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“Opt-out” Class Action and Notification Procedure is the Exclusive Method of Class Action Litigation in South Carolina

June 29, 2008  |  from South Carolina Construction Law - Discussion of mechanic's liens, delay claims, coverage, and constr

    In a recent decision, the S.C. Supreme Courtheld that the“Opt-out” class action and notification procedure is the exclusive method of lass action litigation in South Carolina.  See Salmonsen v. CGD, Inc., 377 S.C. 442, 661 S.E.2d 81 (2008). 
 
    Several homeowners instituted a class action suit seeking damages arising from the application of defective synthetic stucco Exterior Insulation and Finish System ("EIFS") to residential homes in the Charleston area. On appeal the South Carolina Supreme Court addressed procedural questions concerning the certification of the class and whether certification orders were immediately appealable.

    The trial court originally established an "opt-in" notification procedure, requiring potential members of the class to "opt-in" to the suit in order to be certified as a member of the class. The Court concluded this procedure improperly excluded individuals who should be members of the class. The court adopted an "opt-out" procedure which included all potential members except those who specifically "opt-out." The Court established the "opt-out" method for all future class actions suits in South Carolina.

    The Court further held that because the certification orders affected the mode of trial, specifically limiting the availability of a jury trial, the certification orders were immediately appealable.

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Filed: Construction-Law