THE YEAR IN REVIEW 2007 SELECTED CASES FROM THE ALASKA SUPREME COURT, THE ALASKA COURT OF APPEALS, THE UNITED STATES SUPREME COURT, AND THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT INTRODUCTION The Alaska Law Review’s Year in Review is a collection of brief summaries of selected state and federal appellate cases concerning Alaska law. They are neither comprehensive in breadth, as several cases are omitted, nor in depth, as many issues within individual cases are omitted. Attorneys should not rely on these summaries as an authoritative guide; rather, they are intended to alert the Alaska legal community to judicial decisions from the previous year. The summaries are grouped by subject matter. TABLE OF CONTENTS ADMINISTRATIVE LAW......................................................................................................2 BUSINESS LAW..................................................................................................................13 CIVIL PROCEDURE...........................................................................................................14 CONSTITUTIONAL LAW....................................................................................................32 CONTRACT LAW...............................................................................................................42 CRIMINAL LAW................................................................................................................44 CRIMINAL PROCEDURE....................................................................................................61 ELECTION LAW................................................................................................................85 EMPLOYMENT LAW..........................................................................................................86 ENVIRONMENTAL LAW....................................................................................................91 ETHICS AND PROFESSIONAL RESPONSIBILITY................................................................92 FAMILY LAW....................................................................................................................93 HEALTH LAW.................................................................................................................107 INSURANCE LAW............................................................................................................108 PROPERTY LAW..............................................................................................................112 TORT LAW......................................................................................................................116 1 ADMINISTRATIVE LAW Alaska Supreme Court Alaska Trademark Shellfish, LLC v. State, Department of Fish & Game In Alaska Trademark Shellfish, LLC v. State, Department of Fish & Game,1 the supreme court held that statements made by the Alaska Department of Fish and Game, or its personnel, were insufficient to allow Alaska Trademark Shellfish (ATS) to harvest geoducks by promissory estoppel.2 ATS applied for state permits to allow it to engage in geoduck farming, believing that the permits would allow ATS to harvest wild geoducks on its farm sites.3 However, the Department denied the permits because ATS refused to agree not to harvest the protected wild geoducks.4 In a previous proceeding, the supreme court held that the Department lacked the statutory authority to grant any aquatic farmer the exclusive right to harvest wild stocks.5 Here, the supreme court concluded that the record contained no evidence that would permit an inference that the Department actually promised ATS that it could harvest the wild geoducks.6 The supreme court affirmed the superior court’s judgment for the State, holding that statements made by the Department or its personnel were insufficient to allow ATS to harvest geoducks by promissory estoppel.7 Bickford v. State, Department of Education & Early Development In Bickford v. State, Department of Education & Early Development,8 the supreme court held that the Alaska Department of Education had not violated the Individuals with Disabilities Education Act (IDEA) when it rejected an ambiguous complaint and required the resubmission of a clarified version.9 The mother of a learning- disabled child sent a complaint to the Department naming eight plaintiffs and listing twenty counts accusing the Anchorage School District of violating IDEA student- evaluation procedures.10 The document appeared to be drafted as a civil court document and did not specify where it was meant to be filed.11 The Department forwarded the complaint to the attorney general, and the assistant attorney general told the mother that she would have to clarify her complaint in order to resolve the procedural problems it presented.12 The supreme court determined that the Department’s dismissal of the original complaint was found to be proper because the complaint raised issues beyond the jurisdiction of the Department and was otherwise vague in its intended purpose.13 The 1 172 P.3d 764 (Alaska 2007). 