Automobile Insurance SubrogationAutomobile Total Loss ThresholdsDeductible ReimbursementDiminution of ValueFirst Come, First Served: Subrogating Multiple Claims in Excess of Policy LimitsFuneral Procession Traffic LawsImputing Contributory Negligence of Driver to Vehicle OwnerKeep Right Traffic LawsLaws Regarding Using Cell Phones/Headphones/Texting While DrivingLoss Of UseMed Pay/PIP SubrogationOwner Liability For Stolen VehiclesPayment of Sales Tax After Vehicle Total LossPedestrian and Crosswalk LawsRental Car Company Physical Damage and Loss of Use ClaimsRental Car Company’s Liability Insurance Primary or ExcessSudden Medical Emergencies While DrivingSuspension of Drivers’ LicensesUse of Non-Original Equipment Manufacturer (OEM) Aftermarket Crash Parts in Repair of Damaged Vehicles
Federal , State, and Local Governmental EntitiesMunicipal/County/Local Governmental Immunity and Tort LiabilityState Sovereign Immunity And Tort Liability
General Tort Laws/StatutesAnti-Indemnity StatutesContribution ActionsContributory Negligence/Comparative FaultDog Bite LawsEconomic Loss DoctrineParental ResponsibilitySpoliationStatute of LimitationsStatute of Limitations Exceptions
Health Insurance SubrogationHealth and Disability Insurance
InvestigationAdmissibility of Expert TestimonyPre-Suit Disclosure of Liability Policy Limits in Third-Party ClaimsRecording Conversations
Product Liability SubrogationProduct Liability Law
Property Subrogation“Matching Regulations” And Laws Affecting Homeowners Property ClaimsCondominium/Co-OpWaiver of Subrogation LawsDamage to Property Without Market ValueGeneral Contractor Overhead And Profit Payments In First-Party ACV Property Damage ClaimsLandlord/Tenant Subrogation
Subrogation GenerallyAnti-Subrogation RuleCriminal RestitutionMade Whole DoctrineMedical Expenses, Insurance Write-Offs, and The Collateral Source Rule
Workers’ CompensationEmployee Leasing LawsHospital Lien LawsOCIP/CCIP Subrogation In Workers’ Compensation Construction CasesRecovery Of Increased Workers’ Compensation Premiums By EmployerWhich Workers’ Compensation “Benefits” Can Be Subrogated?Workers’ Compensation Subrogation Waiver EndorsementsWorkers’ CompensationWorkers’ Compensation Claims by Undocumented Employees
Automobile Insurance Subrogation
Automobile Total Loss Thresholds
Total Loss Threshold (75%)
Cost of repairing the vehicle exceeds 75% of the fair market value of the vehicle. S.C. Code Ann. § 56-19-480(G).
Automobile and Property: No applicable statute, Administrative Code provision or case law exists.
Diminution of Value
First Party: Where the policy language clearly “expressly limits coverage to the lesser of the actual value or the cost of repair” the South Carolina Supreme Court has held that “[t]hese are alternatives, which do not include an additional obligation to pay for diminished value when the cost of repair is chosen.” The Court also would not read into the cost of repair an additional requirement to also pay for diminished value since, to do so, would render the limitation provision meaningless. Schulmeyer v. State Farm Fire & Cas. Co., 579 S.E.2d 132 (S.C. 2003).
Third Party: South Carolina has held that “the cost of the repairs made… plus the (remaining) diminution in value of the property will ordinarily be the proper measure of damages.” Newman v. Brown, 228 S.C. 472, 477, 90 S.E.2d 649, 652 (1955).
First Come, First Served: Subrogating Multiple Claims in Excess of Policy Limits
A liability insurer has wide discretion in settling multiple liability claims. State Farm Mut. Auto. Ins. Co. v. Hamilton, 326 F.Supp. 931 (D. S.C. 1971). If an insurer settles with one claimant in good faith, the settlement reduces the limit of its liability to the remaining claimants, who may not complain that the insurer favored the settling claimant over them. Id.
Funeral Procession Traffic Laws
There is no state law governing funeral processions, however, the Supreme Court of South Carolina failed to recognize a group of vehicles as a funeral procession when the group had no police escort, there was no permit issued by the traffic department of the Columbia police department, and the group was not following a hearse, but rather, driving to the funeral home. Jones v. Grissett, 186 S.E.2d 829 (S.C. 1972). Furthermore, a vehicle in a funeral procession is not exempt from following traffic-control signals and has no right-of-way to proceed through a red light. Nabors v. Spencer, 207 S.E.2d 79 (S.C. 1974).
