In personal injury lawsuits, monetary damages may be awarded to the plaintiff. These damages typically include compensatory damages which are intended to reimburse the plaintiff for costs which are associated with their injuries. They may include reimbursement for:
- Medical costs;
- Property damage; and
- Other expenses.
Punitive damages, which are also referred to as exemplary damages, may be awarded by a court as a form of punishment to a defendant, or wrongdoer. Punitive damages often serve as a means to deter other individuals from engaging in the same or similar wrongful conduct.
Punitive damages can be awarded in certain cases when an individual commits actions which are particularly egregious, which may include:
- Wanton conduct;
- Intentionally negligent conduct;
- Fraudulent conduct; and
- Other conduct.
Punitive damages that are awarded in addition to compensatory damages. They may be awarded in cases, for example, where an individual is speeding excessively in an area where there are pedestrians.
Punitive damages would be intended to deter that type of conduct in the future. For this reason, they are typically reserved for extreme cases and are rarely awarded.
There are some states that have a cap, or limit, on the amount of punitive damages which may be awarded. In other states, punitive damages are limited to a reasonable amount which is based on the value of the entire case as well as additional factors.
In certain cases, the amount of punitive damages which a defendant may be required to pay to the plaintiff may be extremely high. This applies especially in cases where the defendant’s unlawful conduct is particularly abhorrent and deliberate.
Although there are no laws which provide the maximum amount of punitive damages for every type of claim, the United States Supreme Court has previously issued opinions which limit the amount of punitive damages plaintiffs are permitted to collect.
How Do Punitive Damages Work?
Punitive damages are not awarded in many cases. If they are awarded, it is usually a result of a personal injury claim.
Punitive damages may also be awarded in cases which involve intentional acts which injure the plaintiff, such as a civil battery. Punitive damages are not awarded alone.
Punitive damages are awarded in addition to compensatory damages, they are not automatically awarded. For more information regarding punitive damages, see the following LegalMatch article:
What Do Most States Use as a General Guideline for Punitive Damages?
Although, as previously noted, there may be a cap on the amount of punitive damages that can be awarded in a state, in the majority of states, punitive damages may be awarded when the defendant’s actions are:
- Fraudulent; or
Punitive damages may be awarded in cases where compensatory damages may not achieve sufficient deterrence and the actions of the defendant deserve further punishment.
What Are Some Examples of Punitive Damages Awards in a Personal Injury Claim?
Punitive damages can be awarded in a personal injury claim for conduct including, but not limited to:
- Extreme negligence in a medical malpractice cases, for example, performing the wrong surgery or leaving a surgical implement in the patient’s body;
- Conduct which is extremely dangerous and exposes the public to a high degree of harm, for example, taking out a weapon in a crowded place; or
- Conduct that displays an extreme disregard for laws and statutes, for example, driving at speeds well above the limit in crowded areas.
Punitive damages may be awarded for an injury which results from negligence or is caused intentionally. If an individual acts negligently and should have been aware that their actions would result in substantial harm, they may be liable for punitive damages.
Examples of the types of personal injury lawsuits which commonly result in punitive damages include:
- Automobile accidents;
- Medical malpractice lawsuits;
- Civil battery cases;
- Drunk driving accidents; and
How Are Punitive Damages Calculated?
There is not a maximum dollar cap for punitive damages. This does not mean, however, that a plaintiff is entitled to claim any amount they want for punitive damages.
The requirements for obtaining punitive damages vary by state. Punitive damages are usually restricted to an amount which is set by a damages statute in that particular state.
For example, a state may limit plaintiffs to recover a treble amount of punitive damages, where another state may allow a plaintiff to collect as much as five times the amount of punitive damages. Other states may calculate punitive damages based upon the amount of compensatory damages which are awarded to the plaintiff.
Regardless of the laws of a specific state, the majority require that the plaintiff recover compensatory damages before punitive damages can be considered or awarded. Although the manner in which punitive damages are calculated vary widely by state, there are some factors which will usually be considered when calculating punitive damages, including:
- The type of claim which is the basis of a plaintiff’s lawsuit, for example, a medical malpractice claim versus a breach of contract claim;
- The amount of actual or compensatory damages that are awarded;
- The rules on damages limits in the particular state; and
- Whether the defendant’s actions were egregious or shocking enough to justify issuing a punitive damages award.
Punitive Damages Limits
There are many states which place a cap on the amount of punitive damages which can be awarded. There are some states that provide for a ratio between the amount of actual damages in a case and the amount of punitive damages, also referred to as exemplary damages.
For example, in Missouri, a defendant is not permitted to be awarded more than 5 times the actual damages, or $500,000, whichever amount is greater. It is important to note that in many states, punitive damages will not be awarded if other damages are not awarded in the case.
There are other states which focus on the ability of a defendant to pay based upon their income or net worth. In Montana, the amount of punitive damages cannot exceed $1,000,000 or 3 times the defendant’s net worth, whichever is less.
The United States Supreme Court has provided a limit on the amount of punitive damages which can be awarded. Punitive damages cannot exceed a ratio of 10:1. In other words, punitive damages are not permitted to be more than 10 times the initial award which is given.
If a trial court or a jury awards a plaintiff $100,000 in damages, a court is required to give less than $1,000,000 in punitive damages. The only exception to this rule is when a case is extremely egregious or shocking to the court.
These limits are put in place because punitive damages are intended as punishment, and, therefore, must be used fairly. These damages also exist to reform tort law, making it more difficult for a plaintiff to seek an exorbitant amount of damages for a wrongful act.
Limitations also assist with making the legal system more predictable. As previously noted, the limitations depend on the laws of the specific state. The limits placed upon punitive damages may be a fixed amount or may be fixed in relation to the amount of compensatory damages awarded.
Do I Need to Hire a Lawyer?
It is essential to have the assistance of a personal injury lawyer for any issues, questions, or concerns you may have related to punitive damages. The laws governing punitive damages have many nuances.
Your lawyer can review your case, advise you of the laws of your state, and assist you with filing a claim for punitive damages. Having a lawyer helps ensure you receive the compensation you deserve for your injuries.