On July 28-29, I attended the Cannabis Law Institute (http://www.canbar.org/cli/), held at the University of Denver Sturm College of Law. This conference and continuing legal education event was put on by the National Cannabis Bar Association and the Sturm College of Law. This event provided an opportunity for all attendees (including practitioners, academics, and policy advocates) to engage with one another and learn more about developments in marijuana law and policy, best industry practices, and to identify and discuss emerging issues.
I was invited to provide a perspective on Alaska marijuana law as part of a panel discussion titled The Laws and Regulatory Systems of the Western States. My presentation included a history of marijuana regulation in Alaska, an overview of Alaska’s current regulatory and licensing framework, and a discussion of the unique challenges and controversies the industry faces in Alaska, such as lack of access to banking services and transportation difficulties faced by marijuana businesses that are “off the road system.” In addition to giving a presentation, I was able to attend seminars that covered a variety of topics, including business law issues, legal ethics, constitutional implications of marijuana legalization, federal oversight of state marijuana industries, and updates on the marijuana laws of other states.
Birch Horton Bittner & Cherot (“BHBC”) is fast approaching its 50th anniversary. At a time when many established firms in Anchorage are closing their doors, I can’t help but appreciate how far we have come, and that we are still hard at work for our clients.
Joining with Bill Jermain, “Birch and Jermain” first opened its doors above a sporting goods store on 4th & K Street on February 1, 1971, a second story walkup two-bedroom apartment converted into a small law office (the Keyboard Lounge was later located in the same building). Within two years, Hal Horton, Bill Bittner, and Suzanne Cherot joined this great adventure, contributing to the firm’s success and rapid growth. By 1975, the firm had offices in Anchorage, Fairbanks, Juneau and Washington D.C. While Bill Jermain left to start his own firm in 1976, Hal, Suzanne, Bill and I opened our office building in Anchorage in 1978, where the firm remained for nearly 40 years until moving to its new location at 510 L Street.
The influence this firm has had on the legal landscape for Alaska has been remarkable. We have spawned trial and appellate judges, a U.S. Senator, and numerous excellent attorneys practicing in Alaska and beyond. It is a point of great pride that the firm’s attorneys have worked together on behalf of Alaska and its residents for over 45 years.
Among our major cases, we were retained by the State of Alaska to litigate the D-2 battle; we appeared before the Court of Claims arguing that precluding export of Alaska’s oil constituted a taking; and challenging the validity of the export ban as being in derogation of the Commerce Clause found in the United States Constitution. Each of these issues was eventually legislatively resolved, and the firm played a major role in working with the Alaskan Congressional Delegation to implement the resolutions.
Equally important, we have worked with Alaskans and Alaska’s business community on their continuing evolution and success, including Alaska Native Corporations and the unique SBA 8(a) program, Teamsters members, injured Alaskans, municipal governments, and leaders in industry, big and small, including telecommunications, natural resources, construction, healthcare, commercial real estate and housing. We truly have used our expertise to help the development and growth of Alaska.
Through the years our client base has expanded to the Lower 48, but we have never lost sight of the fact that Alaska is our base and our home. Virtually every member of the D.C. office is a member of the Alaska bar. The firm’s credo has always been to do justice, and as we enter our 47th year, the items I cherish most are the letters of thank you from people we have been able to help.
There is a horror scene in the Hitchcock movie “The Birds” which begins ominously in a restaurant in Bodega Bay, California. Tippi Hedren has driven up from San Francisco to bring a pair of lovebirds to a handsome stranger she met once in a pet store. (I have been told that this is how people “courted,” prior to the internet.) In the restaurant, locals are heatedly discussing the aggressive bird behavior that has been plaguing the town since Tippi’s arrival, but the debate ends when seagulls begin attacking people outside of the restaurant. A gas station attendant is knocked unconscious while filling a car; the gas spills into the street; a man not paying much attention (and you knew this was coming) attempts to light a cigar, and the pool of gas is ignited, ultimately causing the station to explode. The crowd ultimately blames Tippi for the disaster.
