H 4320 Session 111 (1995-1996)
H 4320 General Bill, By Kirsh, B.D. Cain, Meacham, Richardson, Simrill, Wilder and
Witherspoon
A Bill to amend Title 15, Code of Laws of South Carolina, 1976, relating to
civil remedies and procedures by adding Chapter 34 so as to establish
standards and procedures for the recovery of punitive damages in civil
actions, including a limit on the maximum amount of punitive damages which may
be awarded, the manner in which punitive damages must be stated and pled, the
responsibilities of the trier of fact and the court in regard to punitive
damages, and the awarding of attorney's fees in defense of frivolous or
malicious punitive damage claims; and to repeal Section 15-33-135 of the 1976
Code relating to punitive damages and the burden of proof.
12/06/95 House Prefiled
12/06/95 House Referred to Committee on Judiciary
01/09/96 House Introduced and read first time HJ-54
01/09/96 House Referred to Committee on Judiciary HJ-55
A BILL
TO AMEND TITLE 15, CODE OF LAWS OF SOUTH
CAROLINA, 1976, RELATING TO CIVIL REMEDIES AND
PROCEDURES BY ADDING CHAPTER 34 SO AS TO
ESTABLISH STANDARDS AND PROCEDURES FOR THE
RECOVERY OF PUNITIVE DAMAGES IN CIVIL ACTIONS,
INCLUDING A LIMIT ON THE MAXIMUM AMOUNT OF
PUNITIVE DAMAGES WHICH MAY BE AWARDED, THE
MANNER IN WHICH PUNITIVE DAMAGES MUST BE
STATED AND PLED, THE RESPONSIBILITIES OF THE TRIER
OF FACT AND THE COURT IN REGARD TO PUNITIVE
DAMAGES, AND THE AWARDING OF ATTORNEY'S FEES IN
DEFENSE OF FRIVOLOUS OR MALICIOUS PUNITIVE
DAMAGE CLAIMS; AND TO REPEAL SECTION 15-33-135 OF
THE 1976 CODE RELATING TO PUNITIVE DAMAGES AND
THE BURDEN OF PROOF.
Be it enacted by the General Assembly of the State of South
Carolina:
SECTION 1. The 1976 Code is amended by adding:
"CHAPTER 34
Punitive Damages
Section 15-34-10. Punitive damages may be awarded in a civil
action, subject to the provisions of this chapter, to punish a
defendant for wilful, wanton, or reckless conduct and to deter the
defendant and others from committing similar wrongful acts.
Section 15-34-20. As used in this chapter:
(1) `Claimant' means a party, including a plaintiff,
counterclaimant, cross-claimant, or third-party plaintiff, seeking
recovery of punitive damages.
(2) `Compensatory damages' includes nominal damages.
(3) `Defendant' means a party, including a counterdefendant,
cross-defendant, or third-party defendant, from whom a claimant
seeks relief with respect to punitive damages.
(4) `Fraud' does not include constructive fraud unless an
element of intent is present.
(5) `Malice' means a sense of personal ill will toward the
claimant that activated or incited the defendant to perform the act or
undertake the conduct that resulted in harm to the claimant.
(6) `Punitive damages' means extracompensatory damages
awarded for the purposes set forth in Section 15-34-10.
(7) `Wilful, wanton, or reckless conduct' means the conscious
and intentional disregard of and indifference to the rights and safety
of others, which the defendant knows or should know are
reasonably likely to result in injury, damage, or other harm.
`Wilful, wanton, or reckless conduct' means more than gross
negligence.
Section 15-34-30. This chapter applies to every claim for
punitive damages, regardless of whether the claim for relief is based
on a statutory or a common-law right of action or based in equity.
In an action subject to this chapter, in whole or in part, the
provisions of this chapter prevail over any other provision of law to
the contrary.
Section 15-34-40. (A) Punitive damages may be awarded only
if the claimant proves that the defendant is liable for compensatory
damages and that one of the following aggravating factors was
present and was related to the injury for which compensatory
damages were awarded:
(1) fraud;
(2) malice; or
(3) wilful, wanton, or reckless conduct.
(B) The claimant must prove the existence of an aggravating
factor by clear and convincing evidence.
