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Message
from the President MESSAGE
FROM THE PRESIDENT These are exciting times for the Conference. We are continuing to move forward on the international front, and there are some recent developments that I would like to report to you. First, a joint meeting was held in March between members of the Conference, the Uniform Law Conference of Canada, and the Mexican Center for Uniform Laws, to discuss a joint project to create a Harmonized Legal Framework for Unincorporated Nonprofit Associations in North America. At this meeting, the members of this joint project discussed the specific principles that should be included in the harmonized framework. The members will meet again in the fall. This project should result in three “national drafts” – one each for the U.S., Canada, and Mexico – that will implement the principles of the harmonized framework. This will also include the creation of French-language and Spanish-language versions of the act. The ultimate aim will be to bring the national drafts as close together as possible with common legislative language. Each national draft will then be available for adoption. Second, a Joint Committee to Harmonize North American Law on the Assignment of Receivables in International Trade met in April. This joint committee again included members of the Conference, the Uniform Law Conference of Canada and the Mexican Center for Uniform Laws. The committee, at the urging of the U.S. State Department, is pursuing legislative solutions aimed at bringing domestic laws into conformity with the United Nations Convention on the Assignment of Receivables in International Trade. The “Convention,” which was produced by the United Nations Commission on International Trade Law (UNCITRAL) and adopted by the United Nations General Assembly in 2001, seeks to eliminate the prevailing uncertainties in the legal effectiveness of international receivables financing transactions through the establishment of a set of uniform rules. If completed, this project may result in amendments to UCC Article 9. Stay tuned. Third, an application is currently pending that would make the Conference a member of the United Nations Economic and Social Council (ECOSOC). ECOSOC serves as the central forum for discussing international economic and social issues, and for formulating policy recommendations addressed to Member States and the United Nations system. It is responsible for promoting higher standards of living, full employment, and economic and social progress; and identifying solutions to international economic, social and health problems. It has the power to make or initiate studies and reports on these issues. In carrying out its mandate, ECOSOC consults with academics, business sector representatives and more than 2,100 registered non-governmental organizations. We anticipate that our application for membership will be considered soon. The Conference has drafted a “Policy Position on International Activities.” It is reprinted here in this newsletter for your information. We will keep you posted as our international program unfolds. ARE YOU READY FOR HILTON HEAD? The final plans are being made for our annual meeting in Hilton Head. By now you should have received your annual meeting packet, and returned to the Chicago office your registration information. Don’t forget that there’s still time to sign up for some of the optional events, though time is running short. Here’s just a few of the optional events where space is still available: • Sunday tour of Savannah (the “City Trolley Tour” is sold out, but there are still tickets available on the other two scheduled tours of Savannah); • Uniform Law Foundation Annual Benefit Event on Daufuskie Island (just a few tickets remain for this interesting evening); • Karaoke; • Theater night to see Beehive (almost sold out). Contact the Chicago office as soon as possible if you’d like to sign up for any of our optional events. Remember that we’ll be meeting during the high season on Hilton Head, and it may be hard to make your plans once we arrive on the island. The business agenda is now complete, and there’s plenty to keep everyone busy. Acts up for final approval include the Uniform Prudent Management of Institutional Funds Act, the Uniform Anatomical Gift Act, the Uniform Limited Liability Company Act, the Uniform Power of Attorney Act, the Uniform Representation of Children in Abuse, Neglect, and Custody Proceedings Act, the Model Registered Agents Act and Amendments to Entity Acts to Rationalize Annual Filings, and the Uniform Child Abduction Prevention Act (see accompanying article for brief descriptions of each of the final acts). We’ll also be debating drafts on Uniform Emergency Volunteer Healthcare Services Act, Uniform Statutory Trust Entity Act, Uniform Adult Guardianship and Protective Proceedings Jurisdiction Act, Model State Administrative Procedures Act, Uniform Cooperative Association Act, Interstate Depositions and Discovery of Documents Act, Amendments to the Uniform Common Interest Ownership Act, and Uniform Collateral Sanctions and Disqualifications Act. LEGISLATIVE BREAKFASTS IN HILTON HEAD As at previous annual meetings, each morning in Hilton Head, before the general session starts, the Legislative Council will host a legislative breakfast meeting for all commissioners from two separate regions. And as in the past, there will be a follow-up meeting for each of those state’s legislative liaisons only. All commissioners will soon receive a schedule for each state’s meeting and an agenda. It is crucial for every commissioner to attend this Legislative Breakfast. Please note the time and place for your meeting. SEE YOU THIS SUMMER The annual meeting is the pinnacle of the uniform laws process. The quality of uniform acts, their very integrity, depends upon the attendance of uniform law commissioners from every state. Our annual meetings are also a time to greet old friends, and make new ones. We hope to see you in Hilton Head this summer, and look forward to another great meeting. There are currently six uniform acts that are scheduled for completion at this summer’s annual meeting. Here’s a quick look at the proposed final acts. The Uniform Prudent Management of Institutional Funds Act (UPMIFA) is a revision of the Uniform