C. Elements Defined
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C. Elements Defined
1. A Violation of the Act16
The act or practice complained of must be unfair or deceptive.17 It need not be based on a binding contract.18 Where a contract exists, a mere breach of the contract is not conduct which violates the Act.19 However, a breach of warranty founded on misrepresentations published to other consumers may constitute a violation.20
Proof of common law fraud is not required to establish a violation.21 However, it is essential that the act or practice complained of have an impact on the public interest.22 A complaint need not use the "magic language" adverse impact on the public interest, it is sufficient to allege the conduct is "capable of repetition."23 The requirement to show impact on the public interest may be met by showing the acts or practices have potential for repetition.24 Potential for repetition may be demonstrated by showing: the same kind of actions occurred in the past,25 thereby making it likely they will continue without deterrence, or the company's procedures create a potential for repetition,26 although the South Carolina Supreme Court has specifically declined to hold these are the only means for showing potential repetition and said each case must be evaluated on its own merits.27
A number of cases have considered whether particular acts or practices affected the public interest. Appealing a variance granted by a Board of Adjustment was found not to constitute an act or practice impacting on the interests of the people of the state.28 Using privileged information concerning a competitor's customers does not inherently involve acts which impact the public interest in a situation where only two direct competitors are involved.29 The failure of a horse seller to deliver registration papers was not conduct readily susceptible to repetition and did not therefore impact on the public interest.30 Padding a bill for termite repair work was found not to affect the public interest where there was no evidence of similar acts to establish or infer the conduct had potential for repetition.31 Padding automobile repair bills may affect the public interest because of the potential for repetition.32 A warranty by a nursery that it exercised the "greatest care" to keep varieties true to name when breached impacted on the public interest because there was potential for repetition by publication of the misrepresentations to other consumers.33 Outright deception concerning credit approval and having customers sign both an unconditional sales contract and a conditional bailment agreement are capable of repetition and, thus, have the requisite impact on the public interest and constitute SCUTPA violations.34
Trademark infringement may also violate SCUTPA, and the standard for liability for it, like the federal Lanham Act, is likelihood of consumer confusion.35
There are a number of specific acts declared to be unfair trade practices.36 These include:
• Requiring certain insurance coverage;37
• Using assumed or fictitious names to misrepresent geographical origin;38
• Deceptive or misleading advertisement of a live musical performance;39
• Attorney advertising in false, deceptive or misleading manner;40
• Knowingly and willfully misrepresenting food or a food product if that food or food product purports to be or is represented to be a product of South Carolina but is the product of another state, country, or territory;41 and
• Certain practices by vehicle glass repair businesses concerning insurance claimants.42
There are two statutes that provide certain identified activities are "unlawful and a violation of this article"43 on a declaration of a state of emergency by the Governor:
• Price gouging during an emergency;44 and
• Charitable solicitations during emergencies.45
Another statute prohibits the resale of certain tickets for more than one dollar above the original price, and it says the proscribed action "violates the South Carolina Unfair Trade Practices Act."46 Finally, a statute adopted in 2012 describes certain practices committed by those who sell, repair, or replace vehicle glass as "unlawful," but makes no reference to "trade" and does not use the word "unfair."47
2. Proximate Cause
In Wogan v. Kunze,48 the court did not specifically mention proximate cause, but effectively addressed the causation element. The plaintiff alleged the defendant physician rendered an "inaccurate, deceptive bill" in violation of SCUTPA for injections of medication he prescribed for her husband. The court noted that under SCUTPA recovery requires the plaintiff to have an "ascertainable loss" of money or property as a result of an unfair or deceptive method, or act. In Wogan there was no evidence in the record that the plaintiff paid the bill. The medical services were rendered to the plaintiff's husband, and she failed to demonstrate an "ascertainable loss" based on the alleged unfair billing. Thus, the trial court was correct to grant summary judgment to the defendant.
In negligence actions, proximate cause is an element of the tort about which the South Carolina Supreme Court has said:
Proximate cause requires proof of: (1) causation in fact and (2) legal cause.
Causation in fact is proved by establishing the injury would not have occurred "but for" the defendant's negligence. [citation omitted] Legal cause is proved by establishing foreseeability. [citation omitted] Although foreseeability of some injury from an act or omission is a prerequisite to establishing proximate cause, the plaintiff need not prove that the actor should have contemplated the particular event which occurred. The defendant may be held liable for anything which appears to have been a natural and probable consequence of his negligence. [citation omitted] A plaintiff therefore proves legal cause by establishing the injury in question occurred as a natural and probable consequence of the defendant's negligence.49
3. Damages
The plaintiff must prove damages.50 Where a jury found actions of a party constituted violations of the Act, but no actual damages, there was a failure to plead the required elements.51 "Actual damages include special or consequential damages which are the natural and proximate result of the deceptive conduct."52 The Act does not define actual damages, but one decision holds the term means: "... common law damages, or the difference in value between that with which the plaintiff parted and that which he received."53 Attorney's fees and costs cannot serve as the "actual damages" that form the basis of a SCUTPA claim.54
While a plaintiff can apparently not recover for "personal injury" under SCUTPA, he or she can recover for "any ascertainable loss of money" and, therefore, may be able to recover medical costs, lost earnings, and other alleged out-of-pocket expenses.55
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Notes:
[16] Obviously the defendant must have committed the violation. See Harris v. Option One Mortg. Corp., 261 F.R.D. 98 (D.S.C. 2009) (where plaintiffs alleged unfair and deceptive origination and servicing of adjustable rate mortgage loan, they failed to show defendant, who became loan servicer two years after loan's origination, engaged in any of activities claimed to be unfair and deceptive and, therefore, plaintiffs did not stated plausible claim under...
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