Punitive Damage Recovery
If an injured party is harmed by a defendant, he may bring an action to recover damages as compensation. He may also seek to recover punitive damages, which are beyond the amount necessary to compensate the injured party for his actual loss.
Nature of punitive damages
Punitive damages, also called exemplary damages or vindictive damages in certain states, are awarded to punish outrageous conduct, to deter the defendant and others from such conduct in the future, or to vindicate an injured party's rights. Punitive damages are based on the flagrant nature of the defendant's misconduct.
When punitive damages are awarded
Statutes frequently define the type of conduct by a defendant that warrants an award of punitive damages to an injured party. Several states limit punitive damages to cases in which the defendant's conduct consists of oppression, fraud, or malice; others use a standard encompassing wilful, wanton, or gross misconduct or wilful indifference to the rights or safety of others; still others require only gross negligence. Some states merely list factors as to what conduct merits punishment and deterrence.
The court may submit the issue of awarding punitive damages to the jury, but damages are not guaranteed even if an injured party offers clear proof of the defendant's wrongful conduct. However, the jury must reasonably exercise its discretion in deciding whether to make an award.
Availability of punitive damages
Some states abolished awards of punitive damages in certain types of tort suits, while others restrict the amount of punitive damages by a dollar amount or percentage.
The injured party should be careful to check his state's law as to the amount of punitive damages that he may retain. Some states allocate portions of the award to the state.
Some states permit punitive damages to be recovered in an action in equity, while others permit them only in actions at law.
Proof of punitive damages
An injured party may not sue a defendant merely for punitive damages. Rather, he must first prove an underlying tort that entitles him to recover compensatory or nominal damages. Punitive damages may thereafter be awarded.
The injured party must prove that the defendant's misconduct warrants punishment or deterrence. The injured party must be aware of the standard of conduct of which his jurisdiction requires proof. He may have to prove that the defendant acted with oppression, fraud, or malice, or that he acted wilfully, wantonly, or with gross misconduct, or that he acted grossly negligent.
An injured party generally should present proof that the defendant's actions were beyond those that are tolerated by society and that the defendant displayed a desire to injure the injured party.
Amount of punitive damages awarded
The amount of punitive damages awarded is not related to the extent of the injured party's injuries. Instead, a sufficient amount will be awarded to satisfy the particular purpose of the imposition of the damages.
Factors to consider in order to punish the defendant include:
- the magnitude of the wrong
- the nature and extent of the wrong
- the degree of the defendant's culpability
- the defendant's motive
- the manner of inflicting the injury
- the defendant's intent to injure
- the defendant's attempts to conceal the misconduct
- the duration of the misconduct
- the importance of the public policy that the defendant violated
- the defendant's conduct upon being discovered
- the relationship between the parties
Factors to consider in order to deter the defendant include:
- the necessity of preventing future similar acts
- the likelihood of recurrence of the misconduct
- the profit earned or expected from the conduct
- the cost of reducing or eliminating the risk of injury
- the defendant's character
- the defendant's financial status
- the deterrent effect on others expected from an award
- the defendant's conduct upon being discovered
Factors to consider in order to vindicate an injured party's rights include:
- the nature and extent of the injury
- the situation and sensibilities of the parties
- the amount of the injured party's unrecoverable costs and losses in time, energy, and money
- the amount of actual damages
Punitive damages in certain actions
Punitive damages are often awarded for intentional torts, including assault and battery, false arrest and imprisonment, malicious prosecution, intentional infliction of emotional distress, trespass, fraud, and conversion.
Punitive damages may sometimes be recovered in negligence actions, particularly in cases involving vehicular accidents, property destruction, or other instances involving conscious risk of serious injury.
Punitive damages may be awarded in a strict products liability action if the injured party proves the requisite misconduct by the defendant. Some of the various standards of misconduct required in different jurisdictions includes gross negligence, reckless disregard of public safety, conscious disregard of public safety, willful or wanton misconduct, and malice, oppression, and fraud.
Breach of contract cases may sometimes warrant an award of punitive damages if the breach is accompanied by a tort. A common example of this type of claim is one for bad faith breach of contract by an insurer.
Some courts may award punitive damages in cases involving purely property damage and economic loss if the defendant's conduct is reprehensible.
Who is liable for punitive damages
Punitive damages may be recovered against a defendant who committed the tort and, sometimes, against someone who did not actually commit the tort. For example, an employer may be liable for.