Habitat for Humanity now has upwards of 30,000 board members, in addition to the hundreds of thousands of volunteers who build Habitat houses.
These boards represent the economic, educational, ethnic, social, religious, political, cultural, and racial diversity of our entire U.S. population. Without exception, no board member at any level of service in Habitat for Humanity receives any remuneration whatsoever.
During the 20th anniversary year last year, Habitat celebrated by building its 50,000th Habitat house worldwide. It is predicted that the 100,000 threshold will be reached by the end of this century.
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The basic principle of this volunteer movement is that Habitat builds houses with people, not for people, who in no other way could achieve the American dream of homeownership. These homes are built by volunteers, sold at no profit on a no-interest, long-term mortgage which can be affordable by the Habitat homeowners, who in no other way could do it.
What happens in this process is that relationships are formed, and these relationships, then, are put in concrete when this mortgage is signed with the local board; and thus, what happens is that as these Habitat homeowner families, these partners, have other needs in terms of medical or educational or jobs or personal crises or whatever, the relationships are real and the relationships and people do not let each other down. Thus, these volunteers then become volunteers in other arenas of need in our society.
It is true that across the United States some persons have declined service on Habitat for Humanity boards because of perceived liability threats. There are Habitat affiliate boards for whom the largest single administrative cost is the perceived necessity of purchasing liability insurance to protect board members. These are moneys which otherwise would be used to build more houses with more persons in need.
Local Habitat boards carry medical and liability insurance which most deem imperative to the successful recruitment of volunteers. There are some conflicts with worker's compensation laws about who is and who is not covered, which sometimes gets expensive.
It is important not only to protect volunteers from unwarranted liability threats, but to clearly communicate the information that all who volunteer can do so without unnecessary impediments. We are grateful for your sensitivity to identify perceived and real barriers for the need for ever-increasing volunteerism in our society, and the willingness to do everything possible to remove such barriers.
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Mr. Chairman, again we express appreciation to you and your colleagues. We in Habitat for Humanity pledge ourselves to cooperate in every way with you and others toward which we might assure justice for all, yet make it attractive for more and more persons to volunteer their services for the good of all persons and for society as a whole. Thank you, Mr. Chairman.
Mr. HYDE. Thank you, sir.
[The prepared statement of Dr. Jones follows:]
PREPARED STATEMENT OF DR. THOMAS L. JONES, MANAGING DIRECTOR, WASHINGTON OFFICE, HABITAT FOR HUMANITY
Mr. Chairman, Mr. Ranking Member, Members of the Committee, colleagues and friends:
Personally and on behalf of Millard Fuller, Founder and CEO of Habitat for Humanity International, as well as all of its leaders and its hundreds of thousands of volunteers in every part of our country, I express warm greetings and respectful gratitude for your consideration of the vital subject of volunteerism in our nation. We appreciate the truth that we can count some of you as faithful Habitat for Humanity volunteers who build houses and serve by giving important support in many other ways.
No words can adequately convey the absolute necessity the reality of volunteerism has had and continues to have in our great nation. Volunteers handle intervention hotlines; run soup kitchens; deliver meals to shut-ins; read books in our nation's schools; coach youth sports programs; and bring arts, education and entertainment opportunities to rural and isolated communities. And in the case of Habitat for Humanity, they build houses. Habitat for Humanity would not be the organization it is today without the benefit of its volunteer involvement over the past two decades.
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The expression of the value of service through volunteerism has been central in every chapter of the positive development of our country. Habitat for Humanity epitomizes and expresses the strength of volunteerism in our whole society.
Habitat for Humanity truly is a voluntary movement. Begun in Americus, Georgia in 1976 by Millard Fuller, Habitat for Humanity now has 1,347 affiliates in all fifty states and the District of Columbia. In addition Habitat for Humanity is working in 52 other countries as well. Each affiliate has 501(c)(3) status as a responsible non-profit corporation with its own locally-elected board. These boards represent the economic, educational, ethnic, social and religious diversity of the United States population. Without exception, no board member at any level of service in Habitat for Humanity receives any remuneration whatsoever.
During its 20th anniversary year in 1996, Habitat for Humanity celebrated the building of its 50,000th home worldwide. It is predicted that the 100,000 threshold will be achieved by the turn of the century.
The basic principle of this volunteer movement is that Habitat builds houses with people (not for) who in no other way could achieve the American dream of homeownership. Habitat houses are built primarily by volunteers and future homeowners, sold at no profit with a long-term no-interest mortgage at terms the homeowner family can afford. After more than twenty years, stories abound demonstrating the difference homeownership makes in raising strong citizens for this and future generations. And the result of this positive voluntary service in the lives of the persons who serve is life-changing for them.
Habitat for Humanity homeowners are required to invest an average of 300500 hours of sweat equity, working on their own homes and the homes of others. As the homeowners work on homes with local community leaders who are volunteers, relationships are forged. In a sense, the relationships are ''put in concrete'' for fifteen, twenty, or twenty-five years when the mortgage is signed with the local board. Often, when other challenges of life come to the homeowner partner families--jobs, education, medical needs, personal crises, and the like--the relationships are real and people do not let each other down. Other forms of volunteering become real as a result.
Page 81 PREV PAGE TOP OF DOC Habitat volunteers build quality, but simple, decent homes. The average Habitat home is about 1000 square feet. After more than twenty years, the default rate among Habitat homeowners is less than one percent.
Because of Habitat's wonderful success in these twenty years in which volunteers have done such marvelous work which has been good for so many lives and for our society as a whole, we of Habitat for Humanity--volunteers and homeowner partners alike--respectfully request that you, the Members of the United States Congress, do everything possible to encourage more and more voluntary efforts in our society by overcoming any barriers which deter voluntary service.
Across the United States, some persons have declined service on Habitat for Humanity boards because of perceived liability responsibilities. There are Habitat boards for whom the largest single administrative cost is the perceived necessity of purchasing liability insurance to protect board members. These are moneys which otherwise would be used to build more houses with more persons in need.
Local Habitat boards carry medical and liability insurance which most deem imperative to the successful recruitment of volunteers. There are occasional conflicts across the Habitat movement with workers compensation laws about who is and who is not covered which sometimes get expensive. It is important not only to protect volunteers from unwarranted liability threats, but to clearly communicate the information that all who volunteer can do so without unnecessary impediments.
Mr. Chairman, again we express appreciation to you and your colleagues. We in Habitat for Humanity International pledge ourselves to cooperate in every way with you and others in any process toward which we might insure justice for all, yet make it attractive for more and more persons to volunteer their services for the good of all people and for our society as a whole.
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Mr. HYDE. And next, Mr. Fred Hanzalek, I hope I am pronouncing that correctly, of the American Society of Mechanical Engineers.
STATEMENT OF FRED HANZALEK, CONNECTICUT STATE COORDINATOR, ON BEHALF OF THE AMERICAN SOCIETY OF MECHANICAL ENGINEERS
Mr. HANZALEK. Thank you, Mr. Chairman. My name is Fred Hanzalek. I am a retired mechanical engineer, and I am actively involved supporting volunteerism as the State coordinator in my home State of Connecticut. I am testifying on behalf the American Society of Mechanical Engineers, and I am pleased to have this opportunity to express our support for both House bills 911 and 1167.
Now, our society is not necessarily a household word. I guess the best thing one can say is we are part of the infrastructure, and that is very apt because the chances are we designed and built a lot of the infrastructure.
Both these bills serve to encourage volunteers to contribute their services for the good of their communities while establishing a reasonable base for redress of claims that may arise from their actions. We, the American Society of Mechanical Engineers, are a nonprofit educational and technical society with 125,000 individual members who work in all sectors of the economy, including industry, academia and government. Many of our members are actively involved in volunteer work for the society, and as one example, we have over 3,600 volunteers who donate invaluable services free of charge to enhance and protect the public safety each year through the development of codes and standards.
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Recognizing volunteers are the lifeblood of ASME, the society has issued a general position statement on volunteer protection which calls for protection of volunteers acting within the scope of their duties from personal liability. We have long held this position, and we are firmly on record as supporting volunteer protection legislation. Although volunteers are not often sued successfully, the publicity associated with such cases and the resources required in cost and time to defend against such suits have a strong chilling effect on potential volunteers.
Other speakers have placed the Gallup poll in the record, and I will not take the committee's time to reiterate it. However, one specific item which came from that poll is that in 1985, which is over 12 years ago, it was estimated that with 89 million volunteers, they provided more than 100 billion dollars' worth of free services to our economy. Since that time, of course, there has been relentless pressure to reduce government-funded service at all levels, and only a significant increase in volunteer effort has any chance of taking up the slack.
