Harrell v. Bowen

Justice NEWBY

dissenting.

I agree with the majority that our common law has traditionally viewed punitive damages as valuable for punishing a wrongdoer and deterring others and that Chapter ID reinforces the common law in this regard. However, I believe the majority misconstrues the framework for punitive damages enacted by the General Assembly. When Chapter ID is examined in its entirety, the intent of the legislature becomes clear: a jury is permitted to award punitive damages despite the death of the tortfeasor. Therefore, I respectfully dissent.

Chapter ID has several sections which are typical of other chapters in the North Carolina General Statutes. Section ID-1 describes the broad policy of punitive damages. Section ID-5 provides definitions applicable to the Chapter. Section ID-10 details the scope of the Chapter, and section ID-15 delineates the “[standards for recovery of punitive damages.”

In particular, section ID-15 states: “Punitive damages may be awarded only if the claimant proves that the defendant is liable for compensatory damages and that one of the following aggravating factors[: (1) fraud, (2) malice, or (3) willful or wanton conduct] was present and was related to the injury for which compensatory damages were awarded.” N.C.G.S. § 1D-I5(a) (2007). Moreover, “[t]he claimant must prove the existence of an aggravating factor by clear *148and convincing evidence.” Id. § 1D-I5(b) (2007). Once the plaintiff meets the requirements of this section, the jury must determine in its discretion whether or not to award punitive damages. See id. § ID-35 (2007). Notably, neither section ID-15 nor any other section of Chapter ID limits punitive damages to situations in which a plaintiff can establish the presence of every stated statutory purpose for the award of punitive damages. Instead, with regard to the statutory purposes of punitive damages, Chapter ID requires only that, once plaintiff has established eligibility under section ID-15, the jury “consider” those purposes when “determining the amount of punitive damages, if any, to be awarded.” Id. § 1D-35(1).

The North Carolina Pattern Jury Instructions illustrate the approach intended by the legislature. First, the jury must answer, “Is the defendant liable to the plaintiff for punitive damages?” 2 N.C.P.I. — Civ. 810.96, at 1 (gen. civ. vol. May 2001). “On this issue the burden of proof is on the plaintiff to prove three things.” Id. The plaintiff must first prove the existence of an aggravating factor by clear and convincing evidence. Id., at 2. The plaintiff also must prove by the greater weight of the evidence that the aggravating-factor was related to the injury and that the defendant participated in the wrongful conduct. Id., at 2-3. If the plaintiff satisfies its burden of proof on these three issues, it is the jury’s duty to answer “Yes” and find the defendant liable to the plaintiff for punitive damages. Id., at 3.

If the jury determines the defendant is liable to the plaintiff for punitive damages, it must then answer a second question: “What amount of punitive damages, if any, does the jury in its discretion award to the plaintiff?” 2 N.C.P.I. — Civ. 810.98, at 1 (gen. civ. vol. May 1996). At this point, the jury is instructed to consider the purposes of punitive damages because any amount awarded should bear a rational relationship to those purposes. Id., at 2-3.

Thus, neither Chapter ID nor the Pattern Jury Instructions make plaintiff’s eligibility for an award contingent upon satisfying all of the statutory purposes of punitive damages. Rather, they give the jury discretion to determine the appropriate amount of an award with reference to the statutory purposes. The jury is free to consider a defendant’s death when using its discretion to determine the award amount, just as the jury would be permitted to consider that a living defendant should be punished even though it believed any deterrent effect would be small or nonexistent. See Hofer v. Lavender, 679 S.W.2d 470, 474-75 (Tex. 1984) (concluding punitive, or exemplary, *149damages could be collected from the estate of a deceased tortfeasor after discussing the “equally important considerations other than punishment of the wrongdoer” recognized in Texas as purposes for punitive damages); Perry v. Melton, 171 W. Va. 397, 401, 299 S.E.2d 8, 12 (1982) (holding punitive damages could be collected from the estate of a deceased tortfeasor because “[p]unitive damages in [West Virginia] serve other equally important functions and are supported by public policy interests going beyond simple punishment of the wrongdoer”).

In contrast to the statutory structure and the Pattern Jury Instructions, the majority incorporates the statutory purposes of punitive damages into section ID-15. The majority holds that punitive damages cannot be awarded unless the plaintiff meets the criteria in section ID-15 and establishes that the punitive damages will punish the defendant, deter the defendant, and deter others. If the legislature intended the purposes of punitive damages to be treated as prerequisites for an award, it would have included those purposes in section ID-15.

The General Assembly’s use of the word “purposes” in Chapter ID is equally significant. Although the title of section ID-1