Petition for Writ of Certiorari — McGee v. Brown

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No. te R ZU 199}

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Supreme Court of the United States

October Term, 1990

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JOHN DAVID McGEE and HANAHAN MOTORS, INC.,

Petitioners,

CRYSTAL G. BROWN,

Respondent.

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Petition For Writ Of Certiorari To The

Supreme Court Of South Carolina

PETITION FOR WRIT OF CERTIORARI

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THomas J. KEAvENy, II

KeEaTING L. Simons, III

Hotmes & THOMSON

100 Broad Street

Charleston, SC 29402

(803) 723-2000

Counsel for Petitioners

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

QUESTION PRESENTED FOR REVIEW

1. Does South Carolina’s procedure for awarding

punitive damages violate the Due Process Clause of the

United States Constitution?

ii

TABLE OF CONTENTS

Page

QUESTION PRESENTED ...... 2. cc cccccccnscecccees i

TABLE OF CONTENTS .......cccccscescsseccesseses ii

TABLE OF AUTHORITIES... nc ccccccccccesesecess ili

GROUNDS ON WHICH JURISDICTION iS

INVOKED ........ STITT 1

PROVISIONS AND STATUTES INVOKED.......... 2

STATEMENT OF CASE........... ou eeeeeeeweheeue 2

FEDERAL QUESTION FACTORS................55 3

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TABLE OF AUTHORITIES

Page

Cases

Green Oil Co. v. Hornsby, 539 So. 2d 218 (Ala. 1989) ..... 6

Hammond v. City of Gadsden, 493 So. 2d 1374 (Ala.

ES PEEVES UAE M Gas 402 6

Hicks v. Herring, 246 S.C. 429, 144 S.E.2d 151 (1965) ..... 4

Mylin v. Allen-White Pontiac, Inc., 281 S.C. 174, 180,

I UD ava scan ces cccaccisicsecccsas 5

Pacific Mutual Life Insurance Co. v. Haslip, 1991 WL

24587 59 U.S.L.W. 4157 (U.S. March 4, 1991)

SE ee een 4,5,7

Sample v. Gulf Refining Co., 183 S.C. 399, 191 S.E.

eee GCL LKN Ca 45 655.b5 sos bende eisca's 4

Young v. Warr, 252 S.C. 179, 165 S.E.2d 797 (1969) ..... 5

CONSTITUTIONAL PROVISIONS

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No.

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In The

Supreme Court of the United States

October Term, 1990

sa

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JOHN DAVID McGEE and HANAHAN MOTORS, INC.,

Petitioners,

CRYSTAL G. BROWN,

Respondent.

a

4

Petition For Writ Of Certiorari To The

Supreme Court Of South Carolina

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PETITION FOR WRIT OF CERTIORARI

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of

GROUNDS ON WHICH THE JURISDICTION OF

THIS COURT IS INVOKED

The date of the Opinion of the South Carolina

Supreme Court is December 20, 1990 (see Appendix A).

The statutory provision believed to confer jurisdiction on

this Court is 28 U.S.C. § 1257(a):

Final judgments or decrees rendered by the

highest court of a State in which a decision

could be had, may be reviewed by the Supreme

Court by writ of certiorari where . . . any title,

right, privilege, or immunity is specifically set

p or claimed under the Constitution . . .

if. . . the United States.

A.

—_

CONSTITUTIONAL PROVISIONS INVOLVED

U.S. CONST. amend. V:

No person shall be . . . deprived of life, liberty, or prop-

erty, without due process of law... .

U.S. CONST. amend. XIV, § 1:

No state shall make or enforce any law which shall

abridge the privilege or immunities of citizens of the

United States; nor shall any state deprive any person of

life, liberty, or property, without due process of law... .

a

i

STATEMENT OF THE CASE

In February 1988, the Plaintiff filed this tort action in

Court of Common Pleas, Charleston County, South Caro-

‘ina. She sought actual and punitive damages for per-

sonal injuries she sustained in an automobile accident

which occurred in Charleston County on April 4, 1987

(see Appendix F). The Defendants filed a qualified gen-

eral denial (see Appendix E). With consent of counsel, the

case was transferred to Defendants’ home county of

Berkeley.

On March 28, 1989 the case was ce'led to trial. At that

time the Defendants moved to strike Plaintiff’s prayer for

punitive damages on the basis that South Carolina’s pro-

cedures for awarding punitive damages violated the Due

Process Ciause of the United States and South Carolina

Constitutions (see Appendix C). That motion was denied

(see Appendix C). On March 30, 1989 the jury returned a

verdict for actual damages in the amount of $67,500.00; it

_ awarded punitive damages in the amount of $100,000.00.

(see Appendix B).

Defendants unsuccessfully moved for judgment

n.O.v. aS to punitive damages (see Appendix C). A timely

appeal was then filed in the South Carolina Supreme

Court on the grounds that (1) the lower court erred in

several evidentiary rulings and, (2) the state’s common

law procedures for awarding punitive damages denied

the Defendants due process (see Appendix D). That Court

affirmed the jury verdict (see Appendix A).

a

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FEDERAL QUESTION FACTORS

The Defendants challenged the constitutionality of

the State’s procedures for awarding punitive damages—

before the trial of the case began (see Appendix C). The

trial court denied the Defendants’ motion to strike the

prayer for punitive damages and, in essence, held that a

“higher” court would have to determine whether or not

The State’s procedures for awarding such damages were

constitutionally infirm. The State Supreme Court declined

the challenge apparently on the basis that the Defen-

dant’s Motion to the trial court was not sufficiently spe-

cific (see Appendix A).!

' However, the trial court’s order (see Appendix C) clearly

indicates that its holding was based not on its own view of the

motion’s merit, but, instead, on its reluctance to sail into

unchartered waters. Therefore, there is no reason to believe a

more “specific” objection would have yielded a different result.

ARGUMENT AMPLIFYING REASONS

RELIED ON FOR ALLOWANCE FOR WRIT

Petitioner contends South Carolina’s procedures for

awarding punitive damages violate the Due Process

Clause of the United States Constitution in several

respects. First, the state requires only that a jury find a

defendant’s conduct to be reckless, willful, or wanton.

Sample v. Gulf Refining Co., 183 S.C. 399, 191 S.E. 209

(1937). This standard is virtually useless as juries are told

only that reckless, willful or wanton conduct is that

which evidences a conscious disregard for, or indifference

to, the rights of others. Secondly, the jury is instructed

that if it finds a defendant’s conduct to be reckless, it

must return a verdict for punitive damages. Sample, 183

S.C. at 410. (If Plaintiff proves reckless, willful and won-

ton violation of his rights, the jury has not only the right

but the duty to award punitive damages). This is contrary

to the situation recently presented to this Court in the

case of Pacific Mutual Life Insurance Co. v. Haslip, 59

U.S.L.W.-4157 (U.S. March 4, 1991) (No. 89-1279) where

the jury was instructed that a punitive award was not

compulsory.

Thirdly, South Carolina’s juries are given virtually no

limiting criteria in determining the amount of punitive

awards. Under existing law, juries are to consider three

factors in arriving at punitive awards; those factors are:

(1) the character of the tort committed; (2) the punish-

ment to be meted out; and (3) the ability of the wrong-

doer to pay. Hicks v. Herring, 246 S.C. 429, 144 S.E.2d 151

(1965). There is no limit on the amount a jury may award.

The amount awarded does not have to bear any specific

relation to actual damages; in fact, it is “peculiarly within

—

the judgment and discretion of the jury”. Mylin v. Allen-

White Pontiac, Inc., 281 S.C. 174, 180, 314 S.E.2d 354 (1984).

More importantly, the remedies available to a party

who is wronged by an excessive punitive award are

unsatisfactory and without objective standards of review

which are clearly delineated. This, too, is in contrast to

Alabama’s apparently well developed and elaborate

review procedures discussed in Haslip. Unlike the “Ham-

mond” test discussed by the Court in Haslip, South Caro-

lina‘s criteria for judicial review of punitive awards is as

vague as the standard for determining whether to make

an award and, if so, the amount of the award. South

Carolina’s trial courts may reduce punitive verdicts only

if those verdicts are found to be unduly liberal or exces-

sive. Young v. Warr, 252 S.C. 179, 165 S.E.2d 797 (1969).

The standard is not defined further. On appeal to the

State Supreme Court, the Defendant must meet an even

higher, but equally vague, standard. The Defendant must

prove that the award is so excessive as to indicate pas-

sion, prejudice, caprice, or some other improper consider-

ation. Id. Both standards of judicial review are entirely

subjective and ill-defined leaving Defendants solely to

the “gut-reaction” of the bench.

As this Court recently noted in Haslip, 59 U.S.L.W. at

4159, constitutional challenges to punitive awards have

frequently been brought to the Court. In Haslip, the Court

squarely addressed, for the first time, a due process chal-

lenge to a punitive award. There, the Court found that

Alatama’s procedures were constitutional. However, the

Court seemed to limit its holding to the facts of that case

and seemed to concentrate on critical points which

clearly distinguish it from this case. The Court found that

the jury was adequately instructed, that the trial court

conducted an adequate post-trial hearing which satisfied

the requirements of Hammond v. City of Gadsden, 493 So.

