BILL ANALYSIS Ó SENATE JUDICIARY COMMITTEE Senator Noreen Evans, Chair 2013-2014 Regular Session SB 131 (Beall) As Amended May 2, 2013 Hearing Date: May 7, 2013 Fiscal: No Urgency: No NR SUBJECT Damages: childhood sexual abuse: statute of limitations DESCRIPTION Existing law provides that an action for recovery of damages suffered as a result of childhood sexual abuse shall be commenced within eight years of the date the plaintiff attains the age of majority or within three years of the date the plaintiff discovers or reasonably should have discovered that the psychological injury or illness occurring after the age of majority was caused by sexual abuse, whichever occurs later. This bill would instead provide that an action described above shall be commenced within 25 years of the date the plaintiff attains the age of majority or within five years of the date the fact of the psychological injury and its causal connection to the sexual abuse is first communicated to the plaintiff by a licensed mental health practitioner, whichever occurs later. This bill would provide that these time limits for commencement of an action shall be applied retroactively, and would revive, for a period of one year, a cause of action that would otherwise be barred by the statute of limitations as of January 1, 2014, provided that the plaintiff discovered the cause of his or her injury on or after January 1, 2004. This bill would also provide that a plaintiff shall be entitled to conduct discovery before the court may rule on a motion challenging the sufficiency of the plaintiff's showing that a person or entity knew or had reason to know, or was otherwise on notice, of any unlawful sexual conduct by an employee or agent, and failed to take reasonable steps to avoid those acts in the (more) SB 131 (Beall) Page 2 of ? future. BACKGROUND Before 1990, claims of childhood sexual abuse were governed by a one year statute of limitations. (Code Civ. Proc. Sec. 340(3).) However, if the cause of action accrued while the plaintiff was a minor, the statute was tolled until he or she became an adult. (Code Civ. Proc. Sec. 352(a).) Thus, any complaint had to be filed within one year of the plaintiff's 18th birthday. In 1990, the Legislature rewrote the statute of limitations for cases involving adult trauma caused by childhood sexual abuse. (SB 108 (Lockyer, Ch. 1578, Stats. 1990).) That law provides that the time for commencing an action based on injuries resulting from "childhood sexual abuse" shall be eight years after the plaintiff reaches majority (i.e., age 26) or within three years of the date of the plaintiff discovers or reasonably should have discovered that the psychological injury or illness occurring after the age of majority was caused by the abuse, whichever occurs later. As subsequently interpreted by the courts, SB 108 changed the statute of limitations for actions against the perpetrators, but did not change it for actions against other responsible third parties. (See Debbie Reynolds Prof. Rehearsal Studios v. Superior Court (1994) 25 Cal.App.4th 222; Tietge v. Western Province of the Services (1997) 55 Cal.App.4th 382.) In 1998, the Legislature responded to this interpretation and enacted AB 1651 (Ortiz, Ch. 1021, Stats. 1998) to apply the extended statute of limitations in actions against third parties. However, any action against any person or entity other than the sexual abuser would have to be commenced before the plaintiff's 26th birthday. (Code Civ. Proc. Sec. 340.1(b).) In 2002, SB 1779 (Burton and Escutia, Ch.149, Stats. 2002) was enacted to extend the statute of limitations in cases against a third party who was not the perpetrator of the sexual abuse beyond age 26, when the third party knew or had reason to know of complaints against an employee or agent for unlawful sexual conduct and failed to take reasonable steps to avoid similar unlawful conduct by that employee or agent in the future. SB 1779 also created a one year window in which victims could bring a claim against a third party, when that claim would have otherwise been barred solely because the statute of limitations had expired. SB 131 (Beall) Page 3 of ? Almost 1,000 cases were filed in California during the one year window in 2003. However, between 2005 and 2012, about 50 cases were filed by victims who were over the age of 26 in 2003, but did not make a causal connection between childhood abuse and problems as an adult until after 2003. The Quarry brothers, who filed suit in 2007, were among those who filed one of these cases. The trial court dismissed the case based on their age in 2003 (over 26 years of age), stating that the brothers should have brought their case within the one year window under SB 1779. The First District Court of Appeal reversed the trial