81st Legislative Session _ 2006

Committee: House Judiciary
Friday, February 03, 2006

                                            P - Present
                                            E - Excused
                                            A - Absent

Roll Call
P    Gillespie
P    Haley
P    Hennies
P    Jensen
P    Michels
P    Murschel
P    O'Brien
P    Roberts
P    Sebert
P    Tornow
P    Van Norman
P    Hunt, Vice-Chair
P    Cutler, Chair

OTHERS PRESENT: See Original Minutes

The meeting was called to order by Chair Cutler

MOTION:     TO APPROVE THE MINUTES OF FEBRUARY 1, 2006

Moved by:    Hunt
Second by:    Murschel
Action:    Prevailed by voice vote.

         HB 1210: adopt the revised Uniform Arbitration Act and to repeal certain provisions regarding arbitration.

Proponents:    Mark Marshall, self, Sioux falls
        Michael Demersseman, Rapid City, SD
        Randy Moses, Division of Insurance

        Thomas Barnett Jr., State Bar Of SD
Opponents:    Mike Shaw, Property and Casualty Insurance

MOTION:     AMEND HB 1210

1210ra
     On page 17, between lines 17 and 18 of the printed bill, insert:

"      Section 31. That § 21-25A-3 be amended to read as follows:

     21-25A-3.   This chapter does not apply to insurance policies and every provision in any such policy requiring arbitration or restricting a party thereto or beneficiary thereof from enforcing any right under it by usual legal proceedings in ordinary tribunals or limiting the time to do so is void and unenforceable. However, nothing in this chapter may be deemed to impair the enforcement of or invalidate a contractual provision for arbitration entered into between insurance companies or a policy issued to an exempt commercial policyholder as defined by §  58-24-68 . ".


     On page 17 , line 18, after " 21-25A-1 " insert ", 21-25A-2, and 21-25A-4".

Moved by:    O'Brien
Second by:    Hunt
Action:    Prevailed by voice vote.

MOTION:     AMEND HB 1210

1210rb
     On page 13, line 8 of the printed bill, delete everything after " Section 21. " .

     On page 13 , delete lines 9 to 24 , inclusive.

     On page 14 , delete line 1 .

Moved by:    Hunt
Second by:    Tornow
Action:    Failed by roll call vote.(5-6-2-0)

Voting Yes:    Gillespie, Jensen, Michels, Tornow, Hunt

Voting No:    Haley, Hennies, Murschel, O'Brien, Roberts, Cutler

Excused:    Sebert, Van Norman

MOTION:     DO PASS HB 1210 AS AMENDED

Moved by:    O'Brien
Second by:    Haley
Action:    Failed by roll call vote.(6-5-2-0)

Voting Yes:    Haley, Hennies, Murschel, O'Brien, Roberts, Cutler

Voting No:    Gillespie, Jensen, Michels, Tornow, Hunt

Excused:    Sebert, Van Norman

MOTION:     DO PASS HB 1210 AS AMENDED

Moved by:    Hunt
Second by:    Tornow
Action:    Prevailed by roll call vote.(7-6-0-0)

Voting Yes:    Haley, Hennies, Murschel, O'Brien, Roberts, Sebert, Cutler

Voting No:    Gillespie, Jensen, Michels, Tornow, Van Norman, Hunt

         HB 1135: revise certain provisions relating to domestic limited liability companies, domestic limited liability partnerships, and the appointment of certain agents.

Presented by:    Brittany Novotny, May, Adam Gerdes & Thompson
Proponents:    Chad Heinrich, Deputy Secretary of State
        Tom Barnett, State Bar Association of South Dakota

MOTION:     DO PASS HB 1135

Moved by:    Hunt
Second by:    Gillespie
Action:    Prevailed by roll call vote.(13-0-0-0)

Voting Yes:    Gillespie, Haley, Hennies, Jensen, Michels, Murschel, O'Brien, Roberts, Sebert, Tornow, Van Norman, Hunt, Cutler

MOTION:     PLACE HB 1135 ON CONSENT CALENDAR
Moved by:    Tornow
Second by:    Jensen
Action:    Prevailed by voice vote.

         HB 1159: define the business of abstracting.

Proponents:    Neil Fulton, Vermillion Title Company
        Chad Hansen, Dakota Homestead Title Insurance
        Steve Berndt, self
Opponents:    Chuck Schroyer, SD Land Title Assn.
        Mitch LaFleur, First American Title Co.
        Greg Wick, Pennington Title Co.
        Mike Wilde, Title Services Inc. Of SD

MOTION:     DEFER HB 1159 TO THE 36TH LEGISLATIVE DAY

Moved by:    Michels
Second by:    Hunt
Action:    Prevailed by roll call vote.(12-1-0-0)

Voting Yes:    Gillespie, Haley, Hennies, Jensen, Michels, Murschel, O'Brien, Roberts, Sebert, Tornow, Hunt, Cutler

Voting No:    Van Norman

         HB 1185: revise certain provisions regarding directed trusts to include custodial accounts.