2d 1374 (1986), and finally that the Alabama Supreme

Court further ensured due process by again applying the

Hammond test, and additional factors set forth in Green

Oil Co. v. Hornsby, 539 So. 2d 218 (1989). Unfortunately,

none of those protections, or protections even closely

approximating them, exist in South Carolina to protect

John McGee and Hanahan Motors, Inc. from ruinous

deprivation and loss of property.?

a

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CONCLUSION

The opinions of this Court relating to the constitu-

tionality of punitive damage awards clearly indicate a

concern that the procedures by which such awards are

2 This point is particularly important and highlights a

critical difference between South Carolina’s procedures and the

procedures in effect in Alabama. In Hornsby, 539 So. 2d at 222,

J. Houston, writing for the Alabama Supreme Court, recog-

nized that the effect of the punitive award on the defendant,

financially, is an important factor to be considered in the

court’s post-judicial review. (“The defendant’s financial posi-

tion is... a consideration essential to a post-judgment critique

of a punitive award.”) It was the court’s position, that punitive

awards, if they are to exist at all, “ought to sting .. .

[bJut . . . [not] be large enough to destroy.” Id. at 222. Unfor-

tunately, the punitive award against these Defendants will

destroy them. It has a already forced Hanahan Motors, Inc. into

Chapter 11 Bankruptcy; if relief is denied by this Court, the

verdict will most probably cause Mr. McGee to declare per-

sonal bankruptcy.

made must be fair. (“General concerns of reasonableness

and adequate guidance from the court . . . properly enter

into the constitutional calculus”. Haslip, 59 U.S.L.W. at

4161.) In this case, the jury was given a virtually mean-

ingless standard for determining whether to award puni-

tive damages and, if so, in determining the amount of

such an award. Moreover, the petitioners were deprived

of any meaningful post-verdict judicial review such as

that evidenced in Haslip.

This Petition should be granted for the purpose of

providing South Carolina juries with standards to con-

strain their discretion, to help them use their authority

wisely and judiciously, and to ensure that citizens of this

state such as John McGee and Hanahan Motors, Inc., are

not deprived of property without adequate due process

of law.

Respectfully submitted,

THomas J. Keaveny, II

KeaTinc L. Simons, III

Hotmes & THOMSON

106 Broad Street

Charleston, SC 29402

(803) 723-2000

Counsel for Petitioners

Attorney for Respondent:

KENNETH W. THORNTON, Jr.

THORNTON, WILE & DUNCAN

716 Prince Street

Georgetown, SC 29442

(803) 546-8461

No.

sa

=

In The

Supreme Court of the United States

October Term, 1990

>

JOHN DAVID McGEE and

HANAHAN MOTORS, INC.,

Petitioners,

CRYSTAL G. BROWN,

z Respondent.

.

APPENDIX TO PETITION FOR

WRIT OF CERTIORARI

a

INDEX TO APPENDIX

_ Page

Appendix A - Opinion of the Supreme Court of

South Carolina, Op. No. 90-MO 329 filed

December 20, 1990, affirming Final Judgment

SOR FORT De FN OF dikes sacs cunecvacuens App. 1

Appendix B - Judgment for Plaintiff in Civil Case

(88-CP-08-1056) filed March 30, 1989......... App. 3

Appendix C —- Partial Transcript of Trial Court

Proceedings containing Defendants’ Motion to

Strike Prayer for Punitive Damages and Motion

for JNOV with regard to punitive damages ..App.

Appendix D - Brief of Appellants (Case No. 88-

CP-08-1056) dated March 16, 1990 ........... App.

9

Appendix E —- Answer dated March 9, 1988....App. 36

Appendix F - Summons and Complaint dated

POY TG, FI wi ccc cnccicscvasvsenenenes App. 40

App. 1

APPENDIX A

THE STATE OF SOUTH CAROLINA

In The Supreme Court

Crystal G. Brown,

Respondent,

John David McGee and

Hanahan Motors, Inc., Appellants.

Appeal from Berkeley County

William L. Howard, Sr., Judge

Memorandum Opinion No. 90-MO-329

Heard September 26, 1990 - Filed December 20, 1990

AFFIRMED

Thomas J. Keaveny, II, of Holmes & Thomson, of Charles-

ton, for Appellants.

Kenneth W. Thornton, Jr., of Law Offices of Kenneth W.

Thornton, Jr., of Georgetown, for Respondent.

PER CURIAM: Affirmed pursuant to Supreme

Court Rule 23. See Easler v. Hejaz Temple of Greenville, 285

S.C. 348, 329 S.E.2d 753 (1985) (amount of damages

award); Broom v. Southeastern Highway Contracting Co., 291

S.C. 93, 352 S.E.2d 302 (Ct.App. 1986) (objection must be

sufficiently specific to bring into focus precise nature of

alleged error).

App. 2

AFFIRMED.

George T. Gregory, jr. C.J.

Davi W. Harwell Al.

A. Lee Chandler A.J.

ernest A. Finney, Jr. A.J.

Jean H. Toal A.J.

App. 3

APPENDIX B

STATE OF SOUTH ) IN THE COURT OF

CAROLINA ) COMMON PLEAS

COUNTY OF BERKELEY ) CASE NUMBER 88-

CP-08-1056

(Filed 89MAR30)

JUDGMENT IN A

CIVIL CASE

Crystal G. Brown vs John David McGee

Hanahan Motors, Inc.

(Plaintiff(s) (Defendant(s)

(X) JURY VERDICT. THIS ACTION CAME BEFORE

THE COURT FOR A TRIAL BY JURY. THE ISSUES

HAVE BEEN TRIED AND THE JURY HAS REN-

DERED ITS VERDICT.

DECISION BY COURT. THIS ACTION CAME TO

TRIAL QR HEARING BEFORE THE COURT. THE

ISSUES HAVE BEEN TRIED OR HEARD AND A

DECISION HAS BEEN RENDERED.

ACTION DISMISSED: ( ) RULE 40(C)(3), ( )

RULE 12(B),( ) SETTLED ( ) VOLUNTARY NON-

SUIT ( ) OTHER

IT IS ORDERED AND ADJUDGED: (_ ) SEE ATTACHED

ORDER, ( ) STATEMENT OR JUDGMENT BY COURT.

The jury finds for the Plaintiff against the defendants

in the sum of sixty seven thousand five hundred

($67,500.00) dollars, actual damages and one hundred

thousand ($100,000.00) dollars, punitive damages.

DATED AT MONCKS CORNER, SOUTH CARO-

LINA, THIS 30th DAY OF March, 1989.

William L. Howard

JUDGE

App. 4

THIS JUDGMENT WAS ENTERED ON THE 30 DAY OF

MARCH 1989.

AND A COPY MAILED FIRST CLASS THIS 30 DAY OF

MARCH 1989.

TO ATTORNEYS OF RECORD OR TO PARTIES (WHEN

APPEARING PRO SE) AS FOLLOWS:

Ken Thornton vs Thomas J. Keaveny

John Austen

ATTORNEY(S) FOR ATTORNEY(S) FOR

PLAINTIFF(S) DEFENDANTS(S)

Annette M. Goodwin

DEPUTY CLERK OF

COURT

App. 5

APPENDIX C

THE STATE OF SOUTH CAROLINA

IN THE SUPREME COURT

HONORABLE WILLIAM L. HOWARD

NINTH JUDICIAL CIRCUIT

CASE NO. 88-CP-08-1056

CRYSTAL G. BROWN,

Plaintiff-Respondent,

VS.

JOHN DAVID McGEE and

HANAHAN MOTORS, INC.,

Defendants-Appllants [sic].

Ne eee ee eee ee ee”

PARTIAL TRANSCRIPT OF RECORD

Kenneth W. Thornton, Jr. Thomas J. Keaveny, II

LAW OFFICES OF HOLMES & THOMSON

KENNETH W. 100 Broad Street

THORNTON, JR., P.A. Post Office Box 858

716 Prince Street Charleston, S.C. 29402

Post Office Box 1480 _ (803) 723-2000

Georgetown, S.C. 29442 ATTORNEYS FOR

(803) 546-8461 DEFENDANTS-

ATTORNEYS FOR APPELLANTS

PLAINTIFF-

RESPONDENT

App. 6

MOTION OF DEFENSE COUNSEL

THE COURT: You had a couple of motions you

wanted to make?

MR. KEAVENY: Yes, sir, Your Honor. In Chambers

before we started the case I made a motion to strike

punitive damages in the case on the grounds that puni-

tive damages are unconstitutional, in violation of due

process, equal protection, and in some cases perhaps

unconstitutional on the basis that they might exceed or

violate the prohibition against excessive fines.

I understand the Court’s position on that, but I did

want to put that on the record.

THE COURT: All right, sir, we'll note your objec-

tion. I will allow that to go to the jury and if the jury

returns punitive damages I will hear you further on that.

At this point I will deny it. Anything else?

POST-TRIAL MOTIONS OF DEFENSE COUNSEL

THE COURT: All right, sir.

MR. AUSTEN: Also, I would move for JNOV on

punitive damages.

THE COURT: All right, sir. Let’s take them one at a

time.

