[Congressional Record Volume 143, Number 39 (Monday, April 7, 1997)]
[Senate]
[Pages S2787-S2790]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ASHCROFT:
  S. 514. A bill to provide uniform standards for the awarding of 
compensatory and punitive damages in a civil action against a volunteer 
or volunteer service organization, and for other purposes; to the 
Committee on the Judiciary.

[[Page S2788]]

            the liability reform for volunteer services act

  Mr. ASHCROFT. Mr. President, in his ``Democracy in America,'' Alexis 
de Tocqueville observed ``Americans of all ages, all stations in life * 
* * are forever forming associations.'' Be it to repair a public 
thoroughfare or to promote temperance, de Tocqueville noted volunteer 
associations were Americans' best response to community needs and to 
cultural pathologies.
  This observation, made over 150 years ago, certainly has been the 
case until a little over a decade ago. Volunteers have nurtured the 
elderly, they have coached generations of children, they have cleaned 
up our communities, they have supported and counseled those in need 
throughout American history.
  I look back at my time as Governor of the State of Missouri when we 
started the Clean the Highways Program using volunteers. We had 5,000 
groups of volunteers--5,000 groups, not 5,000 volunteers--who accepted 
responsibility. It is a sort of fulfillment of de Tocqueville's 
observation about America, that Americans of all ages, of all stations 
in life are forming associations to do good things.
  These groups have been catalysts that interact with all elements of 
our culture. It is to volunteers that we owe a great deal of gratitude 
for our social cohesion--our sense of community in America. When things 
are done from the perspective of government, people view them as 
entitlements. When things are done by individuals because they 
volunteer, people know that we love one another. Basically, it is in 
our care and regard for each other--expressed when we do things on a 
voluntary basis--that is the real glue that binds us together as 
communities and holds us together as a culture.
  It was in 1982 that the first warning signs went out that our 
intricate system of volunteers fulfilling social work was under attack. 
In Runnemede, NJ, a Little League coach volunteer was sued because he 
repositioned his Little League shortstop to the outfield, and in the 
outfield the Little League shortstop then misjudged a flyball and 
sustained an eye injury. A suit was filed on the allegation that the 
10-year-old youngster was a born shortstop, but not an outfielder, and 
the courts found the volunteer coach negligent.
  Over the next 5 years, liability rates for Little League baseball 
short up from $75 to $795 forcing many leagues to stop playing.
  In another example, a boy in a Scouting unit with the Boy Scouts of 
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 that the Boy Scouts and the 
volunteers were negligent for failing to supervise him adequately.
  I remember playing aggressive games as a Boy Scout. I remember 
playing a game we called fox over the hill. One group was supposed to 
run from one line to the other line without getting tackled, pummeled, 
and roughed up. That is the way boys operate. That is part of boyhood. 
But the jury found that the volunteers were personally liable for some 
$7 million. Oregon law caused the judgment to be reduced to around $4 
million, but few Boy Scout volunteers can afford that kind of a 
judgment.
  The jury held the volunteers to a heightened standard of care, 
charging them with a meticulous constant supervision level of care in 
their supervision over activities that routinely have been permitted 
without oversight. Such a standard is impossible to uphold. Anyone who 
has been a Boy Scout or certainly tried to supervise Boy Scouts knows 
that such a standard would be very difficult, and such an impossible 
standard has basically caused a marked drop off in voluntarism across 
the country.
  In fact, the Gallup organization studied voluntarism and, in a study 
titled the ``Liability Crisis and the Use of Volunteers of Nonprofit 
Associations,'' the Gallup organization found that approximately 1 in 
10 nonprofit organizations has experienced the resignation of a 
volunteer due to liability concerns and that 1 in 6 volunteers reported 
withholding services due to a fear of exposure to liability suits.

