A Stitch in Haste

One of the very first rules you learn in law school is "no punitive damages for negligence, only for intentional torts."

Here's a great example why:

Mike Karthauser was walking through the [Bristol, England] city centre to pay some money into the bank when the man jumped out on him.
...
"I thought I was going to have my mobile phone stolen, or get stabbed or something. The fear was really building up inside me and I just didn't know what was going to happen.
...
Mike said the man in the balaclava told him the stunt was being filmed for use in a programme to be screened on Channel Four.

The man in the balaclava, as well as his employer, are liable for the tort of assault. If there was any physical contact with the victim, then they are also liable for the tort of battery. Both are intentional torts, and (in the U.S. at least) either would entitle the victim not only to compensatory damages (which in this fact pattern would be minimal), but also punitive damages, which could be quite high given the outrageous nature of the misconduct.

Now imagine if there were no such thing as punitive damages. People like these jackasses could go around in their balaclavas scaring the bejeesus out of people in order to make a buck (or, perhaps worse, just for the heck of it) as often as they liked. The threat of a lawsuit, based just on compensatory damages, would be no threat at all. This is what is known as "buying the tort" — tortfeasors knowingly committing torts knowing that even if they get sued, it's "worth it." (In negligence, by contrast, the defendant isn't knowingly doing anything wrong -- that's the very definition of negligence.)

Another recent example was of course the Russell Crowe phone-throwing incident. Telling someone like Crowe that if he throws a phone at someone, then he'll only have to pay their medical bills, might not be an effective deterrent. A punitive damages award is far more likely to get a rich person's attention.

So the next time you hear about an "outrageous" punitive damages award (and yes, sometimes they are outrageous), remember — outrageous is as outrageous does.

Some more thoughts about punitive damages:

--In some jurisdictions punitive damage awards go to the state, like a fine, and not to the plaintiff. I'm ambivalent about such a policy. Any thoughts?

--The threat of criminal charges of course serves a similar purpose as punitive damages, but entails a far more complex legal machinery which, given the higher burden of proof and the potential unwillingness of prosecutors to pursue complaints, might not deter potential tortfeasors the way punitive damages can.

--Punitive damages are also not generally allowed for breach of contract, even when it is "intentional." In fact, in law school they teach you than breaching a contract can sometimes actually be a good thing — a so-called "efficient breach." On the other hand, a malicious breach of contract can often easily be framed as fraud, which is an intentional tort eligible for punitive damages.

(Via Fark.)