court's decision, and held that the one year window only applied to victims who were both over the age of 26 and had made the required causal connection more than three years prior to January 1, 2003. It held that victims like the Quarry brothers were not barred as of January 1, 2003, and could avail themselves of the option of filing a claim within three years from discovery. Ultimately the Quarry case and about 20 others were taken up by the California Supreme Court. (Quarry v. Doe (2009) 53 Cal.4th 945.) The Court held that the Legislature failed to make its retroactive intent in SB 1779 clear, and the rules of statutory construction required that when the Legislature amends a statute of limitations, that amendment is presumed to be prospective, and is retroactive only if the Legislature expressly provides that it is intended to be retroactive and revive previously time-barred claims. The majority found the language of SB 1779 did not satisfy that rule of construction, and must be interpreted prospectively, or limited to the one year window. The dissent disagreed, and invited the Legislature to fix the problem. Accordingly, this bill would extend the statute of limitations to the later of 43 years of age or five years from the day a mental health practitioner communicates the causal connection between the injury occurring as an adult and the sex abuse experienced as a child. This bill would apply the above time limits retroactively, and create a one year window in which victims who are over the age of 43 but made the required causal connection after 2004, to bring a claim. This bill would also clarify pleading standards in these cases. CHANGES TO EXISTING LAW Existing law generally provides that the time for commencing a civil action for damages shall be within two years of the injury SB 131 (Beall) Page 4 of ? or death caused by the wrongful act or neglect of another. (Code Civ. Pro. Sec. 340.) Existing law provides that the time for commencing an action based on injuries resulting from childhood sexual abuse, as defined, shall be eight years after the plaintiff reaches majority (i.e., 26 years of age) or within three years of the date the plaintiff discovers or reasonably should have discovered that the psychological injury or illness occurring after the age of majority was caused by the abuse, whichever occurs later. (Code Civ. Pro. Sec. 340.1.) Existing law provides that in civil actions, as described above, against persons or entities other than the perpetrator, whose intentional, negligent, or wrongful act was the legal cause of the sex abuse, the plaintiff must show that the person or entity knew or had reason to know, or was otherwise on notice, of unlawful sexual conduct of an employee or agent, and failed to take reasonable steps, as specified, to avoid acts of unlawful sexual conduct in the future. (Code Civ. Pro. Sec. 340.1.) This bill would instead provide that the time for commencing an action based on injuries resulting from childhood sexual abuse, as defined, shall be 25 years after the plaintiff reaches majority (i.e., 43 years of age) or within five years of the date the injury and its causal connection to the sexual abuse if first communicated to the plaintiff by a licensed mental health practitioner practicing within the state, whichever occurs later. This bill would provide that a plaintiff shall be entitled to conduct discovery before the court may rule on a motion challenging the sufficiency of whether a plaintiff showed that the defendant knew, had reason to know, or was otherwise on notice of the unlawful sexual conduct of an employee or agent, as specified. This bill would retroactively apply the time limits above to any claim that has not been adjudicated to finality on the merits as of January 1, 2014. This bill would revive any cause of action that was dismissed by a court because the applicable statute of limitation had expired, provided that the plaintiff discovered his or her injuries after January 1, 2004, as specified. SB 131 (Beall) Page 5 of ? COMMENT 1.Stated need for the bill According to the author: Over the last 27 years the California Legislature has come to have a better understanding of the insidious and latent nature of the injuries suffered by a child who has been sexually abused and the reasons why victims of childhood sex abuse often wait years before reporting the abuse to law enforcement or otherwise. California Code of Civil Procedure Section 340.1, a remedial statute intended to provide redress the child sex abuse victims, has been amended no less than five times since its original enactment in 1986, consistent with this evolving knowledge of the latent effects of the original abuse. 