BILL ANALYSIS �
AB 2071
Page 1
Date of Hearing: May 8, 2012
ASSEMBLY COMMITTEE ON JUDICIARY
Mike Feuer, Chair
AB 2071 (Hagman) - As Amended: March 29, 2011
SUBJECT : CIVIL LIABILITY: DESTRUCTION OF TREES
KEY ISSUES :
1)SHOULD DAMAGES BE SUBSTANTIALLY REDUCED FOR WRONGDOERS WHO
NEGLIGENTLY DESTROY TREES, INCLUDING BY SETTING WILDFIRES?
2)SHOULD PROPERTY OWNERS WHO HAD INTENDED TO LOG THEIR
NOW-DESTROYED TREES FOR COMMERCIAL PURPOSES BE COMPENSATED AT
TWICE THE RATE OF CONSERVATION GROUPS, GOVERNMENT ENTITIES, OR
OTHER OWNERS WHO HAD INTENDED TO PRESERVE THE TREES ON THEIR
LAND?
FISCAL EFFECT : As currently in print this bill is keyed
non-fiscal.
SYNOPSIS
This bill, sponsored by the Personal Insurance Federation of
California (PIFC), seeks to substantially reduce the money
damages available for injury caused to trees and timber. Under
current law, when such damage is the result of negligence or
involuntary act, the wrongdoer must pay twice the actual
damages. This bill would reduce that in half to just actual
damage in the case of negligence, unless the property owner
intended to make commercial use of the timber. The author
states that this bill is necessary for predictability and
uniformity in the way damages to trees are enforced. The
sponsor adds that the bill is a fair measure that provides for
actual damages when an insured's negligent act causes damages to
trees and punitive damages for those that intentionally harm
trees. The bill is opposed by the Consumer Attorneys of
California, which argues that the bill would insulate negligent
parties from liability for full compensation for damages caused
by irresponsible and negligent action and would reduce
incentives to utilities, railroads and other commercial
interests not to cause wildfires.
SUMMARY : Substantially reduces money damages for destruction of
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timber. Specifically, this bill :
1)Reduces damages for the negligent removal of timber, trees, or
other wood from the land of another, including if the
defendant had probable cause to believe that the land was his
or her own, from two times actual damages to actual damages.
If the owner of the land intended to make commercial use of
the timber or trees, provides that the damages are twice
actual damages. If timber was taken under the authority of
highway officers for specified purposes, limits damages to
actual damages. May eliminate any damages from an involuntary
trespass.
2)Reduces damages for cutting down or carrying off any wood,
underwood, tree, or timber or otherwise injuring any tree or
timber, as specified, from treble damages to actual damages.
If the owner of the land intended to make commercial use of
the wood, damages lowered from treble damages to two times the
actual damages. Provides that damages for the intentional
removal of timber, trees or other wood from the land of
another is three times actual damage.
EXISTING LAW :
1)Specifies the measure of damages available for trespass to
timber, trees, or underwood upon the land of another person is
three times the sum as would compensate for the actual
detriment unless the trespass was casual or involuntary, or
the defendant had probable cause to believe that the land on
which the trespass was committed was his or her own or the
land of the person in whose service or by whose direction the
act was done, in which case the measure of damages is twice
the sum as would compensate for the actual detriment. (Civil
Code Section 3346.)
2)Provides that any person who cuts down or carries off any
wood, underwood, tree, or timber or otherwise injures any tree
or timber without lawful authority, as specified, is liable
for treble the amount of damages that may be assessed therefor
in a civil action. (Code of Civil Procedure Section 733.)
3)Defines "wildfire" as an unplanned, unwanted wildland fire,
including unauthorized human-caused fires, escaped wildland
use events, escaped prescribed fire projects, and all other
wildland fires where the objective is to extinguish the fire.
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(Government Code Section 51177(j).)
4)Provides that any person who personally or through another
willfully, negligently, or in violation of law sets fire to,
allows fire to be set to, or allows a fire kindled or attended
by him or her to escape to the property of another is liable
to the owner of that property for any damages to the property
caused by the fire. (Health and Safety Code Section 13007.)
5)Provides that if a fire originates from the operation or use
of an engine, machine, barbecue, incinerator, railroad rolling
stock, chimney, or any other device that may kindle a fire,
the occurrence of the fire is prima facie evidence of
negligence in the maintenance, operation, or use of that
engine, machine, barbecue, incinerator, railroad rolling
stock, chimney, or other device. If the fire escapes from the
place where it originated and it can be determined which
person's negligence caused the fire, that person is guilty of
a misdemeanor. (Public Resources Code Section 4435.)
COMMENTS : In support of this PIFC-sponsored bill, the author
writes: "This legislation will create predictability and
uniformity in the way we enforce damages to trees."
