Punitive damages. This phrase of- ten gets tossed out when someone is talking about suing someone. Compensatory damages are never enough; let’s go for punitive damages, also. Just the phrase, punitive damages, sounds serious — like a financial wrecking ball, crushing the bad guys. For all the attention punitive damages has received in our popular culture, they are not a given when you go to court. In fact, the jury is only instructed that they may award punitive damages in a very narrow set of circumstances.
Remember the John Grisham movie, The Rainmaker? The young attorney played by Matt Damon slugs through a courtroom battle against the behemoth insurance company that refused a bone marrow transplant to a teenager dying of cancer. At the end, the foreman of the jury reads the verdict: $150,000 in compensatory damages and $50 million in punitive damages. That’s great for movie theaters, but, in real life, that ratio of compensatory to punitive seems a little out of whack, no?
Historically, punitive damages have their roots back to the 12th century in Western Europe and were generally thought to serve three purposes in a civil case: (1) to punish the defendant and provide retribution; (2) to act as a deterrent to the defendant and to others; and (3) to show the court’s disapproval of the defendant’s conduct. Compensation in the form of “compensatory” or “actual” damages are the norm in most civil cases. Punitive damages are very much the exception and are only considered in special circumstances. Keep in mind that it is our criminal courts tasked with handling crime and punishment. In civil cases, the issues being addressed are losses and compensation. Sometimes, however, when a defendant’s conduct in a civil case is so over-the-top, the judge or the jury can award punitive damages in addition to compensatory damages.
The trigger for punitive damages has to do with the egregiousness of what took place. In tort cases, there are three levels of conduct: negligence, gross negligence, and willful and wanton conduct. Negligence occurs when someone fails to use ordinary care through carelessness or inadvertence resulting in an injury. Gross negligence indicates that the wrongdoer was not only negligent but also acted with a degree of indifference or recklessness, showing utter disregard for the safety of others. The final and highest level is “willful and wanton,” defined as a defendant acting with conscious disregard for the rights or safety of another when the defendant is aware of his conduct and is also aware that his conduct will probably result in injury to someone else. It is the last level a court may award punitive damages.
In a “willful and wanton” case, the defendant is said to have known what he was doing, but also knew that his actions would probably harm someone. The classic example is drunk driving, resulting in injury or death. But making a claim for punitive damages in a drunk driving case can still be tricky. Virginia has a special statute addressing punitive damages and drunk driving. Virginia Code §8.01-44.5 provides that a jury or judge may award (but does not have to award) punitive damages where the blood alcohol concentration (BAC level) is established at .15 or greater. Note that this is higher than the standard .08 BAC for a police officer to have probable cause to arrest someone for drunk driving. The other avenue for awarding punitive damages under Virginia Code §8.01-44.5 is when the defendant refuses to submit to a test of his BAC; in such cases, a certification by the officer that the defendant unreasonably refused testing may be admitted into evidence in the civil case for the judge or jury to consider awarding punitive damages.
Punitive damages are not just available in injury cases. In most civil cases involving money or real estate, there is often some form of deliberate rapacious conduct that a keen plaintiff ’s attorney can point out. For example, no one accidentally withdraws money from a bank account; no one accidentally transfers real estate by a fraudulent deed. These acts are all plotted out and done deliberately. This will give the plaintiff the option to argue that money, property, or real estate was taken (I prefer to say “swindled”) by the defendant and that it was done willfully and wantonly. And once the plaintiff has checked that box, the judge or jury will have the option to award punitive damages.
I have one final word about punitive damages: We often hear in the news about “tort reform.” One very real tool in the toolbox of tort reformers is placing a cap on punitive damages. Virginia enacted its own ceiling on punitive damage awards in 1987— punitive damage awards shall be no greater than $350,000. This was done in response to a perceived insurance “crisis,” especially for physicians, and the premiums being paid for their malpractice insurance in Virginia during that time. Now, I am no economist, but I would suggest that $350,000 went a lot farther in 1987 than it does today. Maybe it’s time for this session of the General Assembly to reconsider this cap on punitive damages. After all, a jury only speaks when the verdict is read. Limiting the amount of the verdict may just be limiting justice.