2 Id. at 765. 3 Id. 4 Id. 5 Id. 6 Id. at 766. 7 Id. at 765. 8 155 P.3d 302 (Alaska 2007). 9 Id. at 304. 10 Id. at 305. 11 Id. 12 Id. at 306. 13 Id. at 304. 2 supreme court affirmed the superior court, holding that the Department had not violated IDEA when it rejected an ambiguous complaint and required the resubmission of a clarified version.14 City of Kotzebue v. State, Department of Corrections In City of Kotzebue v. State, Department of Corrections,15 the supreme court held that: (1) the city was entitled to partial reimbursement for the cost of housing prisoners, (2) the city’s claim for more expansive reimbursement of transportation costs was not ripe, and (3) the city must pay the state’s attorneys’ fees.16 Believing that its contract with the state to operate a jail caused unreasonable financial burdens, the city did not renew its contract with the state to operate the jail.17 Alaska state troopers failed to take custody of prisoners for a time after the contract had expired and the city was forced to open the prison, subsequently bringing suit to recover housing and transportation costs from the state for the time after which the contract expired.18 On appeal, the city argued that the state was liable to the city for prisoner housing costs and was also responsible for all transportation of prisoners, and that because Kotzebue was a public-interest litigant, it was not required to pay the state’s attorney’s fees.19 The supreme court held that (1) because the contract power of the Commissioner of the Alaska Department of Corrections was not coextensive with the Commissioner’s power to designate a jail a “correctional facility” for purposes of the statute, the city was entitled to the housing costs it incurred between the time the contract lapsed and the time the jail was no longer an authorized “correctional facility;” (2) because the state lost on the issue of transportation costs and did not appeal the issue, and because the city’s argument sought to regulate the department’s conduct outside of the city, the claim for broader transportation costs was not ripe; and (3) because the city was seeking significant compensation from the state, it had an economic interest in the litigation that made it ineligible for public-interest litigant status.20 The supreme court vacated and remanded the judgment of the superior court regarding housing costs but affirmed on all other grounds, holding that: (1) the city was entitled to partial reimbursement for the cost of housing prisoners; (2) the city’s claim for more expansive reimbursement of transportation costs was not ripe; and (3) the city must pay the state’s attorneys’ fees.21 Copeland v. State. Commercial Fisheries Entry Commission In Copeland v. State, Commercial Fisheries Entry Commission,22 the supreme court held that, under Alaska’s Commercial Fisheries Entry Commission’s (CFEC) regulations, the “unavoidable circumstance” exception is limited to circumstances where fishermen are prevented from fishing due to circumstances beyond their control.23 The 14 Id. at 313. 15 166 P.3d 37 (Alaska 2007). 16 Id. at 45–47. 17 Id. at 38–39. 18 Id. at 39. 19 Id. at 40, 45–46. 20 Id. at 45–47. 21 Id. 22 167 P.3d 682 (Alaska 2007). 23 Id. at 684. 3 CFEC denied Copeland’s application for a limited entry fishing permit.24 On appeal, inter alia, Copeland claimed he qualified for the CFEC’s “unavoidable circumstances” exception in 1970 because domestic issues kept him from fishing that year.25 After reviewing the record, the supreme court found that Copeland simply made a business decision not to fish that year based on fishing forecasts, and that nothing about his decision met the unavoidable circumstance clause’s requirements of uniqueness and unavoidability.26 The supreme court upheld all other aspects of the superior court’s decision.27 The supreme court affirmed the superior court, holding that under CFEC regulations, the “unavoidable circumstance” exception is limited to circumstances where fishermen are prevented from fishing due to circumstances beyond their control.28 Eagle v. State, Department of Revenue In Eagle