State laws vary greatly in the scope and extent of protection for volunteers from civil liabilities, but we believe that the Congress should aid the development of more comprehensive protection for all volunteers, and we are pleased to support House bills 911 and 1167. Thank you for your attention.
Mr. HYDE. Thank you, Mr. Hanzalek.
[The prepared statement of Mr. Hanzalek follows:]
PREPARED STATEMENT OF FRED HANZALEK, CONNECTICUT STATE COORDINATOR, ON BEHALF OF THE AMERICAN SOCIETY OF MECHANICAL ENGINEERS
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Mr. Chairman and Members of the Committee, my name is Fred Hanzalek. I am a retired mechanical engineer and actively involved in volunteerism in my hometown of Suffield, Connecticut.
On behalf of the American Society of Mechanical Engineers (ASME) I am pleased to have the opportunity to express our support for both House Bills 911 and 1167. These bills serve to encourage volunteers to contribute their services for the good of their communities while establishing a reasonable basis for redress of claims that may arise from their actions. ASME is a non-profit educational and technical society with 125,000 individual members who work in all sectors of the economy, including industry, academia and government. Many of our members are actively involved in volunteer work for the Society. For example, 3,600 volunteers donate invaluable services, free of charge, to enhance and protect the public safety of the nation each year through the development of codes and standards.
Recognizing that volunteers are the lifeblood of ASME, the Society has issued a general position statement on volunteer protection which calls for protection of volunteers acting within the scope of their duties from personal civil liability. ASME has long held this position and is firmly on record as supporting volunteer protection legislation. Although volunteers are not often sued successfully, the publicity associated with such cases, and the resources required in cost and time to defend against such suits, have a strong chilling effect on potential volunteers. A Gallup survey of volunteer members of non-profit organizations found that:
One in five volunteers are more concerned about serving in volunteer organizations due to an increased liability threat;
Eighteen percent of those surveyed had withheld their leadership services due to fear of liability;
Forty-nine percent reported seeing fewer people willing to serve on non-profit organizations;
Seventy-Two percent reported volunteers becoming cautious in what they say or do relating to their volunteer work; and
Page 85 PREV PAGE TOP OF DOCTwo percent had actually been sued as a volunteer for a non-profit organization.
A 1985 Gallup survey estimated that America's 89 million volunteers provided more than 100 billion dollars' worth of free services to our economy each year. Since that time, there has been relentless pressure to reduce government funded service at all levels. Only a significant increase in volunteer effort has any chance of taking up the slack.
State laws vary greatly in the scope and extent of protection for volunteers from civil liability. Some states protect volunteers for sports learns, others cover only directors and officers of nonprofit organizations. We believe the Congress should aid the development of more comprehensive protection for all volunteers and ASME is pleased to support House bills 911 and 1167.
Thank you for your time.
Mr. HYDE. And next, Prof. Andrew Popper from the American University, Washington College of Law.
STATEMENT OF PROF. ANDREW F. POPPER, AMERICAN UNIVERSITY, WASHINGTON COLLEGE OF LAW
Mr. POPPER. Thank you, Mr. Chairman.
H.R. 1167 and H.R. 911 are among the most intriguing of the tort reform proposals to come down the pike in years because of the laudable goals they reflect.
Unlike 911, 1167 is a Federal mandate changing State laws. Thus far, there has been no showing that there is a national crisis justifying this type of intrusion. There is no independent study, much less juried piece of research, demonstrating a liability crisis, nor is there reliable data suggesting that federally imposed tort immunity will somehow increase the number, frequency, or quality of volunteers. While there is certainly speculation and good-faith ideas that these benefits might accrue, that hardly seems to be a basis to preempt State law.
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Putting aside the fact that there is no data supporting the claim that tort immunity will produce more and better volunteers, let's consider the individuals who would be touched by these bills. First and foremost there are those who are served: victims of disasters; students tutored in schools; minor children; patients in hospice care; countless others in need of help, compassion, and the diverse and wonderful skills that volunteers bring. These are vulnerable groups, populations at risk, without power to select the people who assist them. Some in this population are legally incompetent, sometimes unable to discern if inappropriate behavior has occurred.
If either of these bills become law, would that lessen or increase the risks that these populations face? Freed from the possibility of civil liability, outside of an inexplicable standard of wanton and willful misconduct, does the likelihood of inappropriate risk-taking go up or down?
Our legal system is predicated on the belief that the potential of liability creates accountability and improves the likelihood of enhanced health and safety. While the common law did not create a duty to aid, it certainly set forth a clear standard once a person has made a decision to volunteer and to assist. One who aids another should conform with the minimum level of due care. These bills would change that standard.
On a personal level, for the past 26 seasons, I have coached various children's soccer teams. I am deeply aware of the responsibilities I have to my players, especially young players. The parents of these kids who leave them on the field make an assumption that I am going to use good judgment, avoid inappropriate risk, be sensitive to the potential of injury, the necessity of preparation, and I make those same assumptions when I entrust my children to another coach or teacher or Scout leader. These bills set aside those assumptions.
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Frankly, not even the most aggressive tort reform proposals reject incentives for due care. Accordingly, it is appropriate to ask in this situation why, when we are involved with those most vulnerable, we would set aside due care obligations.
There is, of course, an entirely different lens through which one could look, and that involves the shortfall of volunteers. A Federal policy that addresses this shortfall merits support.
We all share the hope that our society will nurture those in need, assist those who are hurting, encourage those who have untapped potential, administer to those who have lost hope. The question is: Does the abolition of tort liability for all but extreme misconduct have the effect of stimulating that behavior or the perverse effect of creating negative incentives?
And further, who gets immunized? It is one thing to immunize volunteer workers that the Red Cross carefully trained. But what about college fraternities where the record for due care is not exactly pristine, or medical centers or social organizations or, as inferred by Congresswoman Jackson Lee, the KKK? It can't be the case that the remedy for a shortfall of volunteers to is to give civil pardons to anyone under the umbrella of 501(c)(3).
H.R. 911 is distinguishable from 1167 because it offers hard cash if a State is willing to delete due care obligations. A simple financial question: How much money is it going to cost to provide these State supplements to States that accept the 911 challenge? If the dollar value is in the tens of millions, and I think it is, is that the best use of scarce resources? Would the Red Cross or Habitat or any of these groups rather have an annual transfer directly of these dollars, particularly when you consider that the passage of these bills is not going to reduce the insurance costs of these organizations by a dime?
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Reducing enhanced accountability by lifting the tort system from actors who are in a position of trust to the children and defenseless and infirm takes a huge risk. Outside of a demonstrated crisis, outside of a clear establishment of uncontrollable tort claims, in the absence of a demonstrable nexus between tort immunity for volunteers and increased participation, it seems to me this legislation is ill-advised.
I appreciate the opportunity to testify today. I regret taking this unpopular position, but I thank you for letting me speak my piece.
Mr. HYDE. Well, I am glad you did, Mr. Popper. I think we need some balance, and it hasn't been that balanced this morning, but your vigor and rigor makes up for it.
[The prepared statement of Mr. Popper follows:]
PREPARED STATEMENT OF PROF. ANDREW F. POPPER, AMERICAN UNIVERSITY, WASHINGTON COLLEGE OF LAW
My name is Andrew F. Popper. I am a tenured professor of law at American University, Washington College of Law where I have taught torts, administrative law, product liability, and antitrust since 1978. It has been my honor to appear before various congressional committees more than 20 times during the last decade to discuss various tort reform initiatives. Through these appearances I have had the chance to engage in the public discourse regarding tort reform and welcome the opportunity to do so today.
TORT REFORM BACKGROUND FROM A CONSUMER PERSPECTIVE
Page 89 PREV PAGE TOP OF DOC Since the late 1970's, there has been consideration of proposed legislation designed to limit tort liability. Some bills have sought broad, far-reaching changes that would have grossly curtailed the rights of injured consumers to pursue claims or even have access to the courts. Other bills have been more modest, focused on a single industry that sought Congressional protection (such as the recent big-materials proposals). Some bills were designed to change the tort system completely, creating a ''workers compensation'' model, while another group targeted specific but important parts of tort law such as punitive damages and joint and several liability.
All proposals share the characteristic of federalizing tort law, a field that has been the province of the states for the last 200 years. While there may be arguments to the contrary, these proposals were initiated by insurance or industry interests precisely to benefit those interests, with few, if any, tangible benefits flowing to those who have been injured by negligent behavior or harmed by unreasonably dangerous products in a defective condition (the predicate for the dreaded strict liability/product liability case).
Every time a bill is put forward, whether broad or narrow in its limiting effect, the response by consumer groups and trial lawyers has been opposition, based on a variety of arguments that seek to demonstrate that the bills neither assist injured consumers who seek redress nor do they support incentives for increased safety and efficiency in the provision of goods and services. The result of this collision between the two vast forces of the American marketplace, consumer and producer, has been a stalemate.