Management of Institutional Funds Act (UMIFA) of 1972. UMIFA, adopted in 48 states, provided statutory guidelines for management, investment, and expenditures of endowment funds of institutions. A revision is necessary at this time to bring the law governing charitable institutions in line with modern investment practice. Unlike UMIFA, UPMIFA expressly addresses the needs of charitable institutions by providing for diversification of assets, pooling of assets, total return investment, and whole portfolio management. It does so in a comprehensive manner that is consistent with modern practices in trust and not-for-profit corporation law. Under UPMIFA, the rules governing expenditures from endowment funds have been modified to give a governing board more flexibility in making expenditure decisions, so that the board can cope with fluctuations in the value of the endowment. It does this by providing investment freedom (portfolio managers are not limited in the kinds of assets that may be sought for the portfolio) and by providing updated rules on the expenditure of funds (total return expenditure is expressly authorized under comprehensive prudent standards relating to the whole economic situation of the charitable institution). UPMIFA abolishes the “historic dollar value” limitation on expenditure. It also provides an optional “7 percent rule” that presumes expenditure exceeding 7% of total return is imprudent. The new Act reflects the fact that standards for investing and managing institutional funds are and should be the same regardless of whether a charitable organization is organized as a trust, as a nonprofit corporation, or in some other manner. A revision to the Uniform Anatomical Gift Act (UAGA) is also scheduled for completion. The UAGA was originally promulgated in 1968 and adopted in every state. The 1968 UAGA was a revolutionary Act. It stipulated for the first time that an individual, upon death, could donate his or her organs for medical purposes by signing a simple document before witnesses. This was a radical departure from centuries of common-law precedent, and a major first step. The Act was revised in 1987; the 1987 revision simplified the document of gift and dropped the requirement for witnesses to the document. However, only 26 states adopted the 1987 revision. Consequently, there is significant non-uniformity between the states. Further, neither version of the UAGA comports with changes in federal law relating to the role of hospitals and procurement organizations in securing organs for transplantation. This new revision updates the Act in light of change in federal law and regulations and related developments in the field of organ donation. The revision expands the number of individuals authorized to make anatomical gifts. The revision also allows for the making of anatomical gifts on donor registries, which are already in use in some states. It is hoped that these, and other, revisions can assist in increasing availability of organ donations to better match the demand. The Uniform Limited Liability Company Act (ULLCA) is being revised. The ULLCA was promulgated in 1995 and amended in 1996. ULLCA permits the formation of limited liability companies (LLCs), which provide the owners with the advantages of both corporate-type limited liability and partnership tax treatment. Every state has enacted some sort of LLC legislation, and LLCs are now a firmly entrenched business entity. LLC filings are significant in every U.S. jurisdiction, and in some states new LLC filings approach or even outnumber new corporate filings on an annual basis. However, state LLC laws are far from uniform. This new revision identifies the best elements of the “first generation” LLC statutes, and updates those elements into a new “second generation” statute. The goal of the Uniform Child Abduction Prevention Act is to prevent abduction by parents or others acting in concert with them. Child abduction is a serious problem. In 1999, more than 260,000 children were abducted; 78% of these children were abducted by a family member. Families going through custody disputes and divorce proceedings are the highest risk group for potential abduction. Judges need information about abduction risk factors so that they can place appropriate restrictions to prevent abductions either pre- or post- decree. Dealing appropriately with the risk factors at the time of a custody dispute or family law proceeding may be the best way to protect children from abduction. This Act will fill the void in the majority of states by identifying families at risk for abduction and providing methods to prevent the abduction of children. The Uniform Power of Attorney Act is a revision of the Uniform Durable Power of Attorney Act, first promulgated in 1979 and enacted in the majority of states. That Act provided a simple way for people to deal with their property by providing a power of attorney that will survive the incompetence of the principal. The new Act updates the original Act in numerous ways, reflecting both state legislative trends and collective best practices. While the new Act is primarily a set of default rules that can be altered by specific provisions within a power of attorney, the Act also contains safeguards for the protection of an incapacitated principal. The new Act sets forth detailed descriptions of powers that can be conveyed to an agent. The Uniform Representation of Children in Abuse, Neglect, and Custody Proceedings Act seeks to improve the representation of children in proceedings directly affecting their custody by clearly defining the roles and responsibilities of children’s representatives and by providing guidelines to courts in appointing representatives. The Act also addresses the role of the non-lawyer representative, also called a “guardian ad litem.” An important premise underlying the Act is that an attorney should be appointed for every child who is the subject of an abuse or neglect proceeding. Legal representation for children in these proceedings can ensure that court orders are based on accurate, informed and sensitive assessment of the child’s circumstances. The Act provides for two categories of lawyers: the child’s attorney and the “best interests” attorney. The child’s attorney is in a traditional attorney-client relationship with the child and