636:
company had done nothing to correct the problem. The jury decided on $ 200,000 in compensatory damages, but attributed 20 percent of the fault to
Liebeck, reducing her compensation to $ 160,000. The jury also awarded Liebeck $ 2.7 million in punitive damages, which was at the time two days of McDonald's coffee sales revenue. The judge later reduced the punitive damages to $ 480,000. The case is often criticized for the very high amount of damages the jury awarded. Nevertheless, many legal scholars and documentary film makers like
410:“In many other cases of breach of contract there may be circumstances of malice, fraud, defamation, or violence, which would sustain an action of tort as an alternative remedy to an action for breach of contract. If one should select the former mode of redress, he may, no doubt, recover exemplary damages, or what is sometimes styled vindictive damages; but if he should choose to seek redress in the form of an action for breach of contract, he lets in all the consequences of that form of action:
656:(1996), the Supreme Court ruled that an excessive punitive award can amount to an arbitrary deprivation of property in violation of due process. The court held that punitive damages must be reasonable, as determined by the degree of reprehensibility of the conduct that caused the plaintiff's injury, the ratio of punitive damages to compensatory damages, and any comparable criminal or civil penalties applicable to the conduct. In
671:(2007), the Supreme Court ruled that punitive damage awards cannot be imposed for the direct harm that the misconduct caused others, but may consider harm to others as a function of determining how reprehensible it was. More reprehensible misconduct justifies a larger punitive damage award, just as a repeat offender in criminal law may be punished with a tougher sentence. Dissenting in the
611:. In a number of cases, the Court has indicated that a 4:1 ratio between punitive and compensatory damages is high enough to lead to a finding of constitutional impropriety and that any ratio of 10:1 or higher is almost certainly unconstitutional. However, the Supreme Court carved out a notable exception to this rule of proportionality in the case of
527:
still produces or sells them if it results in death or heavy injuries. Since this is a somewhat new law so far, no further explanatory regulation regarding a detailed amount and applicable scope is promulgated guiding the application of this rule, so a court judge may have discretional power to decide punitive damages case by case under this new law.
617:, where it affirmed an award of $ 10 million in punitive damages, despite the compensatory damages being only $ 19,000, a punitive-to-compensatory ratio of more than 526-to-1. In this case, the Supreme Court affirmed that disproportionate punitive damages were allowed for especially egregious conduct.
642:
argued that corporate lobbyists seized the opportunity to create public misinformation and distrust of the legal system by leaving out important facts in their television advertisements, such as, that the verdict was roughly equivalent to two days of coffee sales for McDonald's, that
Liebeck received
514:
In very few industries, punitive damages could be awarded in either contractual or tort case, except a tort relevant to product defraud or defect. Article 49 of the PRC Law on
Protection of Consumer Rights and Interests enacted on October 31, 1993, provides the rule that any consumer is entitled to a
630:
coffee in her lap which resulted in second and third-degree burns on her thighs, buttocks, groin and genitals. The burns were severe enough to require skin grafts. Liebeck attempted to have McDonald's pay her $ 20,000 medical bills as indemnity for the incident. McDonald's refused, and
Liebeck sued.
