Garrison v. Target Corporation

THE STATE OF SOUTH CAROLINA
In The Court of Appeals
Carla Denise Garrison and Clint Garrison,
Appellants/Respondents,
v.
Target Corporation, Respondent/Appellant.
Appellate Case No. 2017-000267
Appeal From Anderson County
R. Keith Kelly, Circuit Court Judge
Opinion No. 5711
Heard May 15, 2019 – Filed January 15, 2020
AFFIRMED IN PART, REVERSED IN PART, AND
REMANDED
Joshua Thomas Hawkins and Helena LeeAnn Jedziniak,
both of Hawkins & Jedziniak, LLC, of Greenville; and G.
Todd Butler, of Phelps Dunbar LLP, of Jackson,
Mississippi, all for Appellants/Respondents.
Lewis F. Powell, III and George P. Sibley, III, both of
Hunton & Williams LLP, of Richmond, Virginia; and
Knox L. Haynsworth, III, of Brown, Massey, Evans,
McLeod & Haynsworth, LLC, of Greenville, all for
Respondent/Appellant.
GEATHERS, J.: In this negligence action, Appellants/Respondents, Carla Denise
Garrison and Clint Garrison (the Garrisons), challenge the circuit court's order
setting aside the jury's $4.5 million punitive damages award, arguing (1) there was
sufficient evidence to support the jury's finding that the conduct of
Respondent/Appellant Target Corporation (Target) was reckless, willful, or wanton;
(2) the verdict was not excessive; and (3) Target waived the application of the
punitive damages caps set forth in section 15-32-530(A) of the South Carolina Code
(Supp. 2019). The Garrisons also challenge the circuit court's pre-judgment interest
award, arguing the circuit court erred by calculating the interest on compensatory
damages only. Target appeals the circuit court's denial of its motion for a judgment
notwithstanding the verdict (JNOV) as to liability, arguing there was insufficient
evidence of Target's constructive knowledge of a dangerous condition on its
premises. Target also appeals the denial of its motion for a new trial absolute,
arguing the punitive damages award reflected the jury's passion, caprice, and
prejudice. We affirm in part, reverse in part, and remand for a remittitur of the jury's
punitive damages award.
FACTS/PROCEDURAL HISTORY
On May 21, 2014, Appellant/Respondent Carla Denise Garrison (Denise) and
her eight-year-old daughter (Daughter) visited the Target store in Anderson. After
parking her car, Denise retrieved her coupon book and placed it on the hood of the
car to examine it. As she was examining the coupon book, Denise heard Daughter
ask, "Mommy, what is this?" Denise turned her attention to Daughter and saw her
holding a syringe with a needle in it. Denise "immediately reacted" by swatting the
syringe out of Daughter's hand, exclaiming, "Don't ever pick anything like that up,
that's dirty, that's nasty." When Denise swatted the syringe, the needle punctured
her right palm, and she noticed a bead of blood emerge from the puncture site.
Denise went inside the store to wash her hands several times and called her
husband, Appellant/Respondent Clint Garrison (Clint). Clint advised Denise to
report the incident, so Denise spoke to the store manager, Shelby Brintnall, and they
both took photographs of the syringe lying in the parking lot. Brintnall took
possession of the syringe and completed a "Guest Incident Report" form, recounting
the incident as Denise had relayed it to her.1 In response to the form's question,
"Was the floor/ground clean and dry," Brintnall checked the "No" box. Brintnall
also advised Denise to get medical treatment and give the bill to her. After Denise
1
Brintnall testified she placed the syringe in a bag and placed a label on the bag
stating "Do Not Touch" and the syringe later "end[ed] up" in a "hazard box."
left the store, Brintnall completed a second report that was entitled "LOD
Investigation Report."2 In this report, Brintnall indicated that she did not see a needle
in the syringe.
The next day, Denise visited the local hospital emergency room, where a nurse
referred Denise to an infectious disease specialist, Dr. Potts,3 at AnMed Health
Specialty Clinic. The clinic collected a blood sample to have it tested for HIV and
hepatitis, and Dr. Potts prescribed several medications targeted at preventing HIV
and hepatitis. The medications caused Denise to feel dizzy and lose her balance.
They also upset her stomach, put her into a "zombie-like state," and caused her to
have night terrors. Clint testified that Denise was bedridden during this time. Clint
had to take unpaid leave from work to care for Denise, and Clint's mother had to
help care for the Garrisons' four children. Further, Denise had to have her blood
tested every three months for approximately one year.
Soon after Denise started taking the medications, an investigator for Target
telephoned Denise and asked her if she thought Target was responsible for her injury.
She told the investigator that Target was "supposed to take care of the parking lot"
but she was asking only that Target pay her medical bills. Denise eventually filed
an action against Target seeking damages for negligence and violation of the South
Carolina Unfair Trade Practices Act. Subsequently, Denise submitted to Target a
$12,000 offer of judgment, but Target did not accept the offer. Denise and Clint
later filed a second action against Target, asserting causes of action for negligence
and loss of consortium. The circuit court consolidated the two actions and conducted
a trial on September 5 through 8, 2016.
At trial, Brintnall testified that Target's Anderson store did not have a formal
policy for regular "safety sweeps" of the parking lot but there were measures in place
to keep the parking lot in order. She stated that the store had cart attendants who
retrieved carts from the parking lot and simultaneously checked for debris and
picked it up. The attendants also advised the team lead-on-duty of anything they
saw that "need[ed] to be noted." However, Brintnall admitted that management did
not "have a set time" for the cart attendants to perform these tasks; rather, they did
them "every so often." Brintnall added that the store's Property Maintenance
Technician, Jonathan Jackson, "walk[ed] the building" in the mornings.
2
"LOD" is an acronym for the store's team "lead-on-duty."
3
The record does not indicate a first name for Dr. Potts.
The parties also introduced testimony regarding Target's loss of the syringe
and the Garrisons' loss of photographs of the syringe. Brintnall explained that after
she took possession of the syringe, she thought that a co-worker disposed of it but
later learned that it was still at the store. Subsequently, an employee of the Garrisons'
counsel took photographs of the syringe with her cell phone, but those photographs
could not be produced for trial. Brintnall then lost track of the syringe once again,
and its location at the time of trial was a "great mystery." Moreover, Clint was
unable to retrieve from his own cell phone photographs purportedly showing the
needle in the syringe. In light of all of this testimony, the circuit court gave a jury
instruction on the doctrine of spoliation.4
At the conclusion of the trial, the jury returned a verdict for Denise that
included $100,000 in compensatory damages and $4.5 million in punitive damages.
The jury also awarded Clint $3,500 for lost wages and $5,000 for loss of consortium.
The circuit court granted Target's motion for a JNOV as to punitive damages but
denied Target's remaining post-trial motions. The circuit court granted the
Garrisons' motion for costs, pre-judgment interest, and post-judgment interest but
calculated pre-judgment interest on compensatory damages only. These cross-
appeals followed.
ISSUES ON APPEAL
1. Was there sufficient evidence of Target's constructive knowledge of a
dangerous condition on its premises to allow the issue of Target's liability to
go to the jury?
2. Was there sufficient evidence of Target's recklessness, willfulness, or
wantonness to support the jury's punitive damages award?
3. Did the amount of the punitive damages award violate due process?
4
The doctrine of spoliation allows the jury to draw an adverse inference against a
party who "fails to preserve material evidence for trial." Stokes v. Spartanburg Reg'l
Med. Ctr., 368 S.C. 515, 522, 629 S.E.2d 675, 679 (Ct. App. 2006). It is for the jury
"to determine whether the party has offered a satisfactory explanation for that
failure," and if the jury "find[s] the explanation unsatisfactory, [it is] permitted—but
not required—to draw the inference that the evidence would have been unfavorable
to the party's claim." Id.
4. Did Target waive the application of the punitive damages caps in section 15-
32-530?5
5. Did the punitive damages award reflect the jury's passion, caprice, and
prejudice such that a new trial absolute was required?
6. Did the circuit court err by calculating pre-judgment interest on compensatory
damages only?
STANDARD OF REVIEW
JNOV
"When ruling on a JNOV motion, the trial court is required to view the
evidence and the inferences that reasonably can be drawn therefrom in the light most
favorable to the nonmoving party." Williams Carpet Contractors, Inc. v. Skelly, 400
S.C. 320, 325, 734 S.E.2d 177, 180 (Ct. App. 2012). "This court must follow the
same standard." Id. "If more than one reasonable inference can be drawn or if the
inferences to be drawn from the evidence are in doubt, the case should be submitted
to the jury." Id. (quoting Chaney v. Burgess, 246 S.C. 261, 266, 143 S.E.2d 521,
523 (1965)).
"In considering a JNOV, the trial judge is concerned with the existence of
evidence, not its weight." Curcio v. Caterpillar, Inc., 355 S.C. 316, 320, 585 S.E.2d
272, 274 (2003). "When considering a JNOV, 'neither [an appellate] court, nor the
trial court has authority to decide credibility issues or to resolve conflicts in the
testimony or the evidence.'" Id. (alteration in original) (quoting Reiland v. Southland
Equip. Serv., Inc., 330 S.C. 617, 634, 500 S.E.2d 145, 154 (Ct. App. 1998)). "The
jury's verdict must be upheld unless no evidence reasonably supports the jury's
findings." Id.
Punitive Damages
5
Because we conclude that Target waived the application of section 15-32-530, we
need not address whether the statute is constitutional or whether the cap in subsection
(A) applies to the Garrisons. See Futch v. McAllister Towing of Georgetown, Inc.,
335 S.C. 598, 613, 518 S.E.2d 591, 598 (1999) (providing that an appellate court
need not address remaining issues when resolution of a prior issue is dispositive).
An appellate court must review de novo a circuit court's post-trial "due process
review" of a punitive damages award. Mitchell, Jr. v. Fortis Ins. Co., 385 S.C. 570,
583, 686 S.E.2d 176, 183 (2009).
New Trial Absolute
"[I]f a verdict is so grossly excessive and shockingly disproportionate that it
indicates the jury was motivated by passion, caprice, prejudice, or other
consideration not founded on the evidence[,] then it is the duty of the trial court and
the appellate court to set aside the verdict absolutely." Caldwell v. K-Mart Corp.,
306 S.C. 27, 33, 410 S.E.2d 21, 25 (Ct. App. 1991). Nonetheless, "the jury's
determination of damages is entitled to substantial deference[,]" and the circuit
court's decision on whether to grant a new trial based on the amount of the verdict
"will not be disturbed on appeal unless it clearly appears the exercise of discretion
was controlled by a manifest error of law." Welch v. Epstein, 342 S.C. 279, 303,
536 S.E.2d 408, 420 (Ct. App. 2000). An exception to this rule is that an appellate
court must review de novo a circuit court's post-trial "due process review" of a
punitive damages award. Mitchell, 385 S.C. at 583, 686 S.E.2d at 183.
LAW/ANALYSIS
I. Constructive Notice
Target maintains the circuit court erred by denying its JNOV motion as to
liability because there was insufficient evidence of its constructive knowledge of a
dangerous condition on its premises.
To recover damages for injuries caused by a dangerous or
defective condition on a storekeeper's premises, the
plaintiff must show either (1) that the injury was caused
by a specific act of the defendant [that] created the
dangerous condition; or (2) that the defendant had actual
or constructive knowledge of the dangerous condition and
failed to remedy it.
Wintersteen v. Food Lion, Inc. (Wintersteen II), 344 S.C. 32, 35, 542 S.E.2d 728,
729 (2001). "Constructive notice is a legal inference, which substitutes for actual
notice." Major v. City of Hartsville, 410 S.C. 1, 3, 763 S.E.2d 348, 350 (2014). "The
defendant will be charged with constructive notice whenever it appears that the
condition has existed for such length of time prior to the injury that, under existing
circumstances, he should have discovered and remedied it in the exercise of due
care . . . ." Anderson v. Winn-Dixie Greenville, Inc., 257 S.C. 75, 77, 184 S.E.2d 77
(1971). Target admits that this "temporal element does not require the plaintiff to
precisely measure the lifespan of the hazard."
In denying Target's motion, the circuit court stated
[A]lthough there was no direct evidence as to the exact
length of time the syringe had been in the parking lot,
witnesses testified the syringe was "dingy, dirty and
gross," and bore a "weathered" look similar to other items
of trash in the parking lot. That testimony, when viewed
in the light most favorable to Plaintiffs, leads to the
reasonable inference that the syringe was in Target's
parking lot long enough to impute constructive
knowledge. Thus, judgment as a matter of law is not
appropriate on the constructive knowledge issue.
(emphasis added).
When viewed in the light most favorable to the Garrisons, there was sufficient
evidence to support the circuit court's ruling. See Curcio, 355 S.C. at 320, 585
S.E.2d at 274 ("In considering a JNOV, the trial judge is concerned with the
existence of evidence, not its weight."); Williams Carpet, 400 S.C. at 325, 734
S.E.2d at 180 ("When ruling on a JNOV motion, the trial court is required to view
the evidence and the inferences that reasonably can be drawn therefrom in the light
most favorable to the nonmoving party."); id. ("This court must follow the same
standard.").