At the same time that the federal battle for the future consist of tort law has been taking place in Congress, virtually every state legislature has re-played the drama, but with far different results. During the same period of time, in 40 of the 50 states, laws have been passed that modify the tort system and limit liability. Further, after what appears to be intense infighting in the august American Law Institute, the Restatement (Third) of Torts has been completed and is now circulating for comment. This stunning document rewrites tort law and, importantly, does so in manner that favors insurers, manufacturers, and retailers, but does little to improve the situation of those injured by wrongful behavior or dangerous products.
Page 90 PREV PAGE TOP OF DOC The above history is powerful and has an impact on how any new legislative tort modifying proposal is received. From the perspective of consumers, the pattern of questions that must be raised to vet such proposals is well known:
Is the bill based on a ''tort crisis'' argument? In the past every ''crisis'' that has been claimed in either insurance or production has failed to pass muster when subjected to independent research, often by the research arms of the Congress.
Is the bill a veiled threat based on market choices that producers are free to make? The threats are hard to penetrate because actors in the marketplace are free to cease production of vital products unless they receive the extraordinary benefit of immunity. To date, most threats of this type have proven to be little more than a hardball attack to achieve a special benefit.
How would the bill, if passed, improve the quality and efficiency of goods and services?
What mechanism (such as regulation) is proposed to replace the pressure for safety created by the tort system ... and at what cost?
Will the benefits claimed by the proponents of the bill do anything other than give insurers and producers certainty regarding tort risk? In so many ways, this debate has been about nothing other that the quest for certainty regarding exposure to tort claims. Once secured, a producer can calculate that cost, breed that cost into the price of products sold, pass the cost on to the consumers, and forever be outside of the pressures the system exerts. Certainty of risk, once secured, ends the incentive value of the tort system.
VOLUNTEERS, CHARITABLE ORGANIZATIONS, AND IMMUNITY
About ten years ago, a bill surfaced (S. 464) which, if passed, would have vastly improved the lot of both business and consumer interests by modifying the discretionary function exception in the Federal Torts Claims Act. It was genuine tort reform, not tort limitation. It had no chance of passing. Since then, there has been little on the legislative agenda that consumers could support. The current bills, H.R. 1167 and H.R. 911, are the most intriguing of the proposals since S. 464. While both are designed to limit consumers by making it difficult to proceed against negligent actors, who in their role as volunteers to charitable organizations, caused personal injury, or even death, both bills appear to have the goal of expanding the pool of those who are in service to others, while reducing the costs of charitable organizations that orchestrate this type of good work.
Page 91 PREV PAGE TOP OF DOC As the charity/volunteer/tort immunity debate has matured, two different approaches have unfolded. H.R. 1167 is somewhat similar to other tort immunity proposals, using the force of federal legislative edict to mandate state tort law, while H.R. 911 is designed to stimulate individual states to make changes in state law and thereby assist charities and charitable organizations.
Looking to H.R. 1167, the notion of a Congressional mandate changing state law is troubling, particularly in the absence of a showing that there is a national crisis, that a federal law will resolve the crisis, or that the consumers who are effected adversely by the law will be protected through some other mechanism. The literature does not reveal a single independent study, much less a juried piece of research, suggesting that federally imposed tort immunity will increase the number, frequency, or quality of volunteers. While there has been frequent and well publicized speculation that these benefits might accrue, speculation, rhetoric, and emotionalism are hardly the basis for federal preemption of state law. Further, despite current intentions, this is a federal tort reform bill and as such, it would create opportunities for systemic changes that might be very difficult to stop, given the nature of the amendment process. A new narrow federal law can become a stepping stone for amendments that can increase the scope and reach of the law.
Presumably, the premise for H.R. 1167 is that tort immunity for volunteers will serve the public interest by increasing the population and quality of those who are willing to serve. Putting aside for a moment the fact that there is no data supporting this claim, it is worthwhile to consider the individuals who would be touched by this bill and think through how their interests are changed. First and foremost, there are the interests of those served by volunteers. These are victims of disaster, students assisted or tutored in public and private schools, minor children engaged in organized sports (soccer, baseball, etc.), patients in hospice care, and countless others in need of the help, compassion, and diverse skills the volunteers can provide. They are a highly vulnerable group, often without the power to select the person who will assist them, sometimes legally incompetent, and even worse, sometimes unable to discern when inappropriate behaviors have occurred. This is a population at risk. Will the bill, should it become law, lessen or increase the risk to these individuals who are, after all, the focal point of the charities and those who volunteer. to help. Freed from the possibility of civil liability for all but wanton misconduct or criminal acts, over time, will the volunteers be better trained? Better funded? More carefully managed by the professionals in charge of the program? Are the volunteers more or less likely to take risks they are untrained to assess, given the absence of any personal liability? In the absence of data to the contrary, logic suggests that the answer to these questions is uniformly negative. The entire system of tort law is predicated on the belief that the potential of liability creates accountability and improves the likelihood of enhanced health and safety. While the common law did not give rise to a duty to aid, it sets forth a clear standard once a person has made the decision to volunteer and assist. One who aids another should conform with a minimum level of due care. Johnson v. Delchamps, 897 F.2d 808 (5th Cir. 1990); Schulker v. James Roberson, 676 So.2d. 684 (La. App. 1996); Marsallis v. LaSalle, 94 So.2d. 120, 124 (La. App. 1957) H.R. 1167 would change that standard.
Page 92 PREV PAGE TOP OF DOC The volunteers who reach out to others are to be accorded support, respect, honor, and encouragement. However, that should not mean abandoning the conventional responsibilities and obligations all persons share of reasonable care.
On a very personal level, I am a parent and, for the last 26 seasons, have coached various childrens' soccer teams. I am proud of my work as a coach, and deeply aware of the responsibilities I have to my teams. When children, particularly very young ones, are dropped off on the field, the parents of those kids make an implicit assumption that I will use good judgment, avoid inappropriate action or speech that could harm their children, that I will study the sport and become sensitive to the potential of injury, the necessity of preparation, and to other factors that make the environment safe. I make those same assumptions when I entrust one of my children to another volunteer coach, teacher, scout leader, or other volunteer. H.R. 1167 would negate that set of reasonable expectations.
Frankly, not even the most extreme of the tort reform proposals rejected incentives to due care. The debate in most of those bills was about strict liability or damages. Accordingly, it is worth asking why in this situation, involving those least able to ''bargain'' in the marketplace for assistance, one would relieve actors of the beneficial pressure of a legal system that asks them to act reasonably.
There is, of course, an entirely different lens through which one might look to get the full picture of volunteer liability, and that involves the current shortfall of volunteers for a broad range of needs. A federal policy that addresses this shortfall requires serious attention for a profound and obvious reason. We all share the hope that our society will nurture those in need, assist those who are hurting, encourage those with untapped potential, and administer to those who have lost hope. The question that must be asked is whether the abolition of tort liability for all but extreme misconduct will have the effect of increasing the rate and quality of volunteers or will it have the more tragic effect of reducing incentive to safe, effective assistance?
Page 93 PREV PAGE TOP OF DOC Another matter worth thinking about before enacting a federal law that preempts state law is whether it is wise to bestow the gift of tort immunity on volunteers for all charities, as currently defined. While one might think it perfectly safe to absolve of tort liability trained Red Cross volunteers who risk their lives and invest all of their energy to assist others, consider that this is a law that would have the same effect on college fraternities (where the record for ''due care'' is not exactly pristine), numerous medical centers (where occasionally care is administered and record keeping provided by volunteers), social organizations, and perhaps even the Ku Klux Klan. Quite simply, one needs to ask: for whom is this legislation intended? All charities? All volunteers? If so, and that is how both H.R. 1167 and H.R. 911 are written, is that level of risk justified, particularly when it is based on the unsubstantiated assumption that more actors will enter the pool of volunteers, once they hear that they cannot be sued?
Moving on to H.R. 911, a different set of considerations comes into play. This is not a genuine federal mandate that overtly supplants state law. Instead, on its face, it appears to be an incentive package designed to encourage the states to do what many of them (for better or worse) are doing already and are free to do: modify and change internal state tort law. The incentive, a one percent additur for social service funding, is significant. The bill calls attention to an apparent problem, the reduction in the number of volunteers, and then offers hard cash if a state is willing to delete due care obligations from those who are willing to serve. While such legislation is not afflicted with the federalism questions that plague H.R. 1167, the bill places the same policy question on center stage: is the public, and specifically those who are in jeopardy or otherwise in need of assistance, best served by granting immunity to volunteers?
