FRANKLYWNOW - Civil Justice Bill Brings Questions

Civil Justice Bill Brings Questions

Now that Gov. Joe Manchin's civil justice reform bills have been introduced, legislators and observers are dissecting the bills to determine whether more needs to be done. "Manchin put a number of issues out there, and not everyone is going to agree with everything," said Steve White of the Affiliated Construction Trades Foundation. "He's looking for common ground on where a compromise can be found. There are some significant things that can be done short of a full-blown battle." Brenda Nichols Harper, vice president and general counsel of the West Virginia Chamber of Commerce, said the governor's bills must go through a review process before the Chamber will comment specifically about them. "We think the governor has done a good thing by opening up the dialogue. The legislative process is a process -- it's a great opportunity to discuss issues in our civil justice system that are important to preserve business and insurance availability in this state," Harper said. Delegate Joe DeLong, D-Hancock, said the actual bills did not became available until March 1 so legislators only now are getting a chance to look at the details. "There is a whole education process going on. A bunch of members just now are getting education on joint and several and third-party bad faith," DeLong said. But DeLong said he hoped the Legislature did not become paralyzed by debate. "The absolute worst-case scenario is to do nothing. And we've got to do something," he said. "Most of the members agree something needs to change. It's a matter of balance, making the system more balanced." Joint-and-Several One of Manchin's bills reformulates how much multiple defendants should have to pay in a civil action. As the law stands today, multiple defendants in a civil action are jointly liable, which means one defendant could end up paying an entire jury award regardless of whether that defendant is one percent or 99 percent at fault. If other defendants can't pay their share of an award, the "deep pockets" have to pay the rest. Manchin's bill makes anyone found 25 percent or more at fault jointly liable, meaning one defendant could pay more of an award than another regardless of the degree of fault. For those found to have less than 25 percent responsibility, they are severable, which means they pay just their percentage of fault as determined by a jury. If the plaintiff has not been paid the full verdict six months after it has been rendered, anyone bearing 10 percent or more liability could be subject to a reallocation of the remaining unpaid award. Anyone with less than 10 percent liability remains severable. Delegate Mitch Carmichael, R-Jackson, said Manchin's bill is "OK, but it could be a little better." White said the joint-and-several bill has "some balance in it." "We don't like it, but it's not the end of the world either," he said. The Exceptions The joint-and-several bill contains some exclusions that some worry will weaken the effectiveness of the bill:

  • Any party who acted with the intention of inflicting injury or damage.
  • Any party who acted in concert with another person as part of a common plan or design resulting in harm.
  • Any party who negligently or willfully caused the unlawful emission, disposal or spillage of a toxic or hazardous substance.
  • Any party strictly liable for the manufacture and sale of a defective product.

Mychal Schulz, a partner at Dinsmore & Shohl who handles all areas of civil litigation including products liability and deliberate intent cases, said the exceptions to severability narrow the field of cases that actually would be affected by the bill. "What this bill does in these exceptions is coming close to swallowing the general rule such that there is only a small number of cases the bill actually will affect," Schulz said. "You're mostly left with slip-and-fall cases and auto wrecks with more than one defendant. All cases involving intentional torts, joint enterprise or civil conspiracy, toxic torts and strict liability in product defect are excepted. The bill does do something, but the practical effect of what it does is small." Carte Goodwin, Manchin's general counsel, said the exceptions were added for a good reason. "It's to safeguard the public, particularly with regard to toxic substances. As for products liability, it's specific to strict liability, which is without proof of negligence or breach of a standard of care," Goodwin said. "Public policy recognizes that consumers need more protection from defective products than just a warranty. It does not relieve the plaintiff from having to prove the defect." Reallocation System Schulz also took note of the joint-and-several bill's reallocation system. "There is a Byzantine method of reallocation for uncollected damages," he said. For defendants with 10 percent or more of damages, the possibility of being forced to pay again in the future is not going to help lure businesses to West Virginia. For example, a defendant found 10 percent liable in a $1 million case would pay its $100,000. But later, if the remaining $900,000 is not paid, the plaintiff can ask the judge for reallocation of the award, and that defendant would have to pay 10 percent of the remaining unpaid award, or $90,000, he said. "Under this plan, a defendant that pays its share of an award could think it's done, then finds itself two, three or four years later being mandated by the court to pay more," he said. "Businesses like to know risk. They need to quantify risk to be able to make an investment. There's no finality to this (proposal). In fact, there is a disincentive to even pay your portion of the verdict if somewhere down the road there will be reapportionment." Goodwin said the governor's proposal should be looked at as revolutionary because it is changing longstanding law, but he said Manchin understands that legislators and their constituents will have questions and concerns. "This one is really changing decades of case law. It's reasonable folks may raise legitimate concerns about specific parts of the bill. ... The governor is willing to hear anybody's legitimate concerns. It's part of the process," Goodwin said. Schulz said he hopes the bill is debated thoroughly by state lawmakers because it is not true reform of the joint-and-several statute. "The bark of this bill is a whole lot more effective than its bite," he said. "It is one step farther down the road of civil justice reform, but it's a pretty short baby step."

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