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Punitive Damages in California

Attorney Michael Rehm -- (800) 978-0754

In certain Personal Injury cases the person injured may be awarded punitive damages, in addition to compensatory damages. Punitive damages are damages that are designed to punish the defendant for their conduct. Public policy dictates that there are certain behaviors that are so reprehensible that the person acting in such a manner shall be severely punished. Punitive damages look at the wealth of the defendant to determine what that punishment should be.

In California, the main statute dealing with Punitive Damages is Civil Code §3294(a):


In an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant.

 
As the code section states, the defendant must have been guilty of oppression, fraud, or malice. To be awarded punitive damages, the plaintiff must show the defendant acted in one of those three ways. The burden of proof in regards to punitive damages is “clear and convincing evidence.” This is a heightened standard of proof than the normal standard of “preponderance of evidence.” Therefore, it takes more to be awarded punitive damages. The “preponderance of the evidence” standard generally is explained as “more likely than not.” “Clear and convincing” evidence is generally defined as a “high probability” that the fact is true. Your Accident Attorney must show, by clear and convincing evidence that the defendant either acted with malice OR oppression OR fraud.

Civil Code §3294(c) provides the definitions for malice, oppression and fraud (in relation to Punitive Damages):

  • "Malice" means conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others.
  • "Oppression" means despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person's rights.

(3) "Fraud" means an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury.

 
Bullet points:

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  • Punitive Damages cannot be awarded alone. There must be some “actual harm,” suffered by the plaintiff. Therefore, whether it is compensatory or nominal damages, there must be some other damages awarded before punitive damages can be.

  • The defendant's wealth must be taken into consideration. But, the wealth of the defendant will not be taken into consideration until an initial determination by the jury has been made on whether the plaintiff has proven oppression, malice or fraud by clear and convincing evidence. Only then may evidence of the defendant's wealth be used to determine the amount of punitive damages.

  • The jury will be told to consider defendant's wealth in determining the amount.

  • The jury will also be told that the amount of punitive damages should bear a “reasonable relation” to the actual injury, but there is no ratio that the jury is limited by. It is once again, a matter of what the jury considers reasonable.

Punitive damages are often the scapegoat that “tort reform” proponents point to as ridiculous awards. This is mere propaganda and has been since the “tort reform” movement started. As shown above, it is not easy to obtain an award for punitive damages. The underlying conduct must be pretty bad. Once conduct that meets the level of oppression, fraud or malice is proven, the issue becomes how do we, as a society, discourage that kind of conduct? Unfortunately, many of the wrongdoers are not served justice in criminal court. Civil court is the only place where they are punished. Therefore, financial punishment is all there is to discourage the wrongdoer from acting up again and from others observing the case. If there was a cap on how much punitive damages could be, it would turn into a cost of doing business for unscrupulous companies or individuals. When you take a sizable portion of their profits, it is the only way to get the message across. Therefore, when the defendant is extremely wealthy, whether it is a corporation or an individual, the punitive damage award should reflect that fact and be high. The higher the punitive damages award, the more it reflects the wealth of the defendant, not the alleged greed of the victims.

California Personal Injury Attorney Michael Rehm -- (800) 978-0754

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The Law Office of Michael Rehm is a Law Office that practices throughout San Diego County, Sacramento Metro Region, the Bay Area and all of California. Michael Rehm is available for free, confidential consultations at (800) 978-0754.

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