Dayton Hudson Corp. v. American Mutual Liability Ins. Co

In Dayton Hudson Corp. v. American Mutual Liability Ins. Co., 1980 OK 193, 621 P.2d 1155 (Okla. 1980), the Oklahoma Supreme Court embraced the rule of allowing insurance coverage of punitive damages articulated in Northwest Nat'l. Cas. Co. v. McNulty, 307 F.2d 432, 440 (5th Cir. 1962). Dayton Hudson, 621 P.2d at 1160. The court reasoned that since the purpose of punitive damages is to punish and deter wrongdoers rather than to compensate injured parties, allowing the responsibility of the wrongdoer to shift that liability would defeat this purpose. Id. However, since cases of vicarious liability (such as respondeat superior) involve conduct by someone else other than the policyholder, it does not contravene public policy to allow coverage of such liability. Id.