County and municipal officials testified before the Maryland Senate Judicial Proceedings Committee yesterday in support of a bill that would bar punitive damage judgments against local governments, cap jury awards at $100,000 per incident in a successful suit and sharply restrict legal fees in those cases.
The measure was among those proposed by Gov. Harry Hughes in an effort to stem the rising cost of liability insurance premiums for local governments.
Yesterday was the second day of hearings on a package of more than two dozen bills submitted to the General Assembly this year aimed at addressing the problem of skyrocketing premiums for doctors, lawyers and day care center operators and other professionals.
Another bill reviewed by the committee would exempt officers of charitable organizations from lawsuits as long as the organization itself carries insurance of at least $300,000 per individual. Nonprofit groups supported the measure, hoping it would help day care centers -- many run by churches -- to obtain insurance.
"Local governments in Maryland and all across the country are suffering the effects of an insurance explosion," said Dr. Frances George, a Cheverly Town Council member and president of the Maryland Municipal League. "Why have government by crisis? We would like to respond before our cities go bankrupt, not after."
Representatives of the Trial Lawyers Association reiterated their argument that restrictions on the right to sue are morally wrong and would have no effect on the insurance problem. The real cure, they said, lies in tougher regulation of the insurance industry.
"It's just not morally right to say we're going to limit some kid whose life has been destroyed, to a family that faces economic ruin, and [to] say, no, we're not going to pay a tax increase to take care of you because the governments will only have to pay $100,000," said George Shadoan, a Bethesda lawyer, in a rebuttal of the proponents' arguments. "I hope you don't do that."