Denise testified that the syringe was old, dirty, and nasty and that she "could
tell [that], obviously[,] it had been there a long time." Further, Shelby Brintnall, the
manager on duty at the time Denise was injured, testified that she saw the syringe
and admitted that it "look[ed] like it[ had] some wear on it." Brintnall stated that the
syringe was "dirty and dingy" and one end of it had been broken off. She also
affirmed that the photograph taken of the syringe showed "dings" on it as well as
grime. Clint testified that from viewing the photograph of the syringe on the ground
near the site of the injury, he could tell that the syringe had "been there a[]while"
because it, along with surrounding debris, was "weathered." Clint also testified that
some discarded twine lying near the syringe was discolored and looked like it had
been run over. Admittedly, the photographs depict the location where the syringe
landed after Denise had swatted it away from her daughter's hands. Nonetheless, it
is unlikely that the location where the syringe landed was any significant distance
from its original location in the parking lot.
Target argues this court should not consider the Garrisons' testimony
concerning how long the syringe had been in the parking lot because it was
speculative. However, it is reasonable to infer from witness descriptions of the
syringe's weathered appearance that it had been lying in the parking lot long enough
for Target's employees to have discovered it. See Williams Carpet, 400 S.C. at 325,
734 S.E.2d at 180 ("If more than one reasonable inference can be drawn or if the
inferences to be drawn from the evidence are in doubt, the case should be submitted
to the jury." (quoting Chaney, 246 S.C. at 266, 143 S.E.2d at 523)); cf. H. L. Green
Co. v. Bowen, 223 F.2d 523, 525 (4th Cir. 1955) (reversing a judgment for the
plaintiff and stating that the only evidence as to the defendant's constructive notice
of popcorn on which the plaintiff slipped and fell was the testimony of the plaintiff's
witness that she "saw the popcorn on the floor only a few minutes before [the
plaintiff] entered the store and fell; that the popcorn looked fresh, crisp and white;
that the popcorn appeared not to have been walked on, seemed to have been just
dropped on the floor and that the floor around the popcorn was clean and had the
semblance of having been very recently swept" (emphases added)); id. ("We cannot
attribute constructive notice of the presence of this popcorn to [the defendant] on
evidence proving merely that the popcorn had been there a very few minutes.").
Target also argues that the syringe could have already been in its weathered
condition when it was first abandoned in the parking lot. While this is possible, there
is no evidence indicating this is likely. In contrast, the weathered condition of the
debris surrounding the syringe indicates it is likely that the syringe became
weathered after it was abandoned in the lot. Therefore, this case is distinguishable
from Wintersteen v. Food Lion, Inc. (Wintersteen I), in which two equal possibilities
made the determination of how long water had been on a grocery store's floor
nothing more than "pure speculation." 336 S.C. 132, 136, 518 S.E.2d 828, 830 (Ct.
App. 1999), aff'd, 344 S.C. 32, 542 S.E.2d 728 (2001).6 Further, while Target
6
In Wintersteen, the plaintiff slipped on a puddle of clear liquid in a grocery store
and fell, injuring her back. 336 S.C. at 134, 518 S.E.2d at 829. Because the
plaintiff's own expert testified that ice falling from a drink machine could melt in as
fast as one minute, this court concluded, "[W]hile the liquid could have been on the
floor for an extended period of time, it is just as possible that it had been on the floor
for only moments before [the plaintiff] fell" and "[A]ny determination of how long
compares the weathered condition of the syringe to the description of a banana peel
as "withered up" and "mushed up" in Anderson,7 the nature of a banana peel inside
a grocery store does not lend itself to a valid comparison with a syringe in an outdoor
parking lot.
In light of the foregoing, we conclude there was sufficient evidence of
constructive notice to allow the jury to resolve the question of Target's liability.
II. Punitive Damages Award
The Garrisons argue the circuit court erred by setting aside the jury's punitive
damages award because (1) there was sufficient evidence of Target's recklessness,
willfulness, or wantonness to support the award; (2) the amount of the award was
not excessive; and (3) Target waived the application of the punitive damages caps
in section 15-32-530. We will address these grounds in turn. But first, we will
explain how the circuit court structured its rulings on these questions, given the
Garrisons' assertions that (1) the circuit court conflated evidentiary sufficiency with
constitutional excessiveness and (2) the circuit court's judgment concerning the
sufficiency of the evidence to support the award was clouded by the amount of the
award.
In its order addressing the parties' post-trial motions, the circuit court stated,
"[F]inding punitive damages unconstitutional in this case, the [c]ourt finds judgment
as a matter of law is appropriate as to that aspect of the award alone." The order
then discussed the reasons for denying a JNOV as to liability and for granting a
JNOV as to the punitive damages award. This discussion included a post-trial
review of the constitutionality of the punitive damages award. See Austin v. Stokes-
Craven Holding Corp., 387 S.C. 22, 52, 691 S.E.2d 135, 150 (2010) ("Because
punitive damages are quasi-criminal in nature, the process of assessing punitive
damages is subject to the protections of the Due Process Clause of the Fourteenth
Amendment of the United States Constitution." (quoting James v. Horace Mann
Ins. Co., 371 S.C. 187, 194, 638 S.E.2d 667, 670 (2006))); id. at 52, 691 S.E.2d at
151 ("[A] trial judge shall review the constitutionality of a punitive damages award
by determining whether the award was reasonable . . . ."); Mitchell, 385 S.C. at 584,
the water had been on the floor would be pure speculation." Id. at 136, 518 S.E.2d
at 830 (emphasis added).
7
257 S.C. at 80, 184 S.E.2d at 79 ("The phrases 'withered up' and 'mushed up', which
were applied to the appearance of the small bit of peeling after it has been stepped
upon by [the] plaintiff, are . . . insignificant.").
686 S.E.2d at 183 ("To the extent [a punitive damages] award is grossly excessive,
it furthers no legitimate purpose and constitutes an arbitrary deprivation of
property." (quoting State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408, 417
(2003))).
Within its discussion of the award's constitutionality, the circuit court found
there was no evidence that Target "engaged in a pattern of reckless, willful, or
wanton conduct that is sufficiently reprehensible to justify the punitive damages
award." The circuit court also found that the ratio between the punitive damages
award and the actual damages award was "in excess of 45:1." The circuit court
concluded that the award violated Target's due process rights.
A. Supporting Evidence
"In order for a plaintiff to recover punitive damages, there must be evidence
the defendant's conduct was willful, wanton, or in reckless disregard of the plaintiff's
rights." Taylor v. Medenica, 324 S.C. 200, 221, 479 S.E.2d 35, 46 (1996). "A tort
is characterized as reckless, willful or wanton if it was committed in such a manner
or under such circumstances that a person of ordinary reason and prudence would
have been conscious of it as an invasion of the plaintiff's rights." Id.8 "A conscious
failure to exercise due care constitutes willfulness." Id.
Here, the circuit court set aside the punitive damages award by way of a
JNOV. The nature of a JNOV, which is "merely a renewal of [a] directed verdict
motion,"9 requires the circuit court to determine the existence of evidence to support
the award and not its weight. Curcio, 355 S.C. at 320, 585 S.E.2d at 274; cf.
Fairchild v. S.C. Dep't of Transp., 398 S.C. 90, 101, 727 S.E.2d 407, 413 (2012)
(holding the circuit court erred in granting a directed verdict on the issue of punitive
damages and stating, "It is not the duty of a trial court to weigh the evidence.
Viewing the evidence and its reasonable inferences in the light most favorable to
8
See also Geddings v. Atl. Coast Line R. Co., 91 S.C. 477, 75 S.E. 284, 286 (1912)
("Not only is the conscious invasion of the rights of another, in a wanton, willful,
and reckless manner, an act of wrong, but [] the same result follows, when the
wrongdoer does not actually realize that he is invading the rights of another,
provided the act is committed in such a manner that a person of ordinary reason and
prudence would say that it was a reckless disregard of another's rights." (emphasis
added) (quoting Tolleson v. Southern Ry. Co., 88 S.C. 7, 70 S.E. 311, 313 (1911))).
9
RFT Mgmt. Co. v. Tinsley & Adams L.L.P., 399 S.C. 322, 331, 732 S.E.2d 166,
171 (2012).
[the nonmoving party], as both the trial court and this [c]ourt are required to do, we
hold there is evidence to create a jury question as to whether or not [the defendant]
acted with recklessness, thus requiring submission of the issue of punitive damages
to the jury"). "When considering a JNOV, 'neither [an appellate] court, nor the trial
court has authority to decide credibility issues or to resolve conflicts in the testimony
or the evidence.'" Curcio, 355 S.C. at 320, 585 S.E.2d at 274 (alteration in original)
(quoting Reiland, 330 S.C. at 634, 500 S.E.2d at 154). "The jury's verdict must be
upheld unless no evidence reasonably supports the jury's findings." Id.
Further, both the circuit court and this court are "required to view the evidence
and the inferences that reasonably can be drawn therefrom in the light most favorable
to" the Garrisons, the nonmoving parties. Williams Carpet, 400 S.C. at 325, 734
S.E.2d at 180; cf. Hollis v. Stonington Dev., LLC, 394 S.C. 383, 393–94, 714 S.E.2d
904, 909–10 (Ct. App. 2011) ("When ruling on a directed verdict motion as to
punitive damages, 'the circuit court must view the evidence and the inferences that
reasonably can be drawn therefrom in the light most favorable to the nonmoving
party. In reviewing the denial of a motion for directed verdict . . . , the appellate
court applies the same standard as the circuit court.'" (alteration in original) (citation
omitted) (quoting Mishoe v. QHG of Lake City, Inc., 366 S.C. 195, 200, 621 S.E.2d
363, 366 (Ct. App. 2005), cert. denied (Jan. 18, 2007)). "If more than one reasonable
inference can be drawn or if the inferences to be drawn from the evidence are in
doubt," the verdict should be upheld. Williams Carpet, 400 S.C. at 325, 734 S.E.2d
at 180 (quoting Chaney, 246 S.C. at 266, 143 S.E.2d at 523); cf. Hollis, 394 S.C. at
394, 714 S.E.2d at 910 ("The issue of punitive damages must be submitted to the
jury if more than one reasonable inference can be drawn from the evidence as to
whether the defendant's behavior was reckless, willful, or wanton." (quoting Mishoe,
366 S.C. at 201, 621 S.E.2d at 366).
In Mishoe, the plaintiff injured her left ankle and right knee while walking
across the pavement near the emergency room exit of the defendant's hospital and
getting her left foot got caught in a hole. 366 S.C. at 199, 621 S.E.2d at 365.
Although the hospital's head of maintenance had prepared a written report
concerning the hole's existence approximately eleven months before the plaintiff's
injury,10 "[t]he hospital took no action to repair the hole or warn visitors and patients
of the hole's existence." Id. This court concluded that this evidence was sufficient
to submit the issue of the hospital's "willful, wanton, reckless, or malicious conduct
to the jury." 366 S.C. at 202, 621 S.E.2d at 366.
10
The hospital "was required to perform regular, twice-yearly safety inspections of
its premises to maintain its accreditation." Id.
Notably, the hospital had argued that because there was no clear and
convincing evidence that its actions constituted willful, wanton, or reckless conduct,
the circuit court erred in denying its JNOV motion.11 366 S.C. at 200, 621 S.E.2d at
365. In rejecting this argument, then-Chief Judge Hearn summarized the standard
of review for a JNOV ruling on punitive damages as follows:
On appeal from the denial of a motion for directed verdict
or JNOV, the appellate court may only reverse if there is
no evidence to support the circuit court's ruling. Neither
the circuit court nor the appellate court has the authority to
decide credibility issues or resolve conflicts in testimony.
In order to receive an award of punitive damages, the
plaintiff has the burden of proving by clear and convincing
evidence the defendant's misconduct was willful, wanton,
or with reckless disregard for the plaintiff's rights.[12] A
conscious failure to exercise due care constitutes
willfulness. When evidence exists that suggests a
defendant is aware of a dangerous condition and does not
take action to minimize or avoid the danger, sufficient
evidence exists to create a jury issue as to whether there is
clear and convincing evidence of willfulness. The issue of
punitive damages must be submitted to the jury if more
than one reasonable inference can be drawn from the
evidence as to whether the defendant's behavior was
reckless, willful, or wanton.
366 S.C. at 200–01, 621 S.E.2d at 366 (emphases added) (citations omitted).13
11
The clear and convincing "measure of proof is intermediate, more than a mere
preponderance but less than is required for proof beyond a reasonable doubt." Peeler
v. Spartan Radiocasting, Inc., 324 S.C. 261, 265 n.4, 478 S.E.2d 282, 284 n.4 (1996)
(quoting Middleton v. Johnston, 273 S.E.2d 800, 803 (Va. 1981)).
