What are Punitive Damages?

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The purpose of punitive damages is to punish the at-fault party for bad conduct. Furthermore, punitive damages deter others from similarly bad conduct.  This is different from the intent of compensatory damages which is to make the party whole.  As a result, damages are measured differently when considering compensatory versus punitive damages.  

When hearing a punitive damages case, the court will instruct the jury that it is obligated to consider the purpose of punitive damages (i.e., to punish and deter).  The court next instructs the jury that it may also consider the following factors:

  • The reprehensibility of the defendant’s motives and conduct;
  • The likelihood, at the relevant time, of serious harm;
  • The degree of the defendant’s awareness of the probable consequences of its conduct;
  • The duration of the defendant’s conduct;
  • The actual damages suffered by the claimant;
  • Any concealment by the defendant of the facts or consequences of its conduct;
  • The existence and frequency of any similar past conduct by the defendant;
  • Whether the defendant profited from the conduct; and
  • The defendant’s ability to pay punitive damages, as evidenced by its revenues or net worth. 

Hiring an experienced North Carolina personal injury attorney is necessary in cases involving punitive damages because the at-fault party may try to hide evidence of the above factors.  Additionally, you need lawyers who are familiar with how punitive damages may impact the value of your case. For example, if you are injured by a drunk driver this will likely increase the value of your case. An experienced personal injury attorney can help you understand by how much. Make sure your attorney has experience investigating punitive damages cases and finding evidence needed to hold the at-fault accountable for their wrongful conduct.

The inquiry does not stop at locating the right kind of evidence in punitive damages cases.  North Carolina law places a limitation on the amount of recovery for punitive damages.  Under Chapter 1D-25 of the North Carolina General Statutes, punitive damages awards against a defendant shall not exceed three times the amount of compensatory damages or two hundred fifty thousand dollars ($250,000.00), whichever is greater.  However, the cap does not apply in certain cases such as drunk driving.  

As a simple example, consider that a jury awards $100,000.00 for compensatory damages.  In that case, punitive damages would be capped at $300,000.00.  Also consider a case where a jury awards $50,000.00 for compensatory damages.  The cap in that example would be $250,000.00.  If a jury makes a punitive damages award that is more than three times the compensatory award, the court will reduce the award to either the $250,000.00 cap or three times the compensatory award amount.  For example, if a jury awards $300,000.00 for punitive damages but only $50,000.00 for compensatory damages, the court would reduce the punitive damages award to $250,000.00.

With a cap on the amount of recovery, the claim for compensatory damages is critically important to punitive damages cases.  Compensatory damages must be presented in the most compelling and credible way possible in order to maximize punitive damages awards.  That’s why presentation matters.  

Call the attorneys at Horton & Mendez to see how an experienced North Carolina personal injury attorney can help hold the at-fault party accountable in cases involving egregious conduct and claims for punitive damages. 

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