+ * *

With regard to the Hundred Thousand Dollar puni-

tive damage figure, as late as 1984 — no, as late as last

year — the Court of Appeals has addressed punitive dam-

ages in 1984 and they again restated, although in the

App. 7

minority view, that damages or punitive damages - that

where the Plaintiff has proven reckless conduct it is the

duty of the jury to vindicate a private right and give

punitive damages.

So I do not - I cannot say that based on our volumi-

nous law of punitive damages that punitive damages are

unconstitutional. That’s just an issue that is going to have

to — if that is to be addressed again in South Carolina,

that is going to have to be addressed at a higher level.

A Hundred Thousand Dollars is less than one third

of his admitted net worth. Here again, I’ve got to take the

evidence in the light most favorable to the Plaintiff in

deciding this motion.

I cannot say that to punish someone by taking away

less than one third of their net worth, where they are

going ninety-five or a hundred miles an hour down a

four lane highway at eight thirty on a Saturday Morning

under the influence of alcohol after staying up all night,

after knowledge they are under medication from a doctor

who has told them not to mix it with alcohol because to

do so would cause an inability to react properly, or that

mixing it with alcohol would — at least the symptoms of

alcohol - I just cannot say that that [sic] is an outlandish

verdiet or one that is based upon caprice, passion or

sympathy as opposed to those items which I| told them to

consider; that is, the nature of the wrong, the amount of

punishment which should be given, and the abilit|sic] of a

Defendant to pay.

I think that if you take it in light most favorable to

the Plaintiff, with that kind of speed and that kind of

condition, that that is proper.

App. 8

So I’m going to have to deny your motions on that

basis.

Sitting as a thirteenth juror, I cannot grant it.

App. 9

APPENDIX D

THE STATE OF SOUTH CAROLINA

IN THE SUPREME COURT

APPEAL FROM

HONORABLE WILLIAM L. HOWARD

NINTH JUDICIAL CIRCUIT

CASE NO. 88-CP-08-1056

CRYSTAL G. BROWN,

Plaintiff-Respondent,

vs.

JOHN DAVID McGEE and

HANAHAN MOTORS, INC.,

Defendants-Appellants.

a a oe a a a

BRIEF OF APPELLANTS

Kenneth W. Thornton, Jr. Thomas J. Keaveny, II

LAW OFFICES OF HOLMES & THOMSON

KENNETH W. 100 Broad Street

THORNTON, JR., P.A. Post Office Box 858

716 Prince Street Charleston, S.C. 29402

Post Office Box 1480 (803) 723-2000

Georgetown, S.C. 29442 .

/ ATTORNEYS FOR

(803) 546-8461 DEFENDANTS-

ATTORNEYS FOR APPELLANTS

PLAINTIFF-RESPONDENT

App. 10

INDEX

Page

TABLE OF AUTHORITIES............--:e eee eeeees ii

QUESTIONS INVOLVED ..........-.. see cence eee Vv

STATEMENT OF FACTS..........ccseecceccccccece 1

ARGUMENT:

aby ¢ ie | errrrerer rr eer etree rrr 3

Oh og). ie + ee eres eer ee 13

ES ak 6 ob sex ne ncaa sesed cis isneeneewene 23

App. 11

TABLE OF AUTHORITIES

PAGE

CASES:

Aetna Life ins. Co. v. Lavoie, 475 U.S. 813 (1986) ..... 15

Albertini v. Veal, 292 S.C. 561, 357 S.E.2d 716 (Ct.

tC a a ease eee hehe senas sce eperccsee 7, 18

Bankers Life & Cas. Co. v. Crenshaw, 100 L.Ed.2d 62

TOMES asda ath n ese pbs 00sorcecravenes 15,. $7

| ee 17

Continental Cas. Co. v. Wilson-Avery, Inc., 115 Ga.

PR. 77a, COO BBO 192 CISGZ)...w 6. cece recess 13

Crittenden v. Thompson-Walker Co., Inc., 288 S.C.

tim oe eae gee Ut. App. 1986)................ 5

Electrical Workers v. Foust, 442 U.S. 43 (1979)........ 26

Francis v. Mauldin, 215 S.C. 374, 55 S.E.2d 337

RES etka doles das hsb seh a dees nance 8, 11

Gathers v. Harris Teeter Supermarket, Inc., 282 S.C.

ge eR eee eee 13

Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974)....24, 26

Hicks v. Herring, 246 S.C. 429, 144 S.E.2d 151 (1965) .... 17

King v. Daniel Intern. Corp., 278 S.C. 350, 296 S.E.2d

FT 4

Linthicum v. Nationwide Life Ins. Co., 150 Ariz. 326,

ET I ND gids cece vc enivveeceeernesere 19

Lynch v. Pee Dee Express, 204 S.C. 537, 30 S.E.2d 449

TSE Sg Pre 10

M.B.A.F.B. Fed. Credit Union v. Cumis Ins. Society,

a, ee We We ee GON, PZ)... eee ee ees 11

App. 12

Madden v. Cox, 284 S.C. 574, 328 S.E.2d 108, appeal

dismissed 286 S.C. 127, 332 S.E.2d 102 (Ct. App.

NE OA Ee Ce ee ee ee cat COE EE s ays 4,5

Mathews v. Eldridge, 424 U.S. 319 (1976)...... 19, 20, 23

Mylin v. Allen-White Pontiac, Inc., 281 S.C. 174, 314,

7 & § 2. ere rere re ree 17, 18, 26

Norton v. Ewaskio, 241 S.C. 557, 129 S.E.2d 517

ee on Pees SAAS OOS Oe ENTS 23

Payne v. Bouharoun, 292 S.C. 390, 356 S.E.2d 438

i Seer eer Teer ree reece 16

Sample v. Gulf Refining Co., 183 S.C. 399, 191 S.E.

L,I EAR Se ee nee ere tare r ya 16, 26

Santosky v. Kramer, 455 U.S. 745 (1982)........... 21, 22

Smith v. Wade, 461 U.S. 30 (1983) ................ 15, 23

State v. Chasteen, 231 S.C. 141, 97 S.E.2d 517 (1975)..... )

State v. Green, 261 S.C. 366, 200 S.E.2d 74 (1973) ..... 9

State v. Hiott, 276 S.C. 72, 276 S.E.2d 163 (1981)...... 8

State v. Johnson, 293 S.C. 321, 360 S.E.2d 317 (1987)..... 9

State v. Johnson, 293 S.C. 321, 360 S.E.2d 317 (1987) .... 12

State v. Lyle, 125 S.C. 406, 118 S.E. 803 ‘o., ae 10

U.S. v. St. Michael’s Credit Union, 880 F.2d 579 (1st

ee San ee a we aka o oe 8, 9

Wolf v. McDonnell, 418 U.S. 839 (1974) .............. 19

Young v. Warr, 252 S.C. 179, 165 S.E.2d 797 (1969) ..... 4

App. 13

CONSTITUTIONS:

South Carolina Constitution:

RI i IC on Fo rans a oh ere 16

United States Constitution:

EE i ee ow CELE Oa ee nena 16

Sr I Be ae cme ewe ee eee eee os 17

STATUTES:

Cal. Civ. Code § 3294(2) (Deering Supp. 1988) .... 19

Colo. Rev. Stat. § 13-25-127(2) (1987)............ 19

Or. Rew. Stat. 6 SUGZS CISGE) wesc enececels 19

TREATISES:

Jeffries, A Comment on the Constitutionality of Puni-

tive Damages, 72 Va. L. Rev. 139 (1986)............ 16

The Imposition of Punishment By Civil Courts: A

Reappraisal of Punitive Damages, 41 N.Y.U. L.

Se Se ME Ncw ic be heMsn rer esee re CNeeurenwhns 16

Wheeler, The Constitutional Case for Reforming

Punitive Damage Procedure, 69 Va. L. Rev. 269

bi OPA EE TR Een reer eres BCT ee: 16, 24

QUESTIONS INVOLVED

Page

WAS THE VERDICT THE RESULT OF PASSION,

PREJUDICE, CAPRICE, OR OTHER IMPROPER

BO | ee eee rere rn: fos reser 3

App. 14

DOES SOUTH CAROLINA’S PROCEDURE FOR

AWARDING PUNITIVE DAMAGES VIOLATE THE

DUE PROCESS CLAUSE OF THE UNITED STATES

CONSTITUTION AND THE SOUTH CAROLINA

CONSTITUTION? .....csvccinsscuusenentepaeeanes 13

STATEMENT

At approximately 8:30 a.m. on Saturday, April 4,

1987, John McGee, owner of Co-Appellant Hanahan

Motors, Inc., was on his way home from a friend’s house

where he and other friends had spent the night playing

cards in Mount Pleasant. That house was near the inter-

section of Highway 17 and Highway 41 in Charleston

County, approximately six miles from the scene of this

accident. As he approached the intersection he was trav-

eling approximately 55 miles per hour. (Tr., p. 136). He

realized the light controlling traffic was red and a car was

stopped ahead of him. He applied his brakes but was

unable to stop before striking the Respondent's vehicle.

The collision caused the Respondent’s vehicle to come to

rest upside down in the intersection. Mr. McGee's vehicle

also came to rest in the intersection.

Fortunately, the parties did not sustain serious inju-

ries. Mr. McGee’s head struck and broke the windshield.

