2005-2006 Bill 345: Tort Reform - South Carolina Legislature Online

1 South Carolina General Assembly 2 116th Session, 2005-2006 3 4 S. 345 5 6 STATUS INFORMATION 7 8 General Bill 9 Sponsors: Senator Martin 10 Document Path: l:\s-jud\bills\martin\jud0052.lam.doc 11 12 Introduced in the Senate on January 26, 2005 13 Last Amended on March 3, 2005 14 Currently residing in the Senate Committee on Judiciary 15 16 Summary: Tort reform 17 18 19 HISTORY OF LEGISLATIVE ACTIONS 20 21 Date Body Action Description with journal page number 22 1/26/2005 Senate Introduced and read first time SJ-12 23 1/26/2005 Senate Referred to Committee on Judiciary SJ-12 24 2/2/2005 Senate Committee report: Majority favorable with amend., minority unfavorable Judiciary 25 SJ-27 26 2/3/2005 Senate Special order SJ-25 27 2/3/2005 Scrivener's error corrected 28 2/17/2005 Senate Debate interrupted SJ-16 29 2/22/2005 Senate Debate interrupted SJ-9 30 2/23/2005 Senate Amended SJ-24 31 2/23/2005 Senate Debate interrupted SJ-24 32 2/24/2005 Senate Debate interrupted SJ-17 33 2/24/2005 Scrivener's error corrected 34 3/2/2005 Senate Debate interrupted SJ-30 35 3/3/2005 Senate Amended SJ-42 36 3/3/2005 Senate Debate interrupted SJ-42 37 3/4/2005 Scrivener's error corrected 38 3/8/2005 Senate Recommitted to Committee on Judiciary SJ-44 39 40 41 VERSIONS OF THIS BILL 42 43 1/26/2005 44 2/2/2005 45 2/3/2005 46 2/23/2005 47 2/24/2005 48 3/3/2005 49 3/4/2005 50 1 Indicates Matter Stricken 2 Indicates New Matter 3 4 AMENDED 5 March 3, 2005 6 7 S. 345 8 9 Introduced by Senator Martin 10 11 S. Printed 3/3/05--S. [SEC 3/4/05 11:26 AM] 12 Read the first time January 26, 2005. 13 14

1 [345-1] 1 2 3 4 5 6 7 8 9 A BILL 10 11 TO AMEND TITLE 15, CODE OF LAWS OF SOUTH 12 CAROLINA, 1976, RELATING TO CIVIL REMEDIES AND 13 PROCEDURES, BY ADDING CHAPTER 41, SO AS TO 14 PROVIDE THAT IN AN ACTION FOR PERSONAL INJURY, 15 PROPERTY DAMAGE, OR WRONGFUL DEATH, THE 16 LIABILITY FOR EACH DEFENDANT IS SEVERAL ONLY 17 AND MUST BE ALLOCATED TO THE DEFENDANTS 18 BASED ON EACH DEFENDANT’S PERCENTAGE OF 19 FAULT, TO ESTABLISH CRITERIA FOR ESTABLISHING 20 THE PERCENTAGES OF FAULT, AND TO PROVIDE 21 EXCEPTIONS FOR INTENTIONAL OR RECKLESS 22 CONDUCT; TO AMEND SECTION 15-3-640, RELATING TO 23 THE STATUTE OF REPOSE FOR CONSTRUCTION 24 DEFECTS, SO AS TO REDUCE THE STATUTE OF REPOSE 25 FROM THIRTEEN TO SEVEN YEARS AND TO DEFINE 26 “SUBSTANTIAL COMPLETION”; TO AMEND SECTION 27 15-7-30, RELATING TO VENUE FOR A CIVIL ACTION, SO 28 AS TO ESTABLISH PROCEDURES FOR DETERMINING THE 29 PROPER VENUE; TO AMEND SECTION 15-7-100, 30 RELATING TO A CHANGE OF VENUE OF A CIVIL ACTION, 31 SO AS TO PROVIDE THAT WHEN VENUE IS CHANGED, 32 AN ACTION IS NOT SUBJECT TO THE PROCEDURES FOR 33 DETERMINING PROPER VENUE; TO AMEND SECTION 34 15-36-10, RELATING TO FRIVOLOUS CIVIL PROCEEDINGS, 35 SO AS TO ADOPT THE REASONABLE ATTORNEY 36 STANDARD FOR CIVIL FILINGS BY ALL LITIGANTS AND 37 TO REQUIRE THE REPORTING OF VIOLATIONS OF THE 38 ARTICLE; TO AMEND SECTION 34-31-20, RELATING TO 39 POSTJUDGMENT INTEREST, SO AS TO PROVIDE THAT 40 POSTJUDGMENT INTEREST SHALL ACCRUE AT THE 41 PRIME RATE PLUS FOUR PERCENT; TO AMEND SECTION 42 36-2-803, RELATING TO PERSONAL JURISDICTION OF THE

