It’s a Wrap! The 2024-2025 SC legislative Session is officially over. It has been one long and crazy ride trying to get tort/lawsuit reform accomplished in SC! The liquor liability law bill that passed is confusing. The Mom and Pop Alliance of SC will take a stab at explaining it for all of us non-lawyers. Understanding liquor liability law is essential for both businesses and consumers.
A brand-new House bill (H.3430) is the one that made it through both chambers and will be headed to the Governor for signature. For a little background, earlier in the Session the House passed H.3497, in our opinion a relatively weak bill that dealt only with liquor liability law. The Senate passed a stronger, more comprehensive bill (S.244) which, in addition to liquor liability law, offered protections for all types of businesses (read more here). Opponents said the Senate bill was too comprehensive, but from a small business perspective, we very much wanted to see Senate bill S.244 make it through!
What we ended up with was not as strong as we would like, but it is a definite improvement over current liquor liability law. It may help bring down insurance rates. It appears H.3430 was rushed. In fact, it looks like they inserted the new liquor liability law language into a previous bill dealing with the auditor. This legislative process is known as “strike and replace,” or “strike and insert.” It’s a way of avoiding the committee process to get a bill passed very quickly. While legal, we have issues with its use. It was the mechanism used in the past to get the $1.3 Billion incentive package for VW/Scout through both SC chambers in a matter of days.
Understanding Liquor Liability Law in South Carolina
Liquor liability law has significant implications for both businesses and patrons, and understanding it is crucial.
The main issue driving skyrocketing liquor liability insurance rates in SC is our unchecked liability laws. H.3430 helps provide some new safeguards. While it falls short of the true proportional liability we wanted to see (each party only liable according to their degree of fault), the liquor liability law that passed both chambers does offer tangible improvements. It helps address claim severity, which is a key component needed to help lower insurance premiums for venues.
The issue of being 1% at fault and paying 100% of the award (unique to liquor liability law) will end. Now, you must be at least 50% at fault to pay 100% of the liability, as is the case for other industries in SC. Additionally, under this new liquor liability law, those who are under 50% responsible could pay up to 50% of the damages, even if they are only 1% responsible. Again, this is not true proportional liability, but it is much better than current liquor liability law, from our perspective.
Understanding the nuances of liquor liability law can help mitigate risks for businesses.
Other helpful aspects of the bill include:
• No longer limits the apportionment of fault to named defendants. Cases can now include all at-fault parties, with some significant exceptions.
• Guarantees that if there is a DUI driver, they must be on the verdict form. This is huge because they would likely be over 50% responsible for the fault.
• The standard for guilt was raised. A venue must “knowingly” sell to an intoxicated person.
• The Senate bill (S.244) that was sent to the House (which they chose not to go with) lowered the mandatory minimums of liability insurance bars/restaurants need to carry from $1 Million to $500K, which we strongly supported. This bill does not do that, but with mandatory server training and meeting other criteria, venues can lower their maximums.
• The coverage limits for non-profits were lowered to $500K in aggregate, with a $250K per-occurrence limit.
Overall, liquor liability law remains a critical topic for business owners in South Carolina.
• This bill allows the formation of captive insurance companies, like a co-op where parties can pool resources and form their own insurance coverage if standards are met.
The Mom and Pop Alliance of SC (along with many other groups and individuals) have been pushing for lawsuit reform in SC for years. We are happy to see something get across the finish line! Of course, we wish it were closer to true proportional liability and expanded beyond liquor liability to provide protections to all types of businesses. Lastly, we were disappointed to see it will not go into effect until Jan. 1, 2026. Given the urgency of this issue and years of advocacy work to get a bill passed, it is difficult to wait another 7 months to see any results. But at this point, we are just grateful to FINALLY have results!
Local News Via - MyrtleBeachSC.com