The Respondent sustained a hairline fracture of the trans-

verse process of the fourth lumbar vertebrae. She stayed

in the hospital that day and the next for observation. (Tr.,

». 107). She then returned home to Georgetown. From

that point she was seen by Dr. Brilliant, a Charleston

orthopaedist, a total of six times. (Tr. p. 114). Her last visit

to Dr. Brilliant was August 20, 1987. She did not see

App. 15

another physician for neck or back problems until Janu-

ary 1988, when she was seen by Dr. Ahearn in

Georgetown. He prescribed approximately three weeks of

physical therapy which the Respondent received the fol-

lowing month. The second and last visit to Dr. Ahearn

occurred May 18, 1988. (Tr., p. 63). She did not receive

any additional treatment prior to trial.

With the exception of the physical therapy prescribed

by Dr. Ahearn, “to see if she could be helped” (Tr., p. 61),

Respondent’s physicians did nothing more than monitor

her self-healing process. She never suffered any casts,

bandages, stitches, or injections (Tr., pp. 71-74). Her medi-

cal bills were extremely limited and totaled only

$3,543.40. More than half of those charges ($1,829.50)

were from Dr. Ahearn, the Georgetown Memorial Hospi-

tal physical therapy department, and Georgetown Radiol-

ogy. Those were ali incurred almost a year after the

accident. Despite the fact he believed Respondent would

have “good days and bad days” (Tr., p. 47), Dr. Ahearn

could not provide an opinion as to the nature of fre-

quency of the future medical care Respondent would

need. (Tr., p. 50).

At trial Appellants stipulated Mr. McGee was negli-

gent in striking the Respondent's vehicle. They did not

stipulate to gross negligence or to proximate cause.

It is clear from the record and the jury’s verdict that

Respondent’s counsel preyed upon the jury’s emotions

and took advantage of every opportunity to prejudice the

jury against the Appellant; all this in an effort to “ring the

bells” with a total verdict (actual and punitive) which, if

affirmed, will cause Mr. McGee, a 56 year old business

App. 16

man who has worked hard all his life, to declare personal

bankruptcy. (It has already forced his business into bank-

ruptcy).

ARGUMENT I

THE TRIAL COURT ERRED IN NOT GRANTING

APPELLANTS A NEW TRIAL ABSOLUTE ON THE

BASIS THAT THE VERDICT WAS THE RESULT OF PAS-

SION, PREJUDICE, CAPRICE, OR OTHERWISE UNSUP-

PORTED BY THE EVIDENCE. (EXCEPTIONS I, II, IV, V,

VI AND IX).

The jury’s award of $67,50U actual damages and

$100,000 punitive damages is excessive. It is not sup-

ported by the evidence and is the result of passion, preju-

dice, caprice, or other improper considerations.

This Court’s standard of review is, admittedly, lim-

ited. If a verdict is supported by any rational view of the

evidence, it will not be disturbed. King v. Daniel Intern.

Corp, 278 S.C. 350, 296 S.E.2d 335 (1982). But if it appears

that the verdict is shockingly disproportionate to the

plaintiffs’ injuries, the Court has not only the right, but

the duty to set it aside. Young v. Warr, 252 S.C. 179, 165

S.E.2d 797 (1969).

In Madden v. Cox, 284 S.C. 574, 328 S.E.2d 108, appeal

dismissed 286 S.C. 127, 332 S.E.2d 102 (Ct. App. 1985), the

Court affirmed a verdict of $100,000 actual damages

where the plaintiff provided evidence of almost $13,500

in medical expenses. There the Plaintiff was crushed by a

tobacco bin which fell due to a defective lifting mecha-

nism. He suffered excruciating pain immediately and was

App. 17

expected to endure pain daily for the rest of his life; he

was not expected ever to walk without assistance.

In Crittenden v. Thompson-Walker Co., Inc., 288 S.C.

112, 341 S.E.2d 385 (Ct. App. 1986), the Court affirmed an

actual damage award of $75,000. As in Madden, the Plain-

tiff’s damages were severe. There, the Plaintiff was

severely beaten, suffered an orbital blow-out to one eye,

was hospitalized for six days, underwent surgery, suf-

fered multiple bruises, experienced double-vision, and

was left with numbness in one check which was expected

to be permanent. The Court acknowledged that the ver-

dict was “substantial,” but concluded it was not the result

of passion, prejudice, or caprice in light of evidence of

substantial injury.

The award of actual damages in this case is not

supported by any rational view of the evidence. While

the verdict closely approximates those of Madden and

Crittenden, the Respondent's injuries and damages pale in

comparison. Here, the Respondent was hospitalized two

days for observation. She did not undergo surgery, had

no bandages applied, no stitches sewn, no injections

administered. She was not subjected to any traction of

any kind, and did not receive any sort of physical ther-

apy. (Tr., pp. 71-72). She was reieased from the hospital

without medical appliance. (Tr., pp. 72-73). Thereafter,

she saw Dr. Brilliant only six times. (Tr., p. 30). Within

three weeks of the accident (April 14, 1987) Dr. Brilliant

recommended that she “get up and move around.” (Tr., p.

109). By May 18, 1987, a little more than thirty days after

the accident, she had good range of motion and was

instructed only to avoid “strenuous activity.” (Tr., p. 112).

She was not on any medication. (Tr., p. 113).

App. 18

Respondent continued to progress without any

apparent setbacks. On June 9, 1987, a little more than two

months after the accident, she had good, probably almost

normal, range of motion and complained only that her

back occasionally bothered her. (Tr., p. 113).

Respondent last saw Dr. Brilliant on August 20, 1987

and did not receive additional medical treatment for

problems directly relating to this accident until January

1988. At that point, she saw Dr. A. Mason Ahearn. Dr.

Ahearn saw her only once in January and once in May.

(Tr., p. 45). His treatment was limited to a recommenda-

tion of physical therapy. He did not find any objective

problems, prescribed no medical appliances, no prescrip-

tion medications, and did not refer the Respondent for a

second opinion or further evaluation.

Dr. Brilliant did not assign any permanency to the

Respondent and Dr. Ahearn, after seeing the Respondent

only twice, testified at trial in March 1989 only that

Respondent would have “good days and bad days.” (Tr.,

pp. 47-48). Nevertheless, there was no evidence of addi-

tional medical visits after those with Dr. Ahearn the year

before.

With the exception of the fourteen physical therapy

sessions Respondent received in February 1988, her medi-

cal care was limited entirely to observation. Neither Dr.

Brilliant nor Dr. Ahearn ever administered any sort of

“hands on” treatment and there was no testimony she

received any treatment after her last physical therapy

session in February 1988.

App. 19

Respondent's total medical expenses were as follows:

Emergency Medical Services

(4/4/87) $ 95.00

East Cooper Hospital

(4/4/87) 1,141.51

Diagnostic Radiology

(4/4/87) 98.00

Roper Emergency Room

(8/26/87) 73.25

Roper Radiology

(8/29/87) 50.00

Dr. Brilliant

(4/4/87 -— 8/20/87) 323.00

Dr. Ahearn

(1/27/88 - 5/18/87) 297.00

Georgetown Memorial Hospital

(2/4/88 — 2/25/88) 1,318.00

Georgetown Radiology

(2/4/88) 116.00

Prescriptions 31.14

Total $3,452.90

The actual damages award of $67,500 (almost twenty

times the medicals) is clearly not supported by the testi-

mony adduced at trial.

The punitive damage award is excessive as well. It,

too, must be set aside as the result of improper consider-

ation. In determining punitive damages, the jury is to

consider three factors: (1) the character of the tort; (2) the

punishment to be meted out; and (3) the defendant's

wealth. Albertini v. Veal, 292 S.C. 561, 357 S.E.2d 716 (Ct.

App. 1987). Taken together, the total verdict of $167,500 is

just under one-half the Appellant’s net worth and vastly

beyond his ability to pay. The punitive award alone is

nearly one-third of his wealth.

App. 20

Several events occurred during the trial which

explain these excessive awards and which support the

Appellant’s contention that throughout the trial Respon-

dent’s counsel attempted to inflame the jury and

appealed to its emotions. While none of them taken alone

may have been enough to prejudice the jury, in combina-

tion they could have no other effect.

First, the Court denied Appellants’ Motion in Limine

to exclude irrelevant evidence that Mr. McGee had played

poker the night before this accident. Evidence is not

admissible unless it establishes, or makes more or less

probable, some issue presented and bears directly or

indirectly on that issue. Francis v. Mauldin, 215 S.C. 374,

55 S.E.2d 337 (1949). Assuming the evidence is relevant, it

should nevertheless be excluded if the risk of prejudice

outweighs its probative value. State v. Hiott, 276 S.C. 72,

276 S.E.2d 163 (1981).

Evidence that Mr. McGee was returning home from

an all night poker game was not relevant to any issue in

the case. It did not tend to prove, or make more or less

probable, any issue. Furthermore, any probative value

was Clearly outweighed by its prejudicial effect. In U.S. v.