1 [345] 1 1 COURTS, SO AS TO REMOVE THE REQUIREMENT THAT 2 JURISDICTION UNDER THIS SECTION PRECLUDES A 3 CHANGE OF VENUE; BY ADDING SECTION 39-5-39, SO AS 4 TO MAKE IT AN UNLAWFUL TRADE PRACTICE FOR AN 5 ATTORNEY TO ADVERTISE HIS SERVICES IN A FALSE, 6 DECEPTIVE, OR MISLEADING WAY, INCLUDING THE USE 7 OF A NICKNAME THAT CREATES AN UNREASONABLE 8 EXPECTATION OF RESULTS; TO AMEND THE CODE OF 9 LAWS OF SOUTH CAROLINA, RELATING TO INSURANCE 10 SAVINGS, SO AS TO PROVIDE THAT THE DEPARTMENT 11 OF INSURANCE MUST REVIEW DATA REPORTED BY 12 LIABILITY INSURERS IN ORDER TO DETERMINE IF ANY 13 SAVINGS ARE REALIZED AS A RESULT OF A DECREASE 14 IN LITIGATION OR CLAIMS PAID AFTER THE EFFECTIVE 15 DATE OF THIS ACT; TO REPEAL SECTIONS 15-36-20, 16 15-36-30, 15-36-40, AND 15-36-50, RELATING TO 17 FRIVOLOUS CIVIL PROCEEDINGS; AND TO REPEAL 18 SECTION 58-23-90, RELATING TO THE PROPER VENUE TO 19 BRING AN ACTION AGAINST A LICENSED MOTOR 20 CARRIER. 21 Amend Title To Conform 22 23 Be it enacted by the General Assembly of the State of South 24 Carolina: 25 26 PART I 27 GENERAL ASSEMBLY FINDINGS 28 29 SECTION 1. The General Assembly finds that the sections 30 presented in this act constitute one subject as required by Article 31 III, Section 17 of the South Carolina Constitution, in particular 32 finding that each change and each topic relates directly to or in 33 conjunction with other sections to the subject of tort and other civil 34 action reform as clearly enumerated in the title. 35 The General Assembly further finds that a common purpose or 36 relationship exists among the sections, representing a potential 37 plurality but not disunity of topics, notwithstanding that reasonable 38 minds might differ in identifying more than one topic contained in 39 the act. 40 41 PART II 42 GENERAL PROVISIONS 43

1 [345] 2 1 SECTION 2. Section 15-3-640 of the 1976 Code is amended to 2 read: 3 4 “Section 15-3-640. No actions to recover damages based upon 5 or arising out of the defective or unsafe condition of an 6 improvement to real property may be brought more than thirteen 7 seven years after substantial completion of such an the 8 improvement. For purposes of this section, an action based upon 9 or arising out of the defective or unsafe condition of an 10 improvement to real property includes: 11 (1) an action to recover damages for breach of a contract to 12 construct or repair an improvement to real property; 13 (2) an action to recover damages for the negligent construction 14 or repair of an improvement to real property; 15 (3) an action to recover damages for personal injury, death, or 16 damage to property; 17 (4) an action to recover damages for economic or monetary 18 loss; 19 (5) an action in contract or in tort or otherwise; 20 (6) an action for contribution or indemnification for damages 21 sustained on account of an action described in this subdivision 22 section; 23 (7) an action against a surety or guarantor of a defendant 24 described in this section; 25 (8) an action brought against any current or prior owner of the 26 real property or improvement, or against any other person having a 27 current or prior interest in the real property or improvement; 28 (9) an action against owners or manufacturers of components, 29 or against any person furnishing materials, or against any person 30 who develops real property, or who performs or furnishes the 31 design, plans, specifications, surveying, planning, supervision, 32 testing, or observation of construction, or construction of an 33 improvement to real property, or a repair to an improvement to real 34 property. 35 This section describes an outside limitation of thirteen seven 36 years after the substantial completion of the improvement, within 37 which normal statutes of limitations continue to run. 38 Any A building permit for the construction of an improvement 39 to real property shall must contain in bold type notice to the owner 40 or possessor of the property of his rights under this section to 41 contract for a guarantee of the structure being free from defective 42 or unsafe conditions beyond thirteen seven years after substantial 43 completion of the improvement. The Department of Consumer

