Necessity of Statutory Authorization

Punitive Damages are damages awarded as a punishment to the wrong doer/defaulter.  Its purpose is not to compensate the plaintiff.  However, s/he may be entitled to all or a portion of the damages.

In some jurisdictions, punitive damages are available under common law.  However, other jurisdictions are of the view that an award of punitive damages has to be authorized by the legislature or statute.  The state has wide powers in modifying the sanction of punitive damages.  A state legislature may eliminate punitive damages completely or modify its terms.  If a statute creates a cause of action unknown to the common law, punitive damages will not be allowed unless specified in the statute.

Even though the awarding of punitive damages has long been recognized by law, it is subject to constitutional scrutiny.   States, while exercising their powers, have to strictly comply with the “Due Process” rules.  The Due Process Clause of the Fourteenth Amendment prohibits a state from imposing grossly excessive punishment on a tortfeasor.  However, punitive damages may properly be imposed to further a state’s legitimate interests in punishing unlawful conduct and deterring the behavior.

In Cheatham v. Pohle, 789 N.E.2d 467 (Ind. 2003), a defendant husband distributed copies of explicit photos of plaintiff, his ex-wife.  The wife alleged invasion of privacy and intentional infliction of emotional distress.  A jury awarded her compensatory and punitive damages.  The trial court entered judgment.  Both parties appealed.  The Indiana Court of Appeals affirmed the decision.  The State intervened and its petition for rehearing was denied, but its petition to transfer was granted.  Upon appeal, the judgment of the trial court was affirmed.  While deciding the case, the court affirmed that “to the extent punitive damages are recoverable; they are a creature of the common law. The Indiana Legislature is free to create, modify, or abolish common law causes of action.  And, as a matter of federal constitutional law, no person has a vested interest or property right in any rule of common law. As a result, the Indiana General Assembly is free to eliminate punitive damages completely, as other states have done and also has wide discretion in modifying this “quasi-criminal” sanction.  Indeed, several jurisdictions have chosen not to recognize punitive damages as an acceptable award in any form.  In Nebraska, punitive damages are constitutionally prohibited.  In Louisiana, Massachusetts, New Hampshire, and Washington, punitive damages are permitted only if expressly authorized by statute.”


Inside Necessity of Statutory Authorization