12
See S.C. Code Ann. § 15-33-135 (2005).
13
But see Taylor, 324 S.C. at 221–22, 479 S.E.2d at 46 (holding the circuit court
properly denied the defendant's motion for a JNOV on punitive damages because the
record contained "clear and convincing evidence that [the defendant] failed to
exercise due care in treating [the plaintiff]"); Duncan v. Ford Motor Co., 385 S.C.
119, 138, 682 S.E.2d 877, 886 (Ct. App. 2009) (responding to the defendant's
argument that the jury's punitive damages award should be "reversed" by stating that
Here, the Garrisons presented evidence showing that Target's employees were
aware of the importance of inspecting and cleaning the parking lot to keep it safe for
customers and of keeping good records of these efforts. The Garrisons also
presented evidence showing that Target's employees should have been aware of the
existence of the syringe and needle in the parking lot. Yet, immediately after Denise
reported the injury to Target's manager, the employee assigned to the parking lot
could not be located. The Garrisons also highlight the following evidence showing
the falsity of Target's claim that it had the parking lot cleaned on a regular basis:
Target's manager (Shelby Brintnall) and Property Maintenance Technician
(Jonathan Jackson) both testified that a third-party vendor sent a cleaning truck to
sweep Target's parking lot once a week, on every Thursday night. Brintnall and
Jackson also testified that cart attendants regularly checked the lot for debris. Yet,
Clint testified that he camped out in Target's parking lot on a Thursday night, from
11:45 p.m. to 5:30 a.m.,14 and no one came to clean the lot.
Also belying Target's claim that it cleaned the parking lot on a regular basis
were photographs of weathered trash and debris and the testimony of the Garrisons
and Clint's mother that they had observed "trash everywhere" and other debris in
Target's parking lot on different occasions. The Garrisons also maintain that an
inspection log identifying both April 28, 2014, and April 29, 2014, as a Monday
clear and convincing evidence supported the award); Longshore v. Saber Sec. Servs.,
Inc., 365 S.C. 554, 564, 619 S.E.2d 5, 11 (Ct. App. 2005) (responding to the
defendant's argument that the jury's punitive damages award should be "reversed"
by stating, "Although appellate review of an award of punitive damages is limited to
the correction of errors of law, an award of punitive damages must be proven under
a significant burden of proof: clear and convincing evidence"); id. at 564–65, 619
S.E.2d at 11 (holding the circuit court erred in submitting the issue of punitive
damages to the jury because there was "no clear and convincing evidence that [the
defendant's] conduct . . . was willful, wanton, or in reckless disregard of the rights
of others"); Welch, 342 S.C. at 301–02, 536 S.E.2d at 419–20 (holding the circuit
court did not err in denying the defendant's motion for a JNOV as to punitive
damages because there was clear and convincing evidence of the defendant's
reckless culpability).
14
Clint explained that Target's counsel had previously intimated to him that the
cleaning truck regularly arrived at the parking lot after midnight. Clint also listened
to Jackson testify in his deposition that the truck arrived "on Thursday night and
Friday mornings."
"suggested to the jury" that Jackson's testimony claiming to have conducted regular
inspections was false.
When evaluating the above-referenced evidence of Target's failure to
regularly inspect and clean its parking lot, the circuit court was charged with
determining whether the circumstances were such that "a person of ordinary reason
and prudence would have been conscious of [Target's conduct] as an invasion of the
plaintiff's rights." Taylor, 324 S.C. at 221, 479 S.E.2d at 46. As we previously
stated, the Garrisons assert that the circuit court conflated evidentiary sufficiency
with constitutional excessiveness.15 They express the concern that the circuit court
failed to articulate the standard for evaluating a motion for a JNOV as to the award
of punitive damages because the court's judgment was clouded by the amount of the
jury's verdict. They highlight the inconsistency between the circuit court's JNOV
and its initial denial of Target's directed verdict motion as to punitive damages, when
it found sufficient evidence to support such an award: "[T]he [c]ourt finds that there
is at least evidence that[,] when viewed in the light most favorable to the nonmoving
party[,] could lead to more than one inference or at least cause an inference that is
in doubt." We agree with this initial assessment by the circuit court. We also agree
with the Garrisons' assertion that the circuit court lost sight of this principle after
being confronted with the enormity of the jury's punitive damages award.
Based on the foregoing, we reverse the circuit court's JNOV as to the punitive
damages award.
15
In Hundley ex rel. Hundley v. Rite Aid of S.C., Inc., this court set forth the following
demarcation between evidentiary sufficiency and constitutional excessiveness:
Our appellate decisions have heretofore recognized three
stages for a trial court's review of punitive damages. First,
the court must determine whether the defendant's conduct
rises to a sufficient level of culpability to submit the issue
to the jury. . . . Second, the court must conduct a post
trial . . . review to evaluate whether the award deprives the
defendant of due process. If the court concludes that the
defendant's due process rights were violated, a new trial
absolute or new trial nisi remittitur is required.
339 S.C. 285, 314, 529 S.E.2d 45, 60–61 (Ct. App. 2000) (emphasis added) (citations
omitted).
B. Amount of Award
After finding that the ratio between the punitive damages award and the actual
damages award was in excess of 45:1, the circuit court stated, "This ratio should not
stand in . . . light of the Campbell decision[] and cannot stand under the statutory
cap placed on punitive damages . . . in [section] 15-32-530." On appeal, the
Garrisons argue that the amount of the punitive damages award was not excessive
and, therefore, should not be reduced. The Garrisons also argue Target waived the
application of the punitive damages caps in section 15-32-530. We will address
these grounds in turn.
1. Due Process
"[W]hile states possess discretion over the imposition of punitive damages, it
is well established that there are procedural and substantive constitutional limitations
on these awards." Mitchell, 385 S.C. at 584, 686 S.E.2d at 183 (quoting Campbell,
538 U.S. at 416). In other words, "[b]ecause punitive damages are quasi-criminal in
nature, the process of assessing punitive damages is subject to the protections of the
Due Process Clause of the Fourteenth Amendment of the United States
Constitution." Austin, 387 S.C. at 52, 691 S.E.2d at 150 (quoting James, 371 S.C.
at 194, 638 S.E.2d at 670). "To the extent an award is grossly excessive, it furthers
no legitimate purpose and constitutes an arbitrary deprivation of property." Mitchell,
385 S.C. at 584, 686 S.E.2d at 183 (quoting Campbell, 538 U.S. at 417). To make
this determination, trial courts must conduct a post-trial review of a jury's punitive
damages award:
[A] trial judge shall review the constitutionality of a
punitive damages award by determining whether the
award was reasonable under the following guideposts: (1)
the degree of reprehensibility of the defendant's
misconduct; (2) the disparity between the actual and
potential harm suffered by the plaintiff and the amount of
the punitive damages award; and (3) the difference
between the punitive damages awarded by the jury and the
civil penalties authorized or imposed in comparable cases.
Austin, 387 S.C. at 52, 691 S.E.2d at 151 (citing Mitchell, 385 S.C. at 587–88, 686
S.E.2d at 185–86).16 "[A]n appellate court reviews de novo the trial judge's
application of these guideposts." Id.
In Mitchell, our supreme court examined a punitive damages award with a
ratio of 13.9 to 1, based on the jury's $15 million punitive damages award and over
$1 million in potential harm to the plaintiff, and concluded that it was "grossly
excessive." 385 S.C. at 592, 686 S.E.2d at 187. The court remitted the award to $10
million, resulting in a 9.2 to 1 ratio.17 Id. at 594, 686 S.E.2d at 188. We will now
apply the three Gore guideposts to the present case.
a. Reprehensibility
In terms of reprehensibility, [the court] should consider
whether: (1) the harm caused was physical as opposed to
economic; (2) the tortious conduct evinced an indifference
to or a reckless disregard for the health or safety of others;
(3) the target of the conduct had financial vulnerability; (4)
the conduct involved repeated actions or was an isolated
incident; and (5) the harm was the result of intentional
malice, trickery, or deceit, rather than mere accident.
Austin, 387 S.C. at 53, 691 S.E.2d at 151.
Here, the harm to Denise was physical because the needle from the syringe
pricked her palm and drew blood, possibly exposing her to a communicable disease
and requiring her to undergo difficult medical treatment resulting in physical and
emotional suffering for several months. The medications she had to take made her
physically ill and caused vivid nightmares. Further, the Garrisons had financial
vulnerability because they had only Clint's modest income to support their household
and Clint lost part of that income when he had to take time off from work to take
care of Denise.18 As a result, Clint had to borrow money from his mother to pay for
school lunches for the children. Moreover, the Garrisons presented evidence
16
These guideposts were first set forth in BMW of North America, Inc. v. Gore, 517
U.S. 559 (1996).
17
The Mitchell opinion was issued before the punitive damages caps set forth in
section 15-32-530 were enacted in 2011.
18
Clint testified he was making $16.80 per hour for sixty-four hours per week at the
time of Denise's injury.
showing that Target's parking lot was littered with trash and debris on a regular basis.
Therefore, while the existence of the syringe and needle were known to happen on
just one occasion, there is the potential for its recurrence or for other dangerous
debris to harm customers.
b. Ratio
"The ratio of actual or potential harm to the punitive damages award is
'perhaps the most commonly cited indicium of an unreasonable or excessive punitive
damages award.'" Mitchell, 385 S.C. at 588, 686 S.E.2d at 185 (quoting Gore, 517
U.S. at 580).
Although the [United States] Supreme Court has "been
reluctant to identify concrete constitutional limits on the
ratio between harm, or potential harm, to the plaintiff and
the punitive damages award," and has consistently
declined to adopt a bright line ratio or simple mathematical
test, the Court has remarked that "in practice, few awards
exceeding a single-digit ratio between punitive and
compensatory damages[] to a significant degree[] will
satisfy due process." Nevertheless, the Supreme Court has
made clear that "there are no rigid benchmarks that a
punitive damages award may not surpass," so long as "the
measurement of punishment is both reasonable and
proportionate to the amount of harm to the plaintiff and
the general damages recovered." With this instruction in
mind, we note that a court, when determining the
reasonableness of a particular ratio of actual or potential
harm to a punitive damages award, may consider: the
likelihood that the award will deter the defendant from like
conduct; whether the award is reasonably related to the
harm likely to result from such conduct; and the
defendant's ability to pay. Nevertheless, a court may not
rely upon these considerations to justify an otherwise
excessive punitive damages award.
Id. at 588, 686 S.E.2d at 185 (emphases added) (citations omitted) (quoting
Campbell, 538 U.S. at 425–26).
"In reviewing the ratio guidepost, a court need not always compare the
punitive damages award to the actual damages awarded, but in certain cases may
compare it to the potential harm suffered by the plaintiff." Id. at 590, 686 S.E.2d at
187. In TXO Production Corporation v. Alliance Resources, the United States
Supreme Court considered not only the potential harm to the plaintiff but also "the
possible harm to other victims that might have resulted if similar future behavior
were not deterred." 509 U.S. 443, 460 (1993) (quoted in Mitchell, 385 S.C. at 591,
686 S.E.2d at 187).
Here, the jury awarded only $100,000 to Denise to reflect the actual harm she
experienced. However, the potential harm to Denise involved contracting a
communicable disease such as HIV or hepatitis, along with the attendant medical
costs and possible death. Further, Jonathan Jackson, Target's Property Maintenance
Technician, testified that Target had not increased the frequency of its cleaning since
the day of Denise's injury or made any improvements to its "safety scans" or its
cleaning methods since the injury. Therefore, consideration should also be given to
the possible harm to other customers or their children if Target is not adequately
deterred.
The Garrisons point out that the ratio evaluated by our supreme court in
Mitchell compared the plaintiff's potential harm, rather than the actual harm, to the
punitive damages award in that case. In Mitchell, the plaintiff was diagnosed as HIV
positive after he had purchased a health insurance policy from the defendant. 385
S.C. at 577–78, 686 S.E.2d at 180. After receiving claims for the plaintiff's treatment
and testing, the defendant rescinded the policy on the basis that he had
misrepresented his HIV positive status on his insurance application. Id. at 578–79,
686 S.E.2d at 180–81. When a case manager at the clinic visited by the plaintiff
tried to inform the defendant's senior underwriter that the plaintiff did not test
positive for HIV until after he purchased the policy, the underwriter "spurned" the
case manager's offer to send the supporting records to her and stated "that there was
nothing she could do" at that time. Id. at 579–80, 686 S.E.2d at 181.
The plaintiff filed an action for breach of contract and bad faith rescission
against the defendant, and at trial, the plaintiff presented evidence of his actual and
potential harm. Id. at 580–82, 686 S.E.2d at 181–82. The plaintiff
presented testimony from a medical expert who testified
that without medical treatment, he would contract AIDS
in two years and likely die two years after that. [The
plaintiff] introduced testimony from a health care expert
who testified to the minimum expected costs that it would
take to care for [the plaintiff] throughout his life, not
including complications from HIV and AIDS. [The
plaintiff] also introduced an economist who relied on the
health care expert's figures to project a total present value
of $1,081,189.40 for [the plaintiff's] treatment and costs.
