Posted by: Stefanie Caraviello | July 15, 2011

Not all Tort-related Wishes Come True

A recent edition of South Carolina Lawyers Weekly  discussed the Tort Reform bill passage.  It has interview perspectives from many different opinions and geographic regions in South Carolina. I am quoted in this article, as well as Brian Comer.

Not all tort-related wishes come true 

by Caitlin Coakley: Published: July 1st, 2011

Looking back on the past legislative session, attorneys mostly see just one bill: HB 3375, the S.C. Fairness in Civil Justice Act – commonly called the tort reform bill.

Pushed by business groups and conservatives in the legislature, the bill imposes caps on punitive damages to be awarded in tort cases, with some exceptions. It gave Mike Hemlepp, executive director of the South Carolina Association for Justice, a big case of heartburn. As part of an organization that represents trial lawyers, Hemlepp said that he and his group are, on principal, opposed to tort reform and caps of any kind.

“We trust juries,” he said. “Anything that interferes with a jury’s ability to make a judgment, we are opposed to it.”

But with the bill signed into law, Hemlepp is less venomous and more resigned to the new laws. Despite his fundamental opposition to the goal of the bill, he recognizes that the lawyers his organization represents could have gotten off a lot worse.

On the other side of the issue, the defense attorneys say the new law is a good start, but wasn’t as effective as it could have been. Gray Culbreath, president of the South Carolina Defense Trial Attorneys’ Association, said that the bill is a good one, “as a matter of perspective.”

“We have caps now, and we didn’t have any before,” he said. “There is a belief that something’s better than nothing.”

Those mixed feelings are perhaps a reflection of the compromise between the bill introduced in the House of Representatives and the bill that passed the Senate. The House’s original hill was much stricter: a $350,000 across-the-board cap on punitive damages with no exemptions.

But by the time the bill hit the governor’s desk, the punitive-damage caps were more fluid: $500,000 or no more than three times the compensatory damages for most cases, rising to $2 million or four times compensatory damages in cases where the jury ruled that the business or person cut corners in order to rake in an unreasonable profit or if the defendant, business or individual, committed a felony in the process. If the defendant is actually convicted of a felony, caused harm intentionally, or was under the influence of drugs or alcohol, the case is exempted from caps altogether.

The amending and softening that the bill underwent while making its way through the legislative chambers made it into something that Hemlepp begrudgingly admits isn’t too bad.

“I think the legislature did a very good job of educating themselves on something that was very complicated,” he said. “We don’t believe in caps of any kind, but what was passed in this bill is reasonable compared to other states.”

But defense attorneys like Culbreath can’t help but lament some of the things that it left out.

One provision included in the original bill would have overturned a South Carolina statute that disallows information about whether the plaintiff in an automobile accident was wearing a seatbelt.

In the Senate, that provision was taken out, but Culbreath said that the some in the trucking and manufacturing associations to whom he had spoken have said they wished it had been retained.

Brian Comer, a Columbia attorney who worked with the legislature on the proposed product liability aspects of the bill, also acknowledged that the bill has been watered down from its original form. However, he adds that if the alternative would be to not have anything pass, the new law is enough.

“It’s a compromise,” he said. “It does some good things, there are some things that could have been done, but overall there was something done.” In fact, Comer was happy that  he and other product liability attorneys were successful in keeping the bill from being watered down any further.

The legislature briefly considered adding an amendment that would overturn the August 2010 ruling in Branham v. Ford Motor Co., which created the “feasible design” standard: In cases that alleged a company created a defective product, a plaintiff must demonstrate that the company could feasibly have manufactured a safer product.

Had the case been overturned, the plaintiff would only have to prove that the product did not live up to consumer expectations.

Comer said that the issue is one that deserves another look, but should be considered as a separate issue and not as an amendment to a larger bill.

“We aren’t necessarily averse to doing that, but it needs to come at the end of a debate involving members of bar and academic community,” he said. “It shouldn’t be something that happens at the eleventh hour.”

Even Hemlepp acknowledges that the bill wasn’t completely devastating to trial lawyers. The SCAJ successfully added a provision to the bill that prohibits award caps from being disclosed to the jury. By keeping the jury in the dark as to the award caps, it left the jurors to determine what a fair award would be. Under the bill, if the jury’s punitive damage award exceeds the cap, the plaintiff would get the maximum amount allowed by law.

C. Stuart Mauney, a defense trial lawyer in Greenville, said that even if the bill wasn’t everything the business community hoped for, it accomplished the ultimate goal of sending the message that South Carolina was making an effort to become more business friendly.

Having the caps in place, Mauney said, “creates a more positive business climate. When executives make decisions about whether or not to do business in South Carolina, they make the decisions in part based on the state’s lawsuit environment.”

But Terry Haselden, a Spartanburg attorney who handles tort cases, said the bill isn’t good for much else. He calls it a “feel-good bill” that lawmakers can crow about to constituents but doesn’t have much practical impact, since “punitive damages are extremely rare in South Carolina.”

The cases where the cap will come into play, he said, will be the most tragic ones where people are most severely hurt and the jury believes that the plaintiff deserves a higher sum – in other words, he said, the ones that deserve it the most.

“Juries in South Carolina are extremely conservative,” he said. “They rarely award punitive damages unless there’s a darn good reason.”

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