  What we have basically done in the last two decades is to send a 
signal to people: If you volunteer to be helpful, you could jeopardize 
the well-being of your own family; you could make it very difficult to 
maintain the home and lifestyle to which you have become accustomed; in 
trying to help others, you might, as a matter of fact, hurt yourself. I 
think that is sad because it has reduced this good impulse of 
Americans.
  The study also found that 1 of 7 nonprofit agencies had eliminated 
one or more of their valuable programs because of exposure to lawsuits. 
So, instead of having more programs to help more people, we have 
narrowed that because of the threat of lawsuits and the potential of 
liability. Sixteen percent of volunteer board members surveyed reported 
withholding their services to an organization out of fear of 
liability--16 percent. That is almost 1 out of every 6 volunteer board 
members said, ``No, I'm going to think carefully about whether I'm 
going to be on the board, because I don't want to get sued, and I don't 
want to ruin the chances of my family to live properly just because 
some mistake is made somewhere.
  The average reported increase for insurance premiums for nonprofits 
over the previous 3 years, from 1985 to 1988, was 155 percent. That was 
over the years prior to the study, a 155 percent increase in insurance. 
And one in eight organizations reported an increase of over 300 
percent. So, nonprofits found an increase in their insurance premiums. 
These numbers demonstrate rather clearly that the cost of lawsuits and 
the excessive unpredictable and often arbitrary nature of damage awards 
have a direct and a chilling effect on the spirit of voluntarism and on 
the nature of our communities.
  I do not want to wring from the fabric of American society that 
healthy component that lubricates our social exchanges, the component 
of caring and loving and dealing with and helping each other, but if 
our legal system makes it dangerous to help each other and dangerous to 
care and dangerous to volunteer, we will have done this great country a 
tremendous disservice. Voluntarism is one of these defining 
characteristics of American culture. The understanding that people have 
been historically willing to help one another is a mainstay of who we 
are as Americans.
  The hyperlitigious nature of the civil justice system is creating a 
barrier between the desire of Americans to help others and their 
ability to do so. So, Mr. President, today I rise to introduce a bill 
that will offer a new level of protection to volunteers who give 
selflessly of themselves to help others. The Liability Reform for 
Volunteer Services Act will reinstate reason, it will reinstate 
rationality, it will reinstate certainly and fairness to a judicial 
system with regard to voluntarism.
  The Liability Reform for Volunteer Services Act covers volunteer 
services organizations which are defined as nonprofit organizations 
that are organized for the public benefit and operated primarily for 
charitable, civic, educational, religious, welfare, or health purposes. 
Health care providers, however, specifically are excluded from 
coverage. Many of them fly under the banner or nonprofit, but we all 
know that they are anything but volunteer organizations, and they are 
not, in many respects, charitable. Persons volunteering for service 
organizations or governmental entities are covered by the bill if they 
are acting in good faith, within the scope of their official duties, 
and not being compensated for their services. This really is an effort 
to say to that person that volunteers, ``We are going to give you a 
fair situation in which to volunteer, and if you are not being 
compensated, we are still going to hold you to the standard which 
requires you to have good behavior, but we are not going to expose you 
to tremendous liability.''
  The bill establishes a standard for awarding punitive damages. It is 
a rather high standard for awarding punitive damages which is designed 
to punish defendants or defer others from engaging in the same activity 
against the volunteer services organization or the volunteer. An 
injured party would be required to establish by ``clear and convincing 
evidence'' that a volunteer organization or its volunteers acted with a 
``conscious and flagrant indifference'' to the rights or safety of 
others and this conduct caused the harm for which the volunteer is 
being sued.

  The clear and convincing standard is greater than the standard for 
most

[[Page S2789]]