Imputing Contributory Negligence of Driver to Vehicle Owner
Imputed Contributory Negligence Law: Contributory negligence of driver can only be imputed to the owner-passenger if there is existence of an agency, common purpose, and/or joint enterprise. The test is whether driver was owner’s agent and whether owner had any control over management of vehicle. Ray v. Simon, 140 S.E.2d 575 (S.C. 1965).
Contributory negligence of driver cannot be imputed to owner suing third party for damages to vehicle unless there is agency, employer-employee relationship, and the driver is in course and scope. Howle v. McDaniel, 101 S.E.2d 255 (S.C. 1957).
Vicarious Liability/Family Purpose Doctrine: No Vicarious Liability Statute.
South Carolina recognizes the Family Purpose Doctrine. The head of a family who owns, furnishes, and maintains a vehicle for the general use and convenience of his family is liable for the negligence of a family member having general authority to operate the vehicle for such a purpose. If the car was not provided for the general use and convenience of the family, there is no relationship of principal and agent at the time of the wreck to impose liability on the parent under the Family Purpose Doctrine. Evans v. Stewart, 636 S.E.2d 632 (S.C. App. 2006).
Sponsor Liability for Minor’s Driving: S.C. Code. Ann. § 56-1-110: Person signing minor’s drivers’ license application will be jointly and severally liable for the motor vehicle negligence of the minor unless there is a policy of insurance in place which provides required coverage.
Keep Right Traffic Laws
Statute: S.C. Code Ann. § 56-5-1810 and S.C. Code Ann. § 56-5-1840.
Summary: Drivers must drive in the right lane except when overtaking and passing another vehicle; when an obstruction exists in the right lane; upon a roadway with three marked traffic lanes; or upon a roadway designated for one-way traffic. Slower traffic must keep right.
Flow of Traffic: Drivers proceeding slower than the normal speed of traffic must drive in the right lane. Except when overtaking and passing on the right is permitted, the driver of an overtaken vehicle shall give way to the right in favor of the overtaking vehicle on audible signal.
Laws Regarding Using Cell Phones/Headphones/Texting While Driving
Cell Phone/Texting: A driver may not send, read or compose text-based communications while operating a motor vehicle. Exceptions include if the vehicle is parked, hands-free device is being used, or in emergency situations. S.C. Code Ann. § 56-5-3890.
Other Prohibitions: No Applicable Laws.
Comments: Any local ordinances or regulations are preempted by state law regarding wireless electronic communication devices and their operation on the public streets and highways. S.C. Code Ann. § 56-5-3890(G).
Loss Of Use
Loss of Use: Yes. A jury may award a plaintiff for the loss of use of a vehicle for the reasonable length of time that it was being repaired. Fuller v. E. Fire & Cas. Ins. Co., 124 S.E.2d 602 (S.C. 1962). Where a plaintiff’s vehicle is totally demolished, no loss of use damage may be recovered. Vanderford v. Smith, 111 S.E.2d 777 (S.C. 1960). No case law or statutory authority supporting loss of use damages being recoverable without having actually rented substitute vehicle.
Lost Profits: Yes. Lost profits are recoverable if plaintiff can present evidence of a fair and reasonable approximation of the lost profits. Petty v. Weyerhaeuser Co., 342 S.E.2d 611 (S.C. App. 1986). Evidence supporting lost profits “must consist of actual facts from which a reasonably accurate conclusion regarding the cause of the loss and the amount of the loss can be logically and rationally drawn” Drews Co. v. Ledwith-Wolfe Assoc., 371 S.E.2d 532 (S.C. 1988).
Comments: In calculating lost profits, plaintiff must use net profits rather than expected gross profits. However, where a plaintiff seeks damages to his business and reputation, the court can utilize gross revenues to estimate damages if operating costs cannot be reasonably reduced by a plaintiff. Id. quoting 3 A.L.R.3d 689 (1965) & 22 Am.Jur.2d Damages § 178 (1965).
Med Pay/PIP Subrogation
Med Pay: S.C. Code § 38-77-144. PIP and Med Pay coverage may not be subrogated.
PIP: Same as Med Pay. No PIP coverage mandated in South Carolina. Wilson v. Tenn. Farms’ Mut. Ins. Co., 411 S.W.2d 699 (Tenn. 1966).
- “Add-On” PIP State. PIP or similar first-party benefits are “added on” with no limitation on third party lawsuits. First-party basic no-fault-type benefits are recoverable by injured party unless they have rejected tort limitations. Insured must choose whether bound by verbal threshold.
