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S.B. 201





Sponsor: Lyle W. Hillyard

             6      LONG TITLE
             7      General Description:
             8          This bill makes changes concerning the division of punitive damage awards with the
             9      state.
             10      Highlighted Provisions:
             11          This bill:
             12          .    requires that the state's portion of a punitive damage award be paid directly to the
             13      state by the judgment debtor;
             14          .    puts the state on the same footing as another judgment creditor when collecting
             15      punitive damages; and
             16          .    prescribes a priority and order for the payment of punitive damages.
             17      Monies Appropriated in this Bill:
             18          None
             19      Other Special Clauses:
             20          None
             21      Utah Code Sections Affected:
             22      AMENDS:
             23          78-18-1, as last amended by Chapters 200 and 314, Laws of Utah 2002
             25      Be it enacted by the Legislature of the state of Utah:
             26          Section 1. Section 78-18-1 is amended to read:
             27           78-18-1. Basis for punitive damages awards -- Section inapplicable to DUI cases

             28      -- Division of award with state.
             29          (1) (a) Except as otherwise provided by statute, punitive damages may be awarded only
             30      if compensatory or general damages are awarded and it is established by clear and convincing
             31      evidence that the acts or omissions of the tortfeasor are the result of willful and malicious or
             32      intentionally fraudulent conduct, or conduct that manifests a knowing and reckless indifference
             33      toward, and a disregard of, the rights of others.
             34          (b) The limitations, standards of evidence, and standards of conduct of Subsection
             35      (1)(a) do not apply to any claim for punitive damages arising out of the tortfeasor's operation of
             36      a motor vehicle or motorboat while voluntarily intoxicated or under the influence of any drug
             37      or combination of alcohol and drugs as prohibited by Section 41-6-44 .
             38          (c) The award of a penalty under Section 78-11-15 or 78-11-16 regarding shoplifting is
             39      not subject to the prior award of compensatory or general damages under Subsection (1)(a)
             40      whether or not restitution has been paid to the merchant prior to or as a part of a civil action
             41      under Section 78-11-15 or 78-11-16 .
             42          (2) Evidence of a party's wealth or financial condition shall be admissible only after a
             43      finding of liability for punitive damages has been made.
             44          (3) (a) In any judgment where punitive damages are awarded [and paid], 50% of the
             45      amount of the punitive damages in excess of $20,000 shall, by order of the trial court after an
             46      allowable deduction for the payment of attorneys' fees and costs, be remitted by the judgment
             47      debtor to the state treasurer for deposit into the General Fund.
             48          (b) For the purposes of this Subsection (3), an "allowable deduction for the payment of
             49      attorneys' fees and costs" shall equal the amount of actual and reasonable attorneys' fees and
             50      costs incurred by the judgment creditor, as determined by an order of the court, minus the
             51      amount of any separate judgment awarding attorneys' fees and costs to the judgment creditor.
             52          (c) The state shall have all rights due a judgment creditor until the judgment is
             53      satisfied, and stand on equal footing with the judgment creditor of the original case in securing
             54      a recovery.
             55          (d) Unless all affected parties, including the state, expressly agree otherwise or the
             56      application is contrary to the terms of the judgment, any payment on the judgment by or on
             57      behalf of any judgment debtor, whether voluntary or by execution or otherwise, shall be
             58      applied in the following order:

             59          (i) compensatory damages;
             60          (ii) applicable attorney fees and costs;
             61          (iii) the initial $20,000 punitive damages; and finally
             62          (iv) the balance of the punitive damages.

Legislative Review Note
    as of 2-11-04 9:43 AM

A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel

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