No. 5 Session of 1999



                                     AN ACT
     1  Amending Title 42 (Judiciary and Judicial Procedure) of the
     2     Pennsylvania Consolidated Statutes, providing for a statute
     3     of repose; further providing for comparative responsibility;
     4     providing for product seller liability; further providing for
     5     agreements to arbitrate; repealing the Uniform Contribution
     6     Among Tort-Feasors Act; and providing limits on punitive
     7     damages.
     8     The General Assembly of the Commonwealth of Pennsylvania
     9  hereby enacts as follows:
    10     Section 1.  Title 42 of the Pennsylvania Consolidated
    11  Statutes is amended by adding a section to read:
    12  � 5539.  Statute of repose.
    13     (a)  General rule.--Except as provided in subsection (b), no
    14  action brought to recover damages for death, for injury to
    15  persons or property or for economic loss resulting from a
    16  defective product may be brought against any person if the
    17  action is commenced more than 15 years after any of the
    18  following:
    19         (1)  The date of delivery of the product to the first
    20     purchaser or lessee who is not engaged in the business of

     1     selling or leasing the product.
     2         (2)  The date of completion of the replacement or
     3     addition of a new component, system, subassembly or other
     4     part which was added to the product and which is alleged to
     5     have caused death, injury to persons or property, or economic
     6     loss.
     7     (b)  Exception.--Subsection (a) does not apply to any of the
     8  following:
     9         (1)  An action brought under a written warranty which
    10     would be enforceable under law but for the operation of this
    11     section.
    12         (2)  An action against a manufacturer, seller or
    13     distributor of the product or the manufacturer, seller or
    14     distributor of any new component, system, subassembly or
    15     other part of the product alleging a physical illness the
    16     evidence of which did not appear in less than 15 years after
    17     the first exposure to the product.
    18     Section 2.  Section 7102 of Title 42 is amended to read:
    19  � 7102.  Comparative [negligence] responsibility.
    20     (a)  General rule.--In all actions brought to recover damages
    21  for [negligence resulting in] death [or], for injury to person
    22  or property or for economic loss, the fact that the plaintiff
    23  may have been guilty of contributory negligence shall not bar a
    24  recovery by the plaintiff or his legal representative where
    25  [such negligence] the causal responsibility of the plaintiff was
    26  not greater than the causal [negligence] responsibility of the
    27  defendant or defendants against whom recovery is sought, but any
    28  damages sustained by the plaintiff shall be diminished in
    29  proportion to the amount of [negligence] the causal
    30  responsibility attributed to the plaintiff. In any action for
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     1  wrongful death or in any action in which the plaintiff's cause
     2  of action is derived through another person, the causal
     3  responsibility of the decedent or the person through whom the
     4  claim is derived, if any, shall be imputed to the plaintiff.
     5     (b)  Recovery against joint defendant[; contribution].--Where
     6  [recovery is allowed against more than one defendant,] causal
     7  responsibility is attributed to more than one person, including
     8  where a person has been found liable upon a theory of strict
     9  liability, each defendant shall be liable only for that
    10  proportion of the total dollar amount awarded as damages in the
    11  ratio of the amount of his causal [negligence] responsibility to
    12  the amount of causal [negligence] responsibility attributed to
    13  all defendants. [against whom recovery is allowed. The plaintiff
    14  may recover the full amount of the allowed recovery from any
    15  defendant against whom the plaintiff is not barred from
    16  recovery. Any defendant who is so compelled to pay more than his
    17  percentage share may seek contribution.] The court shall enter
    18  separate, several judgments in favor of the plaintiff and
    19  against each defendant only for the amount for which that
    20  defendant is liable.
    21     (c)  Elimination of joint and several liability.--A defendant
    22  found responsible in an action brought to recover damages for
    23  death, injury to person or property or economic loss shall not
    24  be subject to joint and several liability. Except where a
    25  contractual relationship permits, a defendant shall not have the
    26  right to recover any portion of the damages assessed against him
    27  from any other defendant.
    28     (d)  Apportionment of responsibility among nonparties;
    29  effect.--For purposes of apportioning responsibility only, the
    30  question of the causal responsibility of any person who is not a
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     1  party shall be submitted to the trier of fact upon appropriate
     2  request and proofs by any party. The persons whose causal
     3  responsibility may be determined pursuant to this subsection
     4  include a person who is immune from suit or over whom
     5  jurisdiction cannot be maintained, but do not include an
     6  employer to the extent that the employer is granted immunity
     7  from liability or suit pursuant to the act of June 2, 2023
     8  (P.L.736, No.338), known as the Workers' Compensation Act. An
     9  attribution of responsibility to a person as provided in this
    10  subsection shall not be admissible or relied upon in any other
    11  action or proceeding for any purpose.