1 [345] 3 1 Affairs shall publish in conspicuous places the right of any an 2 owner or possessor to contract for such extended liability under 3 this section. Nothing in this section shall prohibit any prohibits a 4 person from entering into any a contractual agreement prior to the 5 substantial completion of the improvement which extends any 6 guarantee of a structure or component being free from defective or 7 unsafe conditions beyond thirteen seven years after substantial 8 completion of the improvement or component. 9 For any improvement to real property, a certificate of occupancy 10 issued by a county or municipality shall constitute proof of 11 substantial completion of the improvement under the provisions of 12 Section 15 - 3 - 630, unless the contractor and owner, by written 13 agreement, establish a different date of substantial completion.” 14 15 SECTION 3. Section 15-7-30 of the 1976 Code is amended to 16 read: 17 18 “Section 15-7-30. (A) As used in this section: 19 (1) ‘Domestic corporation’ means a ‘domestic corporation’ 20 as defined in Section 33 - 1 - 400. 21 (2) ‘Domestic limited partnership’ means a ‘domestic 22 limited partnership’ as defined in Section 33 - 42 - 20. 23 (3) ‘Domestic limited liability company’ means a ‘domestic 24 limited liability partnership’ as defined in Section 33 - 41 - 1110 with 25 its principal place of business within this State. 26 (4) ‘Domestic limited liability partnership’ means a 27 ‘domestic limited liability partnership’ as defined in Section 28 33 - 41 - 1110 with its principal place of business within this State. 29 (5) ‘Foreign corporation’ means a ‘foreign corporation’ as 30 defined in Section 33 - 1 - 400. 31 (6) ‘Foreign limited partnership’ means a ‘foreign limited 32 partnership’ as defined in Section 33 - 42 - 20. 33 (7) ‘Foreign limited liability company’ means a ‘foreign 34 limited liability partnership’ as defined in Section 33 - 41 - 1150 with 35 its principal place of business outside this State. 36 (8) ‘Foreign limited liability partnership’ means a ‘foreign 37 limited liability partnership’ as defined in Section 33 - 41 - 1150 with 38 its principal place of business outside this State. 39 (9) ‘Nonresident individual’ means a person who is not 40 domiciled in this State. 41 (10) ‘Principal place of business’ means:

1 [345] 4 1 (a) the corporation’s home office location within the State 2 from which the corporation’s officers direct, control, or coordinate 3 its activities; 4 (b) the location of the corporation’s manufacturing, sales, 5 or purchasing facility within the State if the corporation does not 6 have a home office within the State; or 7 (c) the location at which the majority of corporate activity 8 takes place if the corporation has multiple centers of 9 manufacturing, sales, or purchasing located within the State if the 10 corporation does not have a home office within the State and has 11 more than one manufacturing, sales, or purchasing facility within 12 the State. The following factors may be considered when 13 determining the location at which the majority of corporate activity 14 takes place: 15 (i) the number of employees located in any one county; 16 (ii) the authority of the employees located in any one 17 county; or 18 (iii) the tangible corporate assets that exist in any one 19 county. 20 (11) ‘Resident individual’ means a person who is domiciled 21 in this State. 22 (B) In all other cases not provided for in Sections 15 - 7 - 10, 23 15 - 7 - 20, or 15 - 78 - 100, the action shall must be tried in the county 24 where it properly may be brought and tried against the defendant 25 according to the provisions of this section in which the defendant 26 resides at the time of the commencement of the action. If there be 27 is more than one defendant then the action may be tried in any 28 county where the action properly may be maintained against one of 29 the defendants pursuant to this section in which one or more of the 30 defendants to such action resides at the time of the commencement 31 of the action. If none of the parties shall reside in the State the 32 action may be tried in any county which the plaintiff shall 33 designate in his complaint. This section is subject however to the 34 power of the court in the county where the action properly may be 35 maintained according to this section to change the place of trial as 36 provided in Section 15 - 7 - 100 or as otherwise in certain cases as 37 provided by law. 38 (C) A civil action tried pursuant to this section against a 39 resident individual defendant must be brought and tried in the 40 county in which the: 41 (1) defendant resides at the time the cause of action arose; or 42 (2) most substantial part of the alleged act or omission 43 giving rise to the cause of action occurred.