This Bill Would Substantially Reduce, or Possibly Even
Eliminate, a Wrongdoer's Legal Liability to Pay Damages For
Injuries He or She Caused . This bill would limit the liability
of wrongdoers by reducing the measure of damages recoverable by
any person or governmental entity for non-intentional damages to
timber, trees or underwood on the land of another from twice the
damages to actual damages. Damages would remain at two times
actual damages if the landowner intended to make commercial use
of the timber. Treble damages would still be available if the
wrongdoer acted intentionally.
Thus, under the bill, damage caused by an escaping fire, other
than an arson fire, would no longer be eligible for treble or
double damages, depending on the facts of the case, but might be
eligible just for actual damages (or twice that based on the
proposed use of the timber by the owner of the damaged
property). It is also possible, under this bill, that such
damages might not be recoverable at all, since the bill
eliminates the use of term "wrongful injury" and replaces it
with "negligence," thus possibly eliminating liability for some
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defendants whose acts caused the injury.
This Bill Would Reward Those Who Intend to Log Their Property
With Twice the Damage Recovery of Those Who Choose Not to Chop
Down Their Trees . Under this bill, while most landowners whose
trees have been destroyed can only collect actual damages,
landowners who intended to make commercial use of the timber are
entitled to twice the actual damages. Thus, under the bill,
landowners who are conservation groups, government entities or
others who choose to preserve wooded land would receive half of
what a commercial logger-owner would receive, despite sustaining
the exact same injury. Neither the author nor the sponsor
provides any explanation for this differential treatment.
This Bill is Similar to Legislation That Was Dropped Last Year .
Last year, AB 992 (Nielsen) would have substantially reduced
liability and damages with respect to injuries caused by
wildfires by, among other things, generally eliminating treble
damages in these cases. The author dropped that bill just
before it was set to be heard in this Committee. Like AB 992,
this bill would have the effect of substantially reducing
damages cause by a fire that was not intentionally set. (See
Kelly v. CB & I Constructors (2009) 179 Cal. App. 4th 442
(holding that fire damage constitutes injury to trees and
subjecting the defendant to double damages.) If a fire is
intentionally set, damages to timber would remain at three times
actual damages. If a fire is negligently set, under this bill,
it appears that damages would be limited to actual damages (a
reduction of 50 percent from current law), unless the property
owner intended to make commercial use of the timber, in which
case damages would be two times actual damage (the same as
current law).
Bill Reduces Damages, But Not Necessarily Punitive Damages . The
sponsor argues that this bill is necessary to protect its
insureds who cannot get insurance to cover punitive damages and
that the damages reduced by this bill are punitive damages. As
a general rule, an "insurer is not liable for a loss caused by
the wilful act of the insured." (Insurance Code Section 533.)
"The policy of this state with respect to punitive damages would
be frustrated by permitting the party against whom they are
awarded to pass on the liability to an insurance carrier."
(City Products Corp. v. Globe Indemnity Co (1979) 88 Cal. App.
3d 31, 42).)
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However, this bill does not seek to reduce damages caused by a
wrongdoer's willful or intentional acts - the punitive damages
under this bill. Those damages remain at three times actual
damages under this proposal. Rather this bill seeks to reduce
damages caused by a wrongdoer's negligent, casual or involuntary
acts.
The court in Ostling v. Loring (1994) 27 Cal. App. 4th 1731 best
explained the damages under the two provisions that this bill
seeks to amend:
"So, the effect of section 3346 as amended, read together
with section 733, is that the Legislature intended, insofar
as wilful and malicious trespass is concerned under either
section, to leave the imposition of treble damages
discretionary with the court, but to place a floor upon
that discretion at double damages which must be applied
whether the trespass be wilful and malicious or casual and
involuntary, etc. There are now three measures of damages
applicable to the pertinent types of trespass: (1) for
wilful and malicious trespass the court may impose treble
damages but must impose double damages; (2) for casual and
involuntary trespass, etc., the court must impose double
damages; and (3) for trespass under authority actual
damages."
(Id. at 1742 quoting Drewry v. Welch (1965) 236 Cal. App. 2d
159, 181 (footnotes omitted, italics in original).) Unlike
punitive damages that may not be covered by insurance policies,
the damages reduced (or possibly eliminated) by this bill appear
to be coverable. Thus, this bill may reduce damages paid by
individuals, particularly if they are uninsured, but it will
also likely reduce payouts required from insurance companies.
ARGUMENTS IN SUPPORT : In support of the bill, the sponsor PIFC
writes that existing law creates:
�S]ignificant coverage problems for insureds who have done
nothing intentional but who, nevertheless, are held
responsible for the punitive part of the damages. The PIFC
member companies are witnessing a growing trend wherein our
insureds fall victim to cash-strapped cities, or attorneys
representing claimants who are looking for a way to
maximize recovery. These claimants routinely demand - and
courts award - double or treble damages. Because punitive
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damages are uninsurable in California, the insurer pays
only the actual damages, putting the insured in the
position of having to pay for the often sizeable additional
damages assessed.