v. State, Department of Revenue,29 the supreme court held that the narrow scope of federal preemption of state law did not extend past the explicit intent of the federal law in question.30 Eagle, a member of the United States Navy from 1986 to 2002, grew up in Alaska and made his last trip to Alaska in 1999.31 The state awarded Eagle a Permanent Fund Division (“PFD”) from 1986 to 1994, but refused to award Eagle a PFD in 1995 because he was no longer a resident, and he did not reapply until 2003.32 The court reasoned that the Federal Soldiers’ and Sailors’ Civil Relief Act explicitly protected servicemembers’ residency for tax and voting purposes, but did not establish residence for all purposes, and that Congress did not intend for the Act to do so.33 The supreme court affirmed, holding that the narrow scope of federal preemption of state law did not extend past the explicit intent of the federal law in question.34 Griffiths v. Andy’s Body & Frame, Inc. In Griffiths v. Andy’s Body & Frame, Inc.,35 the supreme court held that the Workers’ Compensation Board abused its discretion in dismissing as incomplete a claimant’s petition for modification where the claimant followed all instructions set out by the Board in its previous decision.36 Griffiths, an auto body repairman, developed carpal tunnel syndrome after working at Andy’s Body & Frame, Inc. for five years but was denied reemployment benefits because his employer’s medical examiner diagnosed no permanent partial impairment (PPI).37 The Board determined that the employee can seek modification of the decision if the employee is diagnosed with PPI.38 Griffiths 24 Id. at 683. 25 Id. at 683–84. 26 Id. at 684. 27 Id. at 683. 28 Id. at 684. 29 153 P.3d 976 (Alaska 2007). 30 Id. at 982. 31 Id. at 977. 32 Id. 33 Id. at 978–79. 34 Id. at 982. 35 165 P.3d 619 (Alaska 2007). 36 Id. at 624. 37 Id. at 620–21. 38 Id. at 621. 4 obtained a diagnosis of PPI and filed a petition for modification.39 The Board then determined that the petition violated modification procedures by failing to include a statement of due diligence as to why the diagnosis could not have been produced for the previous hearing, and dismissed the petition.40 Griffiths appealed, arguing that the Board’s first decision did not indicate that a statement of due diligence was required.41 Noting that Griffiths was representing himself at the time of the first order and that his interpretation of the order was reasonable under the circumstances, the supreme court held that the Board “violated Griffiths’s reasonable procedural expectations” by dismissing his petition.42 The supreme court vacated the Board’s decision, holding that the board abused its discretion in dismissing as incomplete a claimant’s petition for modification where the claimant followed all instructions set out by the board in its previous decision.43 May v. State, Commercial Fisheries Entry Commission In May v. State, Commercial Fisheries Entry Commission,44 the supreme court held that a commercial fisherman was ineligible to apply for a limited entry permit to the Southeast Alaska herring purse seine fishery.45 In 1977, May applied to the Commercial Fisheries Entry Commission (CFEC) for a permit to enter the fishery, arguing that his prior fishing activity in the Annette Island Reserve (AIR) qualified him.46 The CFEC denied his permit because prior fishing activity within AIR was not a basis for eligibility.47 May’s appeals and long periods of “delay and dormancy” kept his application open until December 2004, when May exhausted his appeals within the CFEC, and his application was denied.48 May appealed to the superior court, alleging equal protection and due process violations and that the CFEC was collaterally estopped from finding him ineligible because of a prior decision.49 The superior court affirmed the CFEC’s final decision on all points.50 May appealed to the supreme court, which held that, to the extent the CFEC’s decision to deny May’s application was inconsistent with a prior decision, the CFEC was not estopped because it explained its reasons for abandoning the prior decision and the prior decision was plainly erroneous.51 The court also held that May’s equal protection claim failed because he did not show intentional discrimination and that his due process claim was entirely without merit.52 The supreme court affirmed the superior court, holding that a commercial fisherman was ineligible to apply for a limited entry permit to the Southeast Alaska herring purse seine fishery.53 39 Id. at 621–22. 40 Id. at 623. 41 Id. 42 Id. at 624 43 Id. 44 168 P.3d 873 (Alaska 2007). 