Riley v. Ford Motor Co.

• Decision Date: 30 September 2015
• Docket Number: Appellate Case No. 2014–001192.,No. 27575.,27575.
• Citation: 777 S.E.2d 824,414 S.C. 185
• Court: South Carolina Supreme Court
• Parties: Laura RILEY, as the Personal Representative of the Estate of Benjamin Riley, Petitioner, v. FORD MOTOR COMPANY, Respondent.

414 S.C. 185

777 S.E.2d 824

Laura RILEY, as the Personal Representative of the Estate of Benjamin Riley, Petitioner

v.FORD MOTOR COMPANY, Respondent.

Appellate Case No. 2014–001192.

No. 27575.

Supreme Court of South Carolina.

Heard June 16, 2015.

Decided Sept. 30, 2015.

Ronnie L. Crosby, of Hampton; and Daniel E. Henderson and Matthew V. Creech, both of Ridgeland, all of Peters Murdaugh, Parker, Eltzroth & Detrick, PA, petitioner.

C. Mitchell Brown, A. Mattison Bogan, and Michael J. Anzelmo, all of Nelson Mullins Riley & Scarborough, LLP, of Columbia; and Curtis L. Ott and Laura W. Jordan, both of Gallivan, White & Boyd, PA, of Columbia, for respondent.

Opinion

Justice KITTREDGE.

This products liability action arose following the death of Benjamin Riley, who was killed in a motor vehicle accident involving a negligently designed door-latch system in his 1998 Ford F–150 pickup truck. Petitioner Laura Riley, as the Personal Representative of the Estate, filed suit against Respondent Ford Motor Company and the at-fault driver, Andrew Marshall Carter, II. Carter settled with the Estate for $25,000, with $20,000 allocated to the survival claim and $5,000 allocated to the wrongful death claim. Petitioner and Ford proceeded to trial on the wrongful death claim. The jury returned a verdict for Petitioner in the amount of $300,000. The trial court granted a nisi additur of $600,000, bringing the judgment to $900,000.

Ford appealed. The court of appeals upheld the finding of liability but reversed the trial court as to nisi additur, as well as the allocation and setoff of settlement proceeds. Riley v. Ford Motor Co., 408 S.C. 1, 757 S.E.2d 422 (Ct.App.2014). We issued a writ of certiorari to review the decision of the court of appeals.¹ We reverse the court of appeals and reinstate the judgment of the trial court.

I.

This case arises from an automobile accident that occurred in August 2007 and resulted in the death of Benjamin Riley, the Sheriff of Jasper County. The facts of the accident are not in dispute and are essentially as follows: Riley was driving a Ford F–150 pickup truck on S.C. 231 just south of Bamberg when Carter, a sixteen-year-old driver who was on his way home from school, pulled out in front of him. Riley swerved in an attempt to avoid Carter's vehicle, but a collision ensued, causing the driver's door of Riley's pickup to open. The impact of the collision sent Riley's pickup truck crashing into a nearby tree; Riley was ejected from the vehicle and thereafter died from the resulting injuries.

Petitioner Laura Riley (Riley's widow), as Personal Representative of the Estate, filed survival and wrongful death claims against Carter and Ford. Specifically, Petitioner alleged Carter was negligent for failing to yield the right-of-way and that Ford defectively designed the door-latch system in Riley's F–150, which allowed the door to open upon impact, and that Riley would not have died had he not been ejected from the vehicle. Petitioner settled with Carter for $25,000, agreeing to allocate $20,000 to the survival claim and $5,000 to the wrongful death claim. In April 2010, the settlement was approved by the trial judge, and the claims against Carter were dismissed.

The case against Ford proceeded to trial in September 2011. At trial, evidence of post-collision conscious pain and suffering was presented;² however, Petitioner withdrew the survival claim mid-trial, and only the wrongful death claim was submitted to the jury. The jury returned a verdict for Petitioner in the amount of $300,000 in actual damages, and although the jury also found there was clear and convincing evidence that Ford's conduct rose to the level of willful, wanton, or reckless, the jury ultimately declined to award any punitive damages.

Thereafter, Petitioner sought a new trial nisi additur, which the trial court granted in the amount of $600,000, bringing the total recovery to $900,000. Additionally, Ford moved for JNOV, and in the alternative, to offset the full $25,000 amount of the prior settlement against the jury's verdict in the wrongful death action, arguing post-verdict settlement reallocations are permitted in South Carolina and that such a reallocation was appropriate in this case because Petitioner “voluntarily withdrew the survival claim during trial.” The trial court denied both motions.

