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Punitive Damages

Punitive damagesPunitive damages are money a Texas jury can order a wrongdoer to pay as punishment for extreme conduct, not to repay a loss. They come on top of the money that pays for an injury, not out of it. If the person or company that hurt you acted with fraud, malice, or gross negligence, Abraham Watkins can help you understand whether your case may support a punitive damages claim. Call 713-222-7211 for a free consultation.

Texas law calls them exemplary damages. Section 41.001 of the Texas Civil Practice and Remedies Code defines them as damages awarded as a penalty or by way of punishment rather than for compensation.

How Punitive Damages Differ From Compensatory Damages

Compensatory damages are meant to repay the losses an injury causes. They include economic damages, which are out-of-pocket losses such as medical bills and lost wages. They also include non-economic damages, such as past and future pain and suffering, mental anguish, and permanent disfigurement. Punitive damages look at something else: what the wrongdoer did, and whether it deserves punishment.

Punitive damages also cannot stand on their own. Under Section 41.004, they may be awarded only if the jury also awards damages other than nominal damages. Nominal damages are a token amount that recognizes a legal wrong without a measurable loss. In practice, a punitive damages claim rides on a real injury claim.

What Conduct Can Lead to Punitive Damages?

Ordinary carelessness is not enough. Under Section 41.003 of the Civil Practice and Remedies Code, the injured person has to prove by clear and convincing evidence that the harm came from one of three things:

  • Fraud, other than constructive fraud, which is a technical form of fraud that does not require an intent to deceive;
  • Malice, meaning the defendant specifically intended to cause the injured person substantial injury or harm; or
  • Gross negligence, meaning the defendant knew about an extreme risk and went ahead anyway, with conscious indifference to the safety or welfare of others.

Clear and convincing evidence is a higher bar than most injury claims face. It means proof that produces a firm belief that the allegations are true. That burden stays with the injured person, and evidence of ordinary negligence, bad faith, or a deceptive trade practice does not meet it.

Examples of When Punitive Damages May Apply

Punitive damages are the exception, not the rule, and they turn on what the wrongdoer knew or intended. Situations where a punitive damages claim may be raised include:

  • a driver who causes a crash while drunk;
  • a trucking company that keeps a driver or truck on the road after learning about a serious safety problem, which is one reason the issue appears in some truck accident claims;
  • a company that knows a product is dangerous and keeps selling it without fixing the problem or warning buyers; and
  • a person who intentionally attacks or injures someone.

In each of these situations, what matters is not only that someone was hurt, but that the wrongdoer knew about the danger or meant to cause harm.

How the Punitive Damages Cap Works

Even when punitive damages are proven, the amount is usually limited. Section 41.008 of the Civil Practice and Remedies Code caps them against a defendant at the greater of two amounts: two times the economic damages, plus the non-economic damages found by the jury up to $750,000; or $200,000. The jury decides economic damages separately so the cap can be worked out, and the cap itself may not be revealed to the jury. Here is how it works with illustrative figures of $50,000 in economic damages and $40,000 in non-economic damages:

Cap measure Calculation Result
Two times economic damages plus non-economic damages (2 x $50,000) + $40,000 $140,000
Flat amount $200,000 $200,000

Because the greater of the two controls, the ceiling in that example is $200,000. Both figures are limits, not estimates of what any case is worth.

When the Cap Does Not Apply

The cap falls away when the punitive damages claim is based on conduct that matches certain serious felonies in the Penal Code. For most of those offenses, the conduct must have been knowing or intentional. The list includes:

  • aggravated assault;
  • intoxication assault; and
  • intoxication manslaughter.

The two intoxication offenses are exceptions to the knowing-or-intentional requirement. That means a claim against a drunk driver who caused serious bodily injury or a death may not be capped at all. This is why the issue comes up in drunk driving crash and wrongful death claims.

How a Jury Decides the Amount

Within the cap, the amount is up to the jury. Under Section 41.011 of the Civil Practice and Remedies Code, a jury setting punitive damages considers evidence relating to:

  • the nature of the wrong;
  • the character of the conduct involved;
  • the degree of culpability of the wrongdoer;
  • the situation and sensibilities of the parties concerned;
  • the extent to which the conduct offends a public sense of justice and propriety; and
  • the net worth of the defendant.

The defendant’s net worth comes with its own limit. Discovery is the pretrial exchange of evidence between the parties. A court may allow discovery of net worth only after finding, in a written order, that the injured person has shown a substantial likelihood of success on the punitive damages claim.

Do Punitive Damages Require a Trial?

An award of punitive damages comes from a jury, and Texas requires that jury to be unanimous on both liability and the amount. Most cases do not go to trial. If a settlement cannot be reached, a jury trial may be necessary, and a strong punitive damages claim can be one reason a case reaches that point.

Talk With a Houston Lawyer About Punitive Damages

Learning that someone acted with conscious disregard for your safety can make an injury feel even harder to accept. Abraham Watkins has represented injured Houstonians since 1951. Our past results include a $28 million car and truck accident case in which our attorneys established gross negligence by the trucking company that hired the driver. We believe everyone deserves access to high-quality legal representation without an upfront cost.

Whether the conduct in your case can support punitive damages depends on the evidence. Call 713-222-7211 or contact us today for a free consultation.

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