STATE OF OKLAHOMA

 

1st Session of the 50th Legislature (2005)

 

COMMITTEE SUBSTITUTE

FOR

HOUSE BILL NO. 2032                 By: Morgan (Fred)

 

 

 

 

 

COMMITTEE SUBSTITUTE

 

<StartFT>An Act relating to damages; amending 23 O.S. 2001, Section 9.1, as amended by Section 1, Chapter 462, O.S.L. 2002 (23 O.S. Supp. 2004, Section 9.1), which relates to punitive damages; modifying factors to be considered in awarding punitive damages; limiting punitive damage award based on net worth of defendant, with exceptions providing that jury award of punitive damages must be unanimous for cases filed after a certain date; providing that portion of punitive damage award in medical liability actions escheats to the state to certain fund; amending Section 18, Chapter 368, O.S.L. 2004 (23 O.S. Supp. 2004, Section 15), which relates to joint and several liability; modifying exceptions to severability; providing limit on recovery for noneconomic damages in certain actions; defining term; repealing Section 6, Chapter 390, O.S.L. 2003, as amended by Section 21, Chapter 368, O.S.L. 2004 and Section 22, Chapter 368, O.S.L. 2004 (63 O.S. Supp. 2004, Sections 1-1708.1F and 1-1708.1F-1), which relate to medical liability actions; providing for codification; and providing an effective date. <EndFT>

 

 

 

 

 

 

BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:

SECTION 1.     AMENDATORY     <23> O.S. 2001, Section <9.1>, as < >amended by Section <1>, Chapter <462>, O.S.L. 20<02> (<23> O.S. Supp. 2004, Section <9.1>), is amended to read as follows:

Section <9.1>  A.  In an action for the breach of an obligation not arising from contract, the jury, in addition to actual damages, may, subject to the provisions and limitations in subsections B, C and, D, E and G of this section, award punitive damages for the sake of example and by way of punishing the defendant based upon the following factors:

1.  The seriousness of the hazard to the public arising from the defendant's misconduct and any harm likely to result or harm that has actually occurred due to the misconduct;

2.  The profitability of the misconduct to the defendant;

3.  The duration and frequency of the misconduct and any concealment of it;

4.  The degree of the defendant's awareness of the hazard and of its excessiveness;

5.  The attitude and conduct of the defendant upon discovery of the misconduct or hazard;

6.  In the case of a defendant which is a corporation or other entity, the number and level of employees involved in causing or concealing the misconduct; and

7.  The financial condition of the defendant.

B.  Category I.  Where the jury finds by clear and convincing evidence that:

1.  The defendant has been guilty of reckless disregard for the rights of others; or

2.  An insurer has recklessly disregarded its duty to deal fairly and act in good faith with its insured; the jury, in a separate proceeding conducted after the jury has made such finding and awarded actual damages, may award punitive damages in an amount not to exceed the greater of:

a.   One Hundred Thousand Dollars ($100,000.00), or

b.   the amount of the actual damages awarded.

Any award of punitive damages under this subsection awarded in any manner other than as required in this subsection shall be void and reversible error.

C.  Category II.  Where the jury finds by clear and convincing evidence that:

1.  The defendant has acted intentionally and with malice towards others; or

2.  An insurer has intentionally and with malice breached its duty to deal fairly and act in good faith with its insured;

the jury, in a separate proceeding conducted after the jury has made such finding and awarded actual damages, may award punitive damages in an amount not to exceed the greatest of:

a.   Five Hundred Thousand Dollars ($500,000.00),

b.   twice the amount of actual damages awarded, or

c.   the increased financial benefit derived by the defendant or insurer as a direct result of the conduct causing the injury to the plaintiff and other persons or entities.

The trial court shall reduce any award for punitive damages awarded pursuant to the provisions of subparagraph c of this paragraph by the amount it finds the defendant or insurer has previously paid as a result of all punitive damage verdicts entered in any court of this state for the same conduct by the defendant or insurer.  Any award of punitive damages under this subsection awarded in any manner other than as required in this subsection shall be void and reversible error.

D.  Category III.  Where the jury finds by clear and convincing evidence that:

1.  The defendant has acted intentionally and with malice towards others; or

2.  An insurer has intentionally and with malice breached its duty to deal fairly and act in good faith with its insured; and the court finds, on the record and out of the presence of the jury, that there is evidence beyond a reasonable doubt that the defendant or insurer acted intentionally and with malice and engaged in conduct life-threatening to humans,

the jury, in a separate proceeding conducted after the jury has made such finding and awarded actual damages, may award punitive damages in any amount the jury deems appropriate, without regard to the limitations set forth in subsections B and C of this section.  Any award of punitive damages under this subsection awarded in any manner other than as required in this subsection shall be void and reversible error.

