SB 691 – Modifies provisions regarding insurance coverage of the cost to defend a claim in an administrative proceeding, proposed administrative rules affecting real property, and procedures for judicial review of state agency actions

• Sponsor: Emery
• LR Number: 4028S.01I
• Committee: Judiciary and Civil and Criminal Jurisprudence
• Last Action: 2/19/2018 - Voted Do Pass S Judiciary and Civil and Criminal Jurisprudence Committee
• Effective Date: August 28, 2018

Current Bill Summary

SB 691 - This act provides that an insurer issuing commercial casualty insurance policies must cover costs associated with the defense of certain claims made in administrative proceedings, as defined in the act. The payment of the defense costs is in addition to the limit of liability.

Currently, if an agency proposes a rule that affects the use of real property, the agency must have a takings analysis performed. This act provides that such analysis shall be performed by the Attorney General's office and removes the provisions providing that an analysis is not necessary where the rule is federally mandated or where the rule codifies existing law.

The act also modifies provisions regarding the award of fees and expenses to the prevailing party in an agency proceeding or civil action arising from an agency proceeding. The act repeals the requirement that a prevailing party must have a net worth of under two million dollars or own a business with a net worth not exceeding seven million dollars in order to qualify for an award of fees and expenses. The court or agency may award the expenses and fees only if the court finds that the agency acted in ways as provided in the act, which include violating constitutional provisions, acting arbitrarily, or abusing discretion, or if the agency action was not substantially justified.

Additionally, the act modifies provisions regarding judicial review of agency decisions in contested cases. When hearing a case, the court shall, rather than may, make a determination of whether the agency action violated the constitution, exceeded statutory authority, was unsupported by evidence, was unauthorized by law, was arbitrary, capricious or unreasonable, or abused discretion. If the court finds that the agency did not act in such a way, then the court shall affirm that agency's action.

Currently, the court may conduct a de novo review only when the action being reviewed is the application of the law to the facts and does not involve agency discretion. This act states that any party, other than the agency, may apply for de novo review. The de novo review may be conducted before a jury.

This act is substantially similar to SB 448 (2017).

JESSI JAMES