563:
to impose "caps" on punitive damages; however, several state courts have struck down these statutory caps as unconstitutional. They are rare, occurring in only 6% of civil cases that result in a monetary award. Punitive damages are entirely unavailable under any circumstances in a few jurisdictions,
518:
Article 96 of the PRC Law on Food Safety adopted on
February 28, 2009, raises the punitive damages to ten times the purchase price added to the compensatory damages that the victim has already claimed from the producer or seller for food with poor quality not compliant to food safety standards. Such
1127:
Should a tort be governed by the law of a foreign state, even if the facts to which the law of such foreign state apply constitute a violation of the laws of such foreign state and of the laws of Japan, the victim may not claim any compensation or other disposition other than that recognized under
587:
debate in the United States, where numerous highly publicized multimillion-dollar verdicts have led to a fairly common perception that punitive damage awards tend to be excessive. However, statistical studies by law professors and the
Department of Justice have found that punitive damages are only
236:
However, punitive damages awarded under court systems that recognize them may be difficult to enforce in jurisdictions that do not recognize them. For example, punitive damages awarded to one party in a US case would be difficult to get recognition for in a
European court in which punitive damages
567:
The general rule is that punitive damages cannot be awarded for breach of contract, but if an independent tort is committed in a contractual setting, punitive damages can be awarded for the tort. Although state laws vary, punitive damages are usually allowed only when the defendant has displayed
526:
Application of the punitive damage rule is further expanded with the enactment of the PRC Law on Tort
Liability effective as of July 1, 2010. This new law sets forth that a victim is entitled to claim punitive damages from any manufacturer or seller expressly aware of the defects in products but
682:
Punitive damages are subjective by their very nature. Since their purpose is to punish—as opposed to compensate—opinions on how to accomplish this will vary widely among jurors. Regardless, research into punitive damages has revealed some common principles. Wealth of the defendant is positively
635:
process, internal documents from McDonald's revealed the company had received hundreds of similar complaints from customers claiming McDonald's coffee caused severe burns. At trial, this led the jury to find McDonald's knew their product was dangerous and injuring their customers, and that the
452:
In Japan, medical negligence and other species of negligence are governed by the criminal code, which may impose much harsher penalties than civil law. For instance, many causes of action which would subject a defendant to a potential punitive damage award in the U.S. would subject the same
433:
courts do not award punitive damages and consider foreign punitive damages unenforceable to the extent that the payment would exceed the damages plus an allowance for reasonable defence costs big enough so that the plaintiff would get a full reimbursement of its loss but not more.
300:(as he then was) said there is no power to give punitive damages in respect of a claim in equity, although he was content to decide the case on the narrower ground that there is no power to award punitive damages for the specific equitable wrong in issue.
662:(2003), the Supreme Court held that punitive damages might only be based on the acts of the defendants which harmed the plaintiffs. The court also elaborated on the factors courts must apply when reviewing a punitive award under due process principles.
317:
In Canada, punitive damages may be awarded in exceptional cases for "malicious, oppressive and high-handed" misconduct. The
Supreme Court of Canada set out 11 principles to guide judges and juries for awarding punitive damages in the leading case
304:
concurred, although he emphasized that the contractual character of the fiduciary relationship in question, and refrained from deciding on whether punitive damages would be available in respect of equitable wrongs more analogous to torts.
924:
Enforcement of foreign awards of punative damaged was prohibited since 2006 by the
General Act Related to the Application of Laws, although was predated by the judgment of the Supreme Court of July 11, 1997, 51-6 Minshu 2573, and other
1180:
683:
correlated with large punitive damage awards, jurors either downplay or ignore jury instructions regarding punitive damages determinations, and jurors tend to punish defendants who have conducted a cost-benefit analysis.
502:, the majority of the New Zealand Court of Appeal held that in addition to compensation, punitive damages could be awarded for breach of confidence, albeit that, on the facts, they were not merited. Similarly, in
483:
it was held that exemplary damages are not to be awarded in actions for breach of contract but the court left open the possibility that exemplary damages might be available where the breach of contract is a tort.
414:(1832) 3B.&Ad. 580. One of these consequences is, I think, this: that he is to be paid adequate compensation in money for the loss of that which he would have received had his contract been kept, and no more.”
256:
cases in the US if the insurer's breach of contract is alleged to be so egregious as to amount to a breach of the "implied covenant of good faith and fair dealing", and is therefore considered to be a
543:. They are generally a matter of state law (although they can also be awarded under federal maritime law), and thus differ in application from state to state. In many states, including
788:
769:
604:
1340:
515:
recovery of double the purchase price of products or service from the seller or service provider against their defraud. Successful cases have been widely reported in this regard.