    12     (e)  Effect of release, covenant not to sue or similar
    13  agreement.--A release, covenant not to sue or similar agreement
    14  entered into by a plaintiff and a person who is, or could be, a
    15  defendant in an action for damages for death, injury to person
    16  or property or economic loss, may discharge that person from all
    17  further liability, but does not discharge any other person
    18  liable with respect to the same cause of action unless the
    19  release, covenant not to sue or similar agreement specifically
    20  so provides. However, any damages to which the plaintiff is
    21  entitled to recover shall be reduced by the largest of the
    22  following:
    23         (1)  The released person's proportional share of the
    24     plaintiff's damages as though the released person were a
    25     defendant at the time judgment is entered.
    26         (2)  The amount paid to the plaintiff by the person
    27     entering into the release, covenant not to sue or similar
    28     agreement.
    29         (3)  The amount or proportion by which the release,
    30     covenant not to sue or similar agreement provides that the
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     1     total damages of the plaintiff shall be released.
     2     [(c)] (f)  Downhill skiing.--
     3         (1)  The General Assembly finds that the sport of
     4     downhill skiing is practiced by a large number of citizens of
     5     this Commonwealth and also attracts to this Commonwealth
     6     large numbers of nonresidents significantly contributing to
     7     the economy of this Commonwealth. It is recognized that as in
     8     some other sports, there are inherent risks in the sport of
     9     downhill skiing.
    10         (2)  The doctrine of voluntary assumption of risk as it
    11     applies to downhill skiing injuries and damages is not
    12     modified by subsections (a) and (b).
    13     (g)  Savings provision.--Nothing in this section shall be
    14  construed in any way to create, abolish or modify a cause of
    15  action or to limit a party's right to join another potentially
    16  responsible party.
    17     [(d)] (h)  Definitions.--As used in this section the
    18  following words and phrases shall have the meanings given to
    19  them in this subsection:
    20     "Defendant or defendants against whom recovery is sought."
    21  Includes impleaded defendants.
    22     "Plaintiff."  Includes counterclaimants and cross-claimants.
    23     Section 3.  Title 42 is amended by adding a section to read:
    24  � 7104.  Liability rules applicable to product sellers.
    25     (a)  General rule.--Except as provided in subsection (b), in
    26  a product liability action, a product seller other than a
    27  manufacturer shall be liable for damages resulting in death,
    28  injury to person or property or economic loss only if the
    29  plaintiff establishes any of the following:
    30         (1)  The product which allegedly caused the harm
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     1     complained of by the plaintiff was sold by the product
     2     seller, the product seller failed to exercise reasonable care
     3     with respect to the product and the failure to exercise
     4     reasonable care was a proximate cause of the harm complained
     5     of by the plaintiff. For purposes of this paragraph, a
     6     product seller shall not be considered to have failed to
     7     exercise reasonable care with respect to the product based
     8     upon an alleged failure to inspect a product where there was
     9     no reasonable opportunity to inspect the product in a manner
    10     which, in the exercise of reasonable care, would have
    11     revealed the aspect of the product which allegedly caused the
    12     harm complained of by the plaintiff.
    13         (2)  The product seller made an express warranty
    14     applicable to the product which allegedly caused the harm
    15     complained of by the plaintiff independent of an express
    16     warranty made by a manufacturer as to the same product, the
    17     product failed to conform to the seller's express warranty
    18     and the failure of the product to conform to the seller's
    19     express warranty caused the harm complained of by the
    20     plaintiff.
    21         (3)  The product seller engaged in intentional wrongdoing
    22     which was a proximate cause of the harm complained of by the
    23     plaintiff.
    24     (b)  Exception.--In a product liability action, a product
    25  seller shall be liable for harm caused by the product as though
    26  the product seller were the manufacturer of the product if the
    27  manufacturer is not subject to service of process under the laws
    28  of any state in which the action might have been brought or if
    29  the court determines that the plaintiff would be unable to
    30  enforce a judgment against the manufacturer.
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     1     (c)  Rental and leases.--Notwithstanding any other provision
     2  of law, any person not excluded from the definition of product
     3  seller who is engaged in the business of renting or leasing a
     4  product shall be subject to liability pursuant to subsection
     5  (a), but shall not be liable to a plaintiff for tortious act of
     6  another solely by reason of ownership of such product.
