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Compensatory And Punitive Damages The compensatory damages awarded to plaintiffs are designed to give justice to them after being wronged. Punitive damages are designed to prevent others from being hurt by the same or similar actions.
On the other hand, vicariously-assessed punitive damages are assessed against a defendant who was not directly negligent but instead had liability imputed under agency principal law. For example, a corporation may be vicariously liable for the acts of its employees.
Under California law, before a plaintiff can recover punitive damages, he must prove, by clear and convincing evidence, fraud, malice or oppression by the defendant as laid out in Civ. Code section 3294(c).
In many jurisdictions, punitive damages are inappropriate if there was no award of compensatory damages. Many appellate courts have ruled that a simple liability finding without an award of compensatory damages is not enough to support a punitive damages award.
Specifically, in a breach of case, the plaintiff is normally only awarded compensatory damages (i.e., money damages for the actual loss suffered based on the value of the contract), and punitive damages are generally not awarded at all.
While mandated percentage "limits" on a punitive damage award have drawn criticism, awards in excess of these limits have also drawn objection. Again, using California as an example, courts have generally found punitive damages greater than 15 percent of a defendant's net worth to be excessive.
Judges may reduce punitive damage awards when it looks like juries have not followed instructions.
Jurisdictions employ one of three standards of proof in decisions concerning punitive damages: (1) beyond a reasonable doubt, (2) by clear and convincing evidence, and (3) by a preponderance of evidence.
Punitive damages are legal recompense that a defendant found guilty of committing a wrong or offense is ordered to pay on top of compensatory damages. They are awarded by a court of law not to compensate injured plaintiffs but to punish defendants whose conduct is considered grossly negligent or intentional.