A starting point for this inquiry might be to ask a simple financial question: how much money is it going to take if a number of states accept the H.R. 911 challenge? Keeping in mind that this is not a penalty for those states that do not accept the challenge, but a supplement for those that do, how many extra millions of dollars will be required to achieve this goal? If the dollar value is in the tens of millions (and that seems quite possible) is this the best use of scarce federal resources, in terms of the goal of giving support and aid to individuals and the charitable organizations? Would the Red Cross or other similarly situated magnificent enterprises benefit more from an annual transfer of a million dollars or from tort immunity for workers who, by and large, are rarely if ever held liable for simple negligence?
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Another question that must be answered is whether there is a genuine problem with tort exposure for volunteers that justifies the articulation (and funding) of an immunity incentive program. As with the question of whether there is a solid factual foundation demonstrating a nexus between immunity and increased individual participation, so to is there a data problem with the ''real liability'' calculus. No doubt there is a powerful perception of run-away verdicts and excessive liability, but what is the reality? Based on research prepared for this hearing, it is simply not the case there is a ''volunteer liability crisis.'' In the handful of celebrated cases involving the Little League and the Boy Scout programs, there was serious misconduct and ultimately fairly small paid judgments. There is simply no record to justify taking away from innocent recipients of volunteer services an expectation of due care in the provision of social services.
H.R. 911 raises other concerns by its very text. The bill expresses a federal policy through funding incentives to provide immunity to volunteers unless the volunteer engages in willful and wanton misconduct. On the continuum of misconduct, where an innocent mistake is at one end and premeditated mayhem is at the other, wanton and willful behavior turns out to be extreme wrongdoing, tantamount to criminal intent. If this standard is adopted by a state, reckless misconduct, gross negligence, reckless disregard of the well-being of another, would all be ''covered'' under the immunity umbrella. At a minimum, the policy should tolerate only that type of breach of duty that is the result of a simple mistake, referred to as a good faith error. Parenthetically, the way the bill is drafted, it would appear that Sec. 4(a)1 was written to limit the immunity to good faith errors, while Sec. 4(a)2 expands the immunity to all acts short of the egregious misconduct contemplated by the requirement of ''willful and wanton.''
There are many reasons why one would want to support legislation that encourages people to volunteer and participate in that wonderful part of life that allows for selfless giving. The challenge of creating enhancements for volunteers has been taken by the current President of the United States, by the immediate past President of the United States, by a former revered Chair of the Joint Chiefs, by literally hundreds of members of this Congress who are sponsoring this legislation and by other for whom I have great admiration and respect. Even so, after spending the brief period of time that the invitation to this hearing permitted to study H.R. 911, I am troubled. In times of need or crisis, when the kind of help charities provide is essential, is it right to create a set of powerful incentives that informs the volunteer that short of willful and wanton misconduct, anything goes?
Page 95 PREV PAGE TOP OF DOC In the end, the questions that must be asked of the bills are the same ones that are raised at the outset of this statement:
If the volunteer is freed of the responsibility of exercising due care, will that compel the charitable organization to train, control, and manage volunteers more or less carefully?
Will there be enhanced accountability for misconduct if the tort system is ''lifted'' from actors who are positions of trust with children, with those who are defenseless, infirm, and vulnerable?
Have appropriate fairness considerations been made regarding the patent disparity (or discrimination) that will exist between those harmed by persons acting on behalf of charities and any other person injured?
Are the state laws that have been enacted genuinely insufficient to protect the interests of the parties, i.e., is federal intervention into a field historically vested to the states, justified?
Is there in fact a ''crisis'' in terms of massive and uncontrollable tort actions and paid out judgments that would be abated by this proposal?
If there is a problem in terms of the number of people involved in critical volunteer work, is there any demonstrable nexus between tort immunity for volunteers and organizations and increased participation in the hard and vital work of charitable organizations?
For some of the above questions, the answer lies only in ones personal opinion, or perhaps more accurately, ones' best guess on the effect of abolishing liability for volunteers, outside or egregious misconduct. At this juncture, my answer to the above questions is no. In the absence of anything more than powerful emotional arguments, rhetoric, and nervous perceptions, passage of either bill seems ill-advised.
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Mr. HYDE. Mr. Charles Tremper, senior vice president, American Association of Homes and Services for the Aging.
STATEMENT OF CHARLES TREMPER, J.D., PH.D., SENIOR VICE PRESIDENT, AMERICAN ASSOCIATION OF HOMES AND SERVICES FOR THE AGING, AND FOUNDER, NONPROFIT RISK MANAGEMENT CENTER
Mr. TREMPER. Thank you very much, Mr. Chairman. I appreciate the opportunity to be here.
I have been conducting research on this issue for 10 years now, originally as a law professor and a visiting scholar at Yale University's program on nonprofit organizations under a grant from the Ford Foundation. What Ford wanted to know in 1986 was whether the liability insurance problems that volunteers and nonprofits were facing were serious and were a one-time event, or whether they could be expected to either persist or recur.
Research during that first year and a half on the subject concluded that the problem was serious, and that it would persist and recur, much like earthquake faults that may lie dormant for years only to cause havoc again when the tectonic plates shift.
The crisis of volunteer liability will ebb and flow due to a number of factors explained in my full statement having to do with insurance rates. When insurance becomes unavailable or very expensive, volunteers become acutely aware of their potential liability, and that is when we experience the most disastrous effects on volunteer recruitment and retention. Representative Jackson Lee suggested that there doesn't seem to be a big effect on volunteers because of their potential liability. It is very different when insurance won't cover the problem.
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The source of the problem, of course, is volunteers' exposure to liability, not the number of suits being filed against them or the judgments that any volunteer may be paying out of pocket. It is the fact that we are asking a volunteer to give not only of themselves, but potentially to put all of their assets on the line in the name of community service.
What we know for sure in absence of hard data on this matter--and after 10 years of research I can assure you there is an absence of hard data on this matter--is that a volunteer can be exposed to a suit, whether having done anything wrong or not. You can be named, as every lawyer on the committee is aware, whether you are ultimately held liable for your actions.
As Representative Conyers noted earlier, every State has enacted some type of volunteer protection law. All of those are compiled in a publication called ''Liability Laws for Charitable Organizations and Volunteers'' from the Nonprofit Risk Management Center. This compilation shows that some of those laws do nothing more than create a false impression of protecting volunteers. For example, one starts out with the sweeping words that ''no volunteer shall be held personally liable;'' then lists a set of exceptions which end in ''except for negligent acts.'' So what the law gives with one hand, it takes away with the other.
Or imagine this. In the current situation in North Dakota, we have a disaster. Perhaps a volunteer from Illinois who works on behalf of an organization incorporated in Texas and headquartered in New York travels to North Dakota and injures a television cameraman from California. Better still, what if the cameraman sues not only the volunteer, but the board members of that organization. What law applies? This is a great opportunity for some national uniformity.
The inconsistency of State laws also undercuts the potential effect on the need for and cost of insurance. Because of the uncertainty and inconsistency, the insurance rates don't change at all. The market for volunteer insurance isn't sufficiently large that insurers differentiate among the States. One price fits all. It doesn't matter what your State volunteer protection law is, your insurance rates are going to be identical.
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Thus, if the intent of the Congress is to free volunteers to offer their services without the threat of legal liability over their heads, and if the insurance costs for volunteer organizations are to be controlled regardless of circumstances that have nothing do with the riskiness of volunteer service, then congressional action is needed. The fundamental question goes beyond one of empirical data: Is it fair to ask volunteers to risk their personal assets as a condition of helping others? Thank you.
Mr. HYDE. Thank you very much, Mr. Tremper.
[The prepared statement of Mr. Tremper follows:]
PREPARED STATEMENT OF CHARLES TREMPER, J.D., PH.D., SENIOR VICE PRESIDENT, AMERICAN ASSOCIATION OF HOMES AND SERVICES FOR THE AGING, AND FOUNDER, NONPROFIT RISK MANAGEMENT CENTER
Representative John Porter chose well in 1985 when he secured bill number 911 for the Volunteer Protection Act. His choice of 911 signified that his bill would provide relief for an emergency facing volunteers at that time and prevent similar emergencies in the future.
The emergency in the early 1980s is now a fading memory. The history is preserved, though, in testimony to Congress on the original version of H.R. 911 and in the archives of the Nonprofit Risk Management Center.
INCONSISTENT STATE LAWS
Although a number of favorable developments have diminished the sense of urgency since then, the need remains as great as ever. The problem of volunteer liability is no more a thing of the past than earthquakes, or mass murderers. The severity of the problem varies over time as a result of fluctuations in the insurance market and the fairly random occurrence of high profile lawsuits against volunteers. For volunteers, the emergency becomes acute whenever they are sued. Lawsuits against volunteers are still being filed despite the patchwork of volunteer protection laws states have enacted.
