BILL ANALYSIS SENATE COMMITTEE ON JUDICIARY S David Roberti, Chairman B 1993-94 Regular Session 3 5 X SB 35X (Kopp and Campbell) As Amended August 8, 1994 Hearing date: August 9, 1994 Civil Code GWW:rn VOID CONTRACTS -LONG TERM SETTLEMENT PAYMENTS TO A CHILD VICTIM OF SEXUAL ASSAULT- HISTORY Source: Los Angeles District Attorney's Office; Senator Campbell Prior Legislation: None Support: Unknown Opposition: None Known KEY ISSUE SHOULD ANY CONTRACT FOR THE PAYMENT OF MONEY TO A MINOR BY THE šALLEGED PERPETRATOR OF AN UNLAWFUL SEX ACT ON THAT MINOR, WHICH IS šENTERED INTO ON OR AFTER THE TIME OF THE ALLEGED UNLAWFUL SEX ACT, šAND WHICH PROVIDES FOR ANY PAYMENTS TO BE MADE MORE THAN ONE YEAR šAFTER THE DATE OF THE EXECUTION OF THE CONTRACT, BE VOID AS A šMATTER OF LAW? PURPOSE Existing law provides that certain contracts are void as contrary to public policy. This bill would make void as a matter of law any contract for the špayment of money by the alleged perpetrator of an unlawful sex act šon a minor to that minor or his or her representative, which is šentered into on or after the time of the alleged unlawful sex act, šand which provides for any payments to be made more than one year šafter the date of the execution of the contract. (More) SB 35X (Kopp and Campbell) Page 2 The bill would authorize a district attorney to bring an action or šintervene in any action to enjoin enforcement of any contract which šviolates this policy. It would also make it punishable as a šmisdemeanor for any parent or guardian of such a child who enters šinto such an agreement on behalf of that child, and any alleged šperpetrator of an unlawful sex act upon that child who enters into šsuch an agreement. The misdemeanor would be punishable by at least š30 days in jail and up to 6 months, or by a fine of at least $100 šand up to $1000, or by both fine and imprisonment. The prohibition would not apply to contracts providing for long šterm payments from a irrevocable trust established for the šbenefit of the minor if the alleged perpetrator has no direct or šindirect access to, or control over, the trust. It would not not šapply after the date of the final judgment in a criminal case šagainst the alleged perpetrator for the alleged unlawful sex act. The purpose of this bill is to prohibit contracts or tort šsettlement agreements from being used to prevent the minor victim šfrom testifying about the crime. COMMENT 1. Stated need for bill According to the sponsors, this bill is necessary "to prevent the compromise of a civil damages claim from inappropriately interfering with the criminal justice process. The innocent need to be protected from extortion and alleged perpetrators need to be prevented from avoiding criminal prosecution by offering financial incentives to discourage testimony." SB 35X, asserts the sponsor, would prevent sexual assault perpetrators using long-term payments in settlement of a tort claim for the sexual assault to coerce the child victim to not testify about the assault. 2. Misdemeanor penalty for entering into such contract In addition to making such contracts void as a matter of public policy, SB 35X would also punish the legal parties entering into such agreement. Proponents contend that a possible jail sentence is necessary to discourage the parents or guardian of the child victim from being used to influence a child's decision to testify in a criminal proceeding. The bill would require a mandatory minimum sentence of at least 30 days in jail or a mandatory minimum fine of $100, or both. SHOULD NOT COURTS RETAIN DISCRETION IN SENTENCING? (More) SB 35X (Kopp and Campbell) Page 3 The mandatory minimum fine of $100 seems to be an infinitesimal amount, compared to the potential gains from a large settlement. SHOULD INSTEAD THE PROCEEDS OF THE ILLEGAL CONTRACT BE SUBJECT TO DISGORGEMENT, WITH THE FUNDS PAYABLE TO THE CHILD WELFARE FUND? 3. Balancing victim's civil rights vs. state's prosecutorial interest This bill seeks to balance a child victim's tort rights with the interest of the state to prosecute sex offenses. The bill would not affect lump sum settlements of civil actions. Nor would it affect settlements establishing an irrevocable trust to make the payments. In both instances, there is no real or implied threat that the payments will be stopped if the child decides to testify. 4. Possible issues for clarification The bill would apply in cases where a minor has been alleged to be a victim of an unlawful sexual act. Several points may benefit from clarification. SHOULD THE TERM "UNLAWFUL SEXUAL ACT" BE SPECIFICALLY DEFINED? WOULD THE TERM INCLUDE "PUBLIC EXPOSURE"? WOULD THE PROHIBITION APPLY TO EITHER OR BOTH A CRIMINAL OR CIVIL ALLEGATION OF AN UNLAWFUL SEXUAL ACT AGAINST AN MINOR? Potentially, a case may occur where a parent is accused of molesting his or her child, and would be required to make child support payments upon a divorce or separation. The proposed language could be read to prohibit long-term support payments in that instance. SHOULD NOT THIS MATTER BE CLARIFIED? 5. Identical measure As amended August 8, SB 35X is identical to SB 1692 (Campbell). That measure has been shelved and Senator Campbell has joined Senator Kopp as joint author of SB 35X. ********* SB 35X (Kopp and Campbell) Page 4