Made Whole: Not applied in South Carolina.
Statute of Limitations: The three (3) year statute of limitations runs from the date of the insured’s accident. S.C. Code Ann. § 15-3-530.
Owner Liability For Stolen Vehicles
Key In The Ignition Statutes: S.C. Code Ann. § 56-5-2570.
Common Law Rule: As a matter of law, sole, proximate, and efficient cause of collision and victim’s resulting injuries was intervening, independent acts of negligence and willfulness on part of thief who steals a vehicle, unless circumstances exist that made the theft foreseeable. Stone v. Bethea, 161 S.E.2d 171 (S.C. 1968); Johnston v. Pittman, 380 S.E.2d 850 (S.C. Ct. App. 1989).
Payment of Sales Tax After Vehicle Total Loss
First-Party Claims: Insurers are not required to reimburse for the sales tax unless the policy specifically states otherwise. Schulmeyer v. State Farm Fire & Cas. Co., 353 S.C. 491, 498, 579 S.E.2d 132, 135 (2003). No applicable statute, case law, or regulation governing recovery of sales tax.
As of July 1, 2017, owners of new vehicle owe an Infrastructure Maintenance Fee (IMF) instead of sales tax. Under the new legislation known as the “Roads Bill”, if a “vehicle or other item that is required to be registered” is purchased or leased and will be titled and/or registered in North Carolina, the owner will owe an Infrastructure Maintenance Fee (IMF) instead of sales tax. For dealers, the IMF will be in the amount of 5% of the gross proceeds of sale price (not to exceed $500). For private sales of vehicles, the cap is $250. Those who move to South Carolina with a vehicle that needs to be registered in the state will automatically owe a $250 IMF per vehicle. Those who purchase a vehicle or other item in the state, that will be registered in a different state, will not need to pay an Infrastructure Maintenance Fee, but a sales tax instead. Salvage title applications are exempt from the IMF. S.C. Stat. Ann. § 56-3-627 (A) through (D).
Third-Party Claims: No applicable statute, case law, or regulation governing recovery of sales tax.
Pedestrian and Crosswalk Laws
S.C. Code Ann. § 56-5-3130: When traffic signal is not in place, vehicles must yield to pedestrian in crosswalk on vehicle’s half of road or close to it. Pedestrians must not step off curb and into path of vehicle when vehicle does not have time to stop.
S.C. Code Ann. § 56-5-3150: Pedestrians must yield to vehicles when crossing outside crosswalk. Pedestrians must use crosswalk at intersections with traffic control devices. Pedestrians must not cross diagonally.
Summary: Pedestrian being in road in violation of statute amounts to a lack of due care that can make pedestrian chargeable with contributory negligence. Cooper by Cooper v. County of Florence, 299 S.C. 386, 385 S.E.2d 44 (S.C. App. 1989).
Rental Car Company Physical Damage and Loss of Use Claims
Recovery From Renter: Recovery of physical damage and loss of use are not prohibited or otherwise regulated. Terms of rental agreement control. Collision Damage Waivers not regulated.
Recovery From Third-Party: Nothing directly dealing with the right of a car rental company to recover loss of use damages. Generally, when a vehicle is damaged, the cost to repair it or depreciation in the vehicle’s value (cost to repair may constitute a part of the measure of depreciation), together with the value of the loss of use of the vehicle is recoverable against the tortfeasor. Newman v. Brown, 90 S.E.2d 649 (S.C. 1955); Coleman v. Levkoff, 122 S.E. 875 (S.C. 1924). Loss of profits by the owner may also be recoverable under the proper circumstances. Charles v. Texas Co., 18 S.E.2d 719 (S.C. 1942).
Rental Car Company’s Liability Insurance Primary or Excess
Summary: Car rental company’s policies are primary, including those who are self-insured. Southern Home Ins. Co. v. Burdette’s Leasing, 234 S.E.2d 870 (S.C. 1977). The same is true for dealer’s garage liability coverage. Travelers Indem. Co. v. Dees, 235 F. Supp. 515 (S.C. 1964).
Sudden Medical Emergencies While Driving
Sudden Unforeseeable Incapacity Defense or Imminent Peril Doctrine. The operator of an automobile is not ordinarily chargeable with negligence if he is suddenly stricken by a fainting spell, or loses consciousness from some other unforeseen cause, and is unable to control the vehicle. Boyleston v. Baxley, 133 S.E.2d 796 (S.C. 1963).