Poor Tippi. But imagine that you are the owner of the gas station, and you are trying to explain the sequence of events to your insurer. Does my insurance cover this loss? The answer will be dependent upon the cause of the loss. Was it fire? The inattentive cigar smoker? Or was it . . . the birds? (Alaskans know better than to discount frolicking animals as a source of damage, such as that time the damage was caused by a bear) (or that other time) (and that almost-other time).
The gas station’s insurer might respond that the station’s policy covers one cause, such as fire (a “covered peril”), but not another, such as aggressive bird behavior (an “excluded peril”). And this situation is not all that uncommon. For instance, in the aftermath of Hurricane Katrina, many Gulf Coast residents’ homes suffered damage caused by a combination of wind and water. When they turned to their insurance companies to provide compensation for their losses, some found their policies covered damage caused by wind but excluded damages caused by flooding or water. How is coverage determined in such cases?
Under the efficient proximate cause rule, if a loss is caused by several different perils, the loss will be covered if the efficient proximate cause was a covered peril. How to determine which peril is the efficient proximate cause? Over the course of the last century, courts have used three general tests:
What was the cause “nearest the loss”? (in Tippi’s case, the fire);
What was the cause that triggered the loss? (in Tippi’s case, the birds); and
What was the cause most at fault? (what do you think?)
While states vary widely on which test they use to define the efficient proximate cause, Alaska follows this third test, called the “apportionment test,” to determine the efficient proximate cause of a loss. So, if a policy covers the main (or “predominant”) cause of a loss, then the policy will be deemed to cover the loss, even if another excluded cause is also a contributing factor.
Not every state follows this rule. In response to courts using efficient proximate cause to determine coverage, some insurance companies started incorporating “anti-concurrent clauses” in their policies. These clauses tried to work around efficient proximate cause by excluding coverage of an otherwise covered peril where an excluded peril was also at fault – regardless of which peril was the predominate one. But insureds in Alaska are protected from these anti-concurrent clauses through legislation. Alaska AS 21.36.096 (“Prohibited denial of claim for causation”) provides:
An insurer may not deny a claim if a risk, hazard, or contingency insured against is the dominant cause of a loss and the denial occurs because an excluded risk, hazard, or contingency is also in a chain of causes but operates on a secondary basis.
So, in Alaska, where there are concurrent causes of a loss, an insurance company is not allowed to deny coverage if the predominant cause is covered. More information about insurance coverage limitations and consumer protections for Alaskans can be found at the Department of Commerce, Community, and Economic Development’s Division of Insurance.
Insurance coverage issues can be complicated, particularly when a loss may be attributable to several different factors. But we like working on complicated coverage issues at Birch Horton. So whether you or your company has been affected by a loss attributable to birds, bears, or hurricanes, we are there to help you work through these issues and to achieve the best result for you.
And for more information on Alfred Hitchcock, Bodega Bay, and Hurricane Katrina, I suggest the following:
2017-06-20T22:40:26+00:00 June 20th, 2017|
Written By: Elisabeth Ross
On Thursday, June 15, 2017, Senator Lisa Murkowski met with BHBC client Denis McCarville, Chief Executive Officer of AK Child and Family, and BHBC attorney Elisabeth Ross in Senator Murkowski’s Washington DC office. The Senator has been a long-time supporter of AK Child’s mission and programs, which are designed to aid children and their families who have suffered challenging trauma.
AK Child has partnered with Alaska Communications to use telehealth technology creatively to reach youth in rural Alaska villages – to provide counseling before issues reach a crisis level where the child has to leave his/her home and community for residential treatment in Anchorage. AK Child uses Alaska Communications’ telecommunications services as a means to train foster parents and provide counseling for families and youth remotely. In this way, AK Child can reach more families and enable better outcomes for these children. This is just one example of the many rural health care providers Alaska Communications supports, using, in part, the resources of the FCC’s universal service program.