is therefore under traditional ethical limitations governing that relationship. The best interests attorney has the responsibility of assisting the court in determining the child’s best interests. Unlike the child’s attorney, the best interests attorney is not bound by the child’s expressed objectives. In custody proceedings, the Act leaves to judicial discretion the question of appointing a child’s representative. The Act sets out basic guidelines for the appointment and role of attorneys and court-appointed advisors. However, states can provide more detailed guidelines through separate standards of practice. Almost every state requires an entity created in another jurisdiction to designate a registered agent for service of process and other legal proceedings to do business in a state. Each state generally provides a registration procedure in each of its entity statutes, i.e., corporation statute, limited liability company statute or limited partnership statute. The Model Registered Agents Act provides one registration procedure for agents no matter the kind of entity represented by the agent. The objective is to simplify registration procedures and provide one registered agent database in each state. The Act would make both registering agents and searching for them become faster, more cost-effective and efficient. The idea (and an initial draft) originated in the organization representing state registration offices, the International Association of Corporation Administrators (IACA), and the Act is being drafted in cooperation with IACA and the Business Law Section of the American Bar Association. NEWEST
DRAFTING COMMITTEE BEGINS WORK: In response to the recent devastation in the Gulf States from Hurricanes Katrina and Rita, specifically the problem of allowing out-of-state medical professionals to practice in the afflicted areas, the Conference recently appointed a drafting committee to draft a new uniform state law that will temporarily lift criminal, civil, and administrative penalties for specific out-of-state licensed health care professionals during a period of emergency. The Uniform Emergency Volunteer Healthcare Services Act (UEVHSA) will allow state governments to give reciprocity to other state's licenses and to provide disaster health care workers with protection from civil liability. The UEVHSA drafting committee, chaired by Commissioner Ray Pepe of Pennsylvania, met for the first time April 28-30 in Washington, DC. The committee already has dozens of observers, including observers from such groups as the American Medical Association, the American Nurses Association, the American Red Cross, the National Association of Emergency Medical Technicians, the National Emergency Management Association, the Department of Health and Human Services, and the Federation of State Medical Boards. A draft of the act will be debated at the Conference annual meeting this summer. The hurricanes that swept through the Gulf region last fall brought to light significant shortcomings in the ability of our nation’s disaster relief capacity. Many qualified physicians, nurses and other medical professionals from other states faced confusing administrative hurdles in obtaining permission to practice in the affected areas that delayed and impeded the timely delivery of essential health care services. The lessons learned from efforts to respond to Hurricanes Katrina and Rita revealed that although laws exist to provide for the interstate recognition of licenses issued to “federalized” health-care professionals and to state and local employees, no uniform and readily understood system exists to recognize licenses issued to other health-care professionals deployed from one state to another during these disasters. Approximately 20 states have enacted laws providing for the interstate recognition of licenses issued to private sector health-care professionals responding to emergencies, including professionals deployed by voluntary organizations such as the American Red Cross. But the mechanics for qualifying for interstate license recognition differs substantially from state to state and the lack of a uniform and readily understood system impaired the rapid and efficient deployment of many health-care professionals needed to respond to the crisis created by Katrina and Rita. The new uniform act should include specific statutory guidelines on the following: the specific kinds of medical professions covered by the statute; language making it clear when provisions of the act take effect, such as during officially-declared states of emergency; language restricting its application to medical professionals holding a valid and current license in another state who are not subject to disciplinary proceedings; and provisions providing limitations on exposure to tort claims faced by health care professionals and disaster relief organizations that provide essential services during disasters and emergencies. All drafts of the new Uniform Emergency Volunteer Healthcare Services Act will be posted on the Conference website at http://www.nccusl.org/, and will be available for public review and comment. UNIFORM LAW FOUNDATION
NEWS Benefit Tickets Selling
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Support for 2005/2006 ULF Campaign We are very grateful. As you know, the current campaign will continue through the Annual Meeting at Hilton Head Island and one of our annual goals is for states to have 100 percent participation. To date, four states (Maine, Nebraska, New Jersey and West Virginia) have achieved that goal. And 13 states are just one commissioner short of that goal (Arkansas, Connecticut, Georgia, Idaho, Iowa, Kansas, Maryland, Massachusetts, Minnesota, New York, Oregon, Puerto Rico and Vermont). If you wish to make a contribution before the annual meeting, you’ll find information as well as a downloadable donation form online at our web site – http://www.uniformlawfoundation.org/. Recent
ULF Grant REMEMBERING STEVE