45 Id. at 887. 46 Id. at 877. 47 Id. 48 Id. at 879. 49 Id. 50 Id. 51 Id. at 882–83. 52 Id. at 884–85. 53 Id. at 887. 5 May v. State, Commercial Fisheries Entry Commission In May v. State, Commercial Fisheries Entry Commission54 the supreme court held that substantial evidence did not support the Commercial Fisheries Entry Commission’s (CFEC) finding that May was ineligible for an entry permit for longline fishing, but that substantial evidence did support the CFEC’s decision that he was ineligible for a pot fishery permit.55 May’s applications for entry permits in the longline and pot fisheries were denied, and, after appeals, the CFEC issued its final ruling which denied his applications and found that he lacked standing to challenge the number of permits that were issued.56 May appealed to the superior court, which affirmed the CFEC’s decision.57 The supreme court held May’s eligibility for a longline fishing permit was supported by substantial evidence, and he therefore also had standing to challenge the maximum number of longline fishing permits issued.58 The supreme court further held that substantial evidence supported the CFEC’s determination that he was ineligible for a pot fishing permit and therefore lacked standing to challenge the number of pot fishing permits issued.59 The supreme court revered the superior court and remanded the case, holding that substantial evidence did not support the CFEC’s finding that MAY was ineligible for an entry permit for longline fishing, but that substantial evidence did support the CFEC’s decision that he was ineligible for a pot fishery permit.60 Pasternak v. State, Commercial Fisheries Entry Commission In Pasternak v. State, Commercial Fisheries Entry Commission,61 the supreme court held that the Commercial Fisheries Entry Commission (CFEC) properly set the maximum and optimum number of fishery permits at seventy-three,62 and advice that Pasternak’s equipment was inappropriate for the fishery did not constitute extraordinary circumstances.63 Pasternak applied for a permit to a sablefish fishery from the CFEC and was denied because his point total was insufficient.64 Pasternak then appealed to the district court, arguing that the CFEC set the number of available permits too low and that he should have been awarded points for extraordinary circumstances, but the district court upheld CFEC’s decision.65 The supreme court explained that Pasternak’s first argument was foreclosed because seventy-three was an appropriate maximum and optimal number of entry permits.66 Next, the court rejected Pasternak’s argument that advice he received from other people that his equipment was not strong enough for sablefish in 1983 constituted extraordinary circumstances because Pasternak made no 54 175 P.3d 1211 (Alaska 2007). 55 Id. at 1222. 56 Id. at 1213–15. 57 Id. at 1215. 58 Id. At 1216–21. 59 Id. at 1221–22. 60 Id. at 1222. 61 166 P.3d 904 (Alaska 2007). 62 Id. at 908, 909. 63 Id. at 910. 64 Id. at 906. 65 Id. at 906–07. 66 Id. at 907–09. 6 attempt to fish that year and did not make all reasonably possible efforts to participate.67 The supreme court of Alaska affirmed the district court, holding that the CFEC properly set the maximum and optimum number of fishery permits at seventy-three,68 and advice that Pasternak’s equipment was inappropriate for the fishery did not constitute extraordinary circumstances.69 Powercorp Alaska, LLC v. State, Alaska Industrial Development & Export Authority In Powercorp Alaska, LLC v. State, Alaska Industrial Development & Export Authority,70 the supreme court held that the Alaska Energy Authority did not violate its authority by requiring bidders to use a specific operating system.71 The Alaska Energy Authority (Authority) had a program to provide electricity to rural communities.72 The program included upgrading the switchgear system, and the Authority preferred the PLC operating system for the switchgear system.73 Powercorp was unable to bid for upgrading the switchgear system because the Authority required all bidders to use the PLC system, whereas Powercorp used a different operating system.74 Powercorp protested the invitation to bid because of the Authority’s demand of the PLC system, and asked that the bidding be delayed until the PC operating system that it used could be evaluated and compared.75 Powercorp’s request was denied, and Powercorp appealed to an independent hearing officer, who ultimately found that the Authority did not abuse its discretion.76 Powercorp then appealed to the superior court, which affirmed the decision.77 On subsequent appeal, the supreme court held that