Id. at 581–82, 686 S.E.2d at 182. The jury awarded the plaintiff $186,000 in actual
damages. Id. at 577, 686 S.E.2d at 179. While the jury awarded $15 million in
punitive damages, the supreme court remitted this award to $10 million. Id. at 577,
594, 686 S.E.2d at 179, 188.
Although the ratio between the actual damages awarded and the remitted
punitive damages award was approximately 54:1, the court determined the plaintiff's
potential harm to be $1,081,189.40, the present value of costs for the evaluation and
treatment of HIV over the plaintiff's lifetime, and compared that amount to both the
$15 million award and the remitted $10 million award. Id. at 591–94, 686 S.E.2d at
187–88. The court held that the original 13.9:1 ratio was "grossly excessive" under
due process standards but the ratio resulting from the remitted punitive damages
award, 9.2 to 1, satisfied due process. Id. at 592–94, 686 S.E.2d at 187–88. The
court noted that the defendant's conduct was "reprehensible enough to merit an
award towards the outer limits of the single-digit ratio." Id. at 593, 686 S.E.2d at
188.
Unlike the plaintiff in Mitchell, Denise did not test positive for HIV, and the
Garrisons did not present the testimony of a health care expert or economist to
determine the economic cost to the Garrisons had Denise actually tested positive for
HIV or hepatitis. Nonetheless, given the potential harm to Denise and other
customers, more than just the $100,000 awarded in compensatory damages to Denise
should be considered in comparison to the amount of punitive damages awarded.
Further, the single-digit ratio formulated by the supreme court in Mitchell of 9.2 to
1 was based on a remitted award of $10 million, and the jury in the present case
awarded less than half of that amount to Denise. Even after taking into account the
greater reprehensibility of the defendant's conduct in Mitchell versus Target in the
present case, the circuit court was incorrect in placing emphasis on the ratio of
punitive damages to mere actual damages awarded (45:1). Therefore, we reverse
the circuit court's conclusion stating "This ratio should not stand in . . . light of the
Campbell decision . . . ."
The Garrisons also contend Target's counsel admitted in closing arguments
that Target was a $73 billion dollar-a-year corporation at the time of trial and this
wealth requires a punitive damages award to be large enough to have a deterrent
effect on Target.19 See id. at 588, 686 S.E.2d at 185 ("[A] court, when determining
the reasonableness of a particular ratio of actual or potential harm to a punitive
damages award, may consider: the likelihood that the award will deter the defendant
from like conduct; whether the award is reasonably related to the harm likely to
result from such conduct; and the defendant's ability to pay. Nevertheless, a court
may not rely upon these considerations to justify an otherwise excessive punitive
damages award."). We agree that the deterrent effect of the award is an important
consideration. On the other hand, courts must exercise caution when considering
the wealth of a defendant as part of a punitive damages review:
trial courts must be careful about considering the net worth
of the defendant. Wealth cannot justify an otherwise
unconstitutional punitive damages award. While the
ability to pay remains relevant to the post-judgment due
process review, a punitive damages award should never be
based solely on a percentage of the defendant's net worth.
Id. at 588 n.8, 686 S.E.2d at 185 n.8 (citation omitted).
c. Comparable Cases
"When identifying 'comparable cases' a court may consider: the type of harm
suffered by the plaintiff or plaintiffs; the reprehensibility of the defendant's conduct;
the ratio of actual or potential harm to the punitive damages award; the size of the
award; and any other factors the court may deem relevant." Id. at 588–89, 686
S.E.2d at 186. The Garrisons do not cite any cases that are truly comparable to the
present case, and we have found none.
19
Target's counsel did not exactly admit to the $73 billion figure. He stated that the
Garrisons' counsel had referred to that amount "four or five times." Target's counsel
then stated, "That's probably right. I don't know." The Garrisons do not cite to any
evidence in the record to back up this figure. And while they also reference a federal
opinion's identification of Target's net worth as $17.633 billion, this reference is not
persuasive because the opinion was signed in 2009 and the trial in the present case
was conducted in 2016. Cantrell v. Target Corp., No. CV 6:06-2723-BHH, 2009
WL 10678353, at *13 (D.S.C. May 15, 2009). The court's net worth reference was
actually $15.633 billion.
Based on the application of all three Gore guideposts to the record in the
present case, we are compelled to conclude that the amount of the punitive damages
award violates due process. Although the evidence supports moderate
reprehensibility on Target's part, it is considerably less than the reprehensibility of
the defendant's conduct in Mitchell. Further, while the ratio of the punitive damages
awarded to the potential harm (versus mere actual harm) is likely much less than
45:1, the evidence does not allow us to precisely determine this ratio. Finally, there
is a dearth of comparable cases to support the award in this case.
Therefore, we affirm the circuit court's conclusion that the punitive damages
award violated due process but reverse the circuit court's specific conclusion that the
ratio of 45:1 "should not stand in the light of the Campbell decision" given that the
ratio of the punitive damages awarded to the potential harm to Denise and other
customers is likely much less than 45:1. See TXO, 509 U.S. at 460 (considering not
only the potential harm to the plaintiff but also "the possible harm to other victims
that might have resulted if similar future behavior were not deterred"). We remand
for a remittitur of the punitive damages award to an amount reasonably consistent
with the circumstances of this case.
2. Statutory Cap
Section 15-32-530 sets forth the following caps on punitive damages. It states,
in part:
(A) Except as provided in subsections (B) and (C), an
award of punitive damages may not exceed the greater of
three times the amount of compensatory damages awarded
to each claimant entitled thereto or the sum of five hundred
thousand dollars.
(B) The limitation provided in subsection (A) may not be
disclosed to the jury. If the jury returns a verdict for
punitive damages in excess of the maximum amount
specified in subsection (A), the trial court should first
determine whether:
(1) the wrongful conduct proven under this section
was motivated primarily by unreasonable financial
gain and determines that the unreasonably
dangerous nature of the conduct, together with the
high likelihood of injury resulting from the conduct,
was known or approved by the managing agent,
director, officer, or the person responsible for
making policy decisions on behalf of the defendant;
or
(2) the defendant's actions could subject the
defendant to conviction of a felony and that act or
course of conduct is a proximate cause of the
plaintiff's damages;
If the trial court determines that either item (1) or (2)
apply, then punitive damages must not exceed the greater
of four times the amount of compensatory damages
awarded to each claimant entitled thereto or the sum of
two million dollars and, if necessary, the trial court shall
reduce the award and enter judgment for punitive damages
in the maximum amount allowed by this subsection. If the
trial court determines that neither item (1) or (2) apply,
then the award of punitive damages shall be subject to the
maximum amount provided by subsection (A) and the trial
court shall reduce the award and enter judgment for
punitive damages in the maximum amount allowed by
subsection (A).
(C) However, when the trial court determines one of the
following apply, there shall be no cap on punitive
damages:
(1) at the time of injury the defendant had an intent
to harm and determines that the defendant's conduct
did in fact harm the claimant; or
(2) the defendant has pled guilty to or been
convicted of a felony arising out of the same act or
course of conduct complained of by the plaintiff and
that act or course of conduct is a proximate cause of
the plaintiff's damages; or
(3) the defendant acted or failed to act while under
the influence of alcohol, drugs, other than lawfully
prescribed drugs administered in accordance with a
prescription, or any intentionally consumed glue,
aerosol, or other toxic vapor to the degree that the
defendant's judgment is substantially impaired.
(emphases added).
a. Waiver
The Garrisons assert that by failing to raise section 15-32-530 as an
affirmative defense in its responsive pleadings, Target waived the application of the
punitive damages caps in this statute.20 As set forth above, the statute designates
20
This issue is preserved for review. Counsel extensively argued the issue in the
post-trial motions hearing, and the circuit court expressly concluded in its written
order that the punitive damages award could not stand under section 15-32-530. Cf.
Spence v. Wingate, 381 S.C. 487, 489, 674 S.E.2d 169, 170 (2009) ("We hold the
Court of Appeals erred in finding the issue was not preserved for appeal. The trial
judge's order granted respondents' motion for summary judgment on precisely the
grounds argued by respondents at the summary judgment hearing [that there existed
no attorney-client relationship between respondents and petitioner; therefore,
respondents owed no duty to petitioner]. While that order did not restate the ground
on which petitioner opposed the motion—a duty based on the existence of a prior
attorney-client relationship—the order explicitly addresses that argument by ruling
respondents 'owed no duty or obligation' to petitioner. This ruling is sufficient to
preserve petitioner's argument that respondents owed a duty to petitioner, and
petitioner was not required to file a Rule 59(e) motion to alter or amend in order to
preserve the issue for appeal."). Even if there is some doubt as to preservation, we
note Target has not asserted in its brief that this question is unpreserved. See Atl.
Coast Builders & Contractors, LLC v. Lewis, 398 S.C. 323, 333, 730 S.E.2d 282,
287 (2012), Toal, C.J. (concurring in result in part and dissenting in part) ("[W]here
the question of preservation is subject to multiple interpretations, any doubt should
be resolved in favor of preservation. When the opposing party does not raise a
preservation issue on appeal, courts are not precluded from finding the issue
unpreserved if the error is clear. However, the silence of an adversary should serve
as an indicator to the court of the obscurity of the purported procedural flaw.").
Therefore, we resolve any possible doubt as to preservation in favor of the Garrisons
on this important question.
more than one cap based on the circuit court's determination concerning the precise
nature of the defendant's conduct and the underlying intent. Because the statute's
language as a whole necessarily affects the proof at trial, the Garrisons argue that
they would have presented more evidence concerning Target's prioritization of
profits over safety had they known Target was going to invoke the punitive damages
caps.
Rule 8(c) of the South Carolina Rules of Civil Procedure (SCRCP) provides,
In pleading to a preceding pleading, a party shall set forth
affirmatively the defenses: accord and satisfaction,
arbitration and award, assumption of risk, condonation,
contributory negligence, discharge in bankruptcy, duress,
fraud, illegality, injury by fellow servant, laches, license,
misrepresentation, mistake, payment, plene administravit
or the administration of the estate is closed, recrimination,
release, res judicata, statute of frauds, statute of
limitations, waiver, and any other matter constituting an
avoidance or affirmative defense.
(emphases added).21 The note to Rule 8(c) states that its aim is "to avoid the 'surprise'
defenses permissible under the old general denial answer" and it is the same as Rule
This court described the nature of an affirmative defense in O'Neal v. Carolina
21
Farm Supply of Johnston, Inc.:
An affirmative defense conditionally admits the
allegations of the complaint, but asserts new matter to bar
the action. In other words, it assumes all elements of the
plaintiff's case have been established. Because the
plaintiff is taken to have proved a good cause of action, the
burden of proof shifts to the defendant to show he is not
liable. On the other hand, where the defendant pleads
special matter that denies an element of the plaintiff's
cause of action, the defense is not affirmative and the
burden of proof remains on the plaintiff to establish his
case.
279 S.C. 490, 494, 309 S.E.2d 776, 779 (Ct. App. 1983) (citation omitted). Further,
an avoidance, which also falls within Rule 8(c)'s pleading requirement, is defined as
8(c) of the Federal Rules of Civil Procedure, with the exception of "some affirmative
defenses added to the list as a guide." Rule 8(c), Note. Therefore, we find federal
cases interpreting the federal rule to be persuasive. See Senate by & through
Leatherman v. McMaster, 425 S.C. 315, 323–24, 821 S.E.2d 908, 912 (2018) (citing
Unisun Ins. v. Hawkins, 342 S.C. 537, 542, 537 S.E.2d 559, 561–62 (Ct. App. 2000)
for the proposition that when a state rule has adopted the language of a federal rule,
federal cases interpreting the federal rule are persuasive).
Similar to the purpose of our Rule 8(c), the purpose of the federal rule "is to
inform the court and the parties how the case will be tried." Simon v. United States,
891 F.2d 1154, 1158 (5th Cir. 1990) (quoting Morris v. Homeco International, 853
F.2d 337, 342 (5th Cir. 1988)). Accordingly, some federal courts treat an issue as
an affirmative defense if requiring the defendant to plead the issue is necessary to
avoid unfair surprise to the plaintiff. See In re ZAGG Inc. S'holder Derivative
Action, 826 F.3d 1222, 1231 (10th Cir. 2016) ("[W]e agree with the Third Circuit
that in determining whether an issue should be treated as an affirmative defense for
purposes of pleading, the critical question (absent a contrary command by statute or
rule, such as the list of affirmative defenses in Rule 8(c)) is whether requiring the
defendant to plead the matter is necessary 'to avoid surprise and undue prejudice by
providing the plaintiff with notice and the opportunity to demonstrate why the
affirmative defense should not succeed.'" (quoting In re Sterten, 546 F.3d 278, 285
(3d Cir. 2008))).