(C) Punitive damages shall not be awarded against a person
solely on the basis of vicarious liability for the acts or omissions of
another. Punitive damages may be awarded against a person only if
that person participated in the conduct constituting the aggravating
factor giving rise to the punitive damages or if, in the case of a
corporation, the officers, directors, or managers of the corporation
participated in or condoned the conduct constituting the aggravating
factor giving rise to punitive damages.
(D) Punitive damages shall not be awarded against a person
solely for breach of contract.
Section 15-34-50. A claimant must elect, prior to judgment,
between punitive damages and any other remedy pursuant to
another statute that provides for multiple damages.
Section 15-34-60. (A) In all actions seeking an award of
punitive damages, the trier of fact shall determine the amount of
punitive damages separately from the amount of compensation for
all other damages.
(B) Punitive damages awarded against a defendant shall not
exceed three times the amount of compensatory damages or two
hundred fifty thousand dollars, whichever is greater. If a trier of
fact returns a verdict for punitive damages in excess of the
maximum amount specified under this subsection, the trial court
shall reduce the award and enter judgment for punitive damages in
the maximum amount.
(C) The provisions of subsection (B) of this section shall not be
made known to the trier of fact through any means, including voir
dire, the introduction into evidence, argument, or instructions to the
jury.
Section 15-34-70. Section 15-34-60(B) shall not apply to a
claim for punitive damages for injury or harm arising from a
defendant's operation of a motor vehicle if the actions of the
defendant in operating the motor vehicle would give rise to an
offense of driving while under the influence of intoxicating liquor,
drugs, or like substances.
Section 15-34-80. Upon the motion of a defendant, the issues of
liability for compensatory damages and the amount of compensatory
damages, if any, shall be tried separately from the issues of liability
for punitive damages and the amount of punitive damages, if any.
Evidence relating solely to punitive damages shall not be admissible
until the trier of fact has determined that the defendant is liable for
compensatory damages and has determined the amount of
compensatory damages. The same trier of fact that tried the issues
relating to compensatory damages shall try the issues relating to
punitive damages.
Section 15-34-90. In determining the amount of punitive
damages, if any, to be awarded, the trier of fact:
(1) shall consider the purposes of punitive damages set forth
in Section 15-34-10; and
(2) may consider only that evidence that relates to the
following:
(a) the reprehensibility of the defendant's motives and
conduct;
(b) the likelihood, at the relevant time, of serious harm;
(c) the degree of the defendant's awareness of the probable
consequences of its conduct;
(d) the duration of the defendant's conduct;
(e) the actual damages suffered by the claimant;
(f) any concealment by the defendant of the facts or
consequences of its conduct;
(g) the existence and frequency of any similar past conduct
by the defendant;
(h) whether the defendant profited from the conduct;
(i) the defendant's ability to pay punitive damages, as
evidenced by its revenues or net worth.
Section 15-34-100. In a jury trial, the court shall instruct the jury
with regard to items (1) and (2) of Section 15-34-90.
Section 15-34-110. The court shall award reasonable attorney's
fees, resulting from the defense against the punitive damages claim,
against a claimant who files a claim for punitive damages that the
claimant knows or should have known to be frivolous or malicious.
The court shall award reasonable attorney's fees against a defendant
who asserts a defense in a punitive damages claim that the
defendant knows or should have known to be frivolous or
malicious.
Section 15-34-120. When reviewing the evidence regarding a
finding by the trier of fact concerning liability for punitive damages
in accordance with Section 15-34-40(A), or regarding the amount of
punitive damages awarded, the trial court shall state in a written
opinion its reasons for upholding or disturbing the finding or award.
In doing so, the court shall address with specificity the evidence, or
lack thereof, as it bears on the liability for or the amount of
punitive damages, in light of the requirements of this chapter.
Section 15-34-130. A demand for punitive damages shall be
specifically stated, except for the amount, and the aggravating factor
that supports the award of punitive damages shall be averred with
particularity. The amount of damages shall be pled in accordance
with applicable court rules adopted by the Supreme Court.
Section 15-34-140. The provisions of this chapter do not apply to
actions brought under the South Carolina Tort Claims Act."
SECTION 2. Section 15-33-135 of the 1976 Code is repealed.
SECTION 3. The provisions of this act are severable. If any
portion of this act is declared unconstitutional or the application of
this act to any person or circumstances is held invalid, the
remaining portions and their applicability to any person or
circumstances are valid.
SECTION 4. This act takes effect July 1, 1996, and applies to
claims arising on or after that date.
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