Defense Digest

Recently, the Superior Court of Pennsylvania examined the issue of whether punitive damages may be awarded without proof of a defendant's finances or wealth. The court held that evidence of a defendant's finances or wealth is not necessary.

In Vance v. 46 and 2, Inc., 920 A.2d 202 (Pa. Super., March 13, 2007), the court addressed a jury verdict awarding a husband-plaintiff both compensatory and punitive damages for personal injuries sustained in a bar fight. The plaintiff offered no evidence at trial of the finances or wealth of the defendants, a bar establishment and its two employee-bouncers.

In 2004, the plaintiff, David Vance, along with five other friends, frequented a bar in Pittsburgh. As they approached the door, two bouncers asked for proof of age of the six individuals. Three women provided Pennsylvania driver's licenses and were admitted. Vance was denied admission, although he presented an immigration card which included his photograph and date of birth, showing him to be of drinking age. The bouncers considered the immigration card to be invalid and told Vance he could not enter. Vance disagreed and a fight ensued.

A Complaint was filed on behalf of Vance and his wife against the bar. The Vances asserted claims of negligence and also sought punitive damages. Contemporaneously, the Vances filed a separate lawsuit against the two employee-bouncers, asserting claims of negligence and assault and battery, and they also sought punitive damages. The trial court consolidated the cases for trial.

The details of the fight were contested at trial. The jury resolved the factual dispute in favor of Vance and rendered a compensatory damage verdict in his favor for roughly $18,000. Vance was also awarded punitive damage verdicts of $25,000 against the bar and $12,000 against the bouncers.

The defendants filed a post-trial motion in which they claimed the trial court erred by denying their motions for nonsuit and judgment notwithstanding the verdict on the punitive damage claims. In their post-trial motion, the defendants argued that the Vances' failure to present any evidence at trial of the defendants' finances or wealth precluded the imposition of a punitive damages verdict. The trial court denied post-trial relief, and an appeal to Superior Court was taken.

The Superior Court began its analysis with the Restatement (Second) of Torts, §908(2) which reads as follows:

(2) Punitive damages may be awarded for conduct that is outrageous, because of the defendant's evil motive or his reckless indifference to the rights of others. In assessing punitive damages, the trier of fact can properly consider the character of the defendant's act, the nature of the harm to the plaintiff that the defendant caused or intended to cause and the wealth of the defendant. (Emphasis added).

The defendants argued that the Pennsylvania Supreme Court's earlier decision in Kirkbride v. Lisbon Contractors, Inc., 555 A.2d 800 (Pa. 1989) required a jury to be presented with evidence of a tortfeasor's wealth before being entitled to impose punitive damages. The Vance Court disagreed with the defendants' interpretation at both §908 and the Kirkbride decision.

In Kirkbride, the Pennsylvania Supreme Court rejected the notion that an award of punitive damages had to be proportional, or bear a reasonable relationship, to an award of compensatory damages. Rather, the court concluded that when determining an appropriate punitive damage award, it was the jury's province to assess the factors outlined in §908(2).

According to Vance, although the wealth of a defendant was one potential consideration in a jury's determination of the amount of punitive damages to award, it was not a factor in the jury's evaluation of whether to impose punitive damages in the first instance. The Superior Court explained that wealth may be considered in the assessment of a punitive damages amount because "if a wealthy person commits a rather heinous act, nominal punitive damages will not deter either that person or any other similarly situated person from committing a similar act." Wealth was, therefore, considered to be a relevant consideration in effectuating the purpose of punitive damages, that is, to punish the tortfeasor for outrageous behavior and to serve as a deterrent to that person and others from engaging in similar conduct.

According to Vance, it was on this basis that Kirkbride rejected the proposition that a punitive damage award had to be proportional to a compensatory damage award. Vance noted that Kirkbride did not hold that a jury could not impose punitive damages without evidence pertaining to the defendant-tortfeasor's wealth.

Vance re-emphasized that the decision to award punitive damages at all lies in the jury's determination of whether the defendant's conduct was outrageous. See, SHV Coal v. Continental Grain Co., 587 A.2d 702, 704 (Pa. 1991). Thus, for example, where a tortfeasor's mental state rises to no more than gross negligence, punitive damages are not justified. Indeed, in the leading case of Feld v. Merriam, 485 A.2d 742 (Pa. 1984), the Pennsylvania Supreme Court did not consider evidence of wealth a prerequisite to the imposition of punitive damages but, rather focused upon, amongst other things, the assessment of the actor's conduct.

In conclusion, Vance supported its holding by referring to a Superior Court panel decision in Reading Radio, Inc. v. Fink, 833 A.2d 199 (Pa. Super. 2003). The court found there that the "polestar for the jury's assessment of punitive damages is the outrageous conduct of the defendants, not evidence of a defendant's wealth." In Reading Radio, the Superior Court stated that evidence of wealth is not mandatory to establish a claim for punitive damages and that a jury could base its "award of punitive damages entirely on its assessment of [the tortfeasor's] conduct."

For these reasons, the Vance Court reaffirmed the principle that evidence of a tortfeasor's wealth is not a precondition to the imposition punitive of damages.

* Dennis is a shareholder in the Pittsburgh, Pennsylvania, office. He may be reached at djroman@mdwcg.com or (412) 803-1190.