     7     (d)  Certification of manufacturer identity.--In a product
     8  liability action against a product seller, the product seller or
     9  manufacturer may file an affidavit certifying the correct
    10  identity of the manufacturer of the product which allegedly
    11  caused the injury, death or damage. Due diligence shall be
    12  exercised in providing the plaintiff with the correct identity
    13  of the manufacturer or manufacturers.
    14         (1)  Upon filing the affidavit, the product seller shall
    15     be relieved of all strict liability claims unless any of the
    16     following applies:
    17             (i)  The identity of the manufacturer given to the
    18         plaintiff by the product seller was incorrect. Once the
    19         correct identity of the manufacturer has been provided,
    20         the product seller shall again be relieved of all strict
    21         liability claims, subject to the provisions of paragraph
    22         (3).
    23             (ii)  The manufacturer has no known agents, facility
    24         or other presence within the United States.
    25             (iii)  The manufacturer has no attachable assets or
    26         has been adjudicated bankrupt and a judgment is not
    27         otherwise recoverable from the assets of the bankruptcy
    28         estate.
    29         (2)  A product seller shall be liable under any of the
    30     following circumstances:
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     1             (i)  The product seller has exercised some
     2         significant control over the design, manufacture,
     3         packaging or labeling of the product related to the
     4         alleged defect in the product which caused the harm
     5         complained of by the plaintiff.
     6             (ii)  The product seller knew or reasonably should
     7         have known of the defect in the product which caused the
     8         harm complained of by the plaintiff or the plaintiff can
     9         affirmatively demonstrate that the product seller was in
    10         possession of facts from which a reasonable person would
    11         conclude that the product seller had or should have had
    12         knowledge of the alleged defect in the product which
    13         caused the harm complained of by the plaintiff.
    14             (iii)  The product seller created the defect in the
    15         product which caused the harm complained of by the
    16         plaintiff.
    17         (3)  The commencement of a product liability action based
    18     in whole or in part on the doctrine of strict liability
    19     against a product seller shall toll the applicable statute of
    20     limitations with respect to manufacturers who have been
    21     identified pursuant to the provisions of paragraph (1).
    22     (e)  Definitions.--As used in this section, the following
    23  words and phrases shall have the meanings given to them in this
    24  subsection:
    25     "Firm."  Any of the following:
    26         (1)  A person other than a natural person.
    27         (2)  An affiliated entity that conducts the practice of a
    28     profession.
    29     "Manufacturer."  Any of the following:
    30         (1)  A person who designs, formulates, produces, creates,
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     1     makes, packages, labels or constructs any product or
     2     component of a product.
     3         (2)  A product seller with respect to a given product to
     4     the extent the product seller designs, formulates, produces,
     5     creates, makes, packages, labels or constructs the product
     6     before its sale.
     7         (3)  A product seller not described in paragraph (2)
     8     which holds itself out as a manufacturer to the user of the
     9     product.
    10         (4)  A United States domestic sales subsidiary of a
    11     foreign manufacturer if the foreign manufacturer has a
    12     controlling interest in the domestic sale subsidiary.
    13     "Product liability action."  A claim or action brought by a
    14  plaintiff for harm caused by a product, irrespective of the
    15  theory underlying the claim, other than an action for harm
    16  caused by breach of an express warranty.
    17     "Product seller."
    18         (1)  A person who, in the course of business conducted
    19     for that purpose, does any of the following:
    20             (i)  Sells, distributes, leases, installs, prepares
    21         or assembles a manufacturer's product according to the
    22         manufacturer's plan, intention, design, specifications or
    23         formulations.
    24             (ii)  Blends, packages, labels, markets, repairs,
    25         maintains or otherwise is involved in placing a product
    26         in the line of commerce.
    27         (2)  The term does not include any of the following:
    28             (i)  A seller of real property.
    29             (ii)  A provider of professional services if sale or
    30         use of a product is merely incidental to the transaction
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     1         and the essence of the transaction is furnishing
     2         judgment, skill or services.
     3             (iii)  A person who acts in only a financial capacity
     4         with respect to sale of a product.
     5     "Profession."  The performance of any type of service to the
     6  public that requires, as a condition precedent to performance of
     7  the service, obtaining from the Supreme Court of Pennsylvania or
     8  a licensing board or commission under the Bureau of Professional
     9  and Occupational Affairs in the Department of State a license,
    10  registration, certificate, permit, admission to practice or
    11  other legal authorization. All physicians, as defined in 1
    12  Pa.C.S. � 1991 (relating to definitions), shall be deemed to be
    13  from the same profession.