2.Revive time-barred claims This bill would extend the statute of limitations for bringing an action based on childhood sex abuse to 43 years of age, and also allow a victim to bring a action within five years from the day a mental health practitioner communicates the causal connection between the injury occuring as an adult and the sexual abuse experienced as a child, whichever occurs later. This bill would apply these time limits retroactively, and create a one year window in which victims who are over the age of 43 but made the required causal connection after 2004, may bring a claim. This one year window should allow individuals, like the Quarry brothers, who are over the maximum age allowed by the statute of limitations, but who made the causal connection after the one year window created by SB 1779 (Burton and Escutia, Ch. 149, Stats. 2002), to bring a case against an abuser or third party (see Background). It should be noted that the revival of actions against perpetrators or third parties only assures that a claim would be heard on its merits. Any other applicable defense would not be affected, and plaintiffs would still have to prove all elements of their case. a. Authority of the Legislature to apply laws retroactively and revive claims While the Legislature is authorized to revive causes of SB 131 (Beall) Page 6 of ? action, the policy rationale for statutes of limitation is "to promote justice by preventing surprises through the revival of claims that have been allowed to slumber until evidence has been lost, memories have faded, and witnesses have disappeared. The theory is that even if one has a just claim it is unjust not to put the adversary on notice to defend within the period of limitation and the right to be free of stale claims in time comes to prevail over the right to prosecute them." (3 Witkin, Calif. Procedure, Actions (4th ed. 1996) 408.) Yet, courts have acknowledged that "the need for repose is not so overarching that the Legislature cannot by express legislative provision allow certain actions to be brought at any time, and it has occasionally done so." (Duty v. Abex Corp. (1989) 214 Cal.App.3rd 742, 749, citing Code of Civil Procedure Section 348, which states: "To actions brought to recover money or other property deposited with any [financial institution] . . . there is no limitation.") Thus, the final inquiry should be whether the Legislature believes that there are sufficient public policy reasons to support reviving any otherwise barred claims under this bill, and whether such an extension would maintain the protections afforded by the statute of limitations, i.e., balancing the interests of the victims with the defendants' right to defend. b. Concerns raised by retroactive application and claim revival Current law places the statute of limitations for civil suits arising out of child sex abuse at eight years passed the age of majority or within three years of making the appropriate causal connection. Thus, these victims have until at least age 26 to file a complaint under existing law. While this may not afford all victims enough time to emotionally and psychologically prepare to publicly come forward, extending the statute of limitations until victims are 43 years of age arguably allows victims who have made the necessary causal connection to wait a signiciant amount of time before bringing a claim. During this time, an abuser is not exposed and countless more victims may be subject to abuse. Accordingly, in addition to ensuring that evidence does not become stale, and that witnesses are available, a statute of limitations is an essential tool in protecting current and future victims from abuse. SB 131 (Beall) Page 7 of ? Further, the opposition argues that many private entities acted in reliance on SB 1779 (Burton and Escutia, Ch. 149, Stats. 2002), which created a one year window in which victims of child sex abuse could bring claims. The Sacramento Country Day School writes that this bill would "break faith with assurances given by the Legislature ten years ago when it enacted SB 1779 (Burton), a one-time, one year lifting of the statute of limitations for all of 2003 that allowed any victim of sexual abuse-regardless of how long ago it occurred-a second chance to file a lawsuit." The California Council of Nonprofit Organizations (CCNO) notes that "these claims resulted in historic settlements, in which more than $1.2 billion dollars was paid to these victims. These settlements would not have been made possible without the defendants' reliance on the implied promise that the pool of claimants represented the total of all latent claims. Insurance policies were surrendered back to carriers, property was mortgaged or sold, and loans were incurred to fund these settlements. Retroactively re-opening these claims subjects these defendants to double jeopardy and violates the promise of SB 1779 that the window for such latent claims would be closed at the end of 2003." 