Page 99 PREV PAGE TOP OF DOC Those laws are compiled in ''State Liability Laws for Charitable Organizations and Volunteers'' from the Nonprofit Risk Management Center. The ''Overview'' for the 1996 edition provides a concise summary.
Every state now has a law pertaining specifically to legal liability of at least some types of volunteers. All of this legislation has contributed to a false impression that volunteers nationwide are immune from suit. To the contrary, many volunteers remain fully liable for any harm they cause and all volunteers remain liable for some actions.
Most of the legislation has been for directors and officers.. Only about half of the states protect volunteers other than directors and officers. Legislatures came to the aid of board members because they faced the worst insurance problems when most of the volunteer protection statutes were enacted. The resulting anomaly is greater protection for the volunteers who make policy than for the ones who carry it out.
Moreover, every volunteer protection statute has exceptions. The most common and understandable are exclusions for claims based on a volunteer's willful or wanton misconduct. Several laws also exclude gross negligence or some other category of error greater than mere negligence. A few laws even permit suits based on negligence, which nullifies the protection they purport to offer.
Beyond these intentional exclusions are gaps that result from ambiguity in much of the legislation passed hastily at the height of the insurance crunch. Some of these laws are confusingly worded, exceptionally complicated, designed for profit-making corporations, or otherwise problematic.
Some of the laws extend protection only if the volunteer's sponsoring organization carries a million dollar liability policy. Curiously, corporations are not required to buy insurance as a condition of protecting stockholders from personal liability for the corporation's actions.
Page 100 PREV PAGE TOP OF DOC This hodgepodge of protections creates uncertainty in the application of law and the legal ask that volunteers run in addition to the other hazards they accept. If a volunteer from Illinois injures a tourist from Maine while cleaning up after a hurricane in Georgia as part of a relief effort sponsored by a charitable organization headquartered in Texas and incorporated in New York, which volunteer protection law applies? What if the injured party sues the volunteer board members of the organization?
Those board members may never have set foot in a state that does not protect volunteers from personal liability. Yet, they can be sued because of actions attributed to the organization in another state. In the business world such a result may be considered tolerable because a corporation and its board members derive the financial benefits of operating in multiple states. The same cannot be said of volunteer directors of charitable organizations.
VOLUNTEER LIABILITY INSURANCE
This tremendous inconsistency among state laws also undercuts their effects on the need for, availability and cost of volunteer liability insurance. Compared to automobile insurance or even corporate general liability policies, volunteer liability policies are small potatoes to insurance companies. The numbers are too low for the types of statistical analyses that would support price differences between states with strong volunteer protection laws and those without. Consequently, everyone gets charged the same.
From an insurance perspective, the low incidence of claims against volunteers is both a blessing and a curse. The blessing of low premiums during good times is obvious. Less obvious is what happens when insurance is tight. Because insurance, like the stock market, is cyclical, periods of rising prices and limited availability have invariably followed ''soft markets'' like the one we are in now. When interest rates rise, or a few big claims hit, or even when insurers decide for whatever reason that volunteers are a bad risk, volunteer liability rates predictably go through the roof. The small numbers make this line of insurance extremely volatile. The small market for volunteer liability insurance also makes it vulnerable to being dropped by insurers when the market turns and they need to decide where to cut back. This is not meant to imply any sinister plot by insurers, but merely to acknowledge the realities of the insurance market.
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Thus, if the intent of Congress is that volunteers be free to offer their services across the country without having the threat of legal liability hang over their heads, and if insurance costs for volunteer organizations are to be controlled regardless of circumstances that have nothing to do with the riskiness of the services those volunteers provide, congressional action is needed.
INSERT OFFSET RING FOLIOS 17 TO 18 HERE
Mr. HYDE. Mr. Conyers.
Mr. CONYERS. Do you know a lot of predatory lawyers?
Mr. TREMPER. I hope none of them were trained in my classes. I have to tell you that----
Mr. CONYERS. No, you don't.
Mr. Popper, how do you respond to the Speaker's observation that we are almost flooded with predatory lawyers?
Mr. POPPER. I think we are most assuredly flooded in our Mid- and Northwest with water, but we are certainly not flooded with predatory lawyers in the United States. I just don't think it is true. In every profession there are some who do not respect ethical norms, whether it is medicine, accounting, engineering, architecture, or law. I think the legal profession by and large has fine people in it who work hard and who are not predators.
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Mr. CONYERS. Well, we just want to keep the record straight.
Now, Mr. Hanzalek, I bet you are a good volunteer and a good representative of the engineers. Did you know that there were two other bills like this over on the Senate side?
Mr. HANZALEK. I am aware of one from last year. I testified for Senator McConnell, who was my classmate from university.
Mr. CONYERS. Well, there are a couple, and as you can tell, some of these bills do things a lot different from other bills. So we want to help. We want to invite you to continue to help us sort this out. So if maybe the engineers--and we can provide you with these other two bills so that you get to know where they are, too, because we have all got to come together in the end to pass a law, and that is what usually happens. As a matter of fact, that is what happened before. We all agreed, and then we went to conference, and you close those doors, but, Congressmen and, Senators, who knows?
Do you know of anybody that got sued that was a volunteer?
Mr. HANZALEK. No, sir. But what my involvement was is recruiting people, both for my professional society and also for the Service Corps of Retired Executives, and I can personally vouch for the accuracy of the statistics which are quoted in the Gallup survey that about 20 percent of the people that you talk to have hesitations. And, of course, the greater their background and personal property, the more problem they have. And unfortunately, these people are often the ones with the most to offer.
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So, no, sir, I don't have any--there was some questions and items in the press in Connecticut last year about this case of the mother suing the coach who allowed the ball to fall on her son's head, but a personal contact, no, sir, I don't.
Mr. CONYERS. OK. Well, we searched the computer files, and you may be relieved to know that the Association of Mechanical Engineers have no lawsuits against them. And we also, while we were looking, we found out that Points of Light didn't have any either, Mr. Jones. Is that correct?
Dr. JONES. I am with Habitat for Humanity. I don't know about lawsuits against Points of Lights.
Mr. CONYERS. Oh, who is with--oh, you have got a couple. Do you know about the couple of cases that you guys have had?
Dr. JONES. I don't know the specifics.
Mr. CONYERS. Well, they are pretty interesting. May I send them to you or provide you with them?
Dr. JONES. Yes, sir, if it will be helpful.
Mr. CONYERS. Well, I already know about them. Do you want to know about them?
Page 104 PREV PAGE TOP OF DOC Dr. JONES. That would be fine, yes, sir.
Mr. CONYERS. You don't sound like you really particularly need them. If I don't give them to you, it won't break your heart.
Dr. JONES. Well, we have various kinds of suits across the 1,347 affiliates. Our testimony is, today, to emphasize the importance of volunteerism and some of the barriers that we have had in terms of volunteerism. We have expressed appreciation for your committee's willingness to struggle with what these problems are and come to the solutions that will be helpful for our society because of the importance of the thread of volunteerism in our country.
Mr. CONYERS. Well, let me ask all of you this. It looks like we are dealing more with myth than fact. Wouldn't it be also important that we dispelled the myth that there are so many suits--I am in the process of tracking this down, and we keep finding out that these things have a sort of evaporating quality. I mean, somebody heard about this, and somebody read about that, but they didn't read that the case was reversed or the verdict was cut in half or something like that.
Dr. JONES. Congressman, one of the realities for us is the perceptions, and perceptions become realities in terms of recruiting volunteers. And the perceptions that board members can be liable or potential board members or potential volunteers building housing can be liable to lawsuits is a detriment in some places in terms of recruiting volunteers. If there is any way that those kind of perceptions can be relieved so that volunteerism will increase, you will have served our country well. I think we all agree, volunteerism is extremely vital to our society, to its history, its present, and its future.
Page 105 PREV PAGE TOP OF DOC Mr. CONYERS. No question.
Dr. JONES. But those perceptions are real; not the lawsuits themselves, but the perception that there is liability.
Mr. CONYERS. Well, that is what I want to begin to kind of turn my attention to.
Attorney Popper, you work in the field as a volunteer, and I empathize with you. My kid had his first soccer game last Sunday, and boy, a star is born. This kid was good.
But I digress. Do you have much hands-on experience or knowledge about the subject matter that brings us here today, namely that volunteer organizations are subject to a lot of lawsuits that State law isn't handling?