Court did not extend the sudden unforeseeable incapacity defense to a defendant who suffered a hypoglycemic episode while driving. The hypoglycemic episode was deemed foreseeable since there was sufficient warning of a hypoglycemic episode approaching. Howle v. PYA/ Monarch, Inc., 344 S.E.2d 157 (S.C. Ct. App. 1986).
Suspension of Drivers’ Licenses
Administrative Suspension: The Department can suspend an owner’s driver’s license and all of his license plates and registration certificates if the owner’s uninsured motor vehicle is involved in a reportable accident resulting in death, injury, or property damage and the uninsured motor vehicle fee is not paid. S.C. Code Ann. § 56-10-530. Driver’s license will remain suspended until individual shows that they have complied with the statute and paid the reinstatement fee. S.C. Code Ann. § 56-10-530.
Judgment: Upon receipt of an unsatisfied judgment, the Department will suspend the driver’s license and registration of any person against whom a judgment arising out of an accident was rendered. S.C. Code Ann. § 56-9-430. Suspension will continue until the judgment is satisfied. S.C. Code Ann. § 56-9-470.
Contact Information: State of South Carolina, Department of Motor Vehicles, Post Office Box 1498, 10311 Wilson Boulevard, Bldg. C, Blythewood, SC 29016, (803) 896-5000, http://www.scdmvonline.com/.
Use of Non-Original Equipment Manufacturer (OEM) Aftermarket Crash Parts in Repair of Damaged Vehicles
Authority: S.C. Code Ann. § 38-78-50; S.C. Code Ann. § 38-78-20.
Summary: Service contracts applying to autos must include information about when non-OEM parts will be allowed.
Federal , State, and Local Governmental Entities
Municipal/County/Local Governmental Immunity and Tort Liability
South Carolina Tort Claims Act: S.C. Code Ann. § 15-78-10, et seq. (1986). Limited waiver of sovereign immunity, subject to exceptions. Political subdivision is liable for torts to the same extent as private individual, subject to limitations. S.C. Code § 15-78-40.
Notice Deadlines: Notice is not prerequisite to filing suit. However, two (2) year statute of limitations; Three (3) years if Notice of Claim filed. S.C. Code § 15-78-110. Must wait 180 days after earlier of (1) date claim filed; (2) claim denied; or (3) rejection of settlement offer. If claim procedure followed, must be filed within one (1) year. S.C. Code § 15-78-80.
Claims/Actions Allowed: Sovereign immunity waived (State liable) for all torts unless one of 40 listed exceptions to waiver of immunity.
Comments/Exceptions: Non-exclusive list of 40 exceptions to the general waiver of political subdivision sovereign immunity, including, among others: (1) legislative, judicial actions; (2) discretionary acts; (3) natural snow or ice conditions; (4) authorized entry on property; (5) absence or condition of traffic sign or barrier unless given reasonable notice to repair; (6) claim against DOT allowed for improper maintenance but not faulty design; and (7) any judicial proceeding. S.C. Code § 15-78-60.
Damage Caps: $300,000 Per Person. $600,000 Per Occurrence. No Punitive Damages. For claims against government doctors, dentists, etc.: $1.2 million per occurrence and aggregate limit. S.C. Code § 15-78-120.
State Sovereign Immunity And Tort Liability
Tort Claims Act: South Carolina Tort Claims Act. S.C. Code Ann. § 15-78-10, et seq. (1986).
Limited waiver of sovereign immunity, subject to exceptions. State is liable for torts to the same extent as private individual, subject to limitations. S.C. Code Ann. § 15-78-40.
Notice Deadlines: Two year statute of limitations; Three years after Notice of Claim (year added to SOL if notice procedure followed). S.C. Code Ann. § 15-78-110. Notice setting forth the circumstances, extent of loss, time and place, names of all persons involved, and amount of loss, must be filed within one (1) year. S.C. Code Ann. § 15-78-80.
Claims/Actions Allowed: Sovereign immunity waived (State liable) for all torts unless listed under exceptions to waiver of immunity.
Comments/Exceptions: Statute lists non-exclusive list of 40 exceptions to the general waiver of State sovereign immunity, including, among others:
(1) legislative, judicial actions;
(2) discretionary acts;
(3) natural snow or ice conditions;
(4) authorized entry on property;
(5) absence or condition of traffic sign or barrier unless given reasonable notice to repair;
(6) claim against DOT allowed for improper maintenance but not faulty design; and
(7) any judicial proceeding.
S.C. Code Ann. § 15-78-60.
Damage Caps: $300,000 per person. $600,000 per occurrence. No punitive damages. S.C. Code Ann. § 15-78-120.
General Tort Laws/Statutes
Prohibits Broad Indemnity. Applies to Construction Contracts, “Promises” or Agreements. S.C. Code § 32-2-10.
