Also known as:punitive damages · exemplary damages · punitive/exemplary damages
Written by attorneys · grounded in primary & secondary sources — see below
A form of damages awarded against a defendant to punish outrageous conduct and to deter the defendant and others from similar future conduct. The award requires proof of evil motive or reckless indifference to the rights of others and may consider the reprehensibility of the act, the harm caused or intended, and the defendant's wealth.
Sources & Authorities
How it applies
Common Examples
6
Contract Breach With Accompanying Tort
Pierre Poulin contracted with Pinnacle Holdings to renovate his warehouse. Pinnacle Holdings intentionally disabled the HVAC system during final negotiations to pressure Poulin into signing quickly. After discovering the tactic, Poulin terminated the contract and sued for breach plus an independent tort claim arising from the pre-contract interference. The court permitted punitive damages because the conduct constituted both a contract breach and a tort for which such damages are recoverable.
Reckless Indifference In Tort
Pamela Phillips operated a delivery truck for Precision Tools. She knowingly ignored repeated warnings that the brakes were failing and continued driving to meet quotas. The truck struck Piper Patel's vehicle, causing serious injury. The jury found Phillips's conduct outrageous due to reckless indifference and awarded punitive damages after considering the nature of the harm and Phillips's personal wealth.
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Cases
Statutes
Uniform Acts
Common Law
Restatements
Study Supplements
Constitutional Excessiveness Review
Preston Pratt sued Patriot Insurance after the insurer fabricated evidence to deny his valid claim. The jury awarded $100,000 in compensatory damages and $10 million in punitive damages. On appeal the court applied the three guideposts of reprehensibility, ratio to actual harm, and comparable penalties to determine whether the punitive award violated due process.
Servitude Enforcement Remedy
Patrick Phan owned a lot subject to a recorded servitude requiring daytime-only operations in a residential-adjacent trade park. ExcavateCo, a neighboring owner, began all-night concrete pouring in violation of the covenant. Phan sought injunctive relief plus punitive damages. The court considered the nature of the servitude and the knowing violation when determining that punitive damages were an available remedy.
Malicious Breach Of Promise
Phuong Pham and Pamela Phillips became engaged after working together at a startup. Two weeks before the wedding Pham called off the engagement upon learning of a large funding round that increased the company's value. Phillips sued for breach of promise to marry, alleging malicious conduct intended to extract concessions. The court permitted punitive damages because the tort aspect of the claim allowed recovery upon proof of malice.
Outrageous Conduct Punished
Pierre Poulin purchased a vehicle from Pacific Bank after the dealer falsely represented that the car had never been in an accident. The dealer knew the representation was false and had concealed prior damage. After the truth emerged Poulin sued in tort. The court awarded punitive damages to punish the outrageous conduct and to deter similar misrepresentations by other dealers.
Common questions
Frequently Asked
4
When are punitive damages available in a contract dispute?+
Punitive damages are not recoverable for a pure breach of contract. They become available only when the breaching conduct also constitutes an independent tort for which punitive damages are traditionally recoverable.
Supporting sources
What conduct supports an award of punitive damages in tort?+
The defendant's conduct must be outrageous because of evil motive or reckless indifference to the rights of others. Courts consider the character of the act, the harm caused or intended, and the defendant's wealth when setting the amount.
Supporting sources
How do courts decide whether a punitive award is constitutionally excessive?+
Due process requires evaluation of three guideposts: the reprehensibility of the defendant's conduct, the ratio between actual or potential harm and the punitive award, and the difference between the punitive award and penalties authorized in comparable cases.
Supporting sources
Can punitive damages be awarded to enforce a servitude?+
Yes. A servitude may be enforced by any appropriate remedy, which expressly includes punitive damages when the nature of the servitude, the parties' conduct, and the costs and benefits of enforcement support that choice.
Supporting sources
304 U.S. 64, 78–80 (1938)Conflict of Laws
…question of liability depended upon the scope of a property right conferred by the State;[^maj-13] and the right to exemplary or punitive damages.[^maj-14] Furthermore, state decisions construing local deeds,[^maj-15] mineral conveyances,[^maj-16] and even devises of real estate[^maj-17] were disregarded.[^maj-18] In part the…