AIA Commends Passage of Miss. Tort Reform Bill

June 3, 2004

On Thursday, the Mississippi House of Representatives voted 76-38 to concur with the Senate-passed version of HB 13, comprehensive tort reform legislation that should bring stability and predictability back to the state’s civil justice system, according to the American Insurance Association (AIA). HB 13 has been held over on a motion to reconsider, which will require another vote by the House tomorrow (Friday) before sending the bill to Gov. Haley Barbour (R).

“Passage of HB 13 is a major accomplishment for insurers and our coalition partners in the Mississippi business community,” said Cecil Pearce, AIA vice president, southeast region. “Achieving comprehensive civil justice reform has been a multi-year process: the legislation that passed in 2002 was a first step and HB 13 completes the process. Gov. Barbour and Lt. Gov. Amy Tuck (R) made civil justice reform a priority in their 2003 campaigns, and their unwavering support was critical to this bill’s passage.”

HB 13 should reportedly have a positive impact on the adverse litigation climate insurers and their policyholders have been subjected to in Mississippi in recent years. Most notably, the state’s venue and joinder laws, which allowed cases to be brought in certain “litigation magnet” counties with only a tangential connection to the parties, reportedly sucked in untold numbers of lawsuits involving multiple plaintiffs against out-of-state defendants.

Along with changes to the law made in 2002 and new rules limiting joinder issued by the state Supreme Court in February, HB 13 completes venue and joinder reform by bringing Mississippi law more in line with other states.

It requires that cases be tried where they arise and that each plaintiff in a lawsuit establish proper venue, thus keeping plaintiffs’ attorneys from joining their cases to claims in a favorable venue. HB 13 also establishes the doctrine of forum non conveniens, which allows the court to dismiss an action or transfer it to another county if it would be more properly heard in another venue.

Additional litigation reforms in HB 13 include the following:

• Maintains the current medical malpractice cap at $500,000, and extends a cap on non-economic damages to other civil defendants. The cap applies to any civil claim filed on or after September 1, 2004;
• Lowers some of the punitive damage caps based on the net worth of the defendant that were first imposed in the 2002 tort reform law;
• Protects “innocent sellers” – a seller who sells a product exactly as it came from a reputable manufacturer is not liable and cannot be included in a suit just to stop an out-of-state defendant from having the right to remove the case to federal court;
• Caps punitive damages based on a defendant’s net worth;
• Abolishes civil liability for premises owners for death or injury to independent contractors or their employees if the contractor knew or reasonably should have known of the danger that caused the harm;
• Abolishes joint and several liability for all defendants and institutes pure allocation of fault; and
• Establishes juror service requirements, making juries more representative by requiring more citizens to serve on juries and making the process less burdensome.

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