Dean's Address

PUNITIVE DAMAGES REVISITED

By. Francis Scott Baldwin

INTRODUCTION

The doctrine of punitive damages is not a "Johnny come late to the law. It has been known for centuries. It is a doctrine that evolved largely to protect the little person against the wrongs of the economically strong and powerful.

Generally speaking, punitive damages has a twofold purpose: to punish the wrongdoer and to serve as an example to others; in order to discourage others from committing similar wrongful acts. The English call it the "Sting of the shelling." Others call it "Smart money."¹

The doctrine of punitive damages requires something more than simple misconduct or simple negligence. In order to recover punitive damages most courts require that the misconduct be "wanton and willful and with a conscious indifference to the rights of others" or a variation on these terms. Always punitive damages must be in addition to actual or compensatory damages,² and the jury must have the discretion to award punitive damages or not.³

Punitive damages are an "Odd creature" in the law. They occupy a strange borderline between the civil and criminal law.⁴ Their justification is rooted in the goals of retribution and deterrence, which derives from criminal law while at once they are awarded to plaintiffs as damages in civil lawsuits.⁵

Although the doctrine of punitive damages is firmly established in the law, it has been surrounded with controversy almost from its inception. Especially it is under attack today. A review of its history and a consideration of its present status will be useful if one is to understand and appreciate its impact on society.

HISTORY

The doctrine of punitive damages was first enunciated in England in the middle of the eighteenth century.⁶

As stated by the U.S. Supreme Court, "punitive damages have long been a part of traditional state tort law."⁷ Blackstone took note of their use.⁸ They were reported in American case law as early as 1784.⁹ The often cited case of Day v. Woodworth in 1852 made it clear that punitive damages were firmly established in American jurisprudence prior to the adoption of the Fourteenth Amendment:¹⁰

It is a well‑established principle of the common law, that in actions of trespass and all actions on the case for torts, a jury may inflict what are called exemplary, punitive, or vindictive damages upon a defendant, having in view the enormity of his offence rather than the measure of compensation to the plaintiff. We are aware that the propriety of this doctrine has been questioned by some writers; but if repeated judicial decisions for more than a century are to be received as the best exposition of what the law is, the question will not admit of argument.

Following the adoption of the Fourteenth Amendment the courts continued to recognize the doctrine. The Supreme Court noted that nothing in the amendments' text or history indicates an intention on the part of the draftees to overturn the prevailing method.¹¹ As one court said: "The Fourteenth Amendment has not displaced the procedure of the ages."¹²

CONTROVERSY

Even though punitive damages have long been a part of AngloAmerican law, they have always been controversial. As recently as the mid‑nineteenth century, treatise writers have argued over whether they even existed.¹³ A noted writer, Theodore Sedgwick, referred to punitive damages as a "Salutary doctrine" where the jury may "at once impose a punishment on the defendant and uphold an example to the community."¹⁴ He noted in 1868 that the doctrine seemed to be settled in England and in this country.¹⁵

But there was thunder on the left. All were not in agreement. Justice Foster of the New Hampshire Supreme Court called them "a perversion of language and ideas so ancient and so common as to seldom attract attention."¹⁶ Justice Foster further denounced the doctrine with the following spicy language:

Undoubtedly this pernicious doctrine has become so fixed in the law ... that it may be difficult to get rid of it. But it is the business of courts to deal with difficulties; and this heresy should be taken in hand without favor, firmly and fearlessly .... [N]ot reluctantly should we apply the knife to this deformity, concerning which every true member of the sound and healthy body of the law may well exclaim‑ 'I have no need of thee.'¹⁷

The debate continued on. In Fay v. Parker it was said:

The idea is wrong. It is a monstrous heresy. It is an unsightly and unhealthy excrescence, deforming the symmetry of the body of the law.¹⁸

Yet, on the contrary, the Wisconsin court in Luther v. Shaw said:

The law giving exemplary damages is an outgrowth of the English love of liberty regulated by law. It tends to elevate the jury as a responsible instrument of government, discourage private reprisals, restrains the strong, influential, and unscrupulous, vindicates the right of the weak, and encourages recourse to and confidence in the courts of law by those wronged or oppressed by acts or practices not cognizable in or not sufficiently punished by the criminal law.¹⁹

Although the doctrine of punitive damages was roundly criticized, it was firmly established as a part of our law as late as the 1980s.²⁰ Its constitutionality was subject to question by justices of the Supreme Court up to and including the recent case of Pacific Mutual Life Insurance Co. v. Haslip²¹ decided in 1991.

HASLIP

In the Haslip case the Supreme Court met square on the question of whether or not punitive damages violated the "due process clause" of the U. S. Constitution.²² The Court stated:

One must concede that unlimited jury discretion‑or unlimited judicial discretion for that matter‑in the fixing of punitive damages may invite extreme results that jar one's constitutional sensibilities.²³

Thereafter the Court said:

We need not, and indeed we cannot, draw a mathematical bright line between the constitutionally acceptable and the constitutionally unacceptable that would fit every case. We can say, however, that general concerns of reasonableness and adequate guidance from the court ... properly enter into the constitutional calculus.²⁴

The Court concluded that the punitive damage award in that case did not "cross the line into the area of constitutional impropriety."²⁵

We now see that the common‑law method of assessing punitive damages is not per se unconstitutional. Further where they are subjected to proper guidance by the legislature or the courts and fit within the realm of reasonableness they do not violate the due process clause.

PUNITIVE DAMAGES AND TORT REFORM

The Supreme Court in Haslip has taken a giant step in "settling the dust" in connection with punitive damages, yet among scholars, politicians and the media the debate rages on. It is now a focal point of tort reform which is the stepchild of the so‑called "litigation crisis." We hear of "run away juries" and the litigation "explosion." It has been said by some that punitive damage awards are "skyrocketing."²⁶ Former President Bush's Council on Competitiveness was considering abolishing punitive damages in products cases.²⁷

Continue to Page 2