Mr. POPPER. From the time I was invited to this hearing up until this morning, I spent as much time as I could trying to determine if this was yet another shadow crisis, if there was a clear record of liability. Your question asks whether there is a crisis at the level of the organizations or volunteers. I have to say while there is a small amount of case law in the field, and while a conventional Nexis search turns up a handful of articles, as one of the commentators mentioned earlier, we are not dealing with the reality of liability, we are dealing with the fear of liability. Further, the liability organizations has to be distinguished from cases against volunteers, where the record doesn't really reflect anything of consequence. Liability is just not what this is about.
Mr. CONYERS. Mr. Tremper. A last question if I can, Chairman Hyde, to Mr. Tremper, who I noticed shaking his head vigorously. Do you have a little evidence that we can document the high liability insurance effects on volunteers?
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Mr. TREMPER. If we are distinguishing high liability insurance, which is a somewhat different issue from a high volume of suits against organizations, I think the record should be abundantly clear. Nobody, including Representative Porter, is asserting that there is a flood of suits against volunteers, and that is not what the bill is about.
As far as high insurance rates and how they have fluctuated over time, data are available on that, and we can make that data available to the committee.
Mr. CONYERS. Yes, but you haven't seen any.
Mr. TREMPER. Yes, sir.
Mr. CONYERS. You have.
Mr. TREMPER. Certainly.
Mr. CONYERS. Did you bring it with you?
Mr. TREMPER. I don't have it in my briefcase.
Mr. CONYERS. What did you think you were being brought here for? That is what witnesses are for, to help us do our work.
Mr. TREMPER. Yes, it is.
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Mr. CONYERS. So now that I have asked you for the thing that nobody has seen, you say you have got it, but you didn't bring it.
Mr. TREMPER. Do I understand your question----
Mr. CONYERS. You are an attorney, aren't you?
Mr. TREMPER. I am trained as an attorney.
Mr. CONYERS. And you are not a predatory attorney, are you?
Mr. TREMPER. I have not practiced as an attorney.
Mr. CONYERS. So you are an attorney who hasn't practiced as an attorney.
Mr. TREMPER. That would be correct.
Mr. CONYERS. Whatever that means.
Just when do we get this information, whenever you get back and mail it in? I wanted to cross-examine you on the statistics that you claim to have seen.
Mr. TREMPER. Is your question specifically about----
Page 108 PREV PAGE TOP OF DOC Mr. CONYERS. Don't worry about it, you don't have the document. I mean, what difference does it make? You are talking about something you have seen ex parte that I have never seen that you will mail to me after this hearing is over. No, thanks, buddy. I don't practice that kind of law.
Now, if you want to come back with your document and let me look at it, and then we can have a sensible discussion, fine. But for you to nitpick my question and then not have the document and then have the nerve to say you will let me have it, you will send it back when you get back to your office, guess what? Why don't you keep it in your office.
Mr. TREMPER. I would not because I do not have it in my office. The type of information you requested is available, could be compiled. It would require assistance----
Mr. CONYERS. Oh, it is not even compiled. Then you don't have it.
Mr. TREMPER. You are asking whether it exists. I said it exists. That is not to assert that I have it and can give it to you today.
Mr. CONYERS. Oh, brother. Mr. Chairman, I don't have any time to give back, but if I did, I would relinquish it all.
Mr. HYDE. Good.
Mr. Popper, have you statistics on how much of these claims are settled as distinguished from going to suit?
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Mr. POPPER. Wouldn't it be wonderful if insurance companies in the United States would reveal information on the number and value of settled claims, sir?
Mr. HYDE. I would love to know how many claims are settled, because we all talk about lawsuits. Those maybe aren't the problem. It is the fear of litigation and the need to settle, and that is how we get the correct dollar volume of what we are talking about. And the plaintiffs' lawyers--well, they disclose it once in a while. Sometimes they are prideful of their verdicts and settlements. I suppose you would have to go through their tax returns to really know. No one suggests that.
Mr. POPPER. Mr. Chairman, even their tax returns, to the extent that they are public, would not reveal that information. But I can say this: If the public had access to that information, it would be very useful, and a law to that effect would be one for which there would be great support.
Mr. HYDE. I will remember that, if we get around to that.
Mr. Scott, whom I stipulate has never been predatory and will never be predatory.
Mr. CONYERS. I second that motion.
Mr. SCOTT. Mr. Chairman, that is not by choice.
I just have a couple of questions again. First of all, the immunity we are talking about is immunity for volunteers, not for the organization. OK.
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Now, following up on some of this conversation, I, too, don't think we ought to confuse insurance rip-offs with a need for tort reform. When we were doing tort reform in Virginia when I was in the State senate, we found that some malpractice carriers were spending in defense costs and payments and claims and judgments, added all up, about 17 percent of what they brought in in premiums went out in claims. The rest was an accounting mumbo jumbo of reserves and claims incurred and not reported and all kind of other things where they can hide it. Seventeen percent of their revenues went out to pay claims. That is not a reason for tort reform, that is a reason for insurance reforms. So if we are not having the cases, the question therefore is why do the insurance rates go up?
Now, the effect of the bill, I would like to ask a question. We keep hearing about this Little League case and different variations on it. If it bill weren't passed, what effect would the passage of the bill have on those kinds of cases against Little League Baseball organizations? Mr. Popper.
Mr. POPPER. Well, as far as I can tell, if we are talking about the same Little League case, it would have no effect. In fact, this legislation would have no effect, as far as I can tell, on insurance rates because the organizations maintain responsibility for the conduct of the volunteers as they do now.
Mr. SCOTT. Does anybody----
Mr. POPPER. These bills would formalize indemnification through Federal law, and if anything, the insurance rates might go up because of the shift in the responsibility patterns in the volunteers themselves.
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Mr. SCOTT. Does anybody disagree with that statement?
Mr. TREMPER. I disagree with that.
Mr. SCOTT. Why would the insurance rates not go up? Are you suggesting they would go down?
Mr. TREMPER. Well, let's start with the first proposition that it would have no effect on the case. The effect it would have is releasing the volunteer who was sued at the same time from the case. One person is out of it. The case against the Little League goes forward. Their insurance might not change; it might go up slightly. Their need to purchase insurance on behalf the volunteer or volunteers, need to purchase insurance on behalf of themselves would go away.
Mr. SCOTT. OK. Let me ask a question on uniformity. On page 4 of the copy of the bill I have on H.R. 911, it says that the States--excuse me, page 5, States may impose exceptions to the release of liability by requiring legislation as an optional legislation that they can put into the State form, which means that some States will adopt it, some States won't.
Are there any provisions that are not desirable that all States ought not to provide? Like if you are driving a motor vehicle covered by insurance, you shouldn't have immunity. Does anybody think you ought to provide immunity when somebody is driving an automobile with insurance? Any acts or omissions, agency laws that would make an organization liable for the acts of or omissions of volunteers although the volunteer is immune, shouldn't they all have that? Should we require the organizations to seek immunity of their volunteers who have some sort of financial responsibility?
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Mr. TREMPER. I would like to address that issue, Mr. Scott, if I may, without speaking specifically to whether it would be good or bad, to at least think of an analogy and to whether it would be appropriate. It is not a condition to protect the stockholders of a corporation that the corporation itself obtain insurance. Corporations obtain that benefit merely by virtue of incorporation. A question could be asked, why don't we do the same for volunteers? Why would they require their organization----
Mr. SCOTT. If an organization is incorporated, all the participants would have personal immunity. They would have a corporate shield that you couldn't get through. If you have a corporation, all the individuals acting within the corporation are not immunized.
Mr. TREMPER. No, the stockholders of the corporation are immunized. The personal assets of the individuals who derive the greatest economic benefit are immunized. But we are saying here that the volunteers would not be because we are so concerned about providing a source of recovery.
Mr. SCOTT. Well, on the provision that the organization seeking immunity on behalf of its volunteers, should that organization provide some kind of financial responsibility? Are you--am I--are you for it or against it?
Mr. TREMPER. I would say that--I am not here representing any interests for or against any of this legislation, but to observe what the effects would be. And what it would be in this case is to impose a burden on charitable organizations to protect their volunteers that is not imposed on business corporations to protect their shareholders.
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Mr. SCOTT. Well, you think it is analogous. I don't think the analogy is valid. But if we are trying to make a balance in this tort reform that we are talking about, and we are seeking immunity for some, shouldn't the organization have some kind of financial responsibility? And is your answer no, they should not? So that an innocent victim would have some recourse.
Mr. TREMPER. I believe the same is true in the situation with a business corporation. If a business corporation has no assets, the----
Mr. SCOTT. If you are driving a truck for a business and run over somebody, you and the corporation are both liable, and the corporate shield does not protect the driver who ran over somebody.
Mr. TREMPER. That is correct.
Mr. SCOTT. Thank you.
So does anybody else have a problem with seeking immunity for volunteers, having the organization have some semblance of financial responsibility?
OK. Thank you, Mr. Chairman.