civil cases, which is merely the preponderance of the evidence, but it 
is less than the criminal standard which is beyond a reasonable doubt. 
The clear and convincing standard is a higher standard than the more-
likely-than-not or preponderance of the evidence standard, but, 
obviously, it is less than the criminal standard of beyond a reasonable 
doubt.
  Punitive damages would be capped so that punitive damages could not 
exceed $250,000, or twice the economic and noneconomic losses. So, 
actual damages would not be affected here. If there were real damages, 
they would be recoverable, but punitive damages would be capped. In 
other words, if there were to be punitive damages, not only would they 
be capped at a maximum of $250,000, or twice the economic damages, you 
would have to be able to provide that there was clear and convincing 
evidence that there was a conscious and flagrant indifference to the 
rights or safety of others.
  Given either party the right to separate any court's proceeding 
covered by the act into two parts, the first would determine whether 
the volunteer or service organization is liable to the injured party, 
and the second would be to determine whether punitive damages should be 
awarded.
  A volunteer services organization or volunteer would only be 
responsible in proportion to its degree of fault. That would mean that 
there would not be the kind of joint liability. If the Salvation Army 
were 10 percent responsible and some other organization 90 percent 
responsible, and the organization that was 90 percent responsible did 
not cover all of their 90 percent in the case, the Salvation Army would 
not be asked to pick up the tab for the other organization. It would 
only be responsible for that damage that it had been found to have 
caused.
  I do not single out one of the most virtuous organizations in 
America, suggesting that they might ever be liable, but if there were a 
case against a charitable organization like that, that would be the 
framework for adjudicating and awarding damages. A volunteer services 
organization or volunteer only would be responsible for damages in 
proportion to the degree of fault that was found on their part.
  The protections provided for in this Bill would not apply if the 
activity for which damages were awarded constitutes a crime of violence 
or terrorism. If the volunteer commits a hate crime or is convicted of 
a civil rights violation these protections would not apply. If a 
volunteer is convicted of a sexual offense under State law, these 
protections would not apply. In addition, if a volunteer is found to 
have been under the influence of alcohol or drugs when the incident 
giving rise to the litigation occurs and that influence caused the 
harm, these protections would not apply. This is not a bill designed to 
authorize people to be high on drugs or alcohol or to commit crimes 
when they are volunteering. In those instances, the sky would be the 
limit. We would be under the old system.
  Let me just say that volunteers do play an integral part in America, 
in community service. They should not have to fear litigation. They 
should not have to withdraw from giving themselves to those in need. 
The Gallup study shows we have had a withdrawal of talent from the 
volunteer pool. This is the time when we need more Americans being 
involved in community in a sense of helping each other, not less.
  In conclusion, let me just make the following observations. The basis 
for the American community and culture is, in large measure, the result 
of voluntarism. Alexis de Tocqueville said this is what makes America 
``America.'' America is great because America is benevolent--this 
goodness is the impetus within us to help each other.

  We have had a development of a legal system which has made that very 
difficult and costly for volunteers. In a very focused and balanced 
way, we are trying to say to people that their liability for acts in 
the volunteer community should be limited only to economic damages 
unless there is a very flagrant disregard for the rights of others and, 
in those events, punitive damages should be limited.
  I believe that this measure will help restore to the American people 
the capacity to be caring and giving people, to live with each other in 
a sense of community--bound together by the glue of mutual concern--in 
service to one another in valuable and selfless ways.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 514

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Liability Reform for 
     Volunteer Services Act''.

     SEC. 2. FINDINGS AND PURPOSES.