II.

Ford appealed. The court of appeals reversed, finding the trial court erred in denying Ford's motion for setoff and in granting the Estate's motion for a new trial nisi additur. Specifically, as to the new trial nisi additur, the court of appeals stated “the trial court's mere disagreement with the jury's determination of the proper amount of [ ] damages is not a compelling reason for granting additur,” and the court of appeals found it was inappropriate for the trial court to “impose its will on a party by substituting its judgment for that of the jury.” Id. at 19–20, 757 S.E.2d at 432–33. The court of appeals acknowledged that the jury's $300,000 verdict was only slightly more than the Estate's total economic loss, despite the Estate's extensive presentation of compelling evidence of noneconomic damages, and that Ford's trial strategy was not to “actively contest” the Estate's damages but instead to focus its efforts on the issue of liability. The court of appeals nevertheless found that because the jury must have awarded some amount in noneconomic damages, no “compelling reason” existed for the trial court to “invade the jury's province” by granting a new trial nisi additur. Id. at 19 n. 10, 757 S.E.2d at 432 n. 10. Thus, the court of appeals reversed the additur award and reinstated the jury's $300,000 verdict.

Regarding setoff, the court of appeals found there was evidence in the record to support a survival action against the other driver and that allocating a portion of the settlement to the survival claim “makes sense.” The court of appeals also acknowledged that $20,000 was a reasonable amount for the other driver to pay to settle the survival claim on the facts of this case. Nevertheless, purportedly relying upon this Court's decision in Rutland v. South Carolina Department of Transportation, 400 S.C. 209, 734 S.E.2d 142 (2012), the court of appeals determined it was appropriate for an appellate court to reevaluate the agreed-upon, and court-approved, settlement allocation, stating:

[W]hen an agreed-upon allocation of settlement proceeds is not reasonably based on the evidence and does not fairly advance the policy of preventing double-recovery, a non-settling defendant who is entitled to a setoff but was not involved in the settlement negotiation is entitled to have the court consider reallocating the settlement proceeds.³

Id. at 16–17, 757 S.E.2d at 431.

The court of appeals determined a “fair allocation” of the Estate's settlement with the other driver was to apportion $5,000 to the survival claim and $20,000 to the wrongful death claim, in essence flipping the allocation the settling parties reached and the allocation the trial court approved. Id. at 17, 757 S.E.2d at 431. The court of appeals reasoned reapportionment was appropriate because Ford was not a party to the settlement negotiations between Petitioner and the other driver and because the court of appeals felt “allocating eighty percent of the settlement to survival is not reasonable.” Id. at 15, 757 S.E.2d at 430. The court of appeals did not question the actual amount ($20,000) originally allocated to the survival action but reexamined only the percentage breakdown. Essentially, the court of appeals decided it was within the province of a reviewing court to evaluate the reasonableness of not only the dollar amounts but also the relative percentage of settlement proceeds assigned to each claim. In so holding, the court of appeals stated, “We hold that in the context of a non-settling defendant's claim for setoff, the court should examine whether the percentages allocated to one claim or the other by the settling parties are reasonable. If the allocation is not reasonable, the court may reallocate the funds.” Id. at 16, 757 S.E.2d at 430. Based on these findings, the court of appeals held Ford was entitled to offset the increased amount of $20,000 against the jury's verdict in the wrongful death action.

III.

Petitioner urges this Court to reverse the court of appeals' decision on the basis that it is a departure from well-established law concerning nisi additur and that the court of appeals erred in modifying the negotiated, court-approved settlement allocation and in finding Ford was entitled to offset the amount of $20,000. We agree and address each issue in turn.

A. New Trial Nisi Additur

Petitioner argues the court of appeals erred in reversing the trial court's order granting a new trial nisi additur because the trial court's decision was an appropriate exercise of discretion and was supported by compelling reasons. We agree.

“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, 530–31, 431 S.E.2d 557, 558 (1993) (citing Easler v. Hejaz Temple, 285 S.C. 348, 356, 329 S.E.2d 753, 758 (1985) ). “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 [alter] the verdict by the granting of a new trial nisi. ” Id. at 531, 431 S.E.2d at 558 (citing O'Neal v. Bowles, 314 S.C. 525, 527, 431 S.E.2d 555, 556 (1993) ). “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 evidence, it becomes the duty of the trial judge and this Court to set...