831:
812:
793:
774:
755:
736:
717:
698:
591:
There is no maximum dollar amount of punitive damages that a defendant can be ordered to pay. In response to judges and juries which award high punitive damages verdicts, the
519:
a substantial statutory amount considered by the legislative organ is based on several extremely serious food quality incidents in the past two years, such as the notorious
600:
712:
613:
856:
218:
and others from engaging in conduct similar to that which formed the basis of the lawsuit. Although the purpose of punitive damages is not to compensate the
400:
Exemplary damages go beyond the philosophical aims of a contractual remedy and are not available as damages for breach of contract. Lord Atkinson said, in
190:
506:, Fisher J in the New Zealand High Court added exemplary damages of NZ$ 5,000 to an account of profits of over NZ$ 20,000 for breach of fiduciary duty.
309:
dissented and opined that there was no principled reason to award punitive damages in respect of common law torts but not analogous equitable wrongs.
233:
and taking some strain away from the criminal justice system. Punitive damages are most important for violations of the law that are hard to detect.
324:
2002 SCC 18. The principles are not intended to form a checklist or be mandatory, but instead is to be considered based on the facts of each case.
244:
Because they are usually paid in excess of the plaintiff's provable injuries, punitive damages are awarded only in special cases, usually under
647:
to her genitals and groin requiring surgery, and that McDonald's had already received numerous complaints about the temperature of the coffee.
229:
are deemed an inadequate remedy. The court may impose them to prevent undercompensation of plaintiffs and to allow redress for undetectable
644:
622:
384:
807:
750:
652:
592:
419:
588:
awarded in two percent of civil cases which go to trial, and that the median punitive damage award is between $ 38,000 and $ 50,000.
1101:
658:
476:
164:
1310:
679:
found that the "nuance eludes me", suggesting that the majority had resolved the case on a distinction that makes no difference.
293:
183:
977:
Howard A. Shelanski & J. Gregory Sidak, Antitrust Divestiture in Network Industries, 68 U. CHI. L. REV. 1, 44 (2011),
667:
495:
barred exemplary damages for cases of negligence unless the defendant acts intentionally or with subjective recklessness.
1355:
945:
389:
693:
826:
320:
1386:
1381:
608:
176:
851:
520:
492:
402:
108:
731:
1082:
248:
law, if the defendant's conduct was egregiously insidious. Punitive damages cannot generally be awarded in
1140:
467:
1270:
835:
816:
797:
778:
759:
740:
721:
702:
50:
296:
held that punitive damages are not available both for breach of contract and breach of fiduciary duty.
292:
to their employer by diverting business to themselves and misusing its confidential information. The
159:
139:
93:
555:; elsewhere, they may be determined solely based on case law. Many state statutes are the result of
446:
306:
253:
113:
572:
to cause harm (such as purposefully rear-ending someone else's car), rather than in cases of mere
596:
577:
274:
144:
103:
98:
55:
45:
260:
cause of action eligible for punitive damages (in excess of the value of the insurance policy).
340:, exemplary damages are limited to cases in which at least one of the circumstances set out by
214:
assessed in order to punish the defendant for outrageous conduct and/or to reform or deter the
1262:
1258:
676:
638:
65:
1311:"The Punitive Damages Calculus: The Differential Incidence of State Punitive Damages Reforms"
991:
1360:
1322:
1065:
346:
79:
60:
379:, despite English cases often being influential in other Commonwealth countries. or by the
1283:
632:
449:, and Japanese law prohibits the enforcement of punitive damage awards obtained overseas.
301:
134:
1094:
962:
838:
819:
800:
781:
762:
743:
724:
289:
70:
1375:
705:
627:
540:
380:
149:
422:
recommended that punitive damages should never be available for breach of contract.
297:
238:
22:
885:
893:
584:
462:
376:
354:
Oppressive, arbitrary or unconstitutional actions by the servants of government.
341:
154:
118:
1219:
861:
595:
has made several decisions which limit awards of punitive damages through the
573:
544:
536:
88:
556:
372:
357:
Where the defendant's conduct was 'calculated' to make a profit for himself.
219:
215:
1254:
222:, the plaintiff will receive all or some of the punitive damages in award.
1356:"Here's the story behind the 'Caution: Contents Hot' label on your coffee"
560:
249:
1297:
Formosa Plastics Corp. USA v. Presidio Engineers & Contractors, Inc.
