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2011-UP-014 - Perjen Inc v. Onyx Company

THIS OPINION HAS NO PRECEDENTIAL VALUE. IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 268(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

Perjen, Inc. d/b/a Melons Restaurant and Bar, Respondent,

v.

Onyx Company, LLC, and Terry Walden, Appellants.


Appeal From Horry County
Larry B. Hyman, Circuit Court Judge


Unpublished Opinion No. 2011-UP-014
Submitted December 1, 2010 – Filed January 25, 2011   


AFFIRMED


Clifford L. Welsh, of North Myrtle Beach, for Appellants.

Nate Fata, of Surfside Beach, for Respondent.

PER CURIAM:  Terry Walden appeals a jury verdict against him for fraud in the sale of Melons Restaurant and Bar.  He argues the trial court erred in (1) denying his motions for a directed verdict and a JNOV and (2) including legislative commentary to section 33-44-303 of the South Carolina Code (2006) in the jury instructions on LLC-member liability.  We affirm.[1]

1.  Walden contends the trial court erred in denying his motions for a directed verdict and a JNOV.  Walden does not argue he did not commit fraud.  Rather, Walden maintains (1) an agent of a limited liability company (LLC) is not personally liable for torts the agent commits for the company and (2) Walden's tortious actions were taken as a member–agent of Onyx rather than as an individual.  We disagree.  

Within the Limited Liability Company Act (the Act), section 33-44-303(a) of the South Carolina Code (2006) provides, "A member . . . is not personally liable for a . . . liability of [an LLC] solely by reason of . . . acting as a member . . . ."  S.C. Code Ann. § 33-44-303(a) (2006) (emphasis added).  The commentary of that section clarifies, "A member . . . is responsible for acts . . . to the extent those acts . . . would be actionable in . . . tort against the member . . . if that person were acting in an individual capacity."  S.C. Code Ann. § 33-44-303 cmt. (2006).  Furthermore, the Act provides, "[T]he principles of law and equity supplement" the Act unless displaced by the Act, and  "[s]upplementary principles include, but are not limited to, the law of agency . . . ."  S.C. Code Ann. §§ 33-44-104(a) & cmt. (2006). 

Echoing the legislative commentary of sections 303 and 104, South Carolina courts have consistently held, "'An agent's liability for his own tortious acts is unaffected by the fact that he acted in his representative capacity.'"  Gilbert v. Mid-South Mach. Co., 267 S.C. 211, 221-22, 227 S.E.2d 189, 193 (1976) (quoting Lawlor v. Scheper, 232 S.C. 94, 98-99, 101 S.E.2d 269, 271 (1957)).  Thus, an LLC's liability shield does not protect a member who commits a tort while acting for the LLC from liability; the LLC member is personally liable as a tortfeasor for torts the member actually commits.  Accordingly, the trial court properly denied Walden's motions for a directed verdict and a JNOV.

2. Walden contends the trial court committed reversible error in charging and providing the jury with the legislative commentary to section 33-44-303.  We disagree. 

"An appellate court will not reverse [a trial] court's decision regarding jury instructions unless the trial court abused its discretion," which "occurs when the trial court's ruling is based on an error of law . . . ."  Clark v. Cantrell, 339 S.C. 369, 389, 529 S.E.2d 528, 539 (2000) (citations omitted).  Generally, a trial court has discretion to provide written jury instructions, but the "practice should be used sparingly, and only where it will aid the jury and where it will not prejudice the defendant."  State v. Covert, 382 S.C. 205, 210, 675 S.E.2d 740, 743 (2009).  A "trial court is required to charge only the current and correct law of South Carolina."  Proctor v. Dep't of Health & Envtl. Control, 368 S.C. 279, 310, 628 S.E.2d 496, 513 (Ct. App. 2006) (internal quotations omitted).  However, an erroneous portion of a jury instruction is harmless "[i]f, as a whole, the charges are reasonably free from error."  Johnson v. Horry Cnty. Solid Waste Auth., 389 S.C. 528, 538, 698 S.E.2d 835, 839-40 (Ct. App. 2010).  

Here, Walden did not object to the trial court's furnishing of a copy of the commentary to the jury.  See State v. Turner, 373 S.C. 121, 126 n.1, 644 S.E.2d 693, 696 n.1 (2007) (noting issues not raised and ruled upon in the trial court will not be considered on appeal).  Moreover, even if the inclusion of the commentary in the instructions provided to the jury was error, that error was harmless.  The instructions as a whole reflected the law relating to LLC-member liability.  See S.C. Code Ann. § 33-44-104 cmt. (2006); Gilbert v. Mid-South Mach. Co., 267 S.C. 211, 221-22, 227 S.E.2d 189, 193 (1976) (citation omitted).  

AFFIRMED.

THOMAS, PIEPER, and GEATHERS, JJ., concur.


[1] We decide this case without oral argument pursuant to Rule 215, SCACR.