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Punitive Damages: State Laws

Punitive Damages: State Laws

In a civil lawsuit, the basis of awarding damages to a plaintiff is to make the plaintiff “whole” after an injury or other reckless or negligent event. There are different types of damages that a plaintiff may pursue, which would be dependent on the injury. A specific type of damage is not necessarily awarded to make the plaintiff whole, but rather to punish the defendant for the recklessness or negligence that they created. These damages are called punitive damages. 

Under some state laws, there are three statutes that govern punitive damages. First, NRS 42.005 governs the general criteria of punitive damages, the limitations on the amount of the ward,, and the determination in a subsequent proceeding. Under the statute, punitive damages may not be awarded under a breach of an obligation that arose out of a contract. Additionally, compared to the general standard of the “preponderance of the evidence,” which is the most relaxed standard in a civil case, punitive damages are measured by “clear and convincing evidence.” This standard is a measure of proof is an intermediate degree of proof. If this standard is met, NRS 42.005(1) dictates the amount of punitive damages that may be administered. Punitive damages may not exceed three times that amount of compensatory damages, which are defined as general damages plus special damages, if the amount of compensatory damages awarded to the plaintiff is equal or greater to $100,000. NRS § 42.005(1)(a). However, punitive damages may not exceed $300,000 if the amount of compensatory damages awarded to the plaintiff is less than $100,000. NRS § 42.005(1)(b).

Second, NRS 42.007 dictates punitive damages with limitations on liability by an employer for a wrongful act of an employee. Under the statute, an employer is not liable for punitive damages unless the employer had advance knowledge that the employee was not fit for employment purposes and that the employee had a conscious disregard of the rights or safety of others, the employee authorized the wrongful act caused by the employee, or the employer is personally guilty of oppression, fraud or malice, whether express or implied. NRS § 42.007(1). A corporation may be liable under the same statute if the previous elements are met by an officer, director, or managing agent of the corporation that was authorized expressly to direct the employee’s conduct as an agent of the corporation. NRS § 42.007(1). These notions would not be applicable for insurance bad faith in relation to insurance coverage, however. NRS § 42.007(2).

Third, NRS § 42.0010 governs punitive damages for an injury caused by a motor vehicle accident while an individual was under the influence of alcohol or a controlled substance. Under the statute, if an individual willfully consumed or used alcohol or a controlled substance, knowing that the defendant would thereafter operate the motor vehicle, the plaintiff may recovery punitive damages in addition to compensatory damages for the purpose of punishing the individual under the influence. NRS § 42.010(1).

These prescriptions allow a plaintiff to recover damages against a defendant for the purposes of punishing the defendant for the wrongful or negligent act. The statutes provided allowed recovery for these actions in an effort to deter future actions or recklessness or negligence of this nature. 

Thanks to a car accident lawyer with our friends at Eglet Adams for their insight on punitive damages.