Punitive Damages 101: Definition and Examples

You’ve been wronged and suffered harm. The responsible party is ordered to pay you compensation for medical bills, lost wages, and other damages—this is known as compensatory damages.

But sometimes, compensatory damages alone feel inadequate. The harm was intentional, reckless, or grossly negligent. You want the wrongdoer to truly pay for their actions. This is where punitive damages come in.

Punitive damages go beyond just compensating the injured person. They are awarded as punishment and to deter similar future misconduct. Simply put, punitive damages are meant to sting—to send a message that egregious behavior has consequences.

In this blog post, we’ll provide a thorough understanding of punitive damages. You’ll learn:

• The legal definition and purpose of punitive damages
• What types of actions justify punitive damages
• Differences between compensatory and punitive awards
• Common examples of cases where punitive damages are awarded
• How punitive amounts are calculated and capped

Here’s everything you need to know about punitive damages.

What Are Punitive Damages?

Punitive damages are monetary damages awarded over and above compensation for actual losses. They are intended to punish individuals who have engaged in especially egregious, reckless, or intentional misconduct. 

Punitive damages also aim to deter similar behavior in the future by making it clear there are harsh financial consequences for gross negligence or intentional harm.

For injured persons and their families, punitive damages can provide a sense of justice and closure when the at-fault party’s actions are truly outrageous. These additional damages send a message to the defendant and society that certain harmful behaviors will not be tolerated.

While compensatory damages make plaintiffs “whole” again financially, punitive damages recognize there should be further punishment for wrongdoing that put lives at risk or intentionally caused harm.

Factors Considered for Punitive Damages

Some factors that may lead to punitive damages being awarded include:

• Gross negligence or reckless conduct that endangered others
• Intentional harm or misconduct
• Previous incidents or patterns of negligence by the defendant
• Lack of remorse or efforts to cover up wrongdoing

In situations where these types of egregious behaviors are present, punitive damages may provide further punishment and accountability.

Examples of When Punitive Damages May Be Awarded

At our personal injury law firm, we have experience helping clients secure punitive damages in cases where the other party’s actions were especially egregious. 

Here are some examples of cases where punitive damages may be warranted:

• A drunk driver going 80 mph in a 35 mph zone causes a devastating accident. Punitive damages would punish this extremely reckless behavior.
• A surgeon botches a surgery while under the influence of prescription drugs used recreationally. Punitive damages would punish their medical malpractice.
• A landlord fails to fix faulty wiring despite multiple requests. A fire results. Punitive damages may deter similar negligence.
• A pharmacy gives a customer the wrong medication, ignoring proper procedures. Punitive damages could prevent recurrences.
• A company sells toys with small detachable parts to young children, ignoring safety regulations. Punitive damages may deter cutting corners on safety.
• A food manufacturer knows a batch of food is contaminated but fails to recall it. Punitive damages could incentivize proper quality control.
• A trucking company requires drivers to exceed hourly limits, resulting in a fatigue-related accident. Punitive damages may stop systemic safety breaches.
• A store’s cluttered aisles cause a slip and fall. Despite previous incidents, no safety improvements were made. Punitive damages may prompt proper precautions.

These examples illustrate situations where punitive damages may provide justified punishment and deterrence when actions are especially negligent or 

Punitive Damages Vs. Compensatory Damages in a Personal Injury Claim

Punitive damages, sometimes referred to as exemplary damages, differ from compensatory damages in several key ways.

Purpose

First, they serve different purposes. Compensatory damages are intended to make the plaintiff whole again by providing compensation for actual losses suffered, such as medical bills, lost wages, and pain and suffering. In contrast, punitive damages are not meant to compensate the plaintiff but rather to punish the defendant for intentional or extremely reckless misconduct, as well as deter similar egregious behavior going forward.

Type of Harm

Punitive damages also address a higher level of harm than compensatory damages. Compensatory damages cover losses stemming from negligence that caused foreseeable harm, while punitive damages respond to extreme recklessness and intentional harm that goes above and beyond typical negligence.

Burden of Proof

In addition, there is a higher burden of proof for punitive damages claims. To receive compensatory damages, the plaintiff must prove by a preponderance of evidence that the defendant’s negligent actions directly caused their losses. But for punitive damages, the plaintiff must meet the higher standard of showing clear and convincing evidence that the defendant’s conduct was intentionally harmful or so extremely reckless that punishment is warranted.

Damage Caps

Punitive damage awards are also more restricted than compensatory damages in most states. While there are generally no caps on the amount of compensatory damages outside of certain categories like pain and suffering, many states place limits on punitive damages, either by capping them at a fixed dollar amount or a multiplier of the compensatory damages awarded. In a few states, punitive damages are not available at all.

In Illinois, however, there are no caps on the amount of punitive damages that can be awarded. Therefore, as long as the plaintiff can prove the defendant’s willful or wanton conduct warrants punitive damages, judges and juries have the discretion to award any appropriate amount of punitive damages that will punish the defendant’s behavior and deter future misconduct. 

Tax Treatment

Finally, punitive damages carry different tax implications. Compensatory damages for physical injury are excluded from taxable income, but punitive damages are considered taxable income in most cases.

Contact Onward Injury Law Today for a Free Consultation

If you or a loved one suffered serious harm in an Illinois accident caused by willful misconduct or extreme recklessness, the experienced personal injury attorneys at Onward Injury Law may be able to help you pursue punitive damages. 

With 6 convenient locations serving injured persons across Central Illinois, our dedicated legal team has a proven track record of success in winning maximum compensation for clients statewide. We understand how to thoroughly investigate accidents, build strong cases, and fight for fair punitive damage awards when warranted.

Don’t wait to get the justice you deserve. Contact us today for a free consultation to discuss your case. Our personal injury lawyers are here to help you recover physically, emotionally, and financially after an accident in Illinois.

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