Punitive Damages Cases In Maryland
Punitive Damages Awards cases:
In Bowden v. Caldor, Inc., 350 Md. 4, 25, 710 A.2d 267 (1998), the Court of Appeals made clear that, "in a tort case where punitive damages are allowable, the amount of punitive damages awarded by the trier of fact is reviewable by the court for excessiveness".
The Court summarized nine principles of Maryland common law that are applicable to judicial review of punitive damages awards for excessiveness:
(1) "'The amount of punitive damages must not be disproportionate to the gravity of the defendant's wrong.'" Id. at 27;
(2) "'The amount of punitive damages should not be disproportionate to . . . the defendant's ability to pay.'" Id. at 28 ;
(3) "The deterrence value of the amount awarded by the jury, under all the circumstances of the case, is relevant." Id. at 29;
(4) "'Substantial deference'" should be accorded "'to legislative judgments concerning appropriate sanctions for the conduct at issue,'" and "when a punitive damages award is several times higher than the largest criminal fine or civil penalty prescribed by the Legislature for any offense or misconduct, the award should be strictly scrutinized." Id. at 31;
(5) Awards should be compared "with other final punitive damages awards in the jurisdiction and particularly with awards in somewhat comparable cases." Id. at 31;
(6) "Evidence of other final and satisfied punitive damages awards against the same defendant for the same conduct may be considered by the trial judge," as well as "evidence indicating that there have been no other such awards of punitive damages against the defendant for the same conduct . . . ." Id. at 34;
(7) "When the total amount of punitive damages awarded against the defendant is based on separate torts, a pertinent consideration . . . is whether the separate torts all grew out of a single occurrence or episode." Id. at 34;
(8) "The plaintiff's reasonable costs and expenses resulting from the defendant's malicious and tortious conduct, including the expenses of the litigation, which are not covered by the award of compensatory damages, are matters which appropriately can be considered . . . ." Id. at 36;
(9) "Whether a punitive damages award bears a reasonable relationship to the compensatory damages awarded in the case is . . . a factor to be considered . . . ." Id. at 39.
The list set forth in Bowden was not "intended to be exclusive or all encompassing," and "not all of the . . . factors are pertinent in every case involving court review of punitive damages awards." Id. at 41.
See also Merritt v. Craig, 130 Md. App. 350, 371, 746 A.2d 923 (where this Court relied upon only four of the principles set forth in Bowden in holding that a trial court properly determined that a punitive damages award of $ 150,000.00 against a seller of real property was not excessive in a fraud case where the seller willfully misrepresented the condition of a water supply system and the buyer was entitled to nearly $ 50,000.00 in compensatory damages or recission of the contract of sale), cert. denied, 359 Md. 29, 753 A.2d 2 (2000).
See generally Alexander & Alexander, Inc. v. B. Dixon Evander & Associates, Inc., 88 Md. App. 672, 715-16, 596 A.2d 687 (where, prior to the Bowden decision, this Court set forth a list of factors, similar to the list in Bowden, to consider in determining whether an award of punitive damages is excessive), cert. denied, 323 Md. 1, 590 A.2d 158 (1991), 323 Md. 2, 590 A.2d 159 (1991), and 326 Md. 435, 605 A.2d 137 (1992).
The Bowden Court explained that the principles for reviewing an award of punitive damages are legal principles, and that in applying legal principles to reduce a jury's punitive damages award, a court is performing a legal function and not acting as a second trier of fact.
Although the function also involves the evidence in the case, it is similar to the legal function of granting a judgment notwithstanding a verdict.
Bowden, 350 Md. at 47. Thus, in reviewing the trial court's decision, this Court is reviewing a decision of law rather than a finding of fact, and we need not extend deference to the decision of the trial court. "Because the issue . . on which the court ruled was a purely legal issue, . . . our review is expansive." In re Michael G., 107 Md. App. 257, 265, 667 A.2d 956 (1995).
In Bowden, 350 Md. at 31, the Court of Appeals explained that, "when a punitive damages award is several times higher than the largest criminal fine or civil penalty prescribed by the Legislature for any offense or misconduct, the award should be strictly scrutinized."
As the trial court indicated, the punitive damages, at least cumulatively, were several times higher than any fine or penalty authorized by the Legislature, even if the conduct upon which the damages were based could be viewed not as a single action but as several different actions which could warrant several different fines or penalties.
In Alexander & Alexander, Inc., 88 Md. App. 672, 596 A.2d 687, a jury awarded more than $ 40,000,000.00 in punitive damages against one insurance broker and in favor of another insurance broker where the first broker interfered with the second broker's contract with a client and thus deprived the second broker of commissions. the award "represented nearly fifty times the . . . compensatory damages." Id. at 720.
The trial court reduced the award to $ 12,500,000.00, but this Court vacated the award and remanded the case for a new trial as to punitive damages. We explained that in those cases in which high awards of punitive damages have been allowed to stand, the harm has involved death or, at least, substantial health or environmental damage.