    14     "Professional."  Any of the following:
    15         (1)  An individual holding a license, registration,
    16     certificate, permit, admission to practice or other legal
    17     authorization to practice a profession.
    18         (2)  A firm owned by members of a profession through
    19     which entity a profession is practiced.
    20         (3)  An owner of an equity interest in a firm owned by
    21     members of a profession through which entity a profession is
    22     practiced.
    23         (4)  An employee or agent of a professional acting in an
    24     individual capacity or liable vicariously or under the law of
    25     agency.
    26     Section 4.  Section 7303 of Title 42 is amended to read:
    27  � 7303.  Validity of agreement to arbitrate; application to
    28             certain parties.
    29     (a)  Written agreement valid.--A written agreement to subject
    30  any existing controversy to arbitration or a provision in a
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     1  written agreement to submit to arbitration any controversy
     2  thereafter arising between the parties is valid, enforceable and
     3  irrevocable, save upon such grounds as exist at law or in equity
     4  relating to the validity, enforceability or revocation of any
     5  contract.
     6     (b)  Other parties.--An individual, corporation or other
     7  entity not a signatory to an arbitration agreement may join in
     8  the arbitration, at the request of a party, with all of the
     9  rights and obligations of the original parties. No signatory to
    10  an arbitration agreement may refuse to arbitrate because of the
    11  addition of participants pursuant to the provisions of this
    12  subsection. Additional participants shall agree in writing to be
    13  bound by the arbitration proceedings and the arbitration
    14  agreement and thereafter shall be treated as parties.
    15     (c)  Employees of parties.--The employees of a party to
    16  arbitration who are involved in a dispute because of their
    17  status as employees of the party shall be deemed to be parties
    18  to the arbitration agreement executed by their employer. An
    19  arbitration agreement executed by the employer shall bar an
    20  action at law against the employer based upon conduct of an
    21  employee involved in the dispute as a result of action taken by
    22  the employee in the course and conduct of employment.
    23     (d)  Minor children.--A minor child shall be bound by an
    24  arbitration agreement executed on behalf of the child by a
    25  parent or legal guardian.
    26     (e)  Applicability.--The provisions of this section shall
    27  apply to all arbitrations conducted pursuant to this subchapter
    28  and Subchapter B (relating to common law arbitration).
    29     Section 5.  Subchapter B of Chapter 83 of Title 42 is
    30  repealed.
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     1     Section 6.  Title 42 is amended by adding a section to read:
     2  � 8372.  Limitations on recovery of punitive damages.
     3     (a)  Standard for award.--To recover punitive damages, a
     4  plaintiff must prove beyond a reasonable doubt that the
     5  defendant acted with an evil motive, with reckless and
     6  outrageous indifference to a highly unreasonable risk of harm or
     7  with knowing indifference to the rights and safety of others. A
     8  showing of gross negligence is insufficient to support an award
     9  of punitive damages. In assessing punitive damages, the trier of
    10  fact may consider the nature of the defendant's conduct, the
    11  extent and type of the harm to the claimant that the defendant
    12  caused or intended to cause and the wealth of the defendant. No
    13  punitive damages may be awarded against a defendant who is only
    14  vicariously liable for actions of an agent unless it can be
    15  shown beyond a reasonable doubt that the party knew of and
    16  directed the conduct of the agent. No punitive damages may be
    17  awarded with the intent of changing conduct in another
    18  jurisdiction if the conduct to be changed is lawful in the other
    19  jurisdiction. If punitive damages are awarded against more than
    20  one defendant, the court shall allocate the total amount of the
    21  award among the applicable defendants based on each defendant's
    22  percentage of fault.
    23     (b)  Amount of award.--In an action alleging damages for
    24  death, for injury to person or property or for economic loss,
    25  punitive damages may be awarded only if actual damages are
    26  awarded. The amount of punitive damages shall not exceed the
    27  greater of 200% of the compensatory damages awarded or $250,000.
    28  Actions brought to recover damages for death, for injury to
    29  person or property or for economic loss shall include all
    30  product liability claims regardless of the theory or doctrine on
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     1  which they are based. For purposes of this section, the term
     2  "punitive damages" shall include punitive damages, exemplary
     3  damages and special damages.
     4     (c)  Substantive right to bifurcate proceeding.--
     5         (1)  In an action which includes a claim for punitive
     6     damages, a defendant shall have the substantive legal right
     7     to have issues relating to punitive damages tried separately
     8     from other issues.