For damages caused by negligent conduct, the measure of
damages is generally the amount which will compensate for
all the detriment proximately caused thereby (Civil Code
3333) The basis for an award of punitive damages is
behavior that shows oppression, fraud or malice. (Civil
Code 3294) Requiring punitive damages to be awarded for
negligent damage to trees violates the public policy of
reasonable damage awards, set forth in Civil Code section
3359.
We believe that AB 2071 is a fair measure that allows for
proper compensation for actual damages in those
circumstances where our insured's negligent act causes
unintentional damages to trees. Punitive damages for those
that intentionally harm trees will remain in place.
ARGUMENTS IN OPPOSITION : The Consumer Attorneys of California
opposes the bill, stating:
In 2007, the Southern California "power line fires",
wrongfully caused by SDG & E Utilities, burned
approximately 300,000 acres of California land, including
1,100 homes and an untold number of trees. AB 2071 would
dramatically reduce the existing long-standing right of
California landowners to recover damages for the wrongful
destruction of trees. The provisions of AB 2071 would only
serve to insulate wrongdoers from liability for full
compensation for damages caused by irresponsible and
negligent action.
AB 2071 amends two code sections that relate to the rights
of property owners to recover damages for the wrongful
destruction of trees on their property. Existing Code of
Civil Procedure Sec. 733, enacted in 1872, provides for
recovery by the owner of land, including a city or town,
for treble damages for the cutting down or carrying off any
wood or underwood without lawful authority. Existing Civil
Code Sec. 3346, which was enacted in 1957, holds a
defendant who trespasses on the land of another responsible
for two times the actual damages to trees resulting from
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the trespass if the trespass was "involuntary or casual."
Sec. 3346 was patterned after the virtually identical
Oregon Revised Statutes Sec. 105.815.
In applying this statute in Oregon, the Oregon Supreme
Court clarified that this measure of damages "granted �the
victim] an accumulative recovery so that he would have
something left in his pocket after he had discharged the
expenses of the litigation." Kinzua Lumber Co. V. Daggett
(1955) 203 Ore. 585 at 606. California Courts have applied
Sec. 3346 to tree damages in fire cases, holding that "tree
damage caused by a negligently spread fire is wrongful
injury to trees caused by a trespass subject to mandatory
doubling pursuant to Civil Code Sec. 3346." Kelly v. CB &
I Constructors, Inc. (2009) 179 Cal.App.4th 442, 450-453.
Due to this, the current provisions of Sec. 3346 are
particularly important to ensure the fair recovery of
damages by victims of wrongfully set fires. The law also
serves as a proper incentive to utilities, railroads, and
other commercial interests not to cause wildfires. Fires
claim lives, level homes and leave their victims in
desperate need of assistance. The law can only do so much
to assist these affected parties, but the doubling of
damages for the destruction of trees remains an important
component of the remedy for the thousands harmed by the
2007 San Diego fires, many who remain uncompensated, as
litigation is ongoing. Civil Code Sec. 3346 recognizes
that the path to recovery is laden with unanticipated
expenses and sizeable legal fees. The doubling ensures
that there is fair compensation after attorney's fees and
the loss of the plaintiff's own time are taken into
account.
AB 2071 protects the entities that cause wildfires at the
expense of everyone else. Under AB 2071, mandatory double
damages would remain if the landowner intended to make
commercial use of the wood, but those damages would not be
available for the rest of society. This would, of course,
include large tracts of land held for conservation purposes
and land owned by the State. In fact, State lands are
frequently subject to the ravages of negligently spread
fires. AB 2071 would affect the ability of the State to
recover when our precious State resources are burned.
Since the intentional cutting of someone else's trees or
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setting a fire intentionally is rare, the wrongdoers who
cause most of the harm to trees by wildfire will be free
from the restraints of the fair compensation purpose behind
this statute.
Additionally, the restriction of proposed Sec. 3346 to
"negligent" harm, rather than "wrongful injuries" in the
current Sec. 3346 would permit persons or entities
wrongfully setting wildfires to argue that the statute only
applies to negligence and does not apply to other common
law torts applicable to fire, such as trespass and
nuisance.
The changes to Code of Civil Procedure Sec. 733 are also
longstanding law that CAOC sees no need to amend. Sec. 733
serves as a deterrent to those who seek to rob natural
resources from landowners.
REGISTERED SUPPORT / OPPOSITION :
Support
Personal Insurance Federation of California (sponsor)
State Farm Insurance Companies
Opposition
Consumer Attorneys of California
Analysis Prepared by : Leora Gershenzon / JUD. / (916) 319-2334