3.Fact of the injury communicated by a mental health practitioner Existing law employs a delayed discovery provision, which authorizes a victim to bring an action within three years from discovering the causal connection between the psychological illness he or she has suffered as an adult and the sexual abuse experienced as a child. Practically speaking, this allows persons who make the connection between the abuse and injury much later in life, to bring a claim within a reasonable period of time. This bill would instead provide that a person may bring a claim within five years of the date the fact of the psychological injury and its causal connection to the sexual abuse is first communicated to the plaintiff by a licensed mental health practitioner. Thus, this bill would create a "standardized" approach, where the time period for delayed discovery would be triggered by a specific event involving a third person, instead of at the time a victim achieves a subjective awareness. SB 131 (Beall) Page 8 of ? The CCNO argues that the requirement that the injury be communicated to the victim by a mental health practitioner creates avenues for abuse. Ultimately, [this requirement] could result in the 25-year limitation period being rendered meaningless, since it puts unfettered, unilateral control of "discovery" in the hands of the plaintiff. Under the existing standard, there is both a subjective and objective component - knew or should have known. Under this new iteration, even if the plaintiff was 100 percent aware and certain of the existence of injury and connection with the childhood abuse, he or she could nevertheless opt to extend the statute indefinitely by merely refusing to enter therapy with a mental health practitioner - thereby foreclosing the "first communication" of the connection by the therapist. And particularly troubling is the fact that this loophole could be taken advantage of by a plaintiff, permitting him or her strategically wait until witnesses are infirm or dead, and documents have surely been discarded, thereby maximizing the chances that a defendant will be unable to effectively defend against the claim. The author instead argues that requiring a mental health professional to communicate the connection between abuse and injury is necessary because, "this avoids the concern that a child sex abuse victim can just claim that they have only now made a causal connection if that is not the case, and it avoids a defense argument that any understanding constitutes a 'causal connection.'" 4.Knew or had reason to know Under existing law, victim plaintiffs making a claim against a third party (i.e., employer) must show that the third party "knew or had reason to know, or was otherwise on notice, of any unlawful sexual conduct by an employee, volunteer, representative, or agent, and failed to take reasonable steps, and to implement reasonable safeguards, to avoid acts of unlawful sexual conduct in the future by that person, including, but not limited to, preventing or avoiding placement of that person in a function or environment in which contact with children is an inherent part of that function or environment." The author claims that this requirement has, in effect, resulted in an onerously high pleading standard for plaintiffs. The SB 131 (Beall) Page 9 of ? author argues that, because relevant evidence as to this element is typically found in an employer's records, in most cases plaintiffs cannot plead facts sufficient to show that the employer "was on notice" prior to discovery being conducted. Accordingly, this bill would allow a plaintiff to conduct discovery before the court may rule on a motion challenging the sufficiency of the plaintiff's showing that a person or entity knew or had reason to know, or was otherwise on notice, of any unlawful sexual conduct by an employee or agent. 5.Maintains status quo as to public entities Under existing law, states are generally immune from lawsuits. The Eleventh Amendment initially only protected states from being sued in federal court by citizens of another state. In Hans v. Louisiana (1890) 134 U.S. 1, the Supreme Court ruled that a citizen cannot sue their own state either, based on principles of state sovereign immunity and federalism. Then, in Alden v. Me. (1999) 527 U.S. 706, the Court extended sovereign immunity further, and prohibited private suits against states in state court as well. Accordingly, citizens generally cannot sue states, state entities, or state officials in their official capacities, however citizens may sue state officials as individuals. This doctrine of state sovereign immunity is limited by a handful of exceptions: (1) a state can be sued if