Denis McCarville, President and CEO of AK Child & Family and the Alaska Association of Homes for Children, visited…
With the deadline looming for the Alaska State Legislature to pass a budget for the next fiscal year, the Governor’s office and the executive branch are taking steps to prepare for the possibility that a deal will not be reached in time. What does this mean to the rest of us? BHBC serves clients in all areas of both the public and private sectors, including individuals, associations, business and state and local governmental clients. This article addresses the possible impacts of a state government shutdown.
State capitol building in Juneau. (Photo courtesy of Thom Watson on Flickr.)
The state government operates on a fiscal year that begins July 1 and ends June 30 of every year. Pursuant to Article IX, Section 12 of the Alaska Constitution, each year the Governor is required to submit an annual budget and appropriations bill for the upcoming fiscal year which must be approved by the Alaska State Legislature. As part of the separate of powers structured in the state constitution, Article IX, Section 13 of the Alaska Constitution gives the Legislature full control over the appropriations approval process. To date, the Legislature has not approved any department budgets or authorized any appropriations for the new fiscal year (FY18). The current legislative session ended earlier this spring; but with no budget in place, the Governor called a special session to continue until the Legislature adopts a budget to fund state government for FY18.
With an increasing budget deficit, due in large part to the State’s reliance on dwindling revenues from oil production, our elected representatives in Juneau are at an impasse on just how to cover that deficit and fund the Governor’s budget. If no agreement is reached by before July 1, funding authorization for state operations will expire and the government will be forced to “shutdown” until a budget is approved.
A full shutdown would be unprecedented in Alaska’s history. Consequently, there are a number of concerns and speculations as to how this affects the rest of us. Will the entire state shutdown? Will all state offices close? The answer is a large maybe. The most likely scenario is that many state employees will be temporarily laid off and programs and services will be suspended during that time while a skeleton crew of absolutely necessary personnel to avoid catastrophes remains in place. While definitive guidance has yet to be issued as to the specific events that would occur in the event of a shutdown, the Governor’s office and other executive branch officials recently issued notices of what could be possible.
The Department of Law also released a fact sheet explaining the Attorney General’s opinion that certain categories of government programs and services may continue during a shutdown. The DOL breaks this down into two categories:
First, “personnel and funding necessary to carry out constitutional mandates,” and
Second, “personnel and funding necessary to carry out federally mandated programs.”
These categories are further broken down into three tiers of priority:
Tier I addresses programs and services “that would lead to [an] immediate threat to public health or safety if interrupted.”
Tier II includes “constitutional and federal mandates that may only be delayed a short amount of time, if at all, before severe impacts would occur to the State’s people and economy.”
Tier III includes “constitutional and federal mandates that … could become urgent if a shutdown were to continue for too long.”
Tier I is fairly clear and addresses public safety and health concerns. This means that no, a shutdown does not mean you get to avoid a speeding ticket. State Troopers and State Wildlife Troopers will continue to enforce state laws and protect the public safety. However, the Department of Public Safety has indicated that a reduction in non-law enforcement personnel that could be required in the event of a shutdown could affect their services. Correctional facilities will remain in operation and courts will operate as needed to address public safety needs.
Tiers II and III, however, are worded broadly enough to make it less clear as to what might be approved to operate during a shutdown. Certainly, a shutdown will cause “severe impacts” on the State’s people and economy but this will not justify keeping all state programs and offices open without the necessary authorized appropriations from the State Legislature. Examples provided, however, are more narrowly tailored to public assistance programs, unemployment benefits and ensuring timely payments of bonded indebtedness. Tiers II and III are more focused on federal programs and less certainty exists surrounding state programs. Consequently, it is necessary to look at each state department, agency, or program affecting you most.