       (a) Findings.--Congress finds that--
       (1) the increasingly litigious nature of the legal 
     profession in the United States has created an unnecessary 
     and ultimately harmful barrier between the traditional desire 
     of individuals to help other individuals and their ability to 
     act on those desires;
       (2) the cost of lawsuits, excessive, unpredictable, and 
     often arbitrary damage awards, and unfair allocations of 
     liability have a direct and chilling effect on the spirit of 
     volunteerism and the provision of charitable service in the 
     United States;
       (3) arbitrary and capricious damage awards against 
     volunteers and charitable institutions have contributed 
     considerably to the high cost of liability insurance, making 
     it difficult and often impossible for volunteers and 
     volunteer service organizations to be protected from 
     liability as those volunteers and many volunteer service 
     organizations serve the public without regard to receiving 
     any personal or institutional economic benefits from that 
     service;
       (4) as a result, volunteer service organizations throughout 
     the United States have been adversely affected and often 
     debilitated as volunteers have refused to help because of a 
     fear of frivolous lawsuits;
       (5) without a resurgence in volunteerism, the essential 
     services that volunteer service organizations provide, 
     including crisis counseling, volunteer rescue services, 
     coaches and referees for sports activities of children, and 
     support for the elderly, will continue to diminish;
       (6) clarifying and limiting the personal liability risks 
     assumed by individuals and institutions who volunteer to help 
     others without benefit to themselves is an appropriate 
     subject for Federal legislation because--
       (A) of the national scope of the problems created by the 
     legitimate fears of volunteers about frivolous, arbitrary, or 
     capricious lawsuits; and
       (B) the citizens of the United States depend on, and the 
     Federal Government expends funds on, numerous social programs 
     that depend on the services of volunteers; and
       (C) it is in the interest of the Federal Government to 
     encourage the continued operation of volunteer service 
     organizations and contributions of volunteers because the 
     Federal Government lacks the capacity to carry out all of the 
     services provided by such organizations and volunteers; and
       (7) liability reform for volunteer service organizations 
     will promote the free flow of goods and services, lessen 
     burdens on interstate commerce and uphold constitutionally 
     protected due process rights and that liability reform is 
     thus an appropriate use of the powers contained in Article I, 
     Section 8, Clause 3 of the United States Constitution, and 
     the Fourteenth Amendment to the United States Constitution.
       (b) Purposes.--The purposes of this Act are to provide 
     protection from personal financial liability for volunteers 
     and volunteer service organizations that provide volunteer 
     services that are conducted in good faith--
       (1) to promote the interests of social service program 
     beneficiaries and taxpayers; and
       (2) to sustain the availability of programs, volunteer 
     service organizations, and governmental entities that depend 
     on volunteer contributions and services; and
       (3) to provide the protection by--
       (A) placing reasonable limits on punitive damages;
       (B) ensuring the fair allocation of liability in certain 
     civil actions; and
       (C) establishing greater fairness, rationality, and 
     predictability in the civil justice system of the United 
     States.

     SEC. 3. DEFINITIONS.

       In this Act:
       (1) Claimant.--
       (A) In general.--The term ``claimant'' means any person who 
     asserts a claim for damages in an action covered by this Act 
     and any person on whose behalf such a claim is asserted.
       (B) Claimants for certain claims.--If a claim described in 
     subparagraph (A) is asserted through or on behalf of--
       (i) an estate, the term includes the claimant's decedent; 
     or
       (ii) a minor or incompetent, the term includes the 
     claimant's legal guardian.
       (2) Clear and convincing evidence.--
       (A) In general.--The term ``clear and convincing evidence'' 
     is that measure or degree of proof that will produce in the 
     mind of the trier of fact a firm belief or conviction as to 
     the truth of the allegations sought to be established.
       (B) Degree of proof.--The degree of proof required to 
     satisfy the standard of clear and convincing evidence shall 
     be--

[[Page S2790]]