1 [345] 5 1 (D) A civil action tried pursuant to this section against a 2 nonresident individual defendant must be brought and tried in the 3 county in which the: 4 (1) most substantial part of the alleged act or omission 5 giving rise to the cause of action occurred; or 6 (2) plaintiff resides at the time the cause of action arose, or if 7 the plaintiff is a domestic corporation, domestic limited 8 partnership, domestic limited liability company, domestic limited 9 liability partnership, foreign corporation, foreign limited 10 partnership, foreign limited liability company, or foreign limited 11 liability partnership, at its principal place of business at the time 12 the cause of action arose. 13 (E) A civil action tried pursuant to this section against a 14 domestic corporation, domestic limited partnership, domestic 15 limited liability company, or domestic limited liability partnership, 16 must be brought and tried in the county in which the: 17 (1) corporation, limited partnership, limited liability 18 company, or limited liability partnership has its principal place of 19 business at the time the cause of action arose; or 20 (2) most substantial part of the alleged act or omission 21 giving rise to the cause of action occurred. 22 (F) A civil action tried pursuant to this section against a foreign 23 corporation required to possess a certificate of authority under the 24 provisions of Section 33 - 15 - 101 et seq., a foreign limited 25 partnership required to possess a certificate of authority under the 26 provisions of Section 33 - 15 - 101 et seq., foreign limited liability 27 company required to possess a certificate of authority under the 28 provisions of Section 33 - 15 - 101 et seq., or foreign limited liability 29 partnership required to possess a certificate of authority under the 30 provisions of Section 33 - 15 - 101 et seq. must be brought and tried 31 in the county in which the: 32 (1) most substantial part of the alleged act or omission 33 giving rise to the cause of action occurred; or 34 (2) foreign corporation, foreign limited partnership, foreign 35 limited liability company, or foreign limited liability partnership 36 has its principal place of business at the time the cause of action 37 arose. 38 (G) A civil action tried pursuant to this section against a foreign 39 corporation not required to possess a certificate of authority under 40 the provisions of Section 33 - 15 - 101 et seq., foreign limited 41 partnership not required to possess a certificate of authority under 42 the provisions of Section 33 - 15 - 101 et seq., foreign limited 43 liability company not required to possess a certificate of authority

1 [345] 6 1 under the provisions of Section 33 - 15 - 101 et seq., or foreign 2 limited liability partnership not required to possess a certificate of 3 authority under the provisions of Section 33 - 15 - 101 et seq. must 4 be brought and tried in the county in which the: 5 (1) most substantial part of the alleged act or omission 6 giving rise to the cause of action occurred; 7 (2) plaintiff resides at the time the cause of action arose, or if 8 the plaintiff is a domestic corporation, domestic limited 9 partnership, domestic limited liability company, domestic limited 10 liability partnership, foreign corporation, foreign limited 11 partnership, foreign limited liability company, or foreign limited 12 liability partnership, at its principal place of business at the time 13 the cause of action arose; or 14 (3) foreign corporation, foreign limited partnership, foreign 15 limited liability company, or foreign limited liability partnership 16 has its principal place of business at the time the cause of action 17 arose. 18 (H) Owning property and transacting business in a county is 19 insufficient in and of itself to establish the principal place of 20 business for a corporation for purposes of this section.” 21 22 SECTION 4. Section 15-7-100 of the 1976 Code is amended to 23 read: 24 25 “Section 15-7-100. (A) The court may change the place of trial 26 in the following cases if: 27 (1) When the it is a court in a county designated for that 28 purpose in the complaint, but the designated county is not the 29 proper county pursuant to the provisions of Chapter 7 of Title 15 30 of the 1976 Code of South Carolina or other statutes providing for 31 the venue of actions; 32 (2) When there is reason to believe that a fair and impartial 33 trial cannot be had therein there; and or 34 (3) When the convenience of witnesses and the ends of 35 justice would be promoted by the change. 36 (B) When the place of trial is changed, all other proceedings 37 shall must be had in the county to which the place of trial is 38 changed, unless otherwise provided by the consent of the parties in 39 writing duly filed or by order of the court. And the papers shall 40 The pleadings and other papers must be filed or transferred 41 accordingly.” 42