the state consents to the suit; (2) Congress (under the 14th Amendment) can make a state subject to money damages if the state violates the civil rights of individuals; and (3) the federal government and the states may waive their immunity in certain cases, such as tort cases. The State of California opened itself up to certain claims through the Government Torts Claim Act in 1963 (the Act), but the State does not have to respond to suits which are not properly filed. (Gov. Code Sec. 810 et seq.) Under the Act, with very limited exceptions, no lawsuit for money damages may be brought against a governmental entity unless a written claim has been properly filed within a six-month time limit. SB 640 (Simitian, Ch. 383, Stats. 2008) provided that child sex abuse claims are not subject to the Act. That bill was applied prospectively, thereby allowing child sex abuse claims against local public entities arising out of conduct occurring on or after January 1, 2009, to not be limited by the six-month time period. SB 131 (Beall) Page 10 of ? This bill would not carve out any additional exceptions to sovereign immunity, and would thus, maintain the status quo. Accordingly, victims who were abused by a public employee (such as a public school teacher or another employee of the State of California) would, in most cases, be limited to suing the actual abuser, because state entities are generally immune from suit. Opponents to this bill argue that it fails to protect children who attend public schools and discriminates against private employers. Sea Crest School in Half Moon Bay writes, "we believe that SB 131 would be a bad law because it discriminates against the overwhelming majority of sex abuse victims since most K-12 students attend public schools. It discriminates against private employers, and it breaks faith with previous legislative efforts to change the statute of limitations and does nothing to prevent abuse, enhance criminal penalties, or extend the criminal statute of limitations against actual perpetrators of abuse." The CCNO echoes this sentiment and writes, "If the goal of SB 131 was to provide compensation for victims, then the bill would recognize and provide redress to all victims equally. The retroactive provisions of SB 131 exclude claims of victims of public schools and of state and local public agencies. The bill seeks to find deep pocket defendants consisting of private institutions while adopting the political expediency of abandoning victims of public institutions." 6. Author's amendment The author offers the following clarifying amendment. On page two, in line nine, after "injury" insert "or illness occurring after the age of majority" Support : California Coalition Against Sexual Assault; California Police Chiefs; California Protective Parents Association; Child Abuse Listening Mediation, Inc.; College Democrats at Pacific Union College; Consumer Attorneys of California; Crime Victims United; Lawyers Against the Sex Abuse of Children; National Partnership to End Interpersonal Violence Across the Lifespan; National Safe Child Coalition; Waste Less Living, Inc.; 13 individuals Opposition : Almaden Country School; Alverno High School; Archdiocese of Los Angeles, Department of Catholic Schools; SB 131 (Beall) Page 11 of ? Berkeley Hall School; California Association of Joint Power Authorities; California Association of Private School Organizations; California Catholic Conference; California Council of Nonprofit Organizations; California State Alliance of YMCAs; Church and State Council; Clairbourn School; Crestview Preparatory School; Echo Horizon School; Flintridge Sacred Heart Academy; Konocti Christian Academy; Los Encinos School; Mirman School; New Community Jewish High School; North American Religious Liberty Association; Pacific Union Conference of Seventh Day Adventist Church; PS1 Pluralistic School; Rolling Hills Preparatory School; Sacramento Country Day School; Sea Crest School; St. Mathew's Parish School; Stoneybrooke Christian Schools; Viewpoint School; Village School; Webb Schools; Wesley School; Westmark School; Wildwood School; one individual HISTORY Source : National Center for Victims of Crime Related Pending Legislation : None Known Prior Legislation : AB 1628 (Beall, 2012) would have extended the statute of limitations in civil cases involving child sex abuse to 35 years of age, prohibited confidential settlements, and imposed new duties on private entities. This bill died in the Senate Appropriations Committee. SB 640 (Simitian, Chapter 383, Statutes of 2008) see Comment 5. SB 1779 (Burton and Escutia, Chapter 149, Statutes of 2002) see Background. AB 1651 (Ortiz, Chapter 1021, Statutes of 1998) see Background. SB 108 (Lockyer, Chapter 1578, Statutes of 1990) see Background. **************