       (i) greater than the degree of proof required to meet the 
     standard of preponderance of the evidence; and
       (ii) less than the degree of proof required to meet the 
     standard of proof beyond a reasonable doubt.
       (3) Compensatory damages.--The term ``compensatory 
     damages'' means damages awarded for economic and noneconomic 
     loss.
       (4) Economic loss.--The term ``economic loss'' means any 
     pecuniary loss resulting from harm (including the loss of 
     earnings or other benefits related to employment, medical 
     expense loss, replacement services loss, loss due to death, 
     burial costs, and loss of business or employment 
     opportunities) to the extent recovery for such loss is 
     allowed under applicable State law.
       (5) Harm.--The term ``harm'' means--
       (A) any physical injury, illness, disease, or death;
       (B) damage to property; or
       (C) economic loss, including any direct or consequential 
     economic loss.
       (6) Health care provider.--The term ``health care 
     provider'' means any person, organization, or institution 
     that--
       (A) is engaged in the delivery of health care services in a 
     State; and
       (B) is required by the applicable laws (including 
     regulations) of a State to be licensed, registered, or 
     certified by the State to engage in the delivery of health 
     care services in the State.
       (7) Noneconomic loss.--The term ``noneconomic loss'' means 
     subjective, nonmonetary loss resulting from harm, including 
     pain, suffering, inconvenience, mental suffering, emotional 
     distress, loss of society and companionship, loss of 
     consortium, injury to reputation, and humiliation.
       (8) Person.--The term ``person'' means any individual, 
     corporation, company, association, firm, partnership, 
     society, joint stock company, or any other entity (including 
     any governmental entity).
       (9) Punitive damages.--The term ``punitive damages'' means 
     damages awarded against any person to punish or deter that 
     person or any other person, from engaging in similar behavior 
     in the future.
       (10) State.--The term ``State'' means any State of the 
     United States, the District of Columbia, the Commonwealth of 
     Puerto Rico, the Northern Mariana Islands, the Virgin 
     Islands, Guam, American Samoa, and any other territory or 
     possession of the United States or any political subdivision 
     of any of the foregoing.
       (11) Volunteer service organization.--The term ``volunteer 
     service organization'' means a not-for-profit organization 
     (other than a health care provider) organized and conducted 
     for public benefit and operated primarily for charitable, 
     civic, educational, religious, welfare, or health purposes.
       (12) Volunteer services.--The term ``volunteer services'' 
     means services provided, in good faith, without compensation 
     or other pecuniary benefit (other than reimbursement of 
     expenses incurred in providing such services) inuring to the 
     benefit of the service provider or any other person (other 
     than the recipient of the volunteer service), and within the 
     scope of the official functions and duties of the service 
     provider with a volunteer service organization or 
     governmental entity.

     SEC. 4. APPLICABILITY.

       (a) In General.--
       (1) Covered claims.--Subject to paragraph (2), this Act 
     governs any claim for damages in any civil action brought in 
     any State or Federal court in any case in which the claim 
     relates to--
       (A) volunteer services performed by the defendant for a 
     governmental entity or a volunteer service organization; or
       (B) activities or services performed by a volunteer service 
     organization.
       (2) Actions excluded.--The limitations on damages contained 
     in this Act shall not apply in any action described in 
     subparagraph (A) or (B) of paragraph (1) in any case in 
     which--
       (A) the misconduct for which damages are awarded --
       (i) constitutes a crime of violence (as that term is 
     defined in section 16 of title 18, United States Code) or an 
     act of international terrorism (as that term is defined in 
     section 2331(1) of title 18, United States Code) for which 
     the defendant has been convicted in any court;
       (ii) constitutes a hate crime (as that term is used in the 
     Hate Crime Statistics Act (28 U.S.C. 534 note)) for which the 
     defendant has been convicted in any court;
       (iii) involves a sexual offense, as defined by applicable 
     State law, for which the defendant has been convicted in any 
     court; or
       (iv) involves misconduct for which the defendant has been 
     found to have violated a Federal or State civil rights law 
     for which the defendant has been convicted in any court; or
       (B) the defendant was found to be under the influence (as 
     determined pursuant to applicable State law) of intoxicating 
     alcohol or any drug, at the time of the misconduct for which 
     damages are awarded and (such influence) was a proximate 
     cause of the harm that is the subject of the action.
       (b) Relationship to State Law.--This Act supersedes State 
     law only to the extent that State law applies to an issue 
     covered by this Act. Any issue (including any standard of 
     liability) that is not governed by this Act shall be governed 
     by otherwise applicable State or Federal law.
       (c) Effect on Other Law.--Nothing in this Act shall be 
     construed to--
       (1) waive or affect any defense of sovereign immunity 
     asserted by any State under any law;
       (2) supersede or alter any other Federal law;
       (3) waive or affect any defense of sovereign immunity 
     asserted by the United States;
       (4) affect the applicability of any provision of chapter 97 
     of title 28, United States Code;
       (5) preempt State choice-of-law rules with respect to 
     claims brought by a foreign nation or a citizen of a foreign 
     nation;
       (6) affect the right of any court to transfer venue or to 
     apply the law of a foreign nation or to dismiss a claim of a 
     foreign nation or of a citizen of a foreign nation on the 
     ground of inconvenient forum; or
       (7) supersede or modify any statutory or common law, 
     including any law providing for an action to abate a 
     nuisance, that authorizes a person to institute an action for 
     civil damages or civil penalties, cleanup costs, injunctions, 
     restitution, cost recovery, punitive damages, or any other 
     form of relief for remediation of the environment (as defined 
     in section 101(8) of the Comprehensive Environmental 
     Response, Compensation, and Liability Act of 1980 (42 U.S.C. 
     9601(8)).