Presented by:    Representative Tim Rave
Proponents:    Matt McCaulley, SD Trust Co.

MOTION:     AMEND HB 1185

1185jb
     On the printed bill, delete everything after the enacting clause and insert:

"
     Section 1. That § 55-1B-1 be amended to read as follows:

     55-1B-1.   Terms used in this chapter mean:

             (1)      "Instrument," any revocable or irrevocable trust document created inter vivos or testamentary or any custodial account agreement ;

             (2)      "Trust protector," any disinterested third party whose appointment is provided for in the trust instrument;

             (3)      Repealed by SL 2005, ch 260, § 2.

             (4)      "Fiduciary," a trustee or custodian under any testamentary or other trust instrument , an executor, administrator, or personal representative of a decedent's estate, or any other party, including a trust advisor, a trust protector, or a trust committee, who is acting in a fiduciary capacity for any person, trust, or estate;

             (5)      "Excluded fiduciary," any fiduciary excluded from exercising certain powers under the instrument which powers may be exercised by the grantor, custodial account owner, trust advisor, trust protector, trust committee, or other persons designated in the trust instrument;

             (6)      "Investment trust advisor," a fiduciary, given authority by the trust instrument to exercise all or any portions of the powers and discretions set forth in § 55-1B-10;

             (7)      "Distribution trust advisor," a fiduciary, given authority by the trust instrument to exercise all or any portions of the powers and discretions set forth in § 55-1B-11 ;

             (8)    "Custodial account," an account, established by a party with a bank as defined in 26 U.S.C. 408(n), as of January 1, 2006, or with another person approved by the Internal Revenue Service as satisfying the requirements to be a nonbank trustee or a nonbank passive trustee set forth in U.S. Treasury Regulations promulgated under 26 U.S.C. 408, that is governed by an instrument concerning the establishment or maintenance, or both, of an individual retirement account, qualified retirement plan, Archer medical savings account, health savings account, Coverdell education savings account, or any similar retirement or savings vehicle permitted under the Internal Revenue Code of 1986, as of January 1, 2006;

             (9)    "Custodial account owner," any party who establishes a custodial account; or has the power to designate the beneficiaries or appoint the custodian of the custodial account; or otherwise is the party who possesses the power to direct the investment, disposition, or retention of any assets in the custodial account or name an authorized designee to effect the same .

     Section 2. That § 55-1B-2 be amended to read as follows:

     55-1B-2.   An excluded fiduciary is not liable, either individually or as a fiduciary, for either of the following:

             (1)      Any loss that results from compliance with a direction of the trust advisor , custodial account owner, or authorized designee of a custodial account owner ;

             (2)      Any loss that results from a failure to take any action proposed by an excluded fiduciary that requires a prior authorization of the trust advisor if that excluded fiduciary timely sought but failed to obtain that authorization.

     Any excluded fiduciary is also relieved from any obligation to perform investment or suitability reviews and , inquiries, or investigations or to make recommendations or evaluations with respect to any investments to the extent the trust advisor , custodial account owner, or authorized designee of a custodial account owner had authority to direct the acquisition, disposition, or retention of any such investment.

     Nothing in subdivision (2) imposes an obligation or liability with respect to a custodian of a custodial account. ".

Moved by:    Michels
Second by:    Roberts
Action:    Prevailed by voice vote.

MOTION:     DO PASS HB 1185 AS AMENDED

Moved by:    Michels
Second by:    Sebert
Action:    Prevailed by roll call vote.(12-0-1-0)

Voting Yes:    Gillespie, Haley, Hennies, Jensen, Michels, Murschel, O'Brien, Roberts, Sebert, Tornow, Van Norman, Cutler

Excused:    Hunt

MOTION:     PLACE HB 1185 ON CONSENT CALENDAR

Moved by:    Michels
Second by:    Roberts
Action:    Prevailed by voice vote.

         HB 1152: establish damage claims procedures for certain claims against construction professionals.


Presented by:    Representative Hal Wick
Proponents:    Greg Brewers, AGC - Building Chapter
        Tim Dougherty, SD Home Builders Assn.
        Larry Ahrendt, Independent Insurance Agents Of SD
        Jeane Wharton, SD Home Builders Association
        Larry Zikmund, Associated General Contractors - Building Chapter
Opponents:    Roger Tellinghuisen, SD Trial Lawyers Association

The Chair deferred HB 1152 until Monday February 6, 2006.

The Chair deferred HB 1163 until Another day.

The Chair deferred HB 1203 until Monday February 6, 2006.

The Chair deferred HB 1230 until Monday February 6, 2006.

The Chair deferred HB 1231 until Monday February 6, 2006.

MOTION:     ADJOURN

Moved by:    Hunt
Second by:    Sebert
Action:    Prevailed by voice vote.

Diane Mellan

____________________________

Committee Secretary
Joni M. Cutler, Chair

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