the rational basis standard should be used in deferring to the agency’s decision-making.78 The supreme court found that the hearing officer carefully investigated the law and evidence when deciding both that the agency was allowed to prefer one operating system over another and that the Authority had a rational basis for its preference.79 The supreme court affirmed the superior court’s decision, holding that the Alaska Energy Authority did not violate its authority by requiring bidders to use a specific operating system.80 Pruitt v. City of Seward In Pruitt v. City of Seward,81 the supreme court held that the doctrines of exhaustion of administrative remedies and collateral estoppel did not bar a building owner from appealing the zoning commission’s denial of a permit to build a canopy.82 67 Id. at 909–10. 68 Id. at 908, 909. 69 Id. at 910. 70 171 P.3d 159 (Alaska 2007). 71 Id. at 161. 72 Id. at 161–62. 73 Id. at 162. 74 Id. 75 Id. 76 Id. at 162–63. 77 Id. at 163. 78 Id. at 164. 79 Id. at 165. 80 Id. at 161. 81 152 P.3d 1130 (Alaska 2007). 82 Id. at 1132–33. 7 After Pruitt built a canopy in violation of the city's decision denying him a variance, the city brought a successful enforcement action against Pruitt in superior court.83 On appeal, Pruitt argued that the city's interpretation of section 15.10.140 of the Seward City Code is not supported by the text of the ordinance.84 The city argued that Pruitt was barred from defending against the enforcement action by the doctrines of exhaustion of administrative remedies85 and collateral estoppel.86 The supreme court held that neither doctrine applied because the city did not give Pruitt notice that its decision was final87 and because the city’s decision denying the variance did not require it to resolve whether or not the canopy violated the zoning restrictions.88 The supreme court further held that, because the city denied Pruitt an appeal and the zoning code is ambiguous, the superior court should have given Pruitt the opportunity to appeal the zoning commission's interpretation of §15.10.140 directly to the commission.89 The supreme court vacated and remanded, holding that the doctrines of exhaustion of administrative remedies and collateral estoppel did not bar a building owner from appealing the zoning commission’s denial of a permit to build a canopy.90 Pyramid Printing Co. v. State, Commission for Human Rights In Pyramid Printing Co. v. State, Commission for Human Rights,91 the supreme court held that the Alaska State Commission for Human Rights’ award of backpay and vacation pay and order of sexual harassment training was appropriate in a sexual harassment case, but that the interest awarded was excessive.92 Tiernan, a former employee at Pyramid Printing Company, quit her job with the company after repeated incidents of inappropriate behavior directed towards her by Pintar, the owner’s son.93 After leaving the company, Tiernan filed a claim for sexual harassment with the Alaska Department of Labor. During the hearing with the Department of Labor, the Pintars offered Tiernan her job back, but she rejected the offer of re-employment.94 After the Department of Labor denied Tiernan’s benefit claims because she left the job voluntarily and without good cause, she filed a claim with the Human RightS Commission.95 The Commission awarded Tiernan damages with interest at 10.5% and also required Pyramid to adopt written policies on discrimination and provide annual training.96 Pyramid appealed the decision.97 Despite the fact that Tiernan was offered reemployment with the company, she was reasonable to believe that the intolerable conditions had not changed, 83 Id. at 1132. 84 Id. at 1139. 85 Id. at 1135. 86 Id. at 1138. 87 Id. 88 Id. at 1138–39. 89 Id. at 1139–41. 90 Id. at 1141. 91 153 P.3d 994 (Alaska 2007). 92 Id. at 996. 93 Id. 94 Id. at 997. 95 Id. 96 Id. 97 Id. 8 and she was therefore not obligated to mitigate damages.98 The supreme court affirmed in part and vacated and remanded in part, holding that the Alaska State Commission for Human Rights’ award of backpay and vacation pay and order of sexual harassment training was appropriate in a sexual harassment case, but that the interest awarded was excessive.99 South Anchorage Concerned Coalition, Inc. v. Municipality of Anchorage Board of Adjustment In South Anchorage Concerned Coalition, Inc. v. Municipality of Anchorage Board of Adjustment,100 the supreme court held that the filing deadline set by section 21.30.050 of the Anchorage Municipal Code is discretionary and not mandatory.101 Neighboring landowners, organized as the South Anchorage Concerned