Not applicable to any electric utility, electric cooperative, or rail carriers.
Pure and Joint Several Liability. Several liability for a defendant found less than 50% at fault, as long as conduct did not involve drugs/alcohol and was not intentional – all others are jointly and severally liable. S.C. Code Ann. § 15-38-15; Branham v. Ford Motor Co., 701 S.E.2d 5 (S.C. 2010).
A tortfeasor who enters into a settlement with claimant is not entitled to recover contribution from another tortfeasor whose liability for the injury or wrongful death is not extinguished by settlement or in respect to any amount paid in settlement which is in excess of what was reasonable. A settling tortfeasor may recover contribution from a non-settling tortfeasor provided the settlement agreement must extinguish the non-settling tortfeasor’s liability and the settlement amount must be reasonable.
Where there is no judgment against the tortfeasor seeking contribution, the right of contribution is barred unless they have either: (1) discharged by payment the common liability within the SOL period applicable to plaintiff’s right of action against them and have commenced action for contribution within one (1) year after payment, or (2) agreed while action is pending against them to discharge common liability and have, within one (1) year after the agreement, paid the liability and commenced their contribution action for contribution. S.C. Code Ann. § 15-38-20. There is a one year statute of limitation after the common liability is extinguished by the release.
Contributory Negligence/Comparative Fault
Modified Comparative Fault: 51% Bar. Damaged party cannot recover if it is 51% or more at fault. If 50% or less at fault, it can recover, although its recovery is reduced by its degree of fault. Plaintiff’s negligence cannot exceed that of the defendant(s). Ross v. Paddy, 340 S.C. 428, 532 S.E.2d 612 (Ct. App. 2000).
Dog Bite Laws
Dog owner will be liable for all damages if victim was on public property or lawfully on private property. S.C. Code Ann. § 47-3-110.
Economic Loss Doctrine
Majority Rule (waffling). There is no tort liability for a product defect if the damage suffered by a plaintiff is only to the product itself. Kennedy v. Columbia Leather and Mfg. Co., Inc., 384 S.E.2d 730 (S.C. 1989). A plaintiff cannot seek economic damages, including damages to the product only, in tort. Palmetto Linen Serv., Inc. v. U.N.X., Inc., 105 F.3d 126 (4th Cir. 2000). South Carolina meekly recognizes the “other property” exception to the ELD when non-commercial parties are involved, but in the context of a commercial transaction between sophisticated parties, injury to other property is not actionable in tort if the injury was or should have been reasonably contemplated by the parties to the contract. In a case where it applied the asbestos exception to the Majority Rule, the South Carolina Supreme Court noted their “difficulty with the Economic Loss Rule generally” and has partially rejected the rule in the residential home building context. Kershaw County Board of Educ. v. U.S. Gypsum, Co., 396 S.E.2d 369 (S.C. 1990) (citing Kennedy). South Carolina courts have held that if there is a legal duty owed to the plaintiff independent of any contract between the parties, a tort action may be pursued. Koontz v. Thomas, 511 S.E.2d 407 (S.C. App. 1999). There is an exception where there is a serious threat of bodily harm. However, in 2009, the South Carolina Supreme Court affirmed that the buyer of a product could not recover in tort for purely economic damages. Sapp v. Ford Motor Co., 687 S.E.2d 47 (S.C. 2009). In particular, a federal court confirmed a plaintiff cannot avoid the ELD by simply classifying a component party (i.e., a hydraulic hose and its fitting) as the “defective product” and the main product as the “other property” that it damaged. Fireman’s Fund Ins. Co. v. Am. Equip. Co., Inc., 2009 WL 10711040 (D.S.C. 2009).
Willful Misconduct. Liability is imposed on parents when child causes malicious or willful personal injury, theft, or destruction to or damages of property. S.C. Code Ann. § 63-5-60.
Minor’s Driving. Adult or guardian signing minor’s drivers’ license application will be jointly and severally liable for the motor vehicle negligence of the minor, unless there is a policy of insurance in place which provides required coverage. S.C. Code Ann. § 56-1-110.
The limit of liability is $5,000.00. Child must be under 18-years-old.
Tort of Spoliation: There is no case law in South Carolina discussing spoliation of evidence, specifically. However, South Carolina apparently recognizes a type of Adverse Inference Rule as it relates to loss or destruction of evidence. Wisconsin Motor Corp. v. Green, 79 S.E.2d 718, 720-21 (S.C. 1954). It appears as though such inference may be given when a party does not provide an explanation for its failure to produce appropriate documents. Id.
