The South Carolina Supreme Court has delivered a significant ruling, upholding the state’s contentious asbestos receivership system. This decision, issued on May 27, 2026, preserves the authority of court-appointed receiver Peter Protopapas, allowing him to continue pursuing insurance assets and affiliated corporate entities related to asbestos claims in the state.
Background of the Case
The ruling stems from the case Tibbs v. Asbestos Corporation Limited, where the legitimacy of the receivership structure surrounding Cape Intermediate Holdings Limited (CIHL), a successor to Cape Asbestos, was challenged. Critics have long argued that the system grants extraordinary power to receivers operating with limited oversight, a concern echoed by defendants and tort reform advocates.
Protopapas, a politically connected figure, serves on the South Carolina Judicial Merit Selection Commission, which has fueled criticism regarding the overlap of political influence within the judicial system. Despite these concerns, the court’s decision largely validates the current framework, allowing the system to continue operating with the backing of the state’s highest court.
International Implications
The case also involved an international dimension, as defendants argued that South Carolina courts lacked the authority to place CIHL into receivership, citing English court rulings that had previously rejected American judgments against Cape entities. However, the South Carolina Supreme Court dismissed these arguments, emphasizing that English law could not dictate jurisdiction under American law.
Justice D. Garrison Hill, writing for the court, rejected the notion of English rulings influencing South Carolina’s legal proceedings, stating that such a view of comity was misguided. The court further criticized the defendants’ attempts to distance current entities from historic asbestos liabilities through corporate restructuring.
Limits and Future Considerations
While the ruling upholds the receivership system, the court did impose some limits. It rejected one rationale used by the lower court, finding insufficient evidence of Cape’s imminent insolvency. The court also emphasized that receivers should not automatically operate across multiple lawsuits without specific authorization in each case, addressing concerns about the expanding reach of asbestos receiverships.
This decision has significant implications for asbestos defendants and the broader debate over judicial power and political influence within South Carolina’s civil justice system. Despite ongoing scrutiny and criticism, the ruling ensures the continuation of the asbestos litigation strategy in the state.
Original reporting: FITSNews — read the source article.