St. Michael's Credit Union, 880 F.2d 579 (1st Cir. 1989), the

Court recognized the prejudicial affect of this type of

testimony. There, the First Circuit Court of Appeals

vacated judgment for the U.S. because, among other

errors, the lower court admitted into evidence testimony

of gambling by a defendant's father. In that case, Janice

Sacharczyk was charged with a number of criminal viola-

tions connected with her employment at St. Michael's

Credit Union. The government took the position that the

father’s gambling activities were relevant to its case

App. 21

against Ms. Sacharczyk because, at times, her father used

the bank’s resources to conduct business. The prosecution

expected to show by inference that the defendant knew

or must have known of his activities and for that reason

she failed to comply with certain IRS filing requirements.

The Court of Appeals was not convinced that the evi-

dence was sufficient to support an inference that the

defendant knew of her father’s gambling. It held that

without some connection between the defendant's activ-

ities and her father’s gambling, the testimony was irrele-

vant and its probative value was substantially

outweighed by the danger of unfair prejudice. Id. at 601.

Evidence which is “unfairly prejudicial” has been

defined as evidence which “might cause a jury to base its

decision on something other than the established proposi-

tions in the case.” Id. at 601, citing J. Weinstein & M.

Berger, Weinstein’s Evidence, § 403[3] at 403-39 (1988). In

South Carolina, gambling is illegal. S.C. Code Ann.

§ 16-19-40 (1976 Law. Co-Op.) This alone may have

served as sufficient basis for some jurors to “punish” Mr.

McGee. Moreover, its admission violated a more funda-

mental prohibition against introducing evidence of other

crimes. In State v. Chasteen, 231 S.C. 141, 97 S.E.2d 517

(1957), the Supreme Court of South Carolina held that

evidence of other crimes is not admissible unless (1) the

witness has been convicted of it, and (2) it is a crime of

moral turpitude. (An exception exists if the crime is one

which must be proven to establish the crime charged. See

State v. Johnson, 293 S.C. 221, 360 S.E.2d 317 (1987); State v.

Green, 261 S.C. 366, 200 S.E.2d 74 (1973)).

The purpose behind limiting the introduction of this

type of evidence was eloquently stated by Justice Marion

in State v. Lyle, 125 S.C. 406, 118 S.E. 803 (1923):

App. 22

The objections . . . to the admission of this class

of evidence are patent. Proof that a defendant

has been guilty of another crime equally hein-

ous prompts to a ready acceptance of a belief in

the prosecution’s [in this case, the Respon-

dent’s] theory that he is guilty of the crime

charged. Its effect is to predispose the mind of

the juror to believe the prisoner [the defendant]

guilty. ...

Id., at 416.

The same is true in this case. Although Respondent’s

action is civil in nature, punitive awards are designed to

punish and deter. In that sense, actions seeking punitive

damages are quasi-criminal in nature. Admitting into evi-

dence testimony that Mr. McGee had been playing poker

the night before this accident allowed the jury to consider

a matter which was completely irrelevant to any issue in

the case and only predisposed jurors to believe he drank

liquor all night.

The prejudice was furthered by the speculative testi-

mony of Ms. Wallace. Her testimony regarding Mr.

McGee’s speed was improperly elicited through leading

questions. While it is well settled that a witness may

provide testimony as to the speed of a vehicle, that testi-

mony cannot be without basis. Lynch v. Pee Dee Express,

204 S.C. 537, 30 S.E.2d 449 (1944). A witness may not

testify to a matter unless evidence is introduced sufficient

to support a finding that the witness has personal knowl-

edge of the matter. M.B.A.F.B. Fed. Credit Union v. Cumis

Ins. Society, Inc., 681 F.2d 930 (4th Cir. 1982). The fact that

Ms. Wallace saw appellant’s vehicle in her rearview mir-

ror and only for a second indicates she had no basis for

App. 23

judging Mr. McGee’s speed. (Tr., pp. 17-18). Her testi-

mony on direct also makes it clear she had no opinion as

to the speed of Mr. McGee’s car. When asked how fast he

was traveling, she said only that he was “flying.” (Tr., pp.

14-15). But in a sequence of questions reminiscent of an

auction, Respondent’s counsel succeeded in getting Ms.

Wallace improperly to speculate Appellant was traveling

a hundred miles an hour.

In keeping with this plan to prejudice the jury,

Respondent’s counsel succeeded in admitting into evi-

dence Dr. Brilliant’s deposition testimony about pro-

cedures followed in assessing permanent impairment,

even though there was no evidence of permanent impair-

ment to Respondent. (Tr., pp. 123-127). As indicated

above, absent a showing that evidence is relevant to some

matter in issue, the Court should not admit it. Francis,

supra. The testimony of Dr. Brilliant served only to preju-

dice and confuse the jury. It allowed the jury to make its

own determination of impairment despite a complete lack

of evidence of the same.

The fourth event which was highly prejudicial to the

Appellant occurred in Respondent's closing argument. It

is there her counsel used the earlier testimony of gam-

bling most invidiously; he argued:

Mr. McGee sees this as a high stakes poker

game. He’s sitting there with a pile of money.

He’s got Three Hundred and Fifty Thousand

Dollars but he doesn’t have any cards, but he’s

[sic] sitting here, coming in here trying to

bluff... all of us, and if he expects me to

believe .. . what he purports to be the truth in

App. 24

this case he is insulting my intelligence. He

doesn’t have the cards to play.

(Tr., pp. 142-143).

This closing argument demonstrates Appellants’ ear-

lier points regarding the prejudicial nature of the evi-

dence. But it goes beyond that and derneans and belittles

Appellants’ right to a jury trial. Respondent’s counsel

should not be allowed to assail that right any more than

the solicitor was allowed to in State v. Johnson, 293 S.C.

321, 360 S.E.2d 317 (1987). There, the solicitor, in his

closing argument, referred to the defendant’s apparent

lack of remorse over the victim’s death. On appeal the

Court held the remarks constituted an improper comment

upon the defendant’s constitutional rights. It is irreconcil-

able, the Court stated, for an accused to plead not guilty

and “simultaneously express remorse for acts he denied

committing.” Id., 293 S.C. at 324. “When an accused

asserts a constitutional right, it is impermissible for the

state to comment upon or argue in favor of guilt or

punishment based upon his assertion of that right.” Id.,

293 S.C. at 323.

The same should be true in a civil context where a

party denies an allegation (here intoxication) and puts the

plaintiff to her burden of proof. In this case, Respondent’s

counsel implies Mr. McGee knows he is guilty of intoxica-

tion, and in lying to the jury tries to use the system in a

last-ditch gamble to avoid culpability.

At a minimum, the statement is intended to invoke

the passion and prejudice of the jury against the Appel-

lant for asserting their constitutional right to a trial by

jury. It violates the rule stated in Gathers v. Harris Teeter

App. 25

Supermarket, Inc., 282 S.C. 220, 231, 317 S.E.2d 748, 749

(1984) that “[i]n a closing argument to the jury an attor-

ney may not make such remarks which are unfairly calcu-

lated to arouse passion or prejudice. See also Continental

Cas. Co. v. Wilson-Avery, Inc., 115 Ga. App. 793, 156 S.E.2d

152, 156 (1967) (“remarks of counsel amount to miscon-

duct and may require corrective action or mistrial even

where the remarks are in some way related to the evi-

dence if the argument is unfairly calculated to arouse

passion or prejudice”). The remarks of Respondent’s

counsel could have had no purpose other than to arouse

the passion of the jury.

Finally, after deliberating for hours, the jury returned

with three questions. They were:

(1) Are we allowed to ask if damages we

award, if any, are going to be paid by an

insurance company.

(2) If so, are punitive damages, if any, covered

under liability.

(3) What does the Three Hundred Fifty Thou-

sand Dollars include.

(Tr. App., p. 6). The Court refused to allow the Appellant

to explain his net worth at trial, and refused to allow him

to do so after the jury’s question. Instead, the Court

merely repeated its punitive damages instruction. Within

minutes, the jury returned the verdict which is the subject

of this appeal.

While any one of the many prejudicial events taken

alone might amount only to harmless error, taken

together they deprived the Appellants of a fair trial. In

light of the prejudicial events discussed above, the

App. 26

Respondent's limited actual damages, and the enormity

of the verdict relative to the Appellants’ ability to pay, the

Court should set aside the verdicts for actual and puni-

tive damages on the basis that both were the result of

passion, prejudice, caprice or other improper consider-

ations.

ARGUMENT II

SOUTH CAROLINA’S PROCEDURE FOR AWARDING

PUNITIVE DAMAGES VIOLATES THE DUE PROCESS

CLAUSE OF THE UNITED STATES CONSTITUTION

AND THE SOUTH CAROLINA CONSTITUTION.

(EXCEPTIONS VIII AND IX).

Both the South Carolina Constitution and the United

States Constitution guarantee citizens of this state due

process of law. Specifically, Article I, Section 3 of the

South Carolina Constitution provides that no citizen of

the state shall be “deprived of life, liberty, or property

without due process of law... .” Article V of the United

States Constitution provides that “[n]o person shall . . . be

deprived of life, liberty, or property, without due process

of law. ...” Article XIV, Section 1 of the United States

Constitution reinforces Article V and makes it applicable

to the states. It provides in pertinent part that no state

shall “deprive any person of life, liberty, or property,

without due process of law... . ”

The United States Supreme Court has given increas-

ing attention to the constitutionality of state procedures

for awarding punitive damages. In Smith v. Wade, 461 U.S.