Statute of Limitations
- Personal Property3 YearsS.C. Code Ann. § 15-3-530, 535
- Personal Injury/Death3 YearsS.C. Code Ann. §§ 15-3-530, 535, 545
- Breach of Contract/Written3/20 (Under Seal)S.C. Code Ann. § 15-3-520, 530
- Breach of Contract/Oral3 YearsS.C. Code Ann. § 15-3-530(1)
- Breach of Contract/Sale of Goods6 YearsS.C. Code Ann. § 36-2-725
- Statute of Repose/ProductsN/AN/A
- Statute of Repose/Real Property8 YearsS.C. Code Ann. § 15-3-640*
- Breach of Warranty6 YearsS.C. Code Ann. § 36-2-725
- Workers’ Comp Third Party Case3 YearsS.C. St. § 42-1-560
- Strict Product Liability3 YearsS.C. Code Ann. §§ 15-3-530, 15-3-535
Statute of Limitations Exceptions
*8 years from substantial completion of improvement to real property. S.C. Code Ann. § 15-3-640.
Health Insurance Subrogation
Health and Disability Insurance
Statute of Limitations: 3 Years. S.C. Code Ann. §§ 15-3-530, 15-3-535, 15-3-545.
Subrogation of Medical and Disability Benefits are allowed. S.C. Code Ann. § 38-71-190. Made Whole does not apply. See S.C. Code § 38-71-190 providing that plaintiff can petition director or its designee on equitable grounds to disallow subrogation. Common Fund applies. First Union Nat’l Bank of S.C. v. Soden, 511 S.E.2d 372 (S.C. App. 1998); S.C. Code § 38-71-190.
Admissibility of Expert Testimony
Admissibility Standards: Other
Case/Statutory Law: State v. Council, 515 S.E.2d 508, cert. denied, 528 U.S. 1050 (1999). Graves v. CAS Medical Systems, Inc., 735 S.E.2d 650, 655 (S.C. 2012).
Comments: South Carolina Rules of Evidence provides the proper analysis to determine admissibility of scientific evidence. Id. at 20, 515 S.E.2d at 518.
(1) The subject matter is beyond the ordinary knowledge of the jury.
(2) The expert must have acquired the requisite knowledge and skill to qualify as an expert in the particular subject matter, although he need not be a specialist in the particular branch of the field.
(3) The substance of the testimony must be reliable.
The final inquiry is the central feature of the analysis. Although Daubert never formally adopted, S.C. rules have always charged the court with performing a “gate keeping” function in limiting the presentation of expert testimony to situations where the testimony will assist the trier of fact in understanding evidence or determining a fact in issue.
Pre-Suit Disclosure of Liability Policy Limits in Third-Party Claims
Duty To Disclose: Yes. S.C. Code Ann. § 38-77-250, South Carolina Fairness in Civil Justice Act of 2011.
Failure To Disclose A Basis For Bad Faith: A court may impose sanctions for violations.
Comments: An insurer who may be liable for a claim, shall provide “within 30 days of receiving a written request from the claimant’s attorney, a statement, under oath, of a corporate officer/claim’s manager, each known policy of non-fleet private passenger insurance issued, the name of the insurer, the name of the insured, and the limits of coverage. A copy of the declarations page will satisfy this duty. The request must be initiated by plaintiff counsel.
One-Party Consent: It is not unlawful for an individual who is a party to or has consent from a party of an in-person or electronic communication to record and or disclose the content of said communication. S.C. Code Ann. § 17-30-30; S.C. Code Ann. § 17-30-15.
Product Liability Subrogation
Product Liability Law
Statute of Limitations/Repose: 3 years for personal injury and wrongful death. S.C. Code Ann. §§ 15-3-530, 535, 545 (1976). Discovery Rule Applies. Statute of Repose is 8 years (Improvements). S.C. Code Ann. § 15-3-640.
Liability Standards: Negligence, Strict Liability, Warranty.
Fault Allocations: Modified Comparative.
Non-Economic Caps/Limits On Actual Damages: No.
Punitive Y/N and Limits: Yes (Qualified Limits).
Heeding Presumption?: No. Branham v. Ford Motor Co., 701 S.E.2d 5, 14-16 (S.C. 2010).
Innocent Seller Statute: No.
Joint and Several Liability: Yes, if > 50%. S.C. Code Ann. § 15-38-15.
Available Defenses: Assumption of Risk; Misuse; Alteration; Learned Intermediary; Inherently Unsafe Products; State of the Art; Presumption; Sophisticated User.