1 [345] 7 1 SECTION 5. Section 15-36-10 of the 1976 Code is amended to 2 read: 3 4 “Section 15-36-10. (A)(1) Any person who takes part in the 5 procurement, initiation, continuation, or defense of any civil 6 proceeding is subject to being assessed for payment of all or a 7 portion of the attorney’s fees and court costs of the other party if: 8 (1) he does so primarily for a purpose other than that of 9 securing the proper discovery, joinder of parties, or adjudication of 10 the claim upon which the proceedings are based; and 11 (2) the proceedings have terminated in favor of the person 12 seeking an assessment of the fees and costs. 13 As used in this chapter, `person’ is defined to mean any 14 individual, corporation, company, association, firm, partnership, 15 society, joint stock company, and any other entity, including any 16 governmental entity or unincorporated association of persons. A 17 pleading filed in a civil or administrative action on behalf of a 18 party who is represented by an attorney must be signed by at least 19 one attorney of record who is an active member of the South 20 Carolina Bar or who is admitted to practice in the courts of this 21 State and must include the address and telephone number of the 22 attorney signing the document. 23 (2) A document filed in a civil or administrative action by a 24 party who is not represented by an attorney must be signed by the 25 party and must include the address and telephone number of the 26 party. 27 (3) The signature of an attorney or a pro se litigant 28 constitutes a certificate to the court that: 29 (a) the person has read the document; 30 (b) a reasonable attorney in the same circumstances would 31 believe that under the facts his claim or defense may be warranted 32 under the existing law or, if his claim or defense is not warranted 33 under the existing law, a good faith argument exists for the 34 extension, modification, or reversal of existing law; 35 (c) a reasonable attorney in the same circumstances would 36 believe that his procurement, initiation, continuation, or defense of 37 a civil cause is not intended merely to harass or injure the other 38 party; and 39 (d) a reasonable attorney in the same circumstances would 40 believe his claim or defense is not frivolous, interposed for delay, 41 or brought for any purpose other than securing proper discovery, 42 joinder of parties, or adjudication of the claim or defense upon 43 which the proceedings are based.

1 [345] 8 1 (4) An attorney or pro se litigant participating in a civil or 2 administrative action or defense may be sanctioned for: 3 (a) filing a frivolous pleading, motion, or document if: 4 (i) the person has not read the frivolous pleading, 5 motion, or document; 6 (ii) a reasonable attorney in the same circumstances 7 would believe that under the facts, his claim or defense was clearly 8 not warranted under existing law and that a good faith or 9 reasonable argument did not exist for the extension, modification, 10 or reversal of existing law; 11 (iii) a reasonable attorney presented with the same 12 circumstances would believe that the procurement, initiation, 13 continuation, or defense of a civil cause was intended merely to 14 harass or injure the other party; or 15 (iv) a reasonable attorney presented with the same 16 circumstances would believe the pleading, motion, or document is 17 frivolous, interposed for merely delay, or merely brought for any 18 purpose other than securing proper discovery, joinder of parties, or 19 adjudication of the claim or defense upon which the proceedings 20 are based; 21 (b) making frivolous arguments a reasonable attorney 22 would believe were not reasonably supported by the facts; or 23 (c) making frivolous arguments that a reasonable attorney 24 would believe were not warranted under the existing law or if there 25 is no good faith argument that exists for the extension, 26 modification, or reversal of existing law. 27 (B)(1) If a document is not signed or does not otherwise comply 28 with this section, it must be stricken unless it is signed promptly or 29 amended to comply with this section after the omission is called to 30 the attention of the attorney or the party. 31 (2) If a document is signed in violation of this section, or an 32 attorney or pro se litigant has violated subsection (A)(4), the court, 33 upon its own motion or motion of a party, may impose upon the 34 person in violation any sanction which the court considers just, 35 equitable, and proper under the circumstances. 36 (C)(1) At the conclusion of a trial and after a verdict for or a 37 verdict against damages has been rendered or a case has been 38 dismissed by a directed verdict, summary judgment, or judgment 39 notwithstanding the verdict, upon motion of the prevailing party, 40 the court shall proceed to determine if the claim or defense was 41 frivolous. An attorney, party, or pro se litigant shall be sanctioned 42 for a frivolous claim or defense if the court finds the attorney,