1222:
Case), 174 Cal. Rptr. 348 (Cal. Ct. App. 1981) (Tamura, J.), subhead VI.
16:
Damages assessed in order to punish the defendant for outrageous conduct
1326:
552:
430:
333:
226:
211:
30:
1341:"TXO Production Corp. v. Alliance Resources Corp., 509 US 443 (1993)"
368:
978:
548:
442:
337:
278:
245:
230:
498:
Punitive damages can also be awarded for equitable wrongs. In
288:, the defendant employees knowingly breached contractual and
1052:
1036:
1192:
Acquaculture Corporation v New Zealand Green Mussel Co Ltd
500:
Acquaculture Corporation v New Zealand Green Mussel Co Ltd
284:
The law is less settled regarding equitable wrongs. In
789:
State Farm Mutual Automobile Insurance Co. v. Campbell
770:
Cooper Industries, Inc. v. Leatherman Tool Group, Inc.
479:
did not bar the availability of exemplary damages. In
367:
has been much criticised and has not been followed in
1309:
McMichael, Benjamin J.; Viscusi, W. Kip (July 2017).
912:
the Privy Council upheld the Australian rejection of
273:
In Australia, punitive damages are not available for
445:
courts do not award punitive damages as a matter of
880:The landmark cases that established this tort were
1095:"Aggravated, Exemplary and Restitutionary Damages"
564:including Nebraska, Puerto Rico, and Washington.
894:9 Cal. 3d 566, 108 Cal. Rptr. 480, 510 P.2d 1032
713:TXO Production Corp. v. Alliance Resources Corp.
614:TXO Production Corp. v. Alliance Resources Corp.
408:
1123:General Act Related to the Application of Laws
992:"Courts outside U.S. wary of punitive damages"
888:(1958) (third-party liability insurance), and
857:Collateral consequences of criminal conviction
580:disregard for the lives and safety of others.
576:, or causes an injury through action taken in
360:Where a statute expressly authorises the same.
886:50 Cal. 2d 654, 328 P.2d 198, 68 A.L.R.2d 883
184:
8:
1100:. The Law Commission. November 1997. LC247.
535:Punitive damages are a settled principle of
237:are most likely to be considered to violate
626:(1994), 79-year-old Stella Liebeck spilled
551:, punitive damages are determined based on
1255:"Factors Affecting Punitive Damage Awards"
1248:
1246:
1230:
1228:
1166:Paper Reclaim Ltd v Aotearoa International
882:Comunale v. Traders & General Ins. Co.
583:Punitive damages are a focal point of the
481:Paper Reclaim Ltd v Aotearoa International
393:, but on appeal the House of Lords upheld
191:
177:
18:
1079:Australian Consolidated Press Ltd v Uren
910:Australian Consolidated Press Ltd v Uren
938:
904:
902:
873:
126:
78:
28:
21:
1279:
1268:
225:Punitive damages are often awarded if
7:
896:(1973) (first-party fire insurance).
453:individual to prison time in Japan.
383:. It was strongly criticised by the
252:disputes. The main exception is in
808:Philip Morris USA Inc. v. Williams
751:BMW of North America, Inc. v. Gore
653:BMW of North America, Inc. v. Gore
593:Supreme Court of the United States
14:
1154:Auckland City Council v. Blundell
694:Pac. Mut. Life Ins. Co. v. Haslip
659:State Farm Auto. Ins. v. Campbell
623:Liebeck v. McDonald's Restaurants
509:
477:Accident Compensation Corporation
473:Auckland City Council v. Blundell
1354:Dryden, Dene (October 5, 2016).
1107:from the original on 2019-02-14.
1009:Gray v Motor Accident Commission
979:https://ssrn.com/abstract=265652
294:New South Wales Court of Appeal
1021:Harris v Digital Pulse Pty Ltd
961:, 79 F.3d 33 (7th Cir. 1996) (
521:Sanlu tainted milk powder case
286:Harris v Digital Pulse Pty Ltd
1:
1049:Whiten v. Pilot Insurance Co.
