By Jack O’Toole
StatehouseReport.com
Ever since S.C. liquor liability insurance premiums started spiking in 2020 — forcing an increasing number of small bars and restaurants out of business — Statehouse observers have wondered whether lawmakers would use the crisis to push through a sweeping “lawsuit reform” bill, or craft a narrower fix for the immediate problem.
On Thursday, a unanimous S.C. House came down firmly on the “narrow” side of that debate, even as the S.C. Senate appeared to kill a broad lawsuit reform bill sponsored by Sen. Majority Leader Shane Massey (R-Edgefield).
House leaders quickly touted their approach in a statement after the vote.
“This is a targeted, effective solution that businesses support and need now,” House Judiciary Committee Chairman Wes Newton, R-Beaufort, said after the vote. “A similar bill passed the House last year, but the Senate refused to take it up. We addressed the concerns raised, built consensus with stakeholders, and delivered a more comprehensive bill that will provide real relief while maintaining accountability in alcohol service.”
According to House leaders, the bill “quickly and directly addresses the liquor liability crisis” with several targeted actions, including:
- An end to joint and several liability for alcohol sales: Under the House bill, bar and restaurant owners who are found to be 1% responsible for the harm caused by a drunk driver could no longer be forced to pay 100% of the damages.
- Creation of a liquor liability risk mitigation program: Bars and restaurants would be incentivized to adopt responsible alcohol service policies to lower their insurance premiums.
- Mandatory training: All servers and managers would be required to complete state-approved training to serve alcohol responsibly and recognize the signs of intoxication.
Beaufort’s John Marshall said the issue of liquor liability insurance is “one of the reasons that I sold my interest” in Old Bull Tavern in 2022.
Marshall said his liquor liability insurance went from less than $4,000 to more than $80,000 in one year.
“The long and short of it is legislators have made it impossible for small businesses,” he said.
Marshall said if a person had drinks at several different restaurants, no matter how much the drank or how much money they spent at each individual bar or restaurant, all of those businesses are “all equally responsible,” according to the current law, should that person drive drunk and cause damages.
“Any of the restaurants could be penalized by the whole amount, no matter how much they were responsible for it,” Marshall said.
Marshall said that in the current situation, if you make 30 percent of your revenue off alcohol sales, a restaurant owner could likely be looking at a liquor liability insurance premium of more than $80,000.
In addition to passing their own narrowly-focused legislation, House leaders announced the formation of a new committee to consider larger reforms to S.C.’s liability laws — a strong signal, according to one Statehouse insider, that members have no appetite for sweeping changes.
In that vein, freshly-installed Committee Chairman Bill Herbkersman, R-Beaufort, noted members would be taking their time to make sure S.C. lawsuit reform efforts don’t end up mirroring Florida’s 2023 legislation — a law that Massey’s bill is often compared to.
“South Carolina will take a deliberate approach, hearing from all sides before considering broader reforms,” Herbkersman said in a statement. “This committee will ensure we’re learning from other states, particularly Florida, to avoid unintended consequences and create meaningful, long-term solutions.”
On the other side of the Statehouse, Massey expressed frustration when senators refused to kill an amendment that would effectively gut his bill.
“We’re done,” he told his colleagues after the vote. “It’s over. Congratulations, y’all, it’s done. There will be businesses closed now because of this.” The House bill will move to the Senate next week.
The Island News Editor Mike McCombs contributed to this report.