Restatement 2nd or 3rd?: Restatement 3rd
“Matching Regulations” And Laws Affecting Homeowners Property Claims
Condominium/Co-OpWaiver of Subrogation Laws
No waiver of subrogation required. S.C. Code Ann. § 27-31-240.
Damage to Property Without Market Value
Service Value: “Accordingly, we hold that the necessary expense in replacing the utility pole is the proper measure of damages for its wrongful destruction.” Duke Power Co. v. Thornton, 401 S.E.2d 195 (S.C. Ct. App. 1991) (citing Horton v. Georgia Power Co., 254 S.E.2d 479 (Ga. Ct. App. 1979)).
Intrinsic Value: “Recovery may be had for the loss or destruction of property even though it has no actual market value, in which case the owner is entitled to recover its actual or reasonable value, or its special value to him.” Nelson v. Coleman Co., 155 S.E.2d 917 (S.C. 1967).
Sentimental Value: Awarding secondhand market value is not adequate compensation to owner of household goods and wearing apparel destroyed by fire, and owner may recover either actual value of item or its value to him, excluding fanciful or sentimental value which he may place on item. Nelson v. Coleman Co., 155 S.E.2d 917 (S.C. 1967).
General Contractor Overhead And Profit Payments In First-Party ACV Property Damage Claims
Payment Of Depreciation Of GCOP/Sales Tax: No applicable case law, statutes, administrative rules, or other guidance with regard to the calculation and/or depreciation of GCOP.
South Carolina statute provides as follows: S.C. Code Ann. § 38-75-60. Cause of action by insurer against tenant. Notwithstanding any other provision of law, no insurer has a cause of action against a tenant who causes damage to real or personal property leased by the landlord to the tenant when the insurer is liable to the landlord for the damages under an insurance contract between the landlord and the insurer, unless the damage is caused by the tenant intentionally or in reckless disregard of the rights of others.
No right of subrogation arises in favor of the insurer against its own insured or against a person who holds the status of an additional insured by the terms of the policy. Aetna Cas. & Sur. Co. v. Security Forces, Inc., 347 S.E.2d 903 (Ct. App. 1986).
The applicable South Carolina restitution statute allows for restitution awards to “victims,” but designates a special hearing to determine amount of restitution that “victim” will be entitled to, considering pecuniary damages or loss suffered by the “victim.” S.C. Code Ann. § 17‐25‐322(A). Despite allowance of restitution to “victim,” neither the courts nor the legislature have addressed whether or not an insurer can recover as a “victim” restitution amounts.
Made Whole Doctrine
South Carolina case law does not discuss application of the Made Whole Doctrine. However, a hybrid of the Made Whole Doctrine is enforced in South Carolina with regard to health insurance subrogation through the application of S.C. St. § 38-71-190. This statute provides that a health insurer may recover no more than “the amount of insurance benefits that the insurer has paid previously in relation to the insured’s injury by the liable third party.” Id. Therefore, this statute allows for a “pro-rata” subrogation right by the health insurer, instead of the more harsh application of the “all or nothing” Made Whole Doctrine. This statute also contains a catch all that if the director, or his designee, upon being petitioned by the insured, determines that the exercise of subrogation by an insurer is inequitable and commits an injustice to the insured, subrogation is not allowed. S.C. St. § 38-71-190. Director is defined in § 38-1-2 as “a person who is appointed by the governor upon the advise and consent of the Senate and who is responsible for the operation and management for the Department of Insurance.” Therefore, under the appropriate fact circumstances, the traditional effect of the Made Whole Doctrine could be applicable in South Carolina as well. Other than the above statute, South Carolina doesn’t appear to apply the Made Whole Doctrine.
Medical Expenses, Insurance Write-Offs, and The Collateral Source Rule
Collateral Source Rule: Common law CSR. Amounts received from collateral source will not reduce plaintiff’s damages, as long as it is “wholly independent of wrongdoer.”
Recovery Of Medical Expenses Rule:
Private Insurance: Despite CSR, a set-off of medical payments made on plaintiff’s behalf by defendant’s insurer is allowed. Mount v. Sea Pines Co., Inc., 523 S.E.2d 464 (S.C. App. 1999). Otherwise, amounts paid by collateral source inadmissible. Covington v. George, 597 S.E.2d 142 (S.C. 2004).
Medicare/Medicaid: The CSR applies to Medicaid payments; the amount billed is recoverable. Haselden v. Davis, 579 S.E.2d 293 (S.C. 2003). The court acknowledged that several other courts have held that the amount paid by Medicaid is the reasonable medical expense.