Mr. HYDE. Thank you, Mr. Scott.
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Mr. PEASE. Thank you, Mr. Chairman, and members of the panel. I have sat through the entire proceedings this morning, not just because I think we have the responsibility to do that, but because this is an area of intense personal interest to me. In fact, though I have had the good fortune to have served for a dozen years in my State senate and now to be here, I am convinced that the work I have done as a volunteer throughout my life is probably as significant to the people in my community as the work I have done in Indianapolis or here.
Having said that, let me also disclose things that may color my questions. Though I am no longer a member of many of the boards that I used to serve on because of my duties here, I am currently the president of the Wabash County Council of the Boy Scouts of America that serves western Indiana, eastern Illinois, because I agreed to do that before I became a candidate, and one keeps their promises to the Boy Scouts. And I serve on the National Council of the Boy Scouts of America, a responsibility I undertook long before I came here.
Now, I do not speak for those organizations. In fact, the Boy Scouts are especially careful that they do not engage in what might even remotely be considered to be lobbying on public policy matters. I not only serve on the board, but I will be spending our August recess in a tent for 2 1/2 weeks as one of those people who actually does work directly with young people. So I bring a variety of perspectives to this discussion.
Now, having said that, I am also tremendously concerned about the State's involvement and my view generally that matters of liability ought be addressed first at the State level, and only if there is a Federal connection that is clear and demonstrable, that the Federal Government preempt in that area. So I was going to ask Mr. Popper some questions about that part of the discussion, until I heard his testimony. And I quite frankly want to ask you some different questions now, and I guess I will ask Mr. Tremper those questions.
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I am intrigued by your statement, not only as an attorney but as a professor of law, that willful and wanton misconduct is an inexplicable standard. How do you explain it? We teach it in law schools, as attorneys we learn it, we practice it every day. How is it that this standard is inexplicable?
Yes, Mr. Popper.
Mr. POPPER. ''Inexplicable'' may have been a poor choice of words. I cannot understand why you would want to provide immunity to individuals who engage in those degrees of fault that are below the standard of wanton and willful. Wanton and willful is tantamount to criminal intent. It is knowing. Therefore, the standard would excuse gross negligence and reckless behavior.
In the event that this legislation were to pass, not only would a volunteer have no liability, as a matter of Federal law or federally encouraged State law, for simple negligence, they would also have no liability for gross negligence, and no liability for reckless misconduct.
Thinking about the one punitive damage case that did involve the Boy Scouts, where there was significant misconduct involved with one of the leaders and it resulted in punitive damages, when you go through the whole pattern of conduct many of the actors seemed to look the other way, by not acknowledging the defendant's prior history of child abuse in theory, their behavior wouldn't be wanton and willful, it would be gross negligence. I really didn't understand why you would want to raise the ceiling that high. You are obviously free to pass this law if you want, but you certainly wouldn't want to use that standard.
Page 116 PREV PAGE TOP OF DOC Mr. PEASE. So you want--it is not the standard that is inexplicable. Your concern is with the policy decision that underlies this proposal.
Mr. POPPER. Thank you for the clarification. That is correct.
Mr. PEASE. I realize my time has expired, Mr. Chairman.
Quickly, your assessment that both of the bills before us reject the incentive for due care, can you explain the reason for your conclusion?
Mr. POPPER. I will try to be brief. Let me put on my whistle as a soccer coach. I have coached for 26 seasons. I went through a great deal of training through Montgomery County soccer. I attend coaches' programs, workshops, health and safety programs, first aid programs, and I think that is common for all volunteers who have been on this panel. In part, I do that because I am aware of my responsibilities, I am aware of the basic due care obligation that I have, and in part because I love what I do and care for the people I work with.
If I was to find out that I could proceed, in fact, with impunity, that is, short of wanton and willful misconduct, anything goes, the extent to which I--and I will now extrapolate broadly to the millions of people who thankfully do volunteer--the extent to which we might want to do that level training might go down, and then, in that sense, there is a discouragement of due care. I think that becomes a serious problem, and is in part my concern.
Mr. PEASE. I appreciate your explanation.
Page 117 PREV PAGE TOP OF DOC I am curious, Mr. Tremper, your reaction to what Professor Popper has shared.
Mr. TREMPER. Two observations very quickly. First, that the incentives of due care are exercised primarily at the organizational level. The organizations remain fully liable under either of the proposals before the committee today. The organizations that do the risk management programs like suggested in the publications are becoming increasingly common among nonprofits, so their volunteers are appropriately trained in what they do and managing risk.
So the second part of that being the incentives for due care arise from many sources other than the potential threat of liability. I just wonder, in Professor Popper's case, if he would be a more negligent coach freed from the possibility of being held liable.
Mr. PEASE. Before we get into an interchange between the two witnesses, which we don't have time for----
Mr. TREMPER. It wasn't meant specifically, but rhetorically. People are careful because they are volunteering and stepping forward and trying to do good, and there are always other incentives outside of whether you will be sued if you are not.
Mr. PEASE. Well, leading question here, but would it also be your conclusion that the organizations themselves, because they are still going to be faced with liability, have an interest in ensuring that due care is exercised by their volunteers?
Mr. TREMPER. No question. That is what all the research shows, that the deterrent effect of the tort law applies at the entity level.
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Mr. PEASE. Finally, one observation, Mr. Graham. I appreciated very much your statement, but just one bit of correction to it because I did chair a judiciary in Indiana, and I am somewhat familiar with the laws. And this probably can be used against me if I support the bill, but our liability bills in Indiana are much broader than the one example you gave, and I have had my staff run that for you so you won't misstate our law in the future.
Mr. GRAHAM. Thank you for the correction.
Mr. HYDE. Thank you. And just before recognizing Ms. Jackson Lee, in listening to this colloquy from you, Mr. Pease, and Mr. Popper, it seems to me that simple negligence ought to be immunized, but anything beyond that I would think might have some sanction. Because if you are grossly negligent, if you are--of course, if you go to willful and wantonness, I agree, that is desiring an unhealthy result and taking acts to accomplish it. But, Mr. Tremper, you seem to disagree. You think it ought to be a higher standard than simple negligence, and tell me why.
Mr. TREMPER. I would like to agree with you that that is what the standard ought to be, but the operation of law as practiced in the court, if you don't choose the higher standard of willful and wanton, the difference between negligence and gross negligence is six strokes on the keyboard when you are filing the claim. The fact is you still have the volunteer being sued, and an allegation of gross negligence is not hard to come up with.
If you really intend to give volunteers protection so they don't need to be worried about being sued for simple mistakes, I think you need to use a higher standard. I wish that were not true. If you could make it work on a simple negligence standard, that would be great, but I don't think you can.
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Mr. HYDE. Well, that is an interesting perspective. You are talking about the world of litigation and filing a complaint, and you charge everything, and you have got to defend, and the line between simple negligence and gross negligence may be a blurry one; is that what you are saying.
Mr. TREMPER. Yes, I would agree. And like I said, if you could operationalize the simple negligence standard sufficiently to provide the protection you intend, terrific. Because I don't think you can, and that is a debatable question, I believe a higher standard would be in order, and I don't think it would lead to any increase in gross negligence among volunteers.
Mr. HYDE. Thank you.
Ms. Jackson Lee.
Ms. JACKSON LEE. I thank the chairman very much, and let me say to each of panelists and Mr. Goodwin in his absence, I have great admiration for the nonprofits that are here today, and I will take certainly direction from my new colleague and be sure to acknowledge that being on boards, in particular the Boy Scouts, myself, I am not speaking on their behalf. But let me pursue the line of questioning very briefly of the chairman, and then, Mr. Chairman, I would like to yield the balance of my time to the ranking member, Mr. Conyers.
Mr. Popper, help me unblur the distinction between a simple negligence, as the chairman has said, and gross negligence. I happen to think since we don't have predatory lawyers that we have some very good lawyers out there who would make the representation and be able to certainly either defend the volunteer if it was a standard that simple negligence was the issue versus gross negligence, or if that was the standard, that simple negligence be excluded and gross negligence not. Because I have a concern, and as I started out, I am a friend of this legislation, but I have a concern about the injured party, and certainly injury can come about through gross negligence. Help us unblur that.
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And my last point, and to the rest of the gentlemen, I thank you. I don't have a question for you as of this time. Your statements were eloquent in and of themselves, but help me, if you would. As I understand it, it is still possible for Ku Klux Klan organizations, chapters, to be covered under such an act.
Mr. POPPER. One of the things that is troubling about particularly 911 is that the definition of ''charity'' is not there, and I think it would be inconceivable that a court analyzing this legislation could exclude any 501(c)(3). So I don't even think that is a debatable question.