"Central to requiring the pleading of affirmative defenses is the prevention of
unfair surprise. A defendant should not be permitted to 'lie behind a log' and ambush
a plaintiff with an unexpected defense." Ingraham, 808 F.2d at 1079 (quoting Bettes
v. Stonewall Ins. Co., 480 F.2d 92, 94 (5th Cir. 1973)). Although Bettes is not a Rule
8(c) case, the court's approach to the concept of unfair surprise is instructive. The
Fifth Circuit examined an insured's request to modify a pre-trial order to "include,
as a contested issue of law," whether his insurer had complied with a statute
requiring insurers who rely on a misrepresentation defense to "show on trial that
within 90 days of learning of the falsity of any such representation[,] it notified the
insured that it refused to be bound by the policy." 480 F.2d at 93. The court
characterized the request as "an eleventh-hour appeal to the district court made only
after other trial tactics had failed," noting, "[t]he pleadings had been completed, the
"the allegation or statement of new matter, in opposition to a former pleading, which,
admitting the facts alleged in such former pleading, shows cause why they should
not have their ordinary legal effect." Ingraham v. United States, 808 F.2d 1075,
1079 (5th Cir. 1987) (quoting Black's Law Dictionary (5th ed. 1979)).
discovery concluded, the pre-trial order entered, the evidence taken, the charge
conference held, the arguments to the jury finished, the jury charged, and the
objections to the charge made before [the insured] sought this modification of the
pre-trial order to show his intent to rely on [the misrepresentation statute]." Id.
(footnotes omitted). The court took a realistic approach to the concept of unfair
surprise:
Although [the insurer] was aware of the existence of [the
misrepresentation statute], it was entitled to be surprised,
as was the district court, when [the insured] sought to
inject it as a legal issue minutes before the case finally
went to the jury. Any detriment to [the insured] caused by
denying the proposed amendment to the pre-trial order
was occasioned by his own actions.
480 F.2d at 94 (emphasis added). The court further stated,
[The insured] was promptly put on notice by [the insurer's]
answer that the [insurer] intended to rely on a
misrepresentation defense, but at no time subsequently
was the issue of notice as an element of that defense
clearly drawn. In such a case, even with the ultimate
burden of proof potentially on his opponent, a litigant
cannot strategically lie behind the log until after the trial
and receipt of evidence, argument, and charge to the jury
before raising an issue not found in the pleadings nor
included in the pre-trial order and then raise it when it is
too late for his opponent to do anything about it. The
manifest prejudice of such tactics would make a shambles
of the efficacy of pre-trial orders and a fair trial.
Id.
Given the concerns over unfair surprise that underlie both the state and federal
rules, it logically follows that a defendant's failure to plead an affirmative defense or
avoidance as required by Rule 8(c) "is deemed a waiver of the right to assert it."
Earthscapes Unlimited, Inc. v. Ulbrich, 390 S.C. 609, 615, 703 S.E.2d 221, 224
(2010) (quoting Whitehead v. State, 352 S.C. 215, 220, 574 S.E.2d 200, 202 (2002)).
We acknowledge that courts may overlook a defendant's failure to plead an
affirmative defense when it "is timely raised to the trial court without resulting in
unfair surprise to the opposing party."22 However, courts will enforce the pleading
requirement when a statutory liability limit such as section 15-32-530 affects the
proof to be presented at trial. See infra. A plaintiff lacking notice that a defendant
will rely on such a statute is unlikely to conduct the discovery or other investigation
necessary to obtain proof overcoming the statutory limit. Cf. Westfarm Assocs. Ltd.
P'ship v. Int'l Fabricare Inst., 846 F. Supp. 439, 441 (D. Md. 1993), aff'd sub nom.
Westfarm Assocs. Ltd. P'ship v. Washington Suburban Sanitary Comm'n, 66 F.3d
669 (4th Cir. 1995) (discussing the plaintiff's and third-party plaintiff's argument that
they would be prejudiced if the third-party defendant was allowed to assert the
damages cap in the Maryland Local Government Tort Claims Act after judgment
was entered on a jury verdict for the plaintiff and noting as "valid considerations"
the contentions that had they known the third-party defendant would assert the
damages cap, they would have planned their discovery and trial presentations to
address the cap). Constraints of time and money may compel the plaintiff to seek
out only the information that is relevant to what she knows will be an issue at trial
or during post-trial motions. The extra expense for "gunfire" often cannot be
justified if lesser means will do. Implicitly recognizing that a plaintiff does not know
what she does not know, courts enforcing the pleading requirement quite reasonably
treat the defendant's failure to invoke a statutory liability limit in a timely manner as
inherently prejudicial. See infra.
The Garrisons cite James v. Lister, 331 S.C. 277, 284, 500 S.E.2d 198, 202
(Ct. App. 1998), cert. denied (Mar. 5, 1999), for the proposition that South Carolina
law requires any liability limits affecting the proof at trial to be pled as an affirmative
defense. In James, this court relied on prior South Carolina opinions requiring
matters to be pled when they "may prejudice the opposing party by introducing
issues [that] may affect the proof at trial." Id. at 283, 500 S.E.2d at 201 (emphasis
added). The court referenced Washington v. Whitaker, in which our supreme court
held that sovereign immunity must be affirmatively pled,23 and Niver v. South
Carolina Department of Highways and Public Transportation, in which this court
held that, under the South Carolina Tort Claims Act (SCTCA), "[t]he burden of
establishing a limitation upon liability or an exception to the waiver of immunity is
upon the governmental entity asserting it as an affirmative defense."24 Id. The court
noted that in Washington, sovereign immunity was asserted as a defense to punitive
damages rather than as a complete bar to the plaintiff's claim. Id. at 283, 500 S.E.2d
at 201–02. The court also noted, "[t]he cases requiring the SCTCA to be pled as an
22
Plyler v. Burns, 373 S.C. 637, 648, 647 S.E.2d 188, 194 (2007).
23
317 S.C. 108, 114–15, 451 S.E.2d 894, 898 (1994).
24
302 S.C. 461, 463, 395 S.E.2d 728, 730 (Ct. App. 1990).
affirmative defense do not differentiate between claims in which the defense may
act as a complete bar and claims in which the defense merely limits liability," citing
Niver and Rakestraw v. South Carolina Department of Highways and Public
Transportation, 323 S.C. 227, 473 S.E.2d 890 (Ct. App. 1996). Id. at 283–84, 500
S.E.2d at 202.
The James court concluded the view of the majority of other jurisdictions that
a statutory recovery limit affecting the proof at trial constitutes an affirmative
defense was consistent with South Carolina law:
only a few cases in other jurisdictions hold a statutorily
mandated recovery limit [that] requires additional proof at
trial does not constitute an affirmative defense. A far
greater number of jurisdictions have concluded either that
1) a limit on recovery must be plead as an affirmative
defense or 2) a recovery limit could constitute an
affirmative defense if the limit affects proof at trial. Given
the current holdings in Washington, Niver, and Rakestraw,
we believe the view [that] requires the pleading of liability
limits that affect proof at trial is consistent with South
Carolina law.
331 S.C. at 284, 500 S.E.2d at 202. The court also concluded that the statute
imposing a cap on recovery against a charitable organization did not automatically
place the plaintiff on notice that the defendant would invoke the cap as a defense:
Although charitable status is not a jury issue, the
invocation of this protection triggers alternative remedies
for the injured plaintiff. Section 33–55–210(A) provides
a mechanism for seeking damages in excess of the
charitable limitation, through an action against a charitable
organization's employees.[25] In such instances, the statute
specifically requires joinder of the employee as a party,
and a special finding by the jury that the employee was
proved guilty of gross negligence as a proximate cause of
the injury. Indirectly, then, [the defendant's] failure to
raise its charitable status as an affirmative defense affected
25
This provision now appears in section 33-56-180 of the South Carolina Code
(2006).
both the parties to the action and the manner in which the
case was tried to the jury, including what issues were or
were not presented to them for resolution.
331 S.C. at 282, 500 S.E.2d at 201 (emphasis added).26 Likewise, the exceptions to
the damages cap Target seeks to apply to the present case, as found in section 15-
32-530, require special findings relating to, inter alia, unreasonable financial gain
as a motivation for the wrongful conduct or the defendant's intent to harm. § 15-32-
530(B), (C). Evidence of these facts may or may not be introduced at trial in the
absence of the defendant's pre-trial assertion of the punitive damages cap. Therefore,
it is unfair and unrealistic to assume that such evidence will always be introduced in
any given case even in the absence of a damages cap. It is also unfair to assume in
the present case that such evidence would have been introduced had the underlying
facts actually existed.
In stark contrast to section 15-32-530, the damages cap in the Tort Claims Act
does not require any special findings that would affect the proof at trial. Section 15-
78-120 of the South Carolina Code (2005) simply imposes a $300,000 recovery cap
per person and a $600,000 cap for the total sum recovered arising out of a single
occurrence and prohibits the recovery of punitive damages. Hence, it comes as no
surprise that this court excused the failure of the defendant in Parker v. Spartanburg
Sanitary Sewer District to initially plead this cap. 362 S.C. 276, 280–85, 607 S.E.2d
26
In the absence of a statute's creation of an issue that may affect the proof at trial,
our appellate courts have not been consistent as to whether a statute's effect on a
private lawsuit must be pled as an affirmative defense. Compare In re Estate of
Hover, 407 S.C. 194, 206–08, 754 S.E.2d 875, 881–82 (2014) (contrasting the
Probate Code's nonclaim statute, which eliminates a claimant's right of action
against a decedent's estate upon noncompliance and, in turn, deprives the court of
the power to adjudicate the claim, with general statutes of limitations, under which
a claim is barred only if the statute is raised as an affirmative defense) with
Earthscapes, 390 S.C. at 615, 703 S.E.2d at 224 (holding that a statutory prohibition
against an unlicensed construction contractor bringing an action to enforce a contract
was "in the nature of an affirmative defense precluding enforcement of a contract
and should be pled"); see also Broome v. Watts, 319 S.C. 337, 342, 461 S.E.2d 46,
49 (1995) (holding that statutorily mandated set-off was not an affirmative defense
that had to be pled because, inter alia, it "was not a matter properly triable to the
jury"); Parker v. Spartanburg Sanitary Sewer District, 362 S.C. 276, 285, 607
S.E.2d 711, 716 (Ct. App. 2005) (holding that the Tort Claims Act's damages cap
did not have to be pled as an affirmative defense because it was "self-executing").
711, 713–16 (Ct. App. 2005). Likewise, the statute governing underinsured motorist
(UIM) coverage interpreted by our supreme court in Broome v. Watts, section 38-
77-160 of the South Carolina Code (2015), does not require any special findings that
would affect the proof at trial. Rather, the statute simply states that automobile
insurance carriers must offer UIM coverage to their insureds "to provide coverage
in the event that damages are sustained in excess of the liability limits carried by an
at-fault insured or underinsured motorist." Id.
In addition to this court's opinion in James, federal opinions interpreting Rule
8(c) of the Federal Rules of Civil Procedure are instructive and persuasive. We rely
on not only those federal opinions cited in James but also more recent federal
opinions explaining when the failure to plead a statutory limit on damages
constitutes a waiver of that limit.
First, we further expound the Fifth Circuit Court of Appeals' reasoning in
Ingraham v. United States. The court gave credence to the same argument that the
Garrisons make in the present case, i.e., "had they known the [Texas statutory limit
on medical malpractice damages] would be applied, they would have made greater
efforts to prove" damages that "were not subject to the statutory limit." 808 F.2d at
1079. The court concluded that the statutory damages limit was an affirmative
defense that had to be "pleaded timely" and that the defendant in that case had
waived the defense. Id. The court explained,
We view the limitation on damages as an "avoidance"
within the intendment of the residuary clause of 8(c).
Black's Law Dictionary, 5th ed. 1979, defines an
avoidance in pleadings as "the allegation or statement of
new matter, in opposition to a former pleading, which,
admitting the facts alleged in such former pleading, shows
cause why they should not have their ordinary legal
effect." Applied to the present discussion, a plaintiff
pleads the traditional tort theory of malpractice and seeks
full damages. The defendant responds that assuming
recovery is in order under the ordinary tort principles,
because of the new statutory limitation, the traditional
precedents "should not have their ordinary legal effect."
Id.
Three years later, the Fifth Circuit examined a Louisiana statute limiting
recovery in medical malpractice actions and held that this statutory recovery limit
was an affirmative defense. Simon, 891 F.2d at 1157. The court recognized that the
statute's applicability "involve[d] more than just a pure issue of law." Id. at 1159.
In 2001, the Fifth Circuit once again explained the concept of waiving an affirmative
defense in terms of preventing unfair surprise to the opposing party:
Although failure to raise an affirmative defense under rule
8(c) in a party's first responsive pleading "generally results
in a waiver . . . , [when] the matter is raised in the trial
court in a manner that does not result in unfair
surprise . . . technical failure to comply precisely with
Rule 8(c) is not fatal." Thus, a defendant does not waive
an affirmative defense if he "raised the issue at a
pragmatically sufficient time, and [the plaintiff] was not
prejudiced in its ability to respond."
