Mark Henkle, Esq.

5/7/2021

A new Senate Bill filed on April 5, 2021 in the North Carolina General Assembly has proposed to change North Carolina’s long-standing rule regarding negligence. (Senate Bill 477) Currently, North Carolina is one of a handful of states that abides by the contributory negligence rule.  That is, a plaintiff cannot recover for injuries resulting from a defendant’s negligence if the plaintiff’s own negligence contributed to his injury. Draughon v. Evening Star Holiness Church of Dunn, 320 N.C. 479, 483 (2020).  This rule is also known as the one-percent rule, where a plaintiff’s recovery was barred if the plaintiff was one percent liable.

The new proposed rule before the NC Senate is titled, “The Victims’ Fair Treatment Act.”  The new proposed rule would allow recovery for a plaintiff even if the plaintiff contributed to his injury. However, the Plaintiff’s claim would be diminished by the percentage of the Plaintiff’s fault.  Further, if the Plaintiff’s own fault is greater than the combined fault of the Defendant or defendants, then the Plaintiff is barred from recovery.   In other words, under the new rule, if the Plaintiff contributed to his own injury but less than fifty-one percent (51%), then the Plaintiff can recover from the Defendants.

Additionally, another provision in the Senate Bill, allows for any party to file a motion for the court to determine whether the proposed settlement is reasonable or not.  The Court will then consider evidence and the following factors:

  1. The likelihood of success by the claimant at trial against the settling defendants.
  2. The amount of applicable primary and excess insurance.
  3. Whether there are insurance coverage disputes in the case.
  4. Whether the settling defendants propose to pay all or nearly all of the applicable insurance coverage.
  5. The liquid assets of the settling defendants.
  6. The assets potentially available to the claimant through execution on any judgment obtained against the settling defendant or defendants, and the degree 40 of difficulty and likelihood of being able to recover those assets under the circumstances, including whether a settling defendant has other creditors already ahead in line.
  7. The equities of the case and whether a settlement is in the interests of justice and the proper administration of the courts.
  8. Any other factors that weigh for or against the proposed settlement, under all of the circumstances.

Many Plaintiff-side personal injury attorneys are lobbying in favor of this new rule as it will allow them to recover potentially bigger fees. But it will also increase litigation time and costs for all parties in a civil action. It will also allow a non-settling defendant to obstruct the settlement of a matter between a plaintiff and another party.  Furthermore, it takes judicial resources to approve of settlements between litigants. Additionally, this procedure opens the door for discovery of confidential and proprietary information of assets and insurance of businesses and individuals which may not be relevant to the case at all or to its resolution.  Furthermore, outside a protective order, that information may even become public record in a case.   

To access this article by GM Associate, Mark Henkle, working out our Charlotte, NC office, please click HERE.