Workers’ Comp: Amount of compensation received not admissible in any third-party action. S.C. Code Ann. § 42-1-570.
Employee Leasing Laws
Employee leasing companies and staff leasing services are governed by § 40-68-70 of the South Carolina Statutes. In order to be a statutory employee under the Workers’ Compensation Act, a worker must be engaged in an activity that “is a part of the client company’s trade, business, or occupation”. S.C. St. § 42-1-400. This statutory requirement has been construed to include activities that: (1) are an important part of the employer’s trade or business of the employer; (2) are a necessary, essential, and integral part of the employer’s business; or (3) have previously been performed by employer’s employees. Glass v. Dow Chemical Co., 482 S.E.2d 49 (S.C. 1997). Only one of these tests must be met in order for a subcontractor’s employee to be considered a statutory employee of the owner and immune from third-party actions as a result of the Exclusive Remedy Rule. Woodard v. Westvaco Corp., 433 S.E.2d 890 (S.C. App. 1993), vacated on other grounds, 460 S.E.2d 392 (1995).
Hospital Lien Laws
Statute: No statutory provision in South Carolina.
Comments: South Carolina is one of nine states without statewide lien laws.
OCIP/CCIP Subrogation In Workers’ Compensation Construction Cases
OCIP Law: No statute or case law specifically dealing with effect of OCIP/CCIP.
Statutory Employer Law: “Upstream” subcontractors are deemed statutory employers of an employee of a sub-subcontractor under the Workers’ Compensation Act and are immune from tort liability. S.C. Code Ann. § 42-1-410. This is true even if they are not called on to pay benefits to the statutory employee. Johnson v. Jackson, 735 S.E.2d 664 (S.C. App. 2012).
Comments: South Carolina has been clear in that exclusivity remedy protection does not extend to a subcontractor sued for negligence by the employee of the business owner, even though the subcontractor becomes a “statutory employee” of the owner for purposes of compensation liability under § 42-1-400 (deals with “owners”). Section 42-1-410 is almost identical but applies to “contractors.” Section 42-1-420 deals with “subcontractors.”
Recovery Of Increased Workers’ Compensation Premiums By Employer
Recovery For Increased Premiums? Undecided.
Statute/Case Law: None.
Rule Summary: There is no authority or precedent regarding the attempted recovery of damages for increased workers’ compensation insurance premiums by an employer from a third-party tortfeasor.
Which Workers’ Compensation “Benefits” Can Be Subrogated?
South Carolina law does not directly address the ability of the carrier to include items such as nurse case management and other fees and expenses in its subrogation lien. However, an argument can be made that such benefits should be recoverable, because § 42-1-560(b) provides that “the carrier shall have a lien on the proceeds of any recovery … to the extent of the total amount of compensation, including medical and other expenses, paid, or to be paid by such carrier … to the extent the recovery shall be deemed to be for the benefit of the carrier.” Nurse case management fees would arguably fall under “other expenses.”
Workers’ Compensation Subrogation Waiver Endorsements
Subrogation Statute: S.C. Code Ann. § 42-1-560
Waiver Allowed? Nothing in the South Carolina Workers’ Compensation Act or applicable case law prohibits the use or efficacy of a waiver of subrogation.
Effect Of Waiver Endorsement on Carrier’s Right To Assert A Lien On Claimant’s Recovery: The effect of a waiver of subrogation on the carrier’s rights, including its right to enforce its statutory lien, has not yet been decided.
Other Applicable Law: None.
Statute of Limitations: 3 Years. S.C. St. § 42-1-560.
Can Carrier Sue Third Party Directly: Yes, after 1 year. Twenty (20) days assignment notice to employee required. Can sue 90 days after that.
Right to Intervene: Yes.
Recovery from UM/UIM Benefits: No.
Subrogation Against Medical Malpractice: Yes.
Subrogation Against Legal Malpractice: Undecided.
Recovery Allocation/Equitable Limitations: First money less fees; but equitable reduction.
Employer Contribution/Negligence: No.
Attorney’s Fees/Costs: Set by Commission F2 1/3.
Future Credit: Yes.
Auto No-Fault: No.
Workers’ Compensation Claims by Undocumented Employees
Statute: The statute expressly includes alien, no matter if they are legally or illegally employed. S.C. Code Ann. § 42-1-130.
Case Law: Curiel v. Envtl. Mgmt. Servs., 655 S.E.2d 482 (S.C. 2007).
Comments/Explanation/Other: Curiel held that the IRCA did not preempt state law and an illegal alien is not precluded from benefits under the state’s workers’ compensation laws.