Giles v. Gen. Elec. Co., 245 F.3d 474, 491–92 (5th Cir. 2001) (emphasis added)
(citation omitted) (alterations in original) (quoting Allied Chem. Corp. v. Mackay,
695 F.2d 854, 855–56 (5th Cir. 1983)). In Lucas v. United States, the Fifth Circuit
held that the defendant raised the Texas statutory cap on malpractice damages at a
"pragmatically sufficient time" and the plaintiff was not prejudiced by the
defendant's failure to reference the cap in its pleading because the issue was raised
at trial "immediately following testimony of the economist regarding the present
value of [the plaintiff's] damages" and the statute did not affect the plaintiff's proof
of damages. 807 F.2d 414, 418 (5th Cir. 1986). The court noted, "the applicability
of the Texas statutory cap on malpractice damages is purely a legal issue [that] can
be resolved without the need for factual proof." Id. (emphasis added).
In Jakobsen v. Massachusetts Port Authority, the First Circuit held the
defendant waived the application of a Massachusetts statute limiting the liability of
municipal corporations to $5,000 by waiting to invoke the statute until it made a
directed verdict motion at trial. 520 F.2d 810, 813 (1st Cir. 1975). In applying Rule
8(c), FRCP, to the statute, the court stated, "While a statutory limitation on liability
is not enumerated among the listed defenses, we think it falls within the Rule's
residuary clause." Id. The court also explained that while the failure to plead an
affirmative defense waives the defense, "when there is no prejudice and when
fairness dictates, the strictures of this rule may be relaxed. Under Rule 15[, FRCP,]
the district court may and should liberally allow an amendment to the pleadings if
prejudice does not result." Id. Nonetheless, the court found the plaintiff would be
prejudiced by treating the defendant's late invocation of the statute as a late
amendment of its answer in that particular case:
As for treating the untimely defense as a late amendment
that should have been allowed, it presented issues of such
complexity and fundamental importance to the conduct of
the litigation that both plaintiff and the court could not, in
fairness, be forced to forego the advance notice they were
entitled to under Rule 8(c).
Id. at 813–14. The court explained,
While the Federal Rules reflect a universal trend away
from stereotyped pleading, they do not presage
abandonment of the requirements that parties be given
reasonable advance notice of the major issues to be raised.
Issues of this magnitude are not to be tossed at one's
opponent in a jury trial just before the charge . . . .
...
The delay undercut plaintiff's ability to develop facts and
fashion his case in a manner relevant to this defense. It also
prejudiced the judge's ability to focus on the facts as they
unfolded so as to rule properly on the claim . . . .
Id. at 815–16.
Almost twenty years later, the First Circuit held that a defendant waived the
application of a Massachusetts statute allowing for contractual limitations of
remedies under the state's commercial code by failing to timely invoke the statute.
See Knapp Shoes, Inc. v. Sylvania Shoe Mfg. Corp., 15 F.3d 1222, 1226 (1st Cir.
1994). The court cited Jakobsen when it noted, "We have previously held that a
statutory provision limiting damages to a fixed sum constituted an affirmative
defense for purposes of Rule 8(c)." Id. The court also explained, "The reason why
affirmative defenses under Rule 8(c) must be pled in the answer is to give the
opposing party notice of the defense and a chance to develop evidence and offer
arguments to controvert the defense." Id. The court noted that in the case before it,
"the limitation of remedies issue was not raised until virtually the end of the liability
trial, after discovery and the submission of all of the evidence on liability." Id. at
1226–27 (emphasis added).
Moreover, the United States District Court for the District of Maryland relied
on Jakobsen in holding that the Maryland Local Government Tort Claims Act was
an avoidance that the defendant "was required to plead affirmatively." Westfarm,
846 F. Supp. at 440. Likewise, the Tenth Circuit has treated the failure to plead a
statutory damages limit as a waiver. In Bentley v. Cleveland Cty. Bd. of Cty.
Comm'rs, the court characterized the damages cap in the Oklahoma Governmental
Tort Claims Act as an affirmative defense and held that the defendant waived the
cap because it first invoked it in a motion to alter or amend the judgment. 41 F.3d
600, 604 (10th Cir. 1994). The court explained,
Permitting the [defendant] to raise this issue at this stage
of the proceedings would be extremely unfair to [the
plaintiff], who may have been able to prove some
exception to the damage cap at trial if he had notice of the
defense. Thus, assuming the [Oklahoma Governmental
Tort Claims Act] applied to this action, counsel for the
[defendant] waived any limit on its liability afforded by
that statute by failing to raise the issue in its answer, the
Pre–Trial Order, or at trial.
41 F.3d at 605.
In Taylor v. United States, the Ninth Circuit held that a statutory limit on
noneconomic damages in medical malpractice cases was not an affirmative defense.
821 F.2d 1428, 1433 (9th Cir. 1987). Yet, the court acknowledged that application
of the statute "may in some instances require resolution of factual issues" and that in
such a case, a plaintiff could be prejudiced if the defendant does not invoke the
statutory limitation prior to judgment.27 Id. The court concluded that in the case
before it, application of the statute required no additional factual inquiry. Id. The
27
In Hernandez v. Cty. of Monterey, the United States District Court for the Northern
District of California stated, in dicta, that a defense "targeting the amount of the
recovery is a limitation rather than an affirmative defense," relying on the Ninth
Circuit's opinion in Taylor as authority without recognizing the Ninth Circuit's
acknowledgement of the obligation to invoke a statutory limitation prior to judgment
when application of the limitation requires resolution of factual issues. 306 F.R.D.
279, 285 (N.D. Cal. 2015).
United States Supreme Court denied certiorari in this case, but Justice White wrote
a brief dissent highlighting Taylor's conflict with the First Circuit's decision in
Jakobsen and the Fifth Circuit's decision in Ingraham. 485 U.S. 992, 992–93 (1988)
(White, J., dissenting).
State court opinions have likewise acknowledged that a defendant can waive
the application of a statutory limitation on damages when the defendant fails to
invoke the limitation in time for the plaintiff to present proof in opposition to the
limitation. In Keene v. Brigham & Women's Hosp., Inc., the Supreme Judicial Court
of Massachusetts stated that a statutory damages cap for charitable corporations was
"treated as an affirmative defense that must be pleaded" although it was "technically
a limitation on liability." 786 N.E.2d 824, 836 (Mass. 2003). The court explained,
"Factual matters related to the cap may need to be determined by the fact finder, with
the burden on the defendant to prove both that it is a charitable organization and that
the tort complained of fell within the range of activities covered by the cap." Id.
The court further stated, "The requirement that it be raised as an affirmative defense
in such circumstances prevents unfair surprise, a key focus of the requirement of
pleading affirmative defenses, and resulting prejudice to the plaintiff." Id. The court
concluded that the defendant in that case raised the statutory cap "in a timely
manner" and the plaintiff made no claim of surprise. Id. at 837; see also Pressler v.
Irvine Drugs, Inc., 169 Cal. App. 3d 1244, 1248, 215 Cal. Rptr. 807, 809 (Ct. App.
1985) (referring to California's statutory cap on noneconomic damages in medical
malpractice cases as an affirmative defense and holding the defendant did not waive
the defense by failing to request special interrogatories).
Target cites Zorrilla v. Aypco Construction II, LLC, in which the Supreme
Court of Texas held that the state's single statutory cap on punitive damages did not
"bear the characteristics of an affirmative defense or avoidance" because it did not
"require proof of any additional fact to establish its applicability." 469 S.W.3d 143,
157 (Tex. 2015). The court emphasized that the statute applied automatically unless
a case fell within the statute's exclusions for conduct described as a felony in certain
sections of the state's penal code if the conduct was committed knowingly or
intentionally. Id. (citing Tex. Civil Practice & Remedies Code Ann. § 41.008(c)).
Although the statute was silent as to the burden of proof, the court interpreted the
statute to place the burden on the plaintiff to show that a case fell within one of the
exclusions. Id. The court concluded that because the statute did not place the burden
of proof on the defendant, it was not an affirmative defense or avoidance that the
defendant was required to plead. Id. The court also stated that because the statutory
cap automatically applied, there was "little concern that plaintiffs will be genuinely
surprised by its application." Id.
While Zorrilla may have logical appeal, our own precedent in James and the
above-referenced persuasive federal court opinions disregard the fiction that a
plaintiff is automatically on notice that a defendant will invoke a statutory damages
cap to limit a jury's award.28 These opinions focus on whether a statutory damages
cap affects the proof at trial rather than which party has the burden of proof under
the statute—no matter who has the burden, the plaintiff must be prepared for the
defendant to place the issue before the finder of fact. In fact, the James court
acknowledged that the plaintiffs in that case would carry the burden of proving gross
negligence in order to recover damages in excess of the statutory cap: "The
[plaintiffs] had no notice that another party was necessary and that they would be
required to prove a greater degree of negligence in order to recover damages in
excess of $200,000." 331 S.C. at 282, 500 S.E.2d at 201. To adopt the reasoning of
Zorrilla would require us to contradict James, which we are unwilling to do,
especially given its more realistic approach to the application of Rule 8(c).
With these considerations in mind, we return to South Carolina's statute,
which begins with a reference to circumstances supporting either a two million dollar
cap or no cap at all: "Except as provided in subsections (B) and (C), an award of
punitive damages may not exceed the greater of three times the amount of
compensatory damages awarded to each claimant entitled thereto or the sum of five
hundred thousand dollars." (emphasis added). Two successive events trigger the
application of a higher cap set forth in subsection (B), i.e., "the greater of four times
the amount of compensatory damages awarded to each claimant entitled thereto or
the sum of two million dollars": (1) the jury returns a verdict exceeding the
maximum amount specified in subsection (A) and (2) the trial court determines that
one of the following two set of circumstances existed:
(1) the wrongful conduct . . . was motivated
primarily by unreasonable financial gain and . . . the
unreasonably dangerous nature of the conduct,
together with the high likelihood of injury resulting
from the conduct, was known or approved by the
managing agent, director, officer, or the person
28
One exception is the Fifth Circuit's recognition that when a damages cap is an
integral part of a statutory scheme under which the plaintiff seeks relief, the plaintiff
cannot claim unfair surprise by the defendant's failure to plead the statutory cap. See
Giles, 245 F.3d at 491 n.32 (citing Oliver v. Cole Gift Ctrs., Inc., 85 F. Supp. 2d 109,
111–12 (D. Conn. 2000)).
responsible for making policy decisions on behalf
of the defendant; or
(2) the defendant's actions could subject the
defendant to conviction of a felony and that act or
course of conduct is a proximate cause of the
plaintiff's damages.
§ 15-32-530(B).
However, subsection (C) provides "there shall be no cap on punitive damages"
when the trial court determines that one of the following three sets of circumstances
applies to the case: (1) "the defendant had an intent to harm and . . . the defendant's
conduct did in fact harm" the plaintiff; (2) the defendant was convicted of a felony
arising out of the same act and the act proximately caused the plaintiff's damages; or
(3) the defendant was "substantially impaired" by a substance "other than lawfully
prescribed drugs administered in accordance with a prescription." § 15-32-530(C).
In the absence of a requirement for a separate post-trial evidentiary hearing to submit
this proof, we interpret the statute's plain language to require the trial court to make
these special findings based on the proof presented to the jury at trial. See State v.
Johnson, 396 S.C. 182, 188, 720 S.E.2d 516, 520 (Ct. App. 2011) ("In interpreting
a statute, the court will give words their plain and ordinary meaning[] and will not
resort to forced construction that would limit or expand the statute." (emphasis
added)).
Similar to the Zorrilla court's analysis of the Texas statutory cap on punitive
damages, Target argues South Carolina's $500,000 punitive damages cap applies
automatically unless the circuit court makes the above-referenced determinations
required by subsection (B) or subsection (C). However, unlike the structure of the
Texas statute, Tex. Civil Practice & Remedies Code Ann. § 41.008, which sets forth
one absolute cap in subsection (b) and separately addresses exclusions from the
statute's application in subsection (c), the structure of South Carolina's statute
denotes from the outset the fact that the $500,000 cap does not automatically apply:
"Except as provided in subsections (B) and (C), an award of punitive damages may
not exceed the greater of three times the amount of compensatory damages awarded
to each claimant entitled thereto or the sum of five hundred thousand dollars." § 15-
32-530(A) (emphasis added). By beginning the statute with a reference to
circumstances supporting either a $2 million cap or no cap at all, the legislature made
it clear that it did not intend to make the $500,000 cap automatically applicable. See
Fox v. Moultrie, 379 S.C. 609, 614, 666 S.E.2d 915, 917 (2008) ("In determining the
plain meaning of a statute, the courts must look at the particular statutory language
at issue and the language and design of the statute as a whole.").