If this legislation were to pass, you would certainly want to take into account organizations that do not train their members, that are undercapitalized, that are underinsured, that are engaged in behaviors you don't want to immunize and knock them out. And I think that is an easy part of this.
As to the distinction between negligence and gross negligence and wanton and willful behavior, having taught torts for 20 years, let me tell you the easiest way to understand this is to put it on a continuum. Simple negligence refers to an ordinary error or good faith mistake. It is a deviation from the standard of reasonable care. It has nothing to do with the lack of wanting to do good. It just turns out that when you evaluate the behavior against a standard of ordinary care, there is a discontinuity causing harm and compensation follows.
Page 121 PREV PAGE TOP OF DOC On the other end is premeditated behavior and mayhem, and wanton and willful behavior ticks closer to that level.
Gross negligence finds itself--I think your question is the answer through your reference to the ''blurriness,'' finds itself in that blurry state of being more than simple negligence. It often involves something like a failure to provide information where the defendant knew of information regarding a particular risk. It is not just a good-faith error where you should have known it, but you didn't.
For example, if a coach is clearly aware of a certain level of high risk in a process or aware of particular sensibilities in a player and then consciously subjects a kid to those risks, that begins to approach gross negligence. When I give final exams I frequently torment students by putting them in a posture of making that distinction. But I don't think you will get even from a careful analysis of case law, anything more than a grand collection of words that say that gross negligence is more than simple negligence and involves something resembling a ''wrongful'' state of mind or a presumptive level of misconduct.
Ms. JACKSON LEE. I thank you. That will lead us to further deliberate and trying to become unblurred.
Let me yield the balance of my time to Ranking Member Mr. Conyers.
Mr. CONYERS. Thank you, Ms. Lee, for allowing that great torts 101 review that Mr. Popper gave us.
Page 122 PREV PAGE TOP OF DOC I just wanted to go back to Mr. Tremper. He had an earlier statement that I never got to, and that was the one where he gave a hypothetical where all the parties were from different places and where would they sue. There is a Federal diversity rule that takes care of that.
Mr. TREMPER. As I understand that rule, and you are undoubtedly more of an expert than I, that has to do with where they sue as opposed to which law applies.
Mr. CONYERS. No, it is both. Obviously the judge is going to apply some law.
Mr. TREMPER. Correct, and the conflicts of law----
Mr. CONYERS. And that is already in the law, that is provided for. The judge can't just arbitrarily pick Iowa rather than Arizona. There are rules that govern that kind of multiple diversity when it comes, when we go into court. So I wanted to put your mind at rest so that you can could sleep quietly in your bed tonight not thinking that this was a problem that we failed to address.
Mr. TREMPER. I am glad to hear that, and I am left only with the volunteer in Illinois wondering which law he or she is going to be subject to.
Mr. CONYERS. Just go into the Federal court, and the judge will turn to the page in the Federal Rules of Civil Procedure, his clerk will point it out to him if his vision is faint and tell him that is it, and that is what he will deliver to your worried plaintiff.
Mr. TREMPER. Thank you.
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Mr. CONYERS. You are more than welcome.
Mr. HYDE. Well, I want to thank this panel. The subject of conflicts of law is not a simple one, and while Mr. Conyers--it may come to him very easily, I always found conflicts a fascinating and difficult subject, where the tort occurred, where the contract was made, the various interests of the parties and the biases of the court, et cetera, et cetera, precedents.
So it is not simple. But we have been treated to some excellent testimony on a difficult subject, one that superficially appears simple, but is complicated and has consequences. You have added to our store of knowledge, for which I am most grateful. Thank you so much. And you especially, Mr. Tremper, you got a rough time from Mr. Conyers, but he is known to do that. I get it every day from him.
The committee is adjourned.
[Whereupon, at 1:02 p.m., the committee adjourned.]
VOLUNTEER LIABILITY LEGISLATION
Page 124 PREV PAGE TOP OF DOCBEFORE THE
COMMITTEE ON THE JUDICIARY
HOUSE OF REPRESENTATIVES
ONE HUNDRED FIFTH CONGRESS
H.R. 911 and H.R. 1167
VOLUNTEER LIABILITY LEGISLATION
APRIL 23, 1997
Serial No. 6
Printed for the use of the Committee on the Judiciary
Superintendent of Documents, Congressional Sales Office, Washington, DC 20402
COMMITTEE ON THE JUDICIARY
Page 125 PREV PAGE TOP OF DOCHENRY J. HYDE, Illinois, Chairman
F. JAMES SENSENBRENNER, Jr., Wisconsin
BILL McCOLLUM, Florida
GEORGE W. GEKAS, Pennsylvania
HOWARD COBLE, North Carolina
LAMAR SMITH, Texas
STEVEN SCHIFF, New Mexico
ELTON GALLEGLY, California
CHARLES T. CANADY, Florida
BOB INGLIS, South Carolina
BOB GOODLATTE, Virginia
STEPHEN E. BUYER, Indiana
SONNY BONO, California
ED BRYANT, Tennessee
STEVE CHABOT, Ohio
BOB BARR, Georgia
WILLIAM L. JENKINS, Tennessee
ASA HUTCHINSON, Arkansas
EDWARD A. PEASE, Indiana
CHRISTOPHER B. CANNON, Utah
JOHN CONYERS, Jr., Michigan
BARNEY FRANK, Massachusetts
CHARLES E. SCHUMER, New York
HOWARD L. BERMAN, California
Page 126 PREV PAGE TOP OF DOCRICK BOUCHER, Virginia
JERROLD NADLER, New York
ROBERT C. SCOTT, Virginia
MELVIN L. WATT, North Carolina
ZOE LOFGREN, California
SHEILA JACKSON LEE, Texas
MAXINE WATERS, California
MARTIN T. MEEHAN, Massachusetts
WILLIAM D. DELAHUNT, Massachusetts
ROBERT WEXLER, Florida
STEVEN R. ROTHMAN, New Jersey
THOMAS E. MOONEY, Chief of Staff-General Counsel
JULIAN EPSTEIN, Minority Staff Director
C O N T E N T S
April 23, 1997
TEXTS OF BILLS
Hyde, Hon. Henry J., a Representative in Congress from the State of Illinois, and chairman, Committee on the Judiciary
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Ashcroft, Hon. John, a Senator in Congress from the State of Missouri
Coverdell, Hon. Paul, a Senator in Congress from the State of Georgia
Gingrich, Hon. Newt, a Representative in Congress from the State of Georgia and Speaker of the House of Representatives
Goodwin, Robert K., president and CEO, the Points of Lights Foundation
Graham, John H., IV, CEO, American Diabetes Association, on behalf of the American Society of Association Executives and the National Coalition for Volunteer Protection
Hanzalek, Fred, Connecticut State coordinator, on behalf of the American Society of Mechanical Engineers
Jones, Dr. Thomas L., managing director, Washington Office, Habitat for Humanity
McConnel, Hon. Mitch, a Senator in Congress from the State of Kentucky
Orr, Terry, the Orr Co.
Popper, Prof. Andrew F., American University, Washington College of Law
Porter, Hon. John Edward, a Representative in Congress from the State of Illinois
Santorum, Hon. Rick, a Senator in Congress from the State of Pennsylvania
Swann, Lynn, immediate part president, Big Brothers Big Sisters of America
Teitell, Conrad, Esq., Cummings & Lockwood, on behalf of the American Council on Gift Annuities
Tremper, Charles, J.D., Ph.D., senior vice president, American Association of Homes and Services for the Aging, and founder, Nonprofit Risk Management Center
LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING
Coverdell, Hon. Paul, a Senator in Congress from the State of Georgia: Letter dated April 22, 1997, from Stephen D. Keener, president and CEO, Little League Baseball, Inc.
Page 128 PREV PAGE TOP OF DOC Goodwin, Robert K., president and CEO, the Points of Lights Foundation: Prepared statement
Graham, John H., IV, CEO, American Diabetes Association, on behalf of the American Society of Association Executives and the National Coalition for Volunteer Protection: Prepared statement
Hanzalek, Fred, Connecticut State coordinator, on behalf of the American Society of Mechanical Engineers: Prepared statement
Jackson Lee, Hon. Sheila, a Representative in Congress from the State of Texas: Prepared statement
Jones, Dr. Thomas L., managing director, Washington Office, Habitat for Humanity: Prepared statement
Popper, Prof. Andrew F., American University, Washington College of Law: Prepared statement
Porter, Hon. John Edward, a Representative in Congress from the State of Illinois: Prepared statement
Swann, Lynn, immediate part president, Big Brothers Big Sisters of America: Prepared statement
Tremper, Charles, J.D., Ph.D., senior vice president, American Association of Homes and Services for the Aging, and founder, Nonprofit Risk Management Center: Prepared statement