     9         (2)  In an action seeking damages for death, for injury
    10     to person or property or for economic loss, if punitive
    11     damages are claimed, a praecipe to strike punitive damages
    12     may be filed. Upon filing a praecipe to strike punitive
    13     damages, an order shall be issued striking without prejudice
    14     the claim for punitive damages, which shall toll the statute
    15     of limitations as to the party filing the praecipe until the
    16     earlier of 45 days after the close of discovery, the time
    17     period set forth in paragraph (3) or the conclusion of the
    18     action. At the close of discovery, but before the beginning
    19     of the trial, the party who filed the punitive damage claim
    20     may move to reinstate the punitive damages claim. The party
    21     claiming punitive damages shall have no right to discover the
    22     financial assets or wealth of a defendant who filed a
    23     praecipe to strike punitive damages until the claim has been
    24     reinstated. Upon the filing of a motion that a punitive
    25     damage claim be reinstated, if the court determines that the
    26     evidence supports a prima facie case for imposition of
    27     punitive damages, then the punitive damages claim shall be
    28     reinstated.
    29         (3)  If a request is made to have the issues relating to
    30     punitive damages tried separately from the other issues in
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     1     the action, the trier of fact shall first hear evidence
     2     relevant to and render a verdict upon the defendant's
     3     liability for compensatory damages and the amount of
     4     compensatory damages. If the trier of fact makes an award of
     5     compensatory damages, the same trier of fact shall
     6     immediately hear additional evidence relevant to, and render
     7     a verdict upon, the defendant's liability for punitive
     8     damages and the amount of any punitive damages. If no award
     9     of compensatory damages is made, the claim for punitive
    10     damages shall be dismissed. If the defendant requests a
    11     separate proceeding concerning liability for punitive
    12     damages, evidence relevant only to the claim of punitive
    13     damages shall be inadmissible in any proceeding to determine
    14     whether compensatory damages are to be awarded.
    15     (d)  Repetitive awards.--
    16         (1)  Punitive damages shall not be awarded in a civil
    17     action based on the same act, omission or course of conduct
    18     for which punitive damages have already been awarded against
    19     the same defendant in a Federal or state court in any
    20     jurisdiction unless one of the following occurs:
    21             (i)  The court determines in a pretrial hearing that
    22         the claimant will offer new and substantial evidence of
    23         previously undiscovered wrongful behavior on the part of
    24         the defendant, other than injury or loss to the claimant
    25         or others, that on its face might justify an additional
    26         award of punitive damages.
    27             (ii)  The act, omission or course of conduct occurred
    28         subsequent to a final judgment of punitive damages, paid
    29         in full, with respect to the same type of act, omission
    30         or course of conduct.
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     1         (2)  A court permitting a claim for or award of punitive
     2     damages under this section shall comply with all of the
     3     following:
     4             (i)  Make specific findings of fact on the record to
     5         support the claim or award.
     6             (ii)  Reduce the amount of the punitive portion of
     7         the damages awarded by the sum of amounts of punitive
     8         damages previously entered against and resolved through
     9         satisfaction, payment or otherwise by the defendant in
    10         prior actions in another Federal or state court in any
    11         jurisdiction.
    12             (iii)  Prohibit disclosure to the jury of the court's
    13         determination and action under this paragraph.
    14     (e)  Exception.--The limitations contained in this section
    15  shall not apply to an action alleging damages for death, injury
    16  to person or property or economic loss where the action relates
    17  to an incident or occurrence for which an individual has been
    18  charged and convicted of a criminal act for which a period of
    19  incarceration is or may be a part of the sentence.
    20     (f)  No additional cause of action.--Nothing in this section
    21  shall be construed to create a cause of action for punitive
    22  damages or to permit the recovery of punitive damages in
    23  circumstances where the award of punitive damages is not
    24  otherwise expressly authorized by law. Punitive damages may be
    25  awarded in connection with a civil cause of action created or
    26  implied by a particular statutory provision only if the
    27  statutory provision expressly authorizes an award of punitive
    28  damages or the Supreme Court of Pennsylvania in a published
    29  opinion issued before the effective date of this act has held
    30  that punitive damages may be awarded in connection with that
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     1  particular type of cause of action.
     2     Section 7.  This act shall apply to all pending actions in
     3  which trial has not commenced on the effective date of this act.
     4  A civil action or proceeding to which 42 Pa.C.S. � 5539 applies
     5  which is not fully barred by statute on the day prior to the
     6  effective date of this act and as to which the period for
     7  commencing suit has been reduced by 42 Pa.C.S. � 5539 may be
     8  commenced within one year after the effective date of this act,
     9  or within the period previously set for commencing suit,
    10  whichever is shorter.
    11     Section 8.  This act shall take effect immediately.
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