In sum, the criteria of section 15-32-530 undoubtedly "affect [the] proof at
29
trial," thus distinguishing section 15-32-530 from other South Carolina statutes that
do not invoke the functions of a fact finder or affect the proof at trial.30 Like the
Louisiana statute examined in Simon, section 15-32-530 involves "more than just a
pure issue of law." 891 F.2d at 1159. To develop the evidence necessary to invoke
one of the two alternatives to the $500,000 cap, a plaintiff must first obtain the
evidence through extra discovery or other investigative measures—measures that
are less likely to unfold without prior notice that the defendant will raise the cap as
an issue before the circuit court. Again, we note section 15-32-530 does not provide
for a separate post-trial evidentiary hearing to submit evidence pertaining to the
factors set forth in subsections (B) and (C). We interpret section 15-32-530 to
require the circuit court to make a determination under subsections (B) or (C) based
on the evidence presented to the jury at trial.
Therefore, we conclude that Target was required to plead the recovery limits
in section 15-32-530 or, at the very least, raise the defense prior to the conclusion of
discovery so that the Garrisons would have had prior notice of the additional
evidence they needed to lift the punitive damages limit.31 Because Target failed to
do so, fairness dictates that we deem the application of the statutory damages limit
to this case waived. See James, 331 S.C. at 286, 500 S.E.2d at 203 (holding that the
trial court did not abuse its discretion in denying the defendant's motion to amend its
29
James, 331 S.C. at 284, 500 S.E.2d at 202.
30
See supra n. 26; cf. Parker, 362 S.C. at 285, 607 S.E.2d at 716 (holding that the
Tort Claims Act's damages cap did not have to be pled as an affirmative defense
because it was "self-executing"); S.C. Code Ann. § 15-78-120(a)(1) (2005)
(providing only that a person's recovery of damages in an action brought under the
Tort Claims Act is limited to $300,000 "because of loss arising from a single
occurrence regardless of the number of agencies or political subdivisions involved");
S.C. Code Ann. § 15-78-30(g) (2005) (defining "occurrence" as "an unfolding
sequence of events [that] proximately flow from a single act of negligence").
31
See James, 331 S.C. at 282–83, 500 S.E.2d at 201 (holding that the defendant's
"failure to raise its charitable status as an affirmative defense affected both the
parties to the action and the manner in which the case was tried to the jury, including
what issues were or were not presented to them for resolution," and therefore, the
statute limiting damages against a charitable organization constituted an affirmative
defense that had to "be pled or waived," as required by Rule 8(c)).
answer to assert a statutory damages limit because "allowing the amendment would
have prejudiced the [plaintiffs]").
Based on the foregoing, we reverse the circuit court's conclusion that the
punitive damages award could not stand under section 15-32-530.
III. New Trial Absolute
Target contends the circuit court should have granted it a new trial absolute
because the punitive damages award reflected the jury's passion, caprice, and
prejudice. We disagree.32
32
Target also contends the circuit court's conclusion that the punitive damages award
violated Target's due process rights required the circuit court to order a new trial
absolute or new trial nisi remittitur rather than simply setting aside the award.
However, this argument is unpreserved. Target filed a post-trial "Motion for
Judgment as a Matter of Law, New Trial Absolute, or New Trial Nisi Remittitur"
indicating the primary relief sought was a JNOV as to liability and punitive damages.
In this motion, Target expressed a preference for obtaining a JNOV as to liability
and punitive damages on the grounds that there was insufficient evidence of
constructive notice or proximate causation and there was no evidence showing that
Target was willful, wanton, or reckless. Target sought as alternative relief either a
new trial absolute or new trial nisi remittitur. The asserted ground for a new trial
absolute was that the awards of compensatory and punitive damages demonstrated
"the jury's decision was actuated by passion, prejudice[,] or caprice." The asserted
grounds for a new trial nisi remittitur were (1) the evidence did not support the
amount of actual damages awarded, and (2) the evidence did not support the amount
of punitive damages awarded; this amount exceeded the cap in section 15-32-530;
and the award violated due process.
In addressing this post-trial motion, the circuit court granted Target's preferred
relief, a JNOV, as to punitive damages and set aside that award. In ruling on Target's
alternative request for a new trial absolute or nisi, the circuit court addressed
primarily the compensatory damages award. The court noted that the punitive
damages award violated due process but concluded that the court had "substantially
altered the overall verdict by eliminating the punitive damages award," and did not
"find compelling reasons to invade the province of the jury by granting a new trial
nisi." Because Target gave the circuit court the impression that it sought a new trial
absolute or nisi only in the event the circuit court did not grant a JNOV, Target was
required to file a Rule 59(e), SCRCP, motion upon receiving the circuit court's post-
"When a party moves for a new trial based on a challenge that the verdict is
either excessive or inadequate, the trial judge must distinguish between awards that
are merely unduly liberal or conservative and awards that are actuated by passion,
caprice, or prejudice." Allstate Ins. Co. v. Durham, 314 S.C. 529, 530, 431 S.E.2d
557, 558 (1993). Likewise, the circuit court must avoid conflating the
constitutionality of a damages award with an award motivated by passion or
prejudice. Cf. Mitchell, 385 S.C. at 592, 596, 686 S.E.2d at 187, 190 (finding a $15
million punitive damages award to be "grossly excessive" such that it rose to the
level of a due process violation but finding "no credible evidence anywhere in the
record" to support the defendant's contention that the compensatory or punitive
damages award resulted from passion, caprice, or prejudice).
When the verdict indicates that the jury was unduly liberal
or conservative in its view of the damages, the trial judge
alone has the power to reduce the verdict by the granting
of a new trial nisi.[33] However, when the verdict is so
grossly excessive or inadequate that the amount awarded
is so shockingly disproportionate to the injuries as to
indicate that the jury was moved or actuated by passion,
caprice, prejudice, or other considerations not found in the
trial order to preserve its argument that the only correct relief for the due process
violation was either a new trial absolute or a new trial nisi. See Parker v. Shecut,
340 S.C. 460, 480, 531 S.E.2d 546, 557 (Ct. App. 2000), rev'd on other grounds,
349 S.C. 226, 562 S.E.2d 620 (2002) ("When an order is internally inconsistent, that
inconsistency must be raised to the trial court by way of a post-trial motion before it
is preserved for appellate review."); Hubbard v. Rowe, 192 S.C. 12, 5 S.E.2d 187,
189 (1939) ("[A]ll that this [c]ourt has ever required is that the questions presented
for its decision must first have been fairly and properly raised in the lower [c]ourt
and passed upon by that [c]ourt.").
33
The principle underlying a new trial nisi remittitur or additur is that the circuit
court "may not impose a substitute for the jury verdict on an unwilling plaintiff" or
defendant, and thus, the court may give to the opposing party a new trial unless the
plaintiff agrees to remit a part of the verdict or the defendant agrees to add a sum to
the verdict. See Graham v. Whitaker, 282 S.C. 393, 401, 321 S.E.2d 40, 45 (1984)
("[J]udges have the authority to grant to a defendant a new trial nisi remittitur. In
such cases, the judge may not impose a substitute for the jury verdict on an unwilling
plaintiff. He may give to the defendant the right to a new trial unless the plaintiff
agrees to remit a portion of the verdict.").
evidence, it becomes the duty of the trial judge and this
[c]ourt to set aside the verdict absolutely.
Durham, 314 S.C. at 531, 431 S.E.2d at 558 (second emphasis added) (citation
omitted). Further, the amount of unliquidated damages that "a jury might properly
award . . . is largely a matter of judgment based upon the facts and circumstances of
each case." Watson v. Wilkinson Trucking Co., 244 S.C. 217, 224, 136 S.E.2d 286,
289 (1964). "In determining the question, the facts must be viewed in the light most
favorable to the plaintiff[,] and[] whe[n] the amount of a verdict bears a reasonable
relationship to the character and extent of the injury sustained, it is not excessive."
Id. Moreover, "the jury's determination of damages is entitled to substantial
deference[,]" and the circuit court's decision on whether to grant a new trial based
on the amount of the verdict "will not be disturbed on appeal unless it clearly appears
the exercise of discretion was controlled by a manifest error of law." Welch, 342
S.C. at 303, 536 S.E.2d at 420.
Here, the jury likely considered the potential harm to Denise, which involved
possibly contracting a communicable disease such as HIV or hepatitis, along with
the attendant medical costs and possible death. Cf. Mitchell, 385 S.C. at 590–92,
686 S.E.2d at 187 (comparing the punitive damages award to the potential harm to
the plaintiff). Further, the evidence shows that despite Target employees' awareness
of the importance of keeping the parking lot safe for customers, they did not increase
the frequency of cleaning the lot after Denise's injury or do anything to improve
"safety scans" or cleaning methods after the injury. Therefore, the jury likely
considered the possible harm to other customers or their children if Target is not
adequately deterred. Cf. TXO, 509 U.S. at 460 (considering "the possible harm to
other victims that might have resulted if similar future behavior were not deterred").
Because these considerations are rational inferences from the evidence presented at
trial, we conclude that the punitive damages award did not result from passion,
caprice, or prejudice. Therefore, the circuit court properly denied Target's motion
for a new trial absolute.
IV. Prejudgment Interest
The Garrisons contend the circuit court should have awarded them pre-
judgment interest on the full amount of compensatory and punitive damages
awarded by the jury rather than merely compensatory damages. We disagree.
Rule 68(a), SCRCP, provides, in pertinent part,
Any party in a civil action, except a domestic relations
action, may file, no later than twenty days before the trial
date, a written offer of judgment signed by the offeror or
his attorney, directed to the opposing party, offering to
take judgment in the offeror’s favor, or to allow judgment
to be taken against the offeror for a sum stated therein, or
to the effect specified in the offer.
(emphasis added). In the present case, Denise made an offer of judgment in the
amount of $12,000 on February 13, 2015.
Further, Rule 68(b) states, in pertinent part,
If an offer of judgment is not accepted and the offeror
obtains a verdict or determination at least as favorable as
the rejected offer, the offeror shall recover from the
offeree: (1) any administrative, filing, or other court costs
from the date of the offer until the entry of the judgment;
(2) if the offeror is a plaintiff, eight percent interest
computed on the amount of the verdict or award from the
date of the offer to the entry of judgment[.]
(emphases added). Because the circuit court granted a JNOV to Target as to the
punitive damages award, the circuit court computed interest on the $100,000
compensatory damages award only.
The Garrisons maintain that the plain language of Rule 68(a) ties pre-
judgment interest to the amount of the verdict or award and not to "any alteration of
the jury's verdict post-judgment." However, Target contends that the use of the term
"determination" in the first sentence of Rule 68(b) indicates that the final amount
may be settled by the presiding judge rather than the jury. We agree. When this
term is considered in combination with the last phrase of Rule 68(b), "eight percent
interest computed on the amount of the verdict or award from the date of the offer
to the entry of judgment,"34 the plain language of the rule contemplates that interest
is to be computed on the final judgment after all post-trial motions have been
resolved. See CFRE, LLC v. Greenville Cty. Assessor, 395 S.C. 67, 74, 716 S.E.2d
877, 881 (2011) ("[The court] should not concentrate on isolated phrases within the
statute."); id. ("Instead, [the court reads] the statute as a whole and in a manner
34
(emphasis added).
consonant and in harmony with its purpose."); Ex parte Wilson, 367 S.C. 7, 15, 625
S.E.2d 205, 209 (2005) ("In interpreting the meaning of the South Carolina Rules of
Civil Procedure, the [c]ourt applies the same rules of construction used to interpret
statutes."); Johnson, 396 S.C. at 188, 720 S.E.2d at 520 ("In interpreting a statute,
the court will give words their plain and ordinary meaning[] and will not resort to
forced construction that would limit or expand the statute."); Singletary v. S.C. Dep't
of Educ., 316 S.C. 153, 162, 447 S.E.2d 231, 236 (Ct. App. 1994) ("The intention of
the legislature must be gleaned from the entire section and not simply clauses taken
out of context.").
Target also argues that pre-judgment interest should not apply to punitive
damages awards because the interest is meant to compensate the offering party rather
than to punish the party who rejected an offer of judgment. Target acknowledges
this is a novel issue in South Carolina and cites opinions from other jurisdictions in
support of this argument. In Haskins v. Shelden, the Supreme Court of Alaska held
that pre-judgment interest should not apply to punitive damages. 558 P.2d 487, 495
(Alaska 1976). The court based its decision on the risk of a double recovery,
explaining,
In making its determination of the appropriate penalty for
[the defendant's] actions, the jury probably assessed the
penalty it wished [the defendant] to presently pay without
discounting for prejudgment interest. In addition, [the
plaintiff] was not deprived of the use of money which she
expected to have available during the years of litigation.
Id.