30 (1983), then Associate Judge Rehnquist, in a dissenting

opinion in which Chief Justice Burger and Justice Powell

App. 27

joined, roundly criticized the procedures by which puni-

tive damages are often awarded. He noted that although

punitive awards are “quasi-criminal, their imposition is

unaccompanied by the type of safeguard present in crimi-

nal proceedings” and went on to write that juries may

“assess punitive damages in wholly unpredictable

amounts bearing no necessary relation to the actual harm

caused.” Id. at 59 (citations omitted).

More recently, the Court recognized that due process

challenges to state punitive damages awards “raise

important issues which, in an appropriate setting, must

be resolved.” Aetna Life Ins. Co. v. Lavoie, 475 U.S. 813,

828-29 (1986). In Bankers Life & Cas. Co. v. Crenshaw, 100

L.Ed.2d 62, 78 (1988) (O’Connor & Scalia, J.J., concur-

ring), two members of the Court recognized that state

laws which allow juries “to award any amount of puni-

tive damages in any tort case in which a defendant acts

with a certain mental state ‘may’ violate the Due Process

Clause of the United States Constitution.” See generally,

Jeffries, A Comment on the Constitutionality of Punitive

Damages, 72 Va. L. Rev. 139 (1986); 37 Vanderbilt L. Rev.

1117 (1984); Wheeler, The Constitutional Case for Reforming

Punitive Damage Procedure, 69 Va. L. Rev. 269 (1983); The

Imposition of Punishment By Civil Courts: A Reappraisal of

Punitive Damages, 41 N.Y.U. L. Rev. 1158 (1966).

South Carolina’s procedures for awarding punitive

damages violate the procedural due process guarantees

of the South Carolina Constitution and United States

Constitution in several respects. First, juries are left with

complete discretion whet>er to award punitive damages.

They are instructed simply that if they find the Appel-

lant’s conduct was grossly negligent, reckless, willful or

App. 28

wanton, they may award punitive damages. Sample v.

Gulf Refining Co., 183 S.C. 399, 191 S.E. 209 (1937). The

standard is so vague that members of the judiciary them-

selves may not recognize behavior that subjects a party to

punitive exposure. In Payne v. Bouharoun, 292 S.C. 390,

356 S.E.2d 438 (Ct. App. 1987), for example, the trial

judge, sitting without a jury, awarded only actual dam-

ages to a plaintiff who had been physically thrown out of

the defendant’s bar. The lower court did not address the

plaintiff’s prayer for punitive damages and the plaintiff

appealed. Reviewing the matter, the Court of Appeals

found the defendant’s actions gave rise to a possible

punitive award and remanded the case for hearing on

punitive damages.

Second, South Carolina common law does not specify

with sufficient detail the manner in which juries are to

determine the amount of punitive awards. Under existing

law, the jury is to consider three factors: (1) the character

of the tort committed; (2) the punishment to be meted

out; and (3) the ability of the wrongdoer to pay. Picks v.

Herring, 246 S.C. 429, 144 S.E.2d 151 (1965). Virtually no

limitations are imposed upon the jury. The punitive

award does not have to bear any specific relation to

actual damages. In fact, in Mylin v. Allen-White Pontiac,

Inc., 281 S.C. 174, 180, 314 S.E.2d 354, __ (1984), the

Court of Appeals held that the amount awarded “is pecu-

liarly within the judgment and discretion of the jury.” The

Hicks standard is virtually identical to the standard crit-

icized by the Supreme Court in BFI v. Kelco, 109 S.Ct.

2909, 2923 (1989) (Brennan, J. and Marshall, J. concur-

ring). In Bankers Life, supra, the Supreme Court criticized

a Mississippi standard similar to Mylin. After noting that

ve

App. 29

the State Supreme Court affirmed the punitive award by

recognizing that the amount of the award was committed

solely to the authority and discretion of the jury, the

Court wrote “[{t]his grant of wholly standardless discre-

tion to determine the severity of punishment appears

inconsistent with due process.” Id. at 78 (O’Connor, J. and

Scalia, J. concurring).

Third, left to its own discretion, the jury could return

a verdict which would prove ruinous to a defendant. This

is precisely what occurred in Albertini v. Veal, 292 S.C.

561, 357 S.E.2d 716 (Ct. App. 1987). There the jury

returned a punitive award which exceeded the defen-

dant’s net worth. Virtually the same consequences appear

in this appeal. Although the Appellant stipulated to his

net worth, he sought to explain the composition of that

net worth for the jury. In fact, the jury sought that infor-

mation but the Court refused to permit testimony regard-

ing it. While the Appellant had some insurance, it was

very limited (approximately $39,000 in coverage

remained at the time of trial). If the verdict in this case is

permitted to stand, Mr. McGee will be personally respon-

sible for more the 75% of the verdict.

Under existing law, the only limitation on the jury’s

unbridled discretion to award punitives rests with the

trial judge and the appellate court. The trial judge may

reduce a punitive verdict if it is unduly liberal or exces-

sive. The appellate court may reduce a punitive verdict

only if the award is so excessive as to indicate it is the

result of passion, prejudice, caprice, or some other

improper consideration. Mylin, supra. Even then, no

objective criteria for review exists.

App. 30

Fourth, despite the fact that punitive awards cause

the Appellant substantial property deprivation (in this

case, approximately one-third of his stipulated net

worth), the state does not require proof beyond a reason-

able doubt or even by clear and convincing evidence as

required in other states. Compare, Colo. Rev. Stat.

§ 13-25-127(2) (1987) (beyond a reasonable doubt); Cal.

Civ. Code § 3294(2) (Deering Supp. 1988) (clear and con-

vincing); Or. Rev. Stat. § 30925 (1988) (same); Linthicum v.

Nationwide Life Ins. Co., 150 Ariz. 326, 332, 723 P.2d 675,

681 (1986) (same).

“Procedural due process imposes constraints on gov-

ernmental decisions which deprive individuals of ‘lib-

erty’ or ‘property’ interests within the meaning of the

Due Process Clause of the Fifth and Fourteenth Amend-

ments.” Mathews v. Eldridge, 424 U.S. 319, 332 (1976). The

right to a hearing prior to suffering loss of property is

well recognized. Id. at 333; Wolf v. McDonnell, 418 U.S. 839

(1974). The Appellants in this case ask the Court to

review South Carolina’s current procedures for determin-

ing whether punitive damages should be awarded and, if

so, in what amount.

In Mathews, supra, the Supreme Court set forth the

factors which should be reviewed in determining the

constitutional adequacy of a challenged procedure. These

factors are:

First, the private interest that will be affected by

the official action; second, the risk of an erro-

neous deprivation of such interest through the

procedures used, and the probable value, if any,

of additional or substitute procedural safe-

guards; and finally, the government's interest,

including the function involved and the fiscal

App. 31

and administrative burdens that the additional

or substitute procedural requirement would

entail.

Id. at 335 (citation omitted). South Carolina’s current

procedure for awarding punitive damages is constitu-

tionally infirm given the seriousness of the private inter-

est that can be affected, the risk of erroneous and

sometimes ruinous deprivation, the probable value of

additional or substitute procedural safeguards, and the

limited burden upon the government of additional or

substitute requirements.

The private interest which is affected in this case is

obvious: Mr. McGee’s estate. The jury is specifically

instructed to take into consideration the defendant’s

wealth, the fruits of a lifetime of hard work. If this verdict

is allowed to stand Mr. McGee will lose, in punitive

damages alone, nearly one-third of the estate which he

has accumulated during his life. This is a very substantial

interest made even more significant by the fact that he is

at that point in life when people begin to slow down and

prepare for retirement.

The second factor to be considered under Mathews is

the risk of erroneous deprivation under existing pro-

cedures and the probable value of additional or substitute

safeguards. The procedures for awarding punitive dam-

ages to be imposed unnecessarily and unfairly increases

the risk of erroneous punitive awards. First, the present

evidentiary standard (preponderance of evidence) con-

tributes to the risk of an erroneous result. Because the

evidence need only preponderate in favor of a prevailing

party, the jury is free to resolve substantial doubts regard-

ing the Appellants’ conduct and intent in favor of the

App. 32

Respondent. This discretion combined with the impreci-

sion in the substantive standard for awarding punitive

damages maximizes the risk that jurors will apply their

prejudices and subjective values to the decision and pun-

ish a defendant when no punishment is appropriate. The

Supreme Court has held that “imprecise substantive stan-

dards that leave determinations unusually open to the

subjective values of the judge” mitigate strongly in favor

of an evidentiary standard that is stricter than mere pre-

ponderance of the evidence. Santosky v. Kramer, 455 U.S.

745, 762 (1982).

Second, as earlier noted, the risk of error is com-

pounded by the law’s failure to state clearly when and

under what circumstances a jury may inflict punishment.