1033:Whiten v. Pilot Insurance Co.
668:Philip Morris USA v. Williams
1023:NSWCA 10, (2003) 197 ALR 626
996:International Herald Tribune
946:Restatement of Torts, Second
890:Gruenberg v. Aetna Ins. Co.
827:Exxon Shipping Co. v. Baker
321:Whiten v Pilot Insurance Co
1403:
1239:. Aspen. pp. 732–736.
1216:Grimshaw v. Ford Motor Co.
609:United States Constitution
510:People's Republic of China
475:that the existence of the
1315:Southern Economic Journal
1299:960 S.W.2d 41 (Tex. 1998)
1253:Conklin, Michael (2020).
1235:Laycock, Douglas (2002).
1055:, 1 SCR 595, at para 95.
1039:, 1 SCR 595, at para 36.
852:Non-economic damages caps
493:New Zealand Supreme Court
403:Addis v Gramophone Co Ltd
1237:Modern American Remedies
1178:Couch v Attorney-General
1118:
1011:HCA 70, (1998) 196 CLR 1
732:Honda Motor Co. v. Oberg
489:Couch v Attorney-General
344:in the leading case of
277:, but are possible for
1278:Cite journal requires
1181:[2010] NZSC 27
1141:Donselaar v. Donselaar
1069:AC 1129, 1 All ER 367
468:Donselaar v. Donselaar
416:
1083:[1966] HCA 37
605:Fourteenth Amendments
264:National applications
51:Consequential damages
1081:(1967) 117 CLR 221,
1053:2002 SCC 18 (CanLII)
1037:2002 SCC 18 (CanLII)
227:compensatory damages
140:Election of remedies
94:Specific performance
1204:Cook v Evatt (No.2)
1119:法の適用に関する通則法 § 22(2)
504:Cook v Evatt (No.2)
254:insurance bad faith
1327:10.1002/soej.12217
1128:the laws of Japan.
665:Most recently, in
631:During the case's
597:due process of law
275:breach of contract
160:Declaratory relief
145:Provisional remedy
104:Account of profits
99:Constructive trust
80:Equitable remedies
56:Liquidated damages
46:Incidental damages
1387:Judicial remedies
1382:Legal terminology
1257:. Rochester, NY.
868:Explanatory notes
677:John Paul Stevens
471:and confirmed in
328:England and Wales
208:exemplary damages
201:
200:
66:Statutory damages
23:Judicial remedies
1394:
1366:
1365:
1361:Business Insider
1351:
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1066:Rookes v Barnard
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1024:
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982:
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959:Kemezy v. Peters
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922:
916:
914:Rookes v Barnard
906:
897:
878:
395:Rookes v Barnard
390:Broome v Cassell
365:Rookes v Barnard
347:Rookes v Barnard
290:fiduciary duties
204:Punitive damages
193:
186:
179:
61:Reliance damages
41:Punitive damages
29:Legal remedies (
19:
1402:
1401:
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940:
935:
930:
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907:
900:
879:
875:
870:
848:
689:
687:Important cases
620:In the case of
599:clauses of the
533:
512:
465:it was held in
459:
440:
428:
412:Thorpe v Thorpe
385:Court of Appeal
330:
315:
271:
266:
197:
135:Adequate remedy
17:
12:
11:
5:
1400:
1398:
1390:
1389:
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1374:
1373:
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1367:
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1301:
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847:
844:
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804:
785:
766:
747:
728:
709:
688:
685:
675:case, Justice
532:
529:
511:
508:
458:
455:
439:
436:
427:
424:
420:Law Commission
362:
361:
358:
355:
350:has been met:
329:
326:
314:
311:
270:
267:
265:
262:
199:
198:
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188:
181:
173:
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152:
147:
142:
137:
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128:
127:Related issues
124:
123:
122:
121:
116:
111:
106:
101:
96:
91:
83:
82:
76:
75:
74:
73:
71:Treble damages
68:
63:
58:
53:
48:
43:
35:
34:
26:
25:
15:
13:
10:
9:
6:
4:
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1377:
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998:. 2008-03-26.
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