Also, in Ramada Inns, Inc. v. Sharp, 711 P.2d 1, 2 (Nev. 1985), the Supreme
Court of Nevada interpreted Nev. Rev. Stat. Ann. § 17.130, which allowed
prejudgment interest "[i]n all judgments and decrees, rendered by any court of
justice, for any debt, damages or costs."35 The court held, "Because the amount of
punitive damages to be awarded is not known until the judgment is
rendered, . . . prejudgment interest may not be granted by a trial court on punitive
damage awards," explaining,
35
The statute merely provided, in pertinent part, "the judgment draws interest from
the time of service of the summons and complaint until satisfied, except for any
amount representing future damages." Nev. Rev. Stat. Ann. § 17.130.
Prejudgment interest is viewed as compensation for use by
defendant of money to which plaintiff is entitled from the
time the cause of action accrues until the time of judgment;
it is not designed as a penalty. A plaintiff is never entitled
to punitive damages as a matter of right; their allowance
or denial rests entirely in the discretion of the trier of fact.
Therefore, the amount of punitive damages to be awarded
cannot be ascertained until the trier of fact has heard all
the evidence.
711 P.2d at 2 (citations omitted).
On the other hand, the Garrisons assert that the statutes interpreted in the
opinions cited by Target are not offer-of-judgment statutes and, thus, do not have
persuasive value. The Garrisons cite a Connecticut opinion interpreting that state's
offer-of-judgment statute to allow punitive damages to be included in the
computation of pre-judgment interest. In Kregos v. Stone, 872 A.2d 901, 906 (Conn.
App. Ct. 2005), the Appellate Court of Connecticut highlighted the pertinent
language of the statute as it was worded when the opinion was issued: "[i]f the court
ascertains from the record that the plaintiff has recovered an amount equal to or
greater than the sum certain stated in the plaintiff's 'offer of judgment,' the court shall
add to the amount so recovered twelve per cent annual interest on said amount."
Conn. Gen. Stat. Ann. § 52-192a.36 The court held that the word "recovered" in the
statute included the entire verdict, both punitive and compensatory damages. 872
A.2d at 906. Notably, Connecticut has a separate pre-judgment interest statute in
addition to the offer-of-judgment statute. See Boulevard Assocs. v. Sovereign
Hotels, Inc., 861 F. Supp. 1132, 1141 (D. Conn. 1994), supplemented on other
grounds by 868 F. Supp. 70 (S.D.N.Y. 1994) ("Unlike § 37–3a (prejudgment
interest), an award of interest under § 52–192a(b) [the offer-of-judgment statute] is
punitive in nature, and is meant to serve the purpose of promoting 'fair and
reasonable compromise of litigation without trial.'" (quoting Crowther v. Gerber
Garment Tech., Inc., 513 A.2d 144, 151 (Conn. App. Ct. 1986))).
We do not interpret Rule 68 as liberally as the Appellate Court of Connecticut
has interpreted that state's offer-of-judgment statute. Rather, we find persuasive the
above-quoted reasoning from the opinions in Haskins and Sharp. Therefore, we
36
The statute was amended after the Appellate Court of Connecticut issued its
opinion in Kregos.
reject the Garrisons' argument that prejudgment interest calculations should include
the amount of a punitive damages award.
CONCLUSION
We affirm the circuit court's denial of Target's JNOV motion as to liability.
We reverse the circuit court's setting aside of the punitive damages award because
we find there was sufficient evidence of Target's recklessness. Further, because
Target waived the application of the punitive damages caps in section 15-32-530,
we reverse the circuit court's conclusion that the punitive damages award cannot
stand under section 15-32-530. Nonetheless, we affirm the circuit court's conclusion
that the punitive damages award violated due process, and we remand for a remittitur
of the award to an amount reasonably consistent with the circumstances of this case.
Finally, we affirm the denial of Target's new trial motion and the calculation of pre-
judgment interest.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
WILLIAMS, J., concurs.
HILL, J., concurring in part and dissenting in part:
I concur in Parts I, III, and IV of the well-crafted majority opinion. I also concur in
Part II insofar as it concludes the issue of punitive damages was properly submitted
to the jury. I cannot, however, join my good colleagues in the rest of their punitive
damages ruling as I believe the punitive damages cap of S.C. Code Ann. § 15-32-530
(Supp. 2019) applies to Garrison's award. I would therefore remand to the circuit
court for a hearing on this issue. This would also entail a remand for a hearing on
Garrison's argument that the cap is unconstitutional, which the Attorney General
must be notified of pursuant to Rule 24(c), SCRCP.
The majority holds the cap put in place by the legislature is an affirmative defense
that disappears if not pled. There is an equally reasonable view that the cap is not
an affirmative defense, and the circuit court must apply it to all punitive damages
verdicts. This view is more consistent with legislative intent and more persuasive
for several reasons.
First, nothing in the Act that created the cap requires it be pled at all, much less as
an affirmative defense. 2011 Act No. 52. This could be shrugged off as an oversight,
but the legislature had pleadings in mind, as the very first sentence of the Act as
codified directs that "[a] claim for punitive damages must be specially prayed for in
the complaint." § 15-32-510(A).
Second, whether a matter is an affirmative defense is controlled by Rule 8(c),
SCRCP, which lists twenty-two specific defenses. Damages caps are not listed, but
the list is not exclusive, so the question becomes whether the cap is "any other matter
constituting an avoidance or affirmative defense." Rule 8(c), SCRCP. This question
is one of interpretation and, as in interpreting statutes, our role is to discern
legislative intent.
A cap is not a defense to a cause of action. All of the specific affirmative defenses
listed in Rule 8(c), SCRCP, share a defining characteristic: they bar liability for the
cause of action. If the affirmative defense is proven, the defendant is not liable at
all, even though the facts the plaintiff has alleged might otherwise entitle the plaintiff
to judgment on the cause of action. See O'Neal v. Carolina Farm Supply of
Johnston, Inc., 279 S.C. 490, 494, 309 S.E.2d 776, 779 (Ct. App. 1983). The listed
affirmative defenses have another common characteristic: not one of them relates to
a bar or limitation on damages for the cause of action, or any other post-verdict
matter.
Nor is the cap an "avoidance." At first glance, an avoidance and an affirmative
defense appear to be identical twins. But a closer look reveals the distinguishing
characteristic of an avoidance is that it depends upon the introduction of new facts
to defeat a cause of action, whereas an affirmative defense relies on the plaintiff's
own facts. This court has observed:
At common law, a pleading of confession and avoidance
is the introduction of new or special matter which admits
the factual premises of the opposing party's pleading but
avoids or repels his conclusions. New matter involves of
necessity a new issue, or the introduction of a new
ingredient as the basis of one which operates as a defense.
A plea by way of confession and avoidance admits that the
cause of action alleged did once exist, but avers
subsequent facts which operate to destroy the cause of
action and defeat a recovery. Thus, an avoidance is a
defense which goes beyond the basic elements of the
opposing party's cause and depends upon additional facts
to defeat the claim.
Oyler v. Oyler, 293 S.C. 4, 6–7, 358 S.E.2d 170, 172 (Ct. App. 1987) (internal
citations omitted). In my view, the plain reading of Rule 8(c), SCRCP, results in the
conclusion that the punitive damages cap is neither an avoidance nor an affirmative
defense, for it does not affect the defendant's liability on the cause of action (only
the damages), and it depends upon the straightforward application of a statute, not
new facts (other than the return of the triggering punitive damages verdict).
The majority is quite correct that James v. Lister held a damages cap on recovery
against charitable organizations was an affirmative defense that was waived if not
pled. 331 S.C. 277, 282-83, 500 S.E.2d 198, 201 (Ct. App. 1998). One difference
between James and our facts is, as the majority points out, the statutory caps there
specifically required the joinder of another party (the employee of the charity) and a
special verdict of the jury that the employee's gross negligence proximately caused
the injury. These procedural requirements fundamentally affected both the parties
and the proof at trial. By contrast, the punitive damages cap here is not an issue for
the jury and does not require adding a new party.
This contrast aligns our facts more with Parker v. Spartanburg Sanitary Sewer Dist.,
which was decided after Lister and held the statutory damages cap codified in the
Tort Claims Act was "self-executing" and not an affirmative defense that had to be
pled. 362 S.C. 276, 285, 607 S.E.2d 711, 716 (Ct. App. 2005); see also Broome v.
Watts, 319 S.C. 337, 342, 461 S.E.2d 46, 49 (1995) (statutory right to setoff not an
affirmative defense falling within residuary clause of Rule 8(c), SCRCP, because
setoff was required by statute and not issue for jury).
The majority's thorough opinion acknowledges that the question of whether statutory
damages caps are affirmative defenses has split the federal circuits. No circuit has
provided any useful analytical model. In addition to Zorilla, the Texas supreme
court decision the majority cites, several other states have decided caps are not
affirmative defenses. McGinnes v. Wesley Med. Ctr., 224 P.3d 581, 591 (Kan. Ct.
App. 2010); Anderson v. City of Milwaukee, 559 N.W.2d 563, 569 (Wis. 1997);
Snyder v. City of Minneapolis, 441 N.W.2d 781, 788 (Minn. 1989).
Frustrated in their search for a coherent approach to deciding what counts as an
affirmative defense under the residuary clause of Rule 8(c), the leading
commentators on the federal rules have thrown up their hands and acknowledged
they can find no objective waypoint, noting "resort must often be had to
considerations of policy, fairness, and, in some cases, probability." C. Wright & A.
Miller, Federal Practice and Procedure: Federal Rules of Civil Procedure § 1271
(3rd Ed.). Their attempt to reconcile these three broad subjective criteria with the
rule and what happens in courtrooms fares no better, for there are only two practical,
interlocking questions: whether the matter claimed to be an affirmative defense
unfairly surprised the other party, and whether the party asserting the matter has
unique access or control to the facts comprising the defense. Looking at Target's
assertion of the cap, the answer to both questions is no.
Which leads to my next point: even if the cap is an affirmative defense that must be
pled, I would not find waiver here because Garrison has not demonstrated unfair
surprise or other prejudice. Plyler v. Burns, 373 S.C. 637, 650, 647 S.E.2d 188, 195
(2007) (holding because the goal of Rule 8(c), SCRCP, is to avoid surprise, technical
failure to plead immunity as an affirmative defense did not waive it where defendant
timely raised it to trial court and plaintiff was not prejudiced or unfairly surprised).
The cap is a matter for the court, not the jury. It would be remarkable for Garrison
to claim she was blindsided by the cap because she was unaware of basic statutes
governing punitive damages, and she does not make such a claim. Her prejudice
argument is had she known Target would rely on the cap, she would have focused
her evidence more on the financial motivations for Target's conduct. This alludes to
an exception to the cap relevant here, which raises the cap to either four times the
compensatory damages award or two million dollars if the circuit court determines
(1) Target's wrongful conduct was motivated primarily by unreasonable financial
gain, and (2) Target's managing agent, director, officer, or the person responsible for
making Target's policy decisions knew or approved of the unreasonably dangerous
nature of the conduct, together with the high likelihood of injury resulting from the
conduct. See S.C. Code Ann. § 15-32-530(B)(1) (Supp. 2019).
If Garrison had additional evidence meeting this criteria, it is doubtful the only thing
holding her back from presenting it to the jury was Target's failure to allege the cap
as an affirmative defense. Lawyers who have smoking guns use them.
Calling a matter an affirmative defense has an important consequence: it shifts the
burden of proof to the defendant. O'Neal, 279 S.C. at 494, 309 S.E.2d at 779
(describing that upon assertion of affirmative defense, "the burden of proof shifts to
the defendant to show he is not liable"). Yet, the legislature did not assign the burden
of proving the cap to any party. It simply directed the trial judge to determine which
level of the cap applies. The practical effect of the majority opinion will be to place
the burden on a defendant to prove the cap (and which level) applies. The
awkwardness of trying to fit the concept of burden-shifting—a concept designed for
determining liability—onto a damages cap is a good clue the cap does not resemble
an affirmative defense. One is reminded of Abraham Lincoln's story about how
many legs a sheep would have if you counted the tail a leg. When told the answer
was five, the response was that calling the tail a leg did not make it one. See Rice,
ed., Reminiscences of Abraham Lincoln by Distinguished Men of his Time at 241-42
(Harper & Bros., 1909).
There is yet another reason to conclude the legislature intended the cap procedure to
be self-executing, one that promotes symmetry and predictability in the law's design.
Public policy debate has swirled around punitive damages for decades, with some
claiming the awards are arbitrary. As the legislature well knew when it passed the
cap, ever since Gamble v. Stevenson circuit courts in our state have had the
mandatory duty to conduct post-trial review of a punitive damages award to ensure
it comports with due process. 305 S.C. 104, 111–12, 406 S.E.2d 350, 354 (1991).
This duty does not depend on a party's pleading or request. Id. To hold the statutory
cap on punitive damages lives or dies by the whims of pleading creates an
unwarranted dichotomy in the judicial treatment of punitive damages awards. Some
may now claim the caps are as arbitrary as the awards they are designed to control.
With great respect for the majority, I respectfully dissent.