Coalition, Inc. (Coalition), challenged a residential development.102 The plat was initially approved, and the Coalition’s subsequent appeal was filed past the deadline set by section 21.30.050(B) of the Anchorage Municipal Code and thus automatically denied.103 The record showed that both the Board of Adjustment and the clerk of court believed they had no discretion in hearing untimely appeals.104 The supreme court held that the language of section 21.30.050(B) of the Anchorage Municipal Code was directory, as opposed to mandatory, and therefore substantial compliance is acceptable absent significant prejudice to the other party.105 The court considered the serious, practical consequences of a mandatory time limit and the intention of the provision—to act as a guideline for the efficient conduct of public business.106 The Board of Adjustment thus has discretion to relax the filing deadline when it hears matter on appeal.107 The supreme court remanded the case to the Board of Adjustment and allowed the appeal to proceed, holding that the filing deadline set by section 21.30.050 of the Anchorage Municipal Code is discretionary and not mandatory.108 Smith v. University of Alaska, Fairbanks In Smith v. University of Alaska, Fairbanks,109 the supreme court held that in situations where causation is a medical issue, the Alaska Worker’s Compensation Board (Board) must explain its decision adequately enough to permit review of its application of legal rules and consideration of relevant evidence.110 Smith had a history of back problems when he injured himself working at the University of Alaska, Fairbanks power plant in 1999.111 A month later, he aggravated his back to the point that he needed 98 Id. at 999. 99 Id. at 1002–03. 100 172 P.3d 768 (Alaska 2007). 101 Id. at 773. 102 Id. at 770. 103 Id. 104 Id. at 770–71. 105 Id. at 771–72. 106 Id. at 772–73. 107 Id. at 773. 108 Id. 109 172 P.3d 782 (Alaska 2007). 110 Id. at 793. 111 Id. at 784. 9 emergency surgery, and later claimed his injury resulted from his work and filed for worker’s compensation.112 When the Board met, it heard evidence from lay people and physicians regarding the potential causes of Smith’s injury.113 Smith appealed after a number of Board and superior court decisions ultimately resulted in denying him worker’s compensation.114 The supreme court found that it was unable to determine (1) the extent to which the Board relied on the lay testimony115 and (2) whether the Board relied on an incorrect legal rule regarding causation.116 Without adequate findings from the Board, the supreme court was unable to render judicial review.117 The supreme court remanded the case to the Board to clarify its findings, holding that in situations where causation is a medical issue, the Board must explain its decision adequately enough to permit review of its application of legal rules and consideration of relevant evidence.118 State, Department of Administration v. Bachner Co. In State, Department of Administration v. Bachner Co.,119 the supreme court held that none of the factors in section 36.30.585(b) of the Alaska Statutes should be given determinative weight in deciding a proper remedy.120 Bachner and Bowers Investment Co. both protested their unsuccessful bids on a leasing contract with the Department, and, after losing there, appealed to the commissioner.121 The hearing officer decided that there had been serious deficiencies in the bidding process and that the proper remedy would be for the state to reimburse the companies for their proposal preparation costs.122 The companies appealed, arguing that the proper remedy should have been either a cancellation of the contract or rescoring.123 The supreme court rejected these arguments and stressed the difficulty in deciding the proper remedy in such situations as well as the hearing officer’s thorough analysis.124 The court also explained that no factor in section 36.30.585(b) of the Alaska Statutes should be determinative and that it was proper for the hearing officer to consider the state’s costs to the winning bidder if the bid was cancelled.125 The supreme court affirmed the decision of the hearing officer, holding that none of the factors in section 36.30.585(b) of the Alaska Statutes should be given determinative weight in deciding a proper remedy.126 State, Division of Corps., Business & Professional Licensing v. Platt 112 Id. at 785. 113 Id. at 785–86. 114 Id. at 787. 115 Id. at 789–90. 116 Id. at 791–92. 117 Id. at 793. 118 Id. 119 167 P.3d 58 (Alaska 2007). 120 Id. at 61–62. 121 Id. at 59–60. 122 Id. 123 Id. 124 Id. at 61–62. 125 Id. 126 Id. 10