The law does not tell juries what factors may or must, or

what factors must not, be considered in deciding whether

to inflict punishment. The law gives no guidance con-

cerning any limiting principles dictated by the purposes

of punitive damages. If the jury were to divine that the

purpose is to deter similar future conduct, the lay jurors,

with none of the sentencing expertise or experience of

judges, would have to speculate as to the manner in

which proper deterrence should be achieved. If the jury

were to divine that the purpose is to punish, the lay

jurors would have to speculate as to retributive princi-

ples. And, of course, the jury being unguided, would

most likely simply vent its spleen with no principled

theory of punitive damages in mind.

The punitive award also far exceeds any monetary

fine the state could have imposed upon Mr. McGee had

he been convicted of DUI in a criminal court. S.C. Code

App. 33

Ann. § 56-5-2940 (1988 Supp.) sets forth the current pen-

alties for driving while intoxicated. These fines range

from a possible fine of two hundred dollars for a first

offense, which this would have been had Mr. McGee been

convicted criminally, to a maximum fine of six thousand

dollars for a third offense. Accordingly, in this case the

punitive award is approximately seventeen times greater

than the maximum fine the state could have imposed if

Mr. McGee had been charged and convicted of DUI, third.

It is five hundred times larger than the fine any South

Carolina court can currently impose for DUI, first.

Because the process by which a jury decides whether,

and in what amount, to award punitive damages substan-

tially increases the risk of erroneous fact finding as com-

pared with other civil proceedings, enhanced procedural

protection is required. See Santoksy v. Kramer, supra (due

process requires enhanced protections against erroneous

fact-findings in proceedings to terminate parental rights).

Furthermore, because the law fails to set standards for

when and in what amount punitive awards may be inflic-

ted, and because these omissions expose defendants to

each jury’s subjective values and individuous discrimina-

tion, procedural safeguards are needed to protect against

errors resulting from the virtually unrestrained discretion

of the jury. See Santosky, [sic] at 762, 763 (proceedings in

which the fact finder has “unusual discretion” to weigh

facts are “often vulnerable to judgments based on cul-

tural or class bias”); Smith, 461 U.S. at 60 (the absence of

procedural safeguards in punitive damages cases exposes

defendants to the “caprice and prejudice” of the jury)

(Rehnquist, J. dissenting).

App. 34

The third and final consideration articulated by the

Mathews Court is the state’s interest, which should

include the function involved and the fiscal and adminis-

trative burdens that additional or substitute procedural

requirements would entail. Modifying the existing pro-

cedures by which punitive damages are awarded under

South Carolina law would not increase fiscal or adminis-

trative burdens on the state or the court system because

these changes focus primarily on the rules under which

punitive damages are determined. Increasing the plain-

tiff’s burden of proof and more clearly defining the stan-

dard for punitive awards will expedite trials and promote

settlement by replacing vague and uncertain standards

with more concrete guidelines and procedures which par-

ties can use in evaluating cases. These procedures may

also reduce the number of appeals and simplify appellate

review because they will provide more meaningful stan-

dards. The Court will no longer be required to resort to

vague standards such as whether or not the punitive

award shocks the conscience. Norton v. Ewaskio, 241 S.C.

557, 129 S.E.2d 517 (1963).

Moreover, no significant governmental interest

weighs heavily against reform. Punitive damage awards

that exceed the proper levels of punishment and deter-

rence cannot be justified. In Gertz v. Robert Welch, Inc., 418

U.S. 323, 349 (1974), the Supreme Court held that “states

have no substantial interest in securing for plain-

tiffs . . . gratuitous awards of money damages far in

excess of any actual injury.” A properly structured pro-

cedure for imposing punitive damages would advance

the state interest in punitive damages awards because it

would guard against over deterrence and excessive

App. 35

punishment. The risk of over deterrence is great under

the current procedure because plaintiffs and their attor-

neys possess strong incentives to seek excessive awards.

See, Wheeler, 69 Va. L. Rev. at 307. Moreover, excessive

verdicts receive apparent sanction from a system that

encourages juries to consider the wealth of the defendant

in determining the proper measure of punitive damages.

CONCLUSION

The Appellants have demonstrated that the enormity

of the actual damage award relative to the Respondent’s

injuries were the result of improper considerations. They

have also demonstrated that the magnitude of the puni-

tive award relative to Mr. McGee’s net worth is

unjustified, ruinous, and the result of improper consider-

ations. Finally, it is evident, given the recent opinions of

the United States Supreme Court, that South Carolina’s

current procedures for assessing punitive damages are

unconstitutional. For these reasons the jury’s verdict

must be set aside.

/s/ Keating L. Simons, III

Keating L. Simons, III

Thomas J. Keaveny, II

HOLMES & THOMSON

100 Broad Street

Post Office Box 858

Charleston, SC 29402-0858

(803) 723-2000

ATTORNEYS FOR APPELLANTS

CHARLESTON, S.C.

March 16, 1990

App. 36

APPENDIX E

STATE OF SOUTH CAROLINA )

COUNTY OF CHARLESTON ) IN THE COURT

CRYSTAL G. BROWN, ) OF COMMON

Plaintiff, ‘ PLEAS

ws ) Case No.

ne : P : } 88-CP-10-730

AVID McGEE an

HANAHAN MOTORS, INC., ‘ ANSWER

Defendants. )

)

The Defendants, above-named, answering the Com-

plaint of the Plaintiff herein, allege and say that:

FIRST: They deny each and every allegation of the Com-

plaint not hereinafter specifically admitted, modified, or

explained.

AS TO THE FIRST CAUSE OF ACTION

SECOND: The Defendant McGee admits so much of

Paragraph 1 as alleges he is a resident of Berkeley

County, State of South Carolina; they admit, upon infor-

mation and belief, that the Plaintiff is a citizen and resi-

dent of Georgetown County.

THIRD: They admit the allegations of Paragraphs 2 and

3.

FOURTH: They admit so much of Paragraph 4 as alleges

on or about April 4, 1987, at approximately 8:30 a.m. a

collision occurred between the vehicles driven by the

Plaintiff and the Defendant McGee on U.S. Highway 17

North By-Pass; they deny the remaining allegations of

said Paragraph and demand strict proof thereof.

App. 37

FIFTH: They deny the allegations of Paragraphs 5 and 6

and demand strict proof thereof.

SIXTH: They admit so much of Paragraph 7 as alleges

that following the accident the Plaintiff was transported

away from the accident by an ambulance; they lack infor-

mation sufficient to form a belief as to the remaining

allegations of said Paragraph and therefore deny the

same and demand strict proof thereof.

SEVENTH: They lack information sufficient to form a

belief as to the allegations of Paragraphs 8 and 9 and

therefore deny the same and demand strict proof thereof.

EIGHTH: They deny the allegations of Paragraph 10 and

demand strict proof thereof.

AS TO THE SECOND CAUSE OF ACTION

NINTH: Responding io Paragraph 11, the Defendants

reaffirm and reallege their responses to the Paragraphs

referred to in said Paragraph.

TENTH: They admit so much of Paragraph 12 as alleges

the Defendant, Hanahan Motors, Inc., is a corporation

incorporated under the laws of this state; they deny the

remaining allegations of said Paragraph and demand

strict proof thereof.

ELEVENTH: They admit the allegations of Paragraphs

13 and 14.

TWELFTH: They deny the allegations of Paragraph 15

and demand strict proof thereof.

App. 38

THIRTEENTH: They are informed and believe Para-

graph 16 alleges conclusions of law to which they are

required neither to admit nor to deny.

FOURTEENTH: They deny the allegations of Paragraph

17 and demand strict proof thereof.

WHEREFORE, having fully responded to the Plain-

tiff’s Complaint, the Defendants pray the same be dis-

missed with costs.

/s/ Thomas j. Keaveny

Thomas J. Keaveny, II

HOLMES & THOMSON

100 Broad Street

P.O. Box 1090

Charleston, SC 29402-1090

803/722-1634

ATTORNEYS FOR DEFENDANTS

CHARLESTON, SC

March 9th, 1988

STATE OF SOUTH CAROLINA

COUNTY OF CHARLESTON IN THE COURT

Defendants.

)

)

CRYSTAL G. BROWN, ) OF COMMON

Plaintiff, PLEAS

- ) Case No.

} 88-CP-10-730

JOHN DAVID McGEE and , gahlelaeieaes

HANAHAN MOTORS, INC., , Bea ee

)

)

The undersigned, Attorneys for Defendants, hereby

certify that on the 9th day of March, 1°38, a copy of the

attached Answer was placed in an envelope with first-

App. 39

class postage, prepaid, and mailed to Kenneth W. Thorn-

ton, Jr., Esquire, Law Offices of Kenneth W. Thornton, Jr.,

P.A., Attorneys for Plaintiff, at their last known address,

P.O. Box 1480, Georgetown, SC 29442.

/s/ Thomas J. Keaveny II

Thomas J. Keaveny, II

HOLMES & THOMSON

100 Broad Street

P.O. Box 1090

Charleston, SC 29402-1090

803/722-1634

ATTORNEYS FOR DEFENDANTS

CHARLESTON, SC

March 9th, 1988

App. 40

APPENDIX F

STATE OF SOUTH CAROLINA ) IN THE COURT

COUNTY OF CHARLESTON )OF COMMON PLEAS

) NINTH JUDICIAL

Crystal G. Brown, ) CIRCUIT

Plaintiff, ) CASE NO.::

ve ) 88-CP-10-730

_ ; )

John David McGee and ) TURY Shiai.

