Bill Protects Little Guy From Y2K Problems Won’T Be Penalized; Another Bill Limits State Liability

State lawmakers are expecting that Washington citizens will survive Y2K - if only to sue each other.

Sponsors of two bills in the Legislature are attempting to brace the public and the courts for a litigation shakedown from the predicted year 2000 computer meltdown.

Billed as a “Citizens Protection Act,” Sen. Dan Swecker, R-Rochester, has proposed a bill that will protect the “little guy” from lawsuits emerging from a Y2K computer glitch.

“This bill will reassure the public that they won’t be penalized because of Y2K problems that were out of their control,” he said.

Swecker’s proposal, one of five similar bills in the nation, focuses on the possibility that the public will not be able to meet financial obligations because of the Y2K bug.

For instance, if bank computers fail to recognize a payroll deposit, many people would be unable to pay their mortgage, insurance, rent or other obligations.

Under the proposal, people would be required to pay their bills as soon as the Y2K problem that created the delay is fixed.

Some people predict economic and societal disruptions beginning Jan. 1, 2000, when some computers think it’s actually the year 1900.

Stephanie Floth of Rochester, Wash., is worried she could lose her home if the bank can’t collect her mortgage payment.

“I’m not willing to lose my house over this,” said Floth, who testified in favor of the legislation. “We’ve worked very hard to achieve excellent credit.”

Floth and her husband have a fully-automated system to pay their mortgage lender in Arizona. In addition, she’s worried that if a Y2K problem hits the post office, she won’t even be able to mail the monthly payment.

Swecker’s proposal would protect the Floths from losing their home or being sued by their lender because their bank encountered a Y2K problem.

While Swecker’s bill would protect individuals, a second bill in the House is aimed at protecting the state.

Except in the event of personal injury, the bill proposed by Rep. Renee Radcliff, R-Mukilteo, would hold the state responsible for only its portion of the damages in a Y2K lawsuit.

If passed, Washington would be the sixth state with a “limited liability” law protecting the state purse.

Currently, if the state is a defendant in a lawsuit, it can be responsible for “joint” liability with any co-defendants. If the other defendants can’t pay, the state pays what’s due.

“If we are the only entity not going out of business then the taxpayers are responsible for 100 percent of the liability,” said Chris Hedrick, the governor’s adviser on technology.

“The state is practicing due diligence in preparing for Y2K,” Radcliff said. “There is not any willful misconduct and I think that changes the complexion of liability, somewhat,” she said. Radcliff proposed the bill at the request of Gov. Gary Locke.

The House Judiciary Committee passed Radcliff’s bill, but a companion measure in the Senate died because lawmakers were concerned about treating the state differently than other businesses.

“The state should have the same liability as any other corporation, city or institution,” said Senate Judiciary chair Michael Heavey, D-Seattle, before killing the bill.