1 [345] 9 1 party, or pro se litigant failed to comply with one of the following 2 conditions: 3 (a) a reasonable attorney in the same circumstances would 4 believe that under the facts, his claim or defense was clearly not 5 warranted under existing law and that a good faith or reasonable 6 argument did not exist for the extension, modification, or reversal 7 of existing law; 8 (b) a reasonable attorney in the same circumstances would 9 believe that his procurement, initiation, continuation, or defense of 10 the civil suit was intended merely to harass or injure the other 11 party; or 12 (c) a reasonable attorney in the same circumstances would 13 believe that the case or defense was frivolous as not reasonably 14 founded in fact or was interposed merely for delay, or was merely 15 brought for a purpose other than securing proper discovery, joinder 16 of proposed parties, or adjudication of the claim or defense upon 17 which the proceedings are based. 18 (2) Unless the court finds by a preponderance of the 19 evidence that an attorney, party, or pro se litigant engaged in 20 advancing a frivolous claim or defense, the attorney, party, or pro 21 se litigant shall not be sanctioned. 22 (D) A person is entitled to notice and an opportunity to respond 23 before the imposition of sanctions pursuant to the provisions of 24 this section. A court or party proposing a sanction pursuant to this 25 section shall notify the court and all parties of the conduct 26 constituting a violation of the provisions of this section and explain 27 the basis for the potential sanction imposed. Upon notification, the 28 attorney, party, or pro se litigant who allegedly violated subsection 29 (A)(4) has thirty days to respond to the allegations as that person 30 considers appropriate, including, but not limited to, by filing a 31 motion to withdraw the pleading, motion, document, or argument 32 or by offering an explanation of mitigation. 33 (E) In determining if an attorney, party, or a pro se litigant has 34 violated the provisions of this section, the court shall take into 35 account: 36 (1) the number of parties; 37 (2) the complexity of the claims and defenses; 38 (3) the length of time available to the attorney, party, or pro 39 se litigant to investigate and conduct discovery for alleged 40 violations of the provisions of subsection (A)(4); 41 (4) information disclosed or undisclosed to the attorney, 42 party, or pro se litigant through discovery and adequate 43 investigation;

1 [345] 10 1 (5) previous violations of the provisions of this section; 2 (6) the response, if any, of the attorney, party, or pro se 3 litigant to the allegation that he violated the provisions of this 4 section; and 5 (7) other factors the court considers just, equitable, or 6 appropriate under the circumstances. 7 (F) In determining whether sanctions are appropriate or the 8 severity of a sanction, the court shall consider previous violations 9 of the provisions of this section. 10 (G) Sanctions may include: 11 (1) an order for the party represented by an attorney or pro 12 se litigant to pay the reasonable costs and attorney’s fees of the 13 prevailing party under a motion pursuant to this section. Costs 14 shall include, but not be limited to, the following: the time required 15 of the prevailing party by the frivolous proceeding; and travel 16 expenses, mileage, parking, costs of reports, and any additional 17 reasonable consequential expenses of the prevailing party resulting 18 from the frivolous proceeding; 19 (2) an order for the attorney to pay a reasonable fine to the 20 court; or 21 (3) a directive of a nonmonetary nature, including injunctive 22 relief, designed to deter a future frivolous action or an action in 23 bad faith. 24 (H) If the court imposes a sanction to an attorney in violation of 25 the provisions of this section, the court shall report its findings to 26 the South Carolina Commission of Lawyer Conduct. 27 (I) This act shall not alter the South Carolina Rules of Civil 28 Procedure or the South Carolina Appellate Court Rules. 29 (J) The provisions of this section apply in addition to all other 30 remedies available at law or in equity. 31 (K) The amount requested for damages in a pleading may not 32 be considered in a determination of a violation of the provisions of 33 this section. 34 (L) All violations of the provisions of this section must be 35 reported to the South Carolina Supreme Court and a public record 36 must be maintained and reported annually to the Governor, Senate, 37 and House of Representatives.” 38 39 SECTION 6. Title 15 of the 1976 Code is amended by adding: 40 41 “Chapter 38 42 Joint and Several Liability 43

