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punitive damages

What Are Punitive Damages?

There were nearly 300,000 civil filings in 2019. The legal system can prove difficult to navigate. That is, after all, why we hire attorneys in the first place. 

Punitive damages are often awarded to plaintiffs after a defendant is found guilty. But, not everyone understands this term (or what it means for both parties).

Not sure where to start? Don’t worry, we’ve got you covered.

Let’s take a look at everything you need to know.

So, What Are They?

When a defendant is found guilty of a crime, it’s not uncommon for them to be tasked with financially compensating the plaintiff. If the court deems that this amount is not sufficient enough, additional damages are awarded in order to make up for this.

But, it isn’t the plaintiff’s satisfaction with the amount they were awarded that is considered insufficient. Punitive damages are specifically designed to further punished defendants for their crimes or negligence.

In a sense, they can be thought of as fines on top of the money that they were already ordered to pay.

How They Work

Since this money is to be given as an additional amount, punitive damages are never awarded on their own.

The logic here is that financially punishing the defendant will deter them from committing similar actions in the future. They’re especially effective if compensatory damages awarded to the plaintiff fail to cause any financial impact on the defendant.

Punitive damages are based on the amount that is ordered in compensatory damages. In many cases, they often tend to be exponentially higher than the amount the defendant pays in initial compensation.

Necessary Requirements

Every case is different, and the difference is even larger between cases of different types. For example, an auto accident case will often vary highly compared to a personal injury case.

Before punitive damages are awarded to the plaintiff, though, the court takes a handful of factors into consideration. These include:

  • Whether or not it’s typical for the type of case in question to include punitive damages
  • Analyzing whether or not the defendant committed a crime or action with malicious intent
  • If negligence was a factor, the court will take a look at how severe it was

It’s important to note the punitive damages are awarded in some states more often than others. In fact, certain types of cases in certain states are almost never awarded punitive damages.

This is due to the fact that states are in charge of choosing the criteria that determine whether or not punitive damages become a factor.

If you’re pursuing compensation from another party, your legal professional will be able to tell you the likelihood of punitive damages being awarded.

Common Scenarios

There are virtually limitless scenarios that warrant this type of compensation. But, let’s take a look at a likely example.

Frank owns a hardware store in a busy metropolitan area. Although he’s usually vigilant of his facilities maintenance, the store’s entrance has a handrail that is notoriously loose.

He’s received numerous complaints from both customers and employees, but he has yet to resolve the situation.

Months after he received his initial complaint, a local contractor purchases a large amount of hardware from his store. While he was exiting the building, he leans against the handrail to maneuver out of a customer’s way who is entering the facility.

Due to the handrail being improperly secured, the contractor fell over a 6-foot ledge as the handrail gave way. This resulted in severe injuries to his spine, left shoulder, and skull.

The contractor than files a lawsuit against the store owner. Since the complaints by his employees were submitted in writing, there’s hard evidence that Frank was grossly negligent.

After the court decides in favor of the plaintiff, Frank is ordered to pay additional punitive damages on top of the compensation he already owes.

As previously mentioned, whether or not punitive damages are awarded will vary from case to case. If it could not be proven that Frank was intentionally negligent, the judge may not have ruled that he was ordered to pay them.

However, Frank’s lack of vigilance may not be able to save him from punitive damages if the defendant suffered severe mental or physical harm or distress.

Calculating Payment

Based on regulations from the Supreme Court, the amount that plaintiffs receive in punitive damages is generally less than four times the sum of their compensatory damages.

If the plaintiff is awarded $10,000 in compensatory damages for medical bills, for instance, he or she will likely receive no more than $40,000 in punitive damages.

Of course, there are certain circumstances we are higher amounts may be awarded.

These can include a scenario where the defendant exhibited a grievous lack of concern for human well-being or if the plaintiff has permanent or prolonged complications or injury due to the defendant.

Similarly, if the majority of cases of a particular type award punitive damages that are far higher than the amount that was awarded during a case in question, this amount could be adjusted to reflect the typical damages.

Understanding Punitive Damages Can Seem Difficult

But it doesn’t have to be.

With the above information about punitive damages in mind, you’ll be well on your way toward understanding every aspect of your case.

Want to learn more about how we can help? Feel free to get in touch with us today to see what we can do.

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