For business and corporate matters, the State Department of Commerce, Community and Economic Development has warned that services related to business and professional licensing, corporate compliance, as well as licensing and regulation of insurance, banking and services industries will likely be suspended. Commercial fishing loans processed by the Commerce Department would also be suspended. For our many business clients, this means there could be delays in processing license applications, potentially affecting your ability to carry on your business.
Processing of labor disputes, workers’ compensation and wage and hour claims, unemployment, as will as job training programs would likely be delayed or suspended by the Department of Labor and Workforce Development during a shutdown. Consequently, labor and employment matters may also have to be put on hold.
Real property and commercial transactions could be significantly impacted as well. The State Department of Natural Resources, which operates the State Recorder’s Office, could be shutdown, delayed, or significantly interrupted during a shutdown. Planning on closing a real estate deal, record a lien or UCC filing? You may not be able to after July 1st.
Issuance of marriage licenses and birth certificates through the Department Health and Social Services (DHSS) could be shutdown or delayed. In addition, inspections and regulatory oversight duties of DHSS over residential and healthcare facilities could also be impacted.
The Department of Environmental Conservation (DEC) warns the processing and issuance of permits and authorizations it oversees would also be significantly impacted. These include air and wastewater permits; water and sewer infrastructure projects, and oversight of cruise ships. The DEC is also responsible for the retail food inspection program, which would also be suspended.
At the height of our beloved Alaska summer season, more pressing concerns affecting your summer recreation plans are valid. A shutdown will likely mean a closure of state offices issuing hunting and fishing licenses, closure of state campgrounds and recreational areas, commercial fishing is also affected.
The Department of Natural Resources (DNR) has warned delays and interruptions will occur to issuing all DNR permits and authorizations, inspections, timber and/or land sales. Operations of state park lands, campgrounds and visitor centers will also likely be impacted.
The State Department of Fish and Game (ADF&G) has warned a shutdown could affect the state’s fisheries, including commercial, subsistence, personal use and sport fisheries. This has obvious impacts on the seasonal sport and commercial fisheries important to the State and local economies. State hunting seasons may be also be impacted. Most certainly, the ADF&G has warned the ability to process and issue state hunting and fishing licenses will be affected.
As this article illustrates, there are many uncertainties surrounding the possibility of a state government shutdown but there are real consequences to Alaskans, Alaskan businesses, and our economy should the Legislature and the Governor fail to find compromise on a budget plan. While this article generally addresses what could happen if no budget agreement is reached before the start of the next fiscal year, it is impossible to address individual situations. For more information regarding how the potential shutdown might affect your specific individual, business or other legal matter, please contact the author for more information.
Birch Horton Bittner & Cherot is proud to announce that Kathryn Black has been named to the 2017 “Alaska Super Lawyers” by Thomson Reuters and Super Lawyers magazine. This is Ms. Black’s 11th year to be listed. Each year, no more than five percent of the lawyers in the state are selected by the research team at Super Lawyers to receive this honor. Ms. Black has been listed in “Best Lawyers” since 2006 in the practice areas of corporate law and mergers and acquisitions.
Ms. Black’s practice consists of representation of financial institutions in all aspects of loan documentation and collections, including in-depth knowledge of bankruptcy, debtor/creditor rights, secured transactions, real estate financing, commercial loan documentation, foreclosures, repossessions, and the law of banking.
Super Lawyers, a Thomson Reuters business, is a rating service of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement. The annual selections are made using a patented multiphase process that includes a statewide survey of lawyers, an independent research evaluation of candidates, and peer reviews by practice area. The result Is a credible, comprehensive, and diverse listing of exceptional attorneys.
The Super Lawyers lists are published nationwide in Super Lawyers Magazines and in leading city and regional magazines and newspapers across the country. Super Lawyers Magazines also feature editorial profiles of attorneys who embody excellence in the practice of law. For more information about Super Lawyers, visit Superlawyers.com.