     SEC. 5. UNIFORM STANDARD FOR AWARD OF PUNITIVE DAMAGES.

       Punitive damages may, to the extent permitted by applicable 
     State or Federal law, be awarded against a defendant if the 
     claimant establishes by clear and convincing evidence that 
     conduct carried out by the defendant with a conscious, 
     flagrant indifference to the rights or safety of others was 
     the proximate cause of the harm that is the subject of the 
     action in any civil action for a claim described in 
     subparagraph (A) or (B) of section 4(a)(1).

     SEC. 6. LIMITATION ON THE AMOUNT OF PUNITIVE DAMAGES.

       The amount of punitive damages that may be awarded in an 
     action described in section 5 shall not exceed the lesser 
     of--
       (1) twice the sum of the amounts awarded to the claimant 
     for economic loss and noneconomic loss; or
       (2) $250,000.

     SEC. 7. PREEMPTION.

       (a) In General.--This Act does not--
       (1) create a cause of action for punitive or compensatory 
     damages; or
       (2) preempt or supersede any State or Federal law to the 
     extent that such law further limits the amount of an award of 
     punitive or compensatory damages.
       (b) Remittitur.--Nothing in this section shall modify or 
     reduce the ability of courts to grant a remittitur.

     SEC. 8. APPLICATION BY COURT.

       The application of the limitation imposed by section 6 may 
     not be disclosed to a jury by a court. Nothing in this 
     section authorizes the court to enter an award of punitive 
     damages in excess of the initial award of punitive damages 
     awarded by a jury.

     SEC. 9. BIFURCATION AT REQUEST OF ANY PARTY.

       (a) In General.--At the request of any party the trier of 
     fact, in any action for punitive damages that is subject to 
     this Act, shall consider in a separate proceeding, held 
     subsequent to the determination of the amount of compensatory 
     damages, whether punitive damages are to be awarded for the 
     harm that is the subject of the action and the amount of the 
     award.
       (b) Inadmissibility of Evidence Relevant Only to a Claim of 
     Punitive Damages in a Proceeding Concerning Compensatory 
     Damages.--If any party requests a separate proceeding under 
     subsection (a), in a proceeding to determine whether the 
     claimant may be awarded compensatory damages, any evidence, 
     argument, or contention that is relevant only to the claim of 
     punitive damages, as determined by applicable State law, 
     shall be inadmissible.

     SEC. 10. LIABILITY FOR COMPENSATORY DAMAGES.

       (a) General Rule.--In any action described in subparagraph 
     (A) or (B) of section 4(a)(1) brought against more than one 
     defendant, the liability of each defendant for compensatory 
     damages shall be determined in accordance with this section.
       (b) Amount of Liability for Compensatory Damages.--
       (1) In general.--Each defendant shall be liable only for 
     the amount of compensatory damages allocated by the trier of 
     fact to the defendant in direct proportion to the percentage 
     of responsibility of the defendant (determined in accordance 
     with paragraph (2)) for the harm to the claimant with respect 
     to which the defendant is found to be liable. The court shall 
     render a separate judgment against each defendant in an 
     amount determined pursuant to the preceding sentence.
       (2) Percentage of responsibility.--For purposes of 
     determining the amount of compensatory damages allocated to a 
     defendant under this section, the trier of fact in an action 
     described in subsection (a) shall determine the percentage of 
     responsibility of each person responsible for the harm to the 
     claimant, without regard to whether that person is party to 
     the action.
                                 ______