Harvey Peeler

The South Carolina Senate agreed to limit lawsuit awards Tuesday, ending years of debate about whether to make the state legal system more business-friendly.

The bill would create a tiered system of damages based upon the degree of negligence or criminal behavior involved. Most lawsuits would cap punitive damages at $500,000, or three times actual costs, whichever is greater.

But that cap rises to $2 million, or four times actual damages, under several circumstances, including if an injury resulted because of an unreasonable profit-based decision or if the person or business that caused the injury was subject to a felony conviction.

The cap is lifted entirely if the person or business that caused the injury is convicted of a felony, intended to harm or was under the influence of drugs and alcohol.

The vote knocks out a key issue pushed by Senate Republican leadership, Gov. Nikki Haley and business interests in the session’s final week. The bill heads back to the House, which approved a $350,000 cap, or three times actual damages, with no exemptions earlier this year.

Business groups noted the caps are still among the highest in the Southeast, but they supported the compromise.

“It’s a decent day’s work,” said Rick Scott, president of the South Carolina Trucking Association. “This puts us close to being competitive; … it is a move forward.”

Attorneys said despite debating the need for years, the bill addressed a problem which did not exist.

“We still do not believe there is a need to put caps on punitive damages,” said Mark Joye with the South Carolina Association for Justice.

The bill has churned in the Senate for weeks as others issues, such as the budget, took precedence and those who opposed the caps sought to avoid a vote. But Haley and the state Republican Party dialed up the pressure Tuesday, with the governor insisting on the House version of the bill and telling lawmakers she would include their vote on her end-of-session report cards.

Lawmakers huddled all day, but it took a late afternoon five-minute recess that stretched more than three hours for the two sides to finally parse the bill’s language. Business lobbyists huddled near the House chamber poring over the latest revision, while lobbyists for trial lawyers did the same thing across the lobby.

Senators shuttled back and forth between the two groups with the others’ thoughts.

The bill now heads back for the House to agree or disagree with the Senate version. In a letter to Senators Tuesday, Haley said she supports the House version of the bill. If the House insists on its version, House and Senate lawmakers will have to work out a compromise.

“We got as good a bill as we can under the circumstances,” said Sen. Gerald Malloy, D-Darlington and an opponent of the caps. “We need to lean on the Senate to try to maintain the Senate position.

Courtesy of The State