A bill that would raise the maximum amount that a plaintiff or plaintiffs can recover when suing the state or local governments over deaths or personal injuries has passed the South Carolina Senate by a wide margin.
Under the current version of the South Carolina Tort Claims Act, which passed in 1986, individuals who file a claim can get no more than $300,000, and a group of plaintiffs can only share a maximum of $600,000 when they suffer harm as a result of an act of the government or a government representative. The new bill, S.7, would raise the individual limit to $500,000 and the group limit to $1 million.
The bill’s chief sponsor, Sen. Gerald Malloy, D-Darlington, said that it is time for the legislation to catch up with the rate of inflation that’s occurred since the bill was originally passed.
“The system had gotten to be a flawed system,” Malloy said. “The money that was being paid out to individuals was not sufficient and there was a lot of expenses as it relates to defense costs in these cases.”
Many personal injury plaintiffs’ attorneys from the state agree with Malloy, saying that in a serious case with lasting damages or death, the current limit simply isn’t enough to cover the increased cost of medical care and other expenses.
Scott Anderson, a personal injury attorney with Grimes Teich Anderson in Greenville, described a scenario in which a state van crashes when the driver negligently loses control, hitting a tree, killing three and seriously injuring five. Regardless of the total medical expenses and the resulting loss of income of each individual, the maximum amount that the group could recover would be a total of $600,000 under current law.
Malloy said that the potential for a slight increase in insurance costs for state and local governments was less significant than the need to protect citizens, and that while plaintiffs’ lawyers stand to benefit from the change, it also will have the effect of potentially lowering the cost of litigation for the state because the current caps have disincentivized defense attorneys from making plea deals, leading to more cases going to trial and ultimately greater costs for the state.
From October to December 2018, the South Carolina Insurance Reserve Fund reports paying over $28.8 million in property and liability coverage losses and in defense expenses. About $6.4 million, or 22 percent, of the money that was paid went to defense attorney fees.
“It promoted some dysfunction within the circuit court cases because they weren’t being settled,” he said. “And that drives up costs, which basically hurts the insurance companies as well.”
Malloy said that the version of the bill which passed the Senate is the result of a bipartisan study which ended in a compromise. An earlier version of the bill would have raised the individual limit to $1 million and the group limit to $2 million. He said that he expects similar compromises as the bill works its way through the House, but that he anticipates its passage.
Opponents of the bill were few in the Senate, as it passed the chamber in a 38-3 vote. The nay votes were Sean Bennett, R-Dorchester, Thomas Corbin, R-Greenville, and Kent Williams, D-Marion County. None of the three could be reached for comment before press time, but proponents of the bill said one argument against it is that it has the potential to increase liability insurance premiums.
“The rationale against it is to limit the state’s liability,” Anderson said, “which helps reduce the state’s exposure and insurance costs.”
Another potential concern is that the increase in the cap could expand the number of tort claims that get filed, increasing the financial burden on the state. George Sink Sr. of George Sink Injury Lawyers in North Charleston said that the cost of litigation against the state is usually high, but that the possibility for recovering more money may incentivize more attorneys to take the risk, although the standard for proving a tort claim against the government is high.
“This is long overdue,” said Robert Reeves, a personal injury attorney from York County. “It’s still difficult to win a claim in a Tort Claims Act case … The legal standard is you must show gross negligence, which is just below intentional. So, you have a bunch of hurdles to get to that cap.”
The House Committee on Ways and Means is currently considering the bill. If passed, it would take effect on July 1, 2020 and pertain only to matters occurring on or after that date.
Follow Matt Chaney on Twitter @SCLWChaney