E.  In any civil action in which an entitlement to punitive damages shall have been established, no award of punitive damages shall exceed the following:

1.  Twenty Million Dollars ($20,000,000.00) for a defendant with a net worth of more than One Billion Dollars ($1,000,000,000.00);

2.  Fifteen Million Dollars ($15,000,000.00) for a defendant with a net worth of more than Seven Hundred Fifty Million Dollars ($750,000,000.00) but not more than One Billion Dollars ($1,000,000,000.00);

3.  Ten Million Dollars ($10,000,000.00) for a defendant with a net worth of more than Five Hundred Million Dollars ($500,000,000.00) but not more than Seven Hundred Fifty Million Dollars ($750,000,000.00);

4.  Seven Million Five Hundred Thousand Dollars ($7,500,000.00) for a defendant with a net worth of more than One Hundred Million Dollars ($100,000,000.00) but not more than Five Hundred Million Dollars ($500,000,000.00);

5.  Five Million Dollars ($5,000,000.00) for a defendant with a net worth of more than Fifty Million Dollars ($50,000,000.00) but not more than One Hundred Million Dollars ($100,000,000.00); or

6.  Four percent (4%) of the defendant’s net worth for a defendant with a net worth of Fifty Million Dollars ($50,000,000.00) or less.

F.  For the purposes of determining the defendant’s net worth in subsection E of this section, the amount of the net worth shall be determined in accordance with generally accepted accounting principles.  The limitation on the amount of punitive damages imposed by subsection E of this section shall not be disclosed to the trier of fact, but shall be applied by the court to any punitive damages verdict.

G.  The limitation on the amount of punitive damages imposed by subsection E of this section shall not apply to actions brought for damages or an injury resulting from an act or failure to act by the defendant:

1.  If the defendant was convicted of a felony under the laws of this state or under federal law which caused the damages or injury; or

2.  While the defendant was under the influence of alcohol or under the influence of drugs other than lawfully prescribed drugs administered in accordance with a prescription.

H.  In determining the amount, if any, of punitive damages to be awarded under either subsection B, C or D of this section, the jury shall make the award based upon the factors set forth in subsection A of this section.

F. I.  Punitive damages shall be awarded only if the jury is unanimous in regard to finding liability for punitive damages and is unanimous in regard to the amount of punitive damages to be awarded.

J.  Fifty percent (50%) of any punitive damages awarded in any medical liability action shall escheat to the state and be deposited to the credit of the Oklahoma Health Care Authority Revolving Fund.

K.  The provisions of this section are severable, and if any part or provision thereof shall be held void, the decision of the court shall not affect or impair any of the remaining parts or provisions thereof.

G.  This L.  The provisions of this section, except subsections E, F, G, I and J of this section, shall apply to all civil actions filed after the effective date of this act August 25, 1995.

M.  The provisions of subsections E, F, G, I and J of this section shall apply to all civil actions filed on or after November 1, 2005.

SECTION 2.     AMENDATORY     Section <18>, Chapter <368>, O.S.L. 20<04> (<23> O.S. Supp. 2004, Section <15>), is amended to read as follows:

Section <15>.  A.  Except as provided in subsections subsection B and C of this section, in any civil action based on fault and not arising out of contract, the liability for damages caused by two or more persons shall be several only and a joint tortfeasor shall be liable only for the amount of damages allocated to that tortfeasor.

B.  A defendant shall be jointly and severally liable for the damages recoverable by the plaintiff if the percentage of responsibility attributed to the defendant with respect to a cause of action is greater than fifty percent (50%).

C.  If at the time the incident which gave rise to the cause of action occurred, any the joint tortfeasors acted with willful and wanton conduct or with reckless disregard of the consequences of the conduct and such conduct in concert in committing a felony that proximately caused the damages legally recoverable by the plaintiff and the defendants were convicted of the felony, the liability for damages shall be joint and several.

D.  This section shall not apply to actions brought by the state or a political subdivision of the state or any action in which no comparative negligence is found to be attributable to the plaintiff.

E. C.  The provisions of this section shall apply to all civil actions based on fault and not arising out of contract that accrue on or after November 1, 2004 2005.

SECTION 3.     NEW LAW     A new section of law to be codified in the Oklahoma Statutes as Section 61.2 of Title 23, unless there is created a duplication in numbering, reads as follows:

A.  Except as provided in subsection B of this section, in any action not arising out of contract, the amount of noneconomic damages awarded shall not exceed Three Hundred Thousand Dollars ($300,000.00), regardless of the number of parties against whom the action is brought or the number of actions brought with respect to the personal injury.

B.  As used in this section, “noneconomic damages” means all subjective, nonmonetary losses including, but not limited to, pain, suffering, inconvenience, mental anguish, emotional distress, loss of enjoyment of life, loss of society and companionship, loss of consortium, injury to reputation and humiliation; provided, however, noneconomic damages do not include exemplary damages, as provided for in Section 9.1 of Title 23 of the Oklahoma Statutes.

C.  Nothing in this section shall apply to an action brought for wrongful death.

D.  The provisions of this section shall apply only to actions that accrue on or after November 1, 2005.

SECTION 4.     REPEALER     Section <6, Chapter 390, O.S.L. 2003, as amended by Section 21, Chapter 368, O.S.L. 2004 and Section 22>, Chapter <368>, O.S.L. 20<04> (<63> O.S. Supp. 2004, Sections <1-1708.1F and 1-1708.1F-1>), are hereby repealed.

SECTION 5.  This act shall become effective <November 1, 2005>.

 

50-1-6704     <SD>     <02/13/05>