IX. Miscellaneous Legislation
House Bill 89 Charitable donations
Signed by the Governor on July 19, 2007; October 18, 2007
House Bill 89 amends section 2305.37 of the Revised Code to provide persons who donate consumer goods to a charitable agency with qualified immunity from civil liability for harm that allegedly arises because the consumer goods are not fit for use and to establish a qualified immunity from civil liability for certain charitable agencies that distribute perishable food or consumer goods free of charge to individuals in need.
Senate Bill 59 Medical negligence
Pending in the Senate Insurance, Commerce and Labor Committee
Senate Bill 59 establishes a mandatory non-binding arbitration pilot program in several selected counties for the resolution of medical malpractice claims.
The arbitration panel determines whether there is probable cause of a breach of a medical standard of care alleged in the complaint. In the event a party does not follow the finding of the arbitration panel and proceeds to court, fees (cost shifting) will apply to the losing party, in essence a loser pay provision.
House Bill 157 Income tax
Effective Marcy 24, 2008; portions effective December 21, 2007
House Bill 157 requires the Tax Commissioner to include on personal income tax returns a space for a taxpayer to authorize a paid tax preparer to communicate with the tax department about the client’s tax return.
Currently, the law prohibits the tax department and its employees and agents from disclosing taxpayer information. The prohibition extends to communication with a person representing the taxpayer unless there is specific authorization from the taxpayer on a specified form of the Department. The bill simplifies the process.
Senate Bill 117 Cable communications bill
Effective September 24, 2007
Senate Bill 117 addresses the regulation of the cable communication industry. The act contains a provision that prohibits a municipal corporation or township from contracting for an audit of a cable provider where the compensation is dependent on the dollar amount of the findings.
The prohibition noted above “shall not prohibit or limit the hiring of legal counsel on a contingency fee basis to enforce the findings of an audit” (R.C. 1332.33(c)(1)).
The above provision is intended to preserve the ability of a municipal corporation or township to enter into a contingency fee agreement with an attorney to enforce the findings of the audit, thus preserving contingency fee arrangements in such circumstances.
House Bill 219 Testimonial privilege
Pending in the House Commerce and Labor Committee
House Bill 219 creates a testimonial privilege, subject to specified exceptions, for communications between a representative of an employee organization and a bargaining unit member made while the representative was acting in a representative capacity on behalf of the employee organization. The bill provides that the privilege does not apply and a representative of an employee organization may testify under the following circumstances:
(1) if and to the extent the testimony appears necessary to prevent the commission of a crime that is likely to create a clear, imminent risk of serious physical harm to or death of another person;
(2) in a civil or criminal action against the representative in the representative's personal or representative capacity, against the employee organization or an affiliate of the employee organization, or against any representative of the employee organization in the representative's representative capacity;
(3) if required to do so by court order; or
(4) with the express consent of the bargaining unit member, the guardian or other legal representative of the bargaining unit member, or, if the bargaining unit member is deceased, the spouse, executor, or administrator of the bargaining unit member.
The bill defines "employee organization" as any labor union or bona fide organization in which employees participate and that exists for the purpose, in whole or in part, of dealing with employers concerning grievances, labor disputes, wages, hours, terms, and other conditions of employment (R.C. 2317.02(M)(4)).
House Bill 248 Non-recourse contracts
Effective August 28, 2008
House Bill 248:
- specifies the requirements for all contracts for a "non-recourse civil litigation advance," defined as a transaction in which a company makes a cash payment to a consumer who has a pending civil claim or action in exchange for the right to receive an amount out of the proceeds of any realized settlement, judgment, award, or verdict the consumer may receive in the civil lawsuit;
- requires those contracts to contain certain disclosures, including the amounts to be advanced to and repaid by the consumer, the annual percentage rate of return, and an itemization of one-time fees;
- requires the contract to contain the consumer's right of cancellation and the manner of cancellation, and a written acknowledgement by the attorney representing the consumer in the civil action or claim stating specified information and that the attorney has reviewed the contract; and
- specifies conspicuous statements that must appear in the contract and other requirements for the contract.
House Bill 404 Viatical settlements
Effective September 11, 208; R.C. 3916.02(A) effective 90 days later
House Bill 404 amends current R.C. Chapter 3916, which regulates viatical settlement providers, brokers, contracts, and arrangements in Ohio. The Bill would toughen licensing requirements for viatical settlement providers and brokers, require fuller disclosure by the providers and brokers to the consumer parties to viatical settlements, more closely regulate marketing and advertising rhetoric, expand the types of life insurance arrangements that come under the regulatory scheme of Chapter 3916, and identify several specific fraudulent activities related to viatical settlements.
The act will eliminate one aspect of third-party owned life insurance known as “Stranger-Originated Life Insurance” or “STOLI,” the issuing, soliciting, marketing, or otherwise promoting of which is specifically defined as a fraudulent activity under R.C. § 3916.171(B)(15). The Bill defines STOLI in R.C. § 3916.01(Y) as a plan or agreement that provides for both of the following at the time of the origination of a life insurance policy: (a) the purchase of a life insurance policy by an applicant primarily for the benefit of a third party investor who lacks an insurable interest in the insured person; and (b) the subsequent accrual, directly or indirectly, to that third party investor of the legal or beneficial ownership of the policy or the benefits of the policy.
By way of background, STOLI typically consists (although there are several variations) of investors loaning money to an insured, who uses the money to purchase a life insurance policy on his life. The insured then sells the policy after the incontestability period to those same investors for some percent of the “life settlement” value at the time of the sale (which is guaranteed to be in excess of the loaned amount used to purchase the insurance). The insured’s beneficiaries get what amounts to free life insurance proceeds (typically in a significant amount) should the insured die before he sells the policy; and if the insured lives beyond the incontestability period, he gets the proceeds when the policy is sold on the life settlement market. The intent of the transaction is for investors to make the spread on the ultimate sale of the policy.
(This description of this legislation was prepared by Robert B. Barnett, a member of the Estate Planning, Trust and Probate Section.)
Senate Bill 345 County law libraries
Pending in the Senate Judiciary-Civil Justice Committee
Senate Bill 345 would:
- create a county law library resources board in each county,
- create a statewide consortium of county law library resources boards;
- provide that each county law library resources board is responsible for coordinating legal research and reference material for county offices, courts, and county departments;
- create the county law library resources fund and the statewide consortium of county law library resources boards fund; and
- Reconstitute the Task Force on Law Library Associations.
A more complete analysis is attached as Appendix G.