Hanahan Motors, Inc., DEMANDED

Defendants. ) SUMMONS

) FOR RELIEF

TO THE DEFENDANTS ABOVE NAMED:

YOU ARE HEREBY SUMMONED, and required to

answer the Complaint in this action, a copy of which is

herewith served upon you, and to serve a copy of your

Answer to the Complaint on the Plaintiffs’ attorney, Ken-

neth W. Thornton, Jr., 716 Prince Street, Post Office Box

1480, Georgetown, South Carolina 29442, within thirty

(30) days after the service hereof, exclusive of the day of

such service, and if you fail to answer the Complaint

within the time aforesaid, the Plaintiff in this action will

apply to the Court for the relief demanded in the Com-

plaint.

DATED at Georgetown, South Carolina, on this the

16th day of February, 1988.

LAW OFFICES OF KENNETH W. THORNTON, JR.,

P.A.

Attorneys for Plaintiffs

BY: /s/ Kenneth W. Thornton

Kenneth W. Thornton, Jr.

App. 41

STATE OF SOUTH CAROLINA )

COUNTY OF CHARLESTON +) IN THE COURT

JOF COMMON PLEAS

Crystal G. Brown, ) NINTH JUDICIAL

Plaintiff, ) CIRCUIT

ve ) CASE NO.:

)

John David McGee and ) NEGLIGENCE

Hanahan Motors, Inc ) JURY TRIAL

ecelich DEMANDED

Defendants. ) COMPLAINT

)

The Plaintiff, complaining of the Defendants, would

respectfully show unto this Court, and hereby alleges as

follows:

FOR A FIRST CAUSE OF ACTION

1. That Plaintiff is a citizen and resident of George-

town County, State of South Carolina, and the Defendant,

John David McGee, is a citizen and resident of Berkele;

County, State of South Carolina.

2. That the accident which gave rise to this cause of

action occurred in the County of Charleston, State of

South Carolina.

3. That at the time of the occurrence herein

described, the Plaintiff was the driver of a 1985 Volks-

wagon Quantum, 4-door GL, bearing South Carolina

License Tag No. JCL 816, which is owned by Crystal G.

Brown, and the Defendant, John David McGee, was the

driver of a 1982 2-door Buick sedan, bearing South Caro-

lina License Tag No. XX43681, which is owned by Hana-

han Motors, Inc.

App. 42

4. That on or about April 4, 1987, at approximately

8:30 o’clock a.m., the Plaintiff was stopped in the left side

through-lane on Route U.S. 17 North Bypass waiting for

the red light to change when the Defendant, John David

McGee, approached from the rear of Plaintiff’s vehicle

and struck Platntiff’s vehicle, which flipped end-over-end

coming to rest on its roof. Defendant’s vehicle was esti-

mated in Uniform Traffic Collision Report as traveling at

the rate of speed of 95 m.p.h.

5. That the time of the collision described above, the

Defendant, John David McGee, was negligent, willful,

wanton, careless, reckless, and grossly negligent in the

following particulars; that at the time of the occurrence

described above, the Defendant, John David McGee, was

negligent, willful, wanton, careless, and grossly negligent

in each of the following particulars:

a. In traveling along a public highway at an

excessive rate of speed;

b. In traveling along a public highway at a rate

of speed too fast for conditions;

c. In traveling along a public highway while

under the influence of alcohol;

d. In failing to maintain a proper lookout for

vehicles on the road ahead;

e. In failing to maintain a proper lookout for

other vehicles, including the vehicle Plaintiff

was driving;

f. In failing to have the vehicle in which the

Defendant was driving under control and to

reduce the speed of the vehicle to a reason-

able and proper rate when approaching

other vehicles;

App. 43

g. In failing to have the vehicle which the

Defendant was driving equipped with

proper brakes, or, if so equipped, in failing

to apply properly the brakes so as to avoid

colliding with Plaintiff’s vehicle;

h. In failing to maneuver the vehicle which

Defendant was driving so as to avoid strik-

ing that of the Plaintiff;

i. In failing to sound his horn or otherwise

warn the Plaintiff of the impending danger;

j. In driving in a grossly reckless manner with-

out regard for the safety of others, including

the Plaintiff;

k. In failing to use even a modicum of care or

caution that a reasonably prudent person

would have used under the circumstances

then and there prevailing;

l. In failing to use the degree of care and cau-

tion that a reasonably prudent person would

have used under the circumstances then and

there prevailing;

m. In acting in reckless disregard for the lives

and safety of other persons using the high-

way, including the Plaintiff;

All of which were the direct and proximate cause of the

injuries and damages suffered by the Plaintiff as are set

forth more particularly below, said acts being in violation

of the statute laws of the State of South Carolina.

6. That the Defendant, John David McGee, is

responsible for the actions as heretofore set forth, which

are the direct and proximate cause of the injuries and

damages suffered by the Plaintiff.

7. That, as a result of the negligence, willfulness,

carelessness, and gross negligence of the Defendant as set

ial

App. 44

forth above, the Plaintiff was transported to East Cooper

Hospital by ambulance where Plaintiff underwent medi-

cal treatment and was hospitalized. Plaintiff suffered

severe and painful injuries which were caused and, based

on information and belief, will in the future cause Piain-

tiff to undergo additional and extensive medical care and

treatment and which have caused, and, based on informa-

tion and belief, will in the future cause Plaintiff to expend

large sums of money for such medical treatment and

related expenses, and which have caused and, based on

information and belief, will in the future cause Plaintiff to

sufter severe pain and suffering, mental anguish and

emotional trauma, and which have caused and, based on

information and belief, will in the future cause Plaintiff to

lose money in the nature of wages and other income.

8. That, as a result of the negligence, willfulness,

wantonness, carelessness, and gross negligence of the

Defendant as set forth above, the Plaintiff was trans-

ported to East Cooper Hospital by ambulance, has been

forced to receive medical care after returning home and

has sustained severe, painful and permanent injuries

which have caused and, upon information and belief, will

in the future cause Plaintiff to expend substantial sums of

money for medical treatment and related expenses and

which have caused and, upon information and belief, will

in the future cause Plaintiff severe pain and suffering,

emotional stress and strain, and Plaintiff will suffer dis-

figurement as a result of these injuries.

9. That, Plaintiff, as a result of said injuries, has lost

time from her employment and will, upon information

and belief, miss time and work in the future, thereby

losing income in the past and future.

App. 45

10. That, because of the facts and circumstances set

forth in the injuries and damages sustained by the Plain-

tiff, the Plaintiff is informed and believes that she is

entitled to a judgment against Defendant for compensa-

tory and exeinplary damages, for costs in this action, and

for such other and future relief as this Court may deem

just and proper.

FOR A SECOND CAUSE OF ACTION

11. The Plaintiff reaffirms and realleges all of the

allegations centained hereinabove as set forth in the First

Cause of Action.

12. That the Defendant, Hanahan Motors, Inc., is a

corporation incorporated under the laws of the State of

South Carolina, and doing substantial business in the

County of Charleston, South Carolina.

13. That, upon information and belief, at the time of

the occurrence herein mentioned, the Defendant, John

David McGee, was operating the aforesaid 1982 2-door

Buick sedan by, and with the permission, of the Defen-

dant, Hanahan Motors, Inc.

14. That, upon information and belief, the aforesaid

1982 2-door Buick sedan is owned, furnished and main-

tained by the Defendant, Hanahan Motors, Inc., for the

general use, pleasure and convenience of John David

McGee, and that, at the time of the occurrence herein

mentioned, the said vehicle is being used for such a

purpose by the Defendant, John David McGee, who has

general authority to do so.

App. 46

15. That at the time of the collision described above,

the Defendant, Hanahan Motors, Inc., was negligent,

willful, wanton, careless, reckless, and grossly negligent

in the following particulars; that at the time of the occur-

rence described above, the Defendant, John David

McGee, the agent, servant, and/or employee of the

Defendant, Hanahan Motors, Inc., was negligent, willful,

wanton, careless, and grossly negligent in allowing the

Defendant, John David McGee, to operate its vehicle in

the aforementioned manner.

16. That the Defendant, Hanahan Motors, Inc.,, by

and through its agents, servants and employees is

responsible for the actions of the Defendant, John David

McGee, as heretofore set forth, which are the direct and

proximate cause of the injuries and damages sustained by

the Plaintiff.

17. That, because of the facts and circumstances set

forth in the injuries and damages sustained by the Plain-

tiff, the Plaintiff is informed and believes that she is

entitled to judgment against the Defendant, Hanahan

Motors, Inc., for compensatory and exemplary damages,

for the costs of this action, and for such other and further

relief as this Court may deem just and proper.

WHEREFORE, the Plaintiff prays for judgment

against both Defendants for compensatory and exemp-

lary damages, for the costs of this action, and in such

other and further relief as this Court may deem just and

proper.

App. 47

LAW OFFICES OF KENNETH W. THORNTON, JR.,

PA.

Attorneys for Plaintiff

BY: /s/ Kenneth W. Thornton

Kenneth W. Thornton, Jr.

Post Office Box 1480

Georgetown, South Carolina 29442

Georgetown, South Carolina,

February 16, 1988.