AUERBACH On February 21, 2006, Steven Auerbach, son of Boris and Sue Auerbach, died from the complications of Leukemia. Those of us who have been with the Conference for awhile knew Steve as one of the children of the Conference. I remember him as a gangly pre-teen and teenager, probably a little bored with the official business of the Conference, circulating around annual meeting sites with other of the Conference’s children. The Conference has always been family-oriented. Children have always been welcome, though I often have wondered what these meetings mean to pre-teens and teens. What they mean, I suspect, is that they associate with and rely upon each other for entertainment, and communications. They seem to bond with each other, perhaps as a defense against the drone of the meeting that so engages their fathers or mothers. What we hear back from the adult children of the Conference, as we do from time to time, is fond memories of those meetings. It is terribly sad to report a death of one of the children, a man young with promise and expectations. Steve was 40. He graduated from the University of Chicago with an undergraduate degree and an MBA. He lived in New York with his wife and three children. He was employed by Federated Department Stores. Those who know the Auerbach’s over the years will remember that Steve’s mother, Sue Auerbach, died seven years ago. For Boris, this is a double load of grief which his many friends in the Conference will share. Hopefully, this notice will be sent on to those adult children of the Conference, wherever they may be, who knew Steve and ran around with him at those annual meetings, also to help share the grief that the Auerbach’s, now Boris and Kathy, feel for Steve. Such sharing may be the best we can do against the sad reality of Steve’s death. POLICY POSITION ON INTERNATIONAL ACTIVITIES The Conference’s mission is to promote uniformity of law among the various states. Its primary focus is on drafting uniform and model laws and then promoting their enactment by the states. Increasingly, as the federal government has legislated in areas that were once the exclusive domain of the states, the Conference has become involved at the federal level, either by trying to persuade Congress or a regulatory agency that state action is preferable or by trying to influence the development of federal law so that, to the extent practicable, it meshes with state law. In the world of the 21st century, the Conference will have to expand its horizons beyond even the federal level in order effectively to accomplish its core mission. With the movement toward globalization, the federal government increasingly participates in the promulgation of private international law conventions that, upon ratification, become preemptive federal law. This disrupts the law in areas such as commercial and family law that historically have been regulated at the state level and that have been the subject of numerous uniform and model laws promulgated by the Conference. The states have a profound interest in, to the extent practicable, having international conventions mesh with their existing laws, influencing the law’s development in other countries so that it is compatible with American legal concepts, and harmonizing their own laws with the laws of other countries. This will facilitate transactions and movement across borders and will provide the citizens of the states a familiar and appropriate legal framework as they participate in the global community. For the same reasons it benefits our citizens and businesses to have uniform state laws, so too will they benefit by having their state laws work in harmony with the laws of other nations. The international arena is not new to the Conference or its members. Over the years, Commissioners have served often on U.S. delegations negotiating international conventions, thus ensuring that persons knowledgeable in state law are involved in the process so that, to the extent practicable, they incorporate principles that are compatible with that law. And the Conference itself has from time to time engaged in projects with an international dimension. Examples include the Uniform Mediation Act, which was recently amended to facilitate state adoption of the Model Law on International Commercial Conciliation; the Uniform International Wills Act, which was an attempt to implement at the state level the provisions of the Convention Providing a Uniform Law on the Form of an International Will; and the Uniform Transboundary Pollution Reciprocal Access Act, which was a joint drafting project between NCCUSL and the Uniform Law Conference of Canada. The Conference is well positioned to advance the interests of the states in the global environment. It has a long and close working relationship with the Uniform Law Conference of Canada and in recent years has developed an excellent relationship with the Mexican Uniform Law Center. It has also been working with representatives of the U.S. Department of State’s Office of Private International Law to develop a collaborative approach to negotiating and implementing international conventions. This will involve closer consultation between the Conference and the State Department regarding the selection of international projects to be supported by the U.S. and, as appropriate, the selection of members designated by the Conference to serve on U.S. delegations. Building on its existing relationships, the Conference has recently embarked on two projects with its North American counterparts in an effort to harmonize the laws of the United States, Canada, and Mexico. Possible other projects would, through collaboration among NCCUSL, the State Department, and the United States Congress, actually implement international conventions at the state rather than the federal level. This would allow the conventions to be cast in language that is more compatible with state law, thereby integrating better with that law and being more readily accessible to practicing lawyers. As the international program unfolds, it will undoubtedly involve a closer working relationship with the State Department, our counterparts in Canada and Mexico, and such international organizations as UNCITRAL, the International Institute for the Unification of Private Law (UNIDROIT), the Hague Conference on Private International Law, and the Organization of American States (OAS). Developing these relationships outside the United States and undertaking drafting and implementation of international projects are a logical and necessary extension of, and fully consistent with, the Conference’s historical mission. |
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