1 [345] 11 1 Section 15-38-15. (A) In an action to recover damages 2 resulting from personal injury, wrongful death, or damage to 3 property or to recover damages for economic loss or for 4 noneconomic loss such as mental distress, loss of enjoyment, pain, 5 suffering, loss of reputation, or loss of companionship resulting 6 from tortious conduct, if indivisible damages are determined to be 7 proximately caused by more than one defendant, joint and several 8 liability does not apply to any defendant whose conduct is 9 determined to be less than twenty percent of the total fault for the 10 indivisible damages as compared with the total of: (i) the fault of 11 all the defendants; and (ii) the fault (‘comparative negligence’), if 12 any, of plaintiff. A defendant whose conduct is determined to be 13 less than twenty percent of total fault shall only be liable for that 14 percentage of the indivisible damages awarded against all 15 defendants. 16 (B) Apportionment of percentages of fault among defendants is 17 to be determined as specified in subsection (C). 18 (C) The jury, or the court if there is no jury, shall: 19 (1) specify the amount of damages; 20 (2) determine the percentage of fault, if any, of plaintiff and 21 the amount of recoverable damages under applicable rules 22 concerning ‘comparative negligence’; and 23 (3) upon a motion by at least one defendant, where there is a 24 verdict under items (1) and (2) above for damages against two or 25 more defendants for the same indivisible injury, death, or damage 26 to property, specify in a separate verdict under the procedures 27 described at subitem (b) below the percentage of liability that 28 proximately caused the indivisible injury, death, damage to 29 property, or economic loss from tortious conduct, as determined by 30 (1) above, that is attributable to each defendant whose actions are a 31 proximate cause of the indivisible injury, death, or damage to 32 property. In determining the percentage attributable to each 33 defendant, any fault of the plaintiff, as determined by (2) above, 34 will be included so that the total of the percentages of fault 35 attributed to the plaintiff and to the defendants must be one 36 hundred percent. 37 (a) For this purpose, the court may determine that two or 38 more persons are to be treated as a single party. Such treatment 39 must be used where two or more defendants acted in concert or 40 where, by reason of agency, employment, or other legal 41 relationship, a defendant is vicariously responsible for the conduct 42 of another defendant.

1 [345] 12 1 (b) After the initial verdict awarding damages is entered 2 and before the special verdict on percentages of liability is 3 rendered, the parties shall be allowed oral argument, with the 4 length of such argument subject to the discretion of the trial judge, 5 on the determination of the percentage attributable to each 6 defendant. However, no additional evidence shall be allowed. 7 (D) Notwithstanding the application of this section, setoff from 8 any settlement received from any potential tortfeasor prior to the 9 verdict shall be applied in proportion to each defendant’s 10 percentage of liability as determined pursuant to subsection (C). 11 (E) This section does not apply to a defendant whose conduct is 12 determined to be intentional.” 13 14 SECTION 7. Section 34-31-20 of the 1976 Code is amended to 15 read: 16 17 “Section 34-31-20. (A) In all cases of accounts stated and in all 18 cases wherein any sum or sums of money shall be ascertained and, 19 being due, shall draw interest according to law, the legal interest 20 shall be at the rate of eight and three-fourths percent per annum. 21 (B) All A money decrees decree and judgments or judgment of 22 courts a court enrolled or entered shall must draw interest 23 according to law. The legal rate of interest is at the rate of twelve 24 percent a year equal to the prime rate as listed in the first edition of 25 the Wall Street Journal published for each calendar year for which 26 the damages are awarded, plus four percentage points, 27 compounded annually. The South Carolina Supreme Court shall 28 issue an order by January 15 of each year confirming the annual 29 prime rate. This section applies to all judgments entered on or 30 after July 1, 2005. For judgments entered between July 1, 2005, 31 and January 14, 2006, the legal rate of interest shall be the first 32 prime rate as published in the first edition of the Wall Street 33 Journal after January 1, 2005, plus four percentage points.” 34 35 SECTION 8. Section 36-2-803 of the 1976 Code is amended to 36 read: 37 38 “Section 36-2-803. (1) A court may exercise personal 39 jurisdiction over a person who acts directly or by an agent as to a 40 cause of action arising from the person’s: 41 (a) transacting any business in this State; 42 (b) contracting to supply services or things in the State;

1 [345] 13 1 (c) commission of a tortious act in whole or in part in this 2 State; 3 (d) causing tortious injury or death in this State by an act or 4 omission outside this State if he regularly does or solicits business, 5 or engages in any other persistent course of conduct, or derives 6 substantial revenue from goods used or consumed or services 7 rendered, in this State; or 8 (e) having an interest in, using, or possessing real property 9 in this State; or 10 (f) contracting to insure any person, property, or risk located 11 within this State at the time of contracting; or 12 (g) entry into a contract to be performed in whole or in part 13 by either party in this State; or 14 (h) production, manufacture, or distribution of goods with 15 the reasonable expectation that those goods are to be used or 16 consumed in this State and are so used or consumed. 17 (2) When jurisdiction over a person is based solely upon this 18 section, only a cause of action arising from acts enumerated in this 19 section may be asserted against him, and such action, if brought in 20 this State, shall not be subject to the provisions of Section 21 15-7-100 (3).” 22 23 SECTION 9. Article 1, Chapter 5, Title 39 of the 1976 Code is 24 amended by adding: 25 26 “Section 39-5-39. Notwithstanding another provision of law, it 27 is an unlawful trade practice, pursuant to Section 39-5-20, for an 28 attorney to advertise his services in this State in a false, deceptive, 29 or misleading manner including, but not limited to, the use of a 30 nickname that creates an unreasonable expectation of results.” 31 32 PART III 33 DEPARTMENT OF INSURANCE AND GENERAL 34 ASSEMBLY 35 REVIEW OF INSURER’S REDUCTION OF PREMIUMS TO 36 REFLECT SAVINGS 37 38 SECTION 10. The Department of Insurance shall review data 39 reported on annual statements by liability insurers, including, but 40 not limited to, paid claims, reserves, loss adjustment expenses, and 41 such additional data as the department may require by 42 promulgation of bulletin, to determine savings related to a decrease 43 in litigation and claims paid pursuant to litigation after the

