Damages awarded as a punishment to the wrong doer/defaulter rather than to compensate the plaintiff is called punitive damages. In the U.S., punitive damages laws are different in various states. However, its purpose serves the same. Compensatory damages are awarded to compensate for the loss suffered by the plaintiff whereas punitive damages are meant to punish and deter the tortfeasor. Generally, punitive damages are awarded when the courts are of the opinion that compensatory damages are inadequate.
It is the duty of the plaintiff to prove that punitive damages have to be awarded and the amount by providing substantial evidence. Some federal, state judiciaries, and legislatures use the amount of compensatory damages awarded as one factor in judging the reasonableness of the punitive award.
Punitive damages are awarded if the tort was committed with the intent to harm and not caused by mere negligence. There is no limit to the amount that a party may be ordered to pay as punitive damages.
In Cappetta v. Lippman, 913 F. Supp. 302 (S.D.N.Y. 1996), a plaintiff client objected to a magistrate’s report and recommendation ordering defendant attorney to pay the client damages for attorney malpractice. The attorney submitted papers in opposition to the objections. The client objected to the magistrate’s findings that the attorney was neither liable for any damages for failing to prosecute the client’s underlying civil action, nor for any punitive damages for that alleged attorney malpractice. The court accepted and adopted the magistrate’s recommendations and awarded damages to the client with the prejudgment interest that was stated in the report. While deciding that the attorney was only liable for damages for the cost of the client’s hiring of a new firm in order to attempt to re-open the underlying action that was dismissed, the court stated that “although generally a defendant attorney is liable to a plaintiff client for the claim he would have recovered in the dismissed suit, punitive damages are not included in this general claim theory. The purpose of punitive damages is to punish the defendant.”