1 [345] 14 1 effective date of this act. The department may require special 2 reports from insurers to determine if savings are realized as a result 3 of the provisions of this act. The department shall compile a report 4 of savings realized and submit it for General Assembly review 5 upon request. Costs or expenses associated with the compilation 6 of this report of savings shall be paid by the insurers pursuant to 7 the provisions of Chapter 13 of Title 38. The Department of 8 Insurance shall review premium and losses by line of insurance to 9 determine if appropriate adjustments have been made based upon 10 the department estimates of savings realized pursuant to the 11 provisions of this act. 12 13 PART IV 14 MISCELLANEOUS 15 16 SECTION 11. If any provision of SECTION 6 or its application 17 to any person is held invalid, unenforceable, or unconstitutional, 18 this validity, unenforceability, or unconstitutionality shall negate 19 the other provisions or applications of SECTION 6, and to this 20 end, the provisions of SECTION 6 are not severable. 21 22 SECTION 12. Sections 15-36-20, 15-36-30, 15-36-40, 15-36-50, 23 and 58-23-90 of the 1976 Code are repealed. 24 25 SECTION 13. The provisions of this act do not affect any right, 26 privilege, or provision of the South Carolina Tort Claims Act as 27 contained in Chapter 78, Title 15 of the 1976 Code of South 28 Carolina or the South Carolina Solicitation of Charitable Funds 29 Act as contained in Chapter 56 of Title 33. 30 31 SECTION 14. The repeal or amendment by this act of any law, 32 whether temporary or permanent or civil or criminal, does not 33 affect pending actions, rights, duties, or liabilities founded thereon, 34 or alter, discharge, release, or extinguish any penalty, forfeiture, or 35 liability incurred under the repealed or amended law, unless the 36 repealed or amended provision shall so expressly provide. After 37 the effective date of this act, all laws repealed or amended by this 38 act must be taken and treated as remaining in full force and effect 39 for the purpose of sustaining any pending or vested right, civil 40 action, special proceeding, criminal prosecution, or appeal existing 41 as of the effective date of this act, and for the enforcement of 42 rights, duties, penalties, forfeitures, and liabilities as they stood 43 under the repealed or amended laws.

1 [345] 15 1 2 SECTION 15. Except as provided in SECTION 11, if any 3 section, subsection, item, subitem, paragraph, subparagraph, 4 sentence, clause, phrase, or word of this act is for any reason held 5 to be unconstitutional or invalid, such holding shall not affect the 6 constitutionality or validity of the remaining portions of this act, 7 the General Assembly hereby declaring that it would have passed 8 this act, and each and every section, item, subitem, subsection, 9 paragraph, subparagraph, sentence, clause, phrase, and word 10 thereof, irrespective of the fact that any one or more other sections, 11 subsections, items, subitems, paragraphs, subparagraphs, 12 sentences, clauses, phrases, or words hereof may be declared to be 13 unconstitutional, invalid, or otherwise ineffective. 14 15 SECTION 16. Upon approval by the Governor: 16 (1) SECTIONS 1, 7, 10, 11, 13, 14, and 15 take effect; 17 (2) SECTION 2 takes effect on July 1, 2005, and applies to 18 improvements to real property for which certificates of occupancy 19 are issued after the effective date; 20 (3) SECTIONS 3, 4, 5, 6, 8, and 12 take effect July 1, 2005, 21 and shall only apply to causes of action arising on or after that 22 date; and 23 (4) SECTION 9 takes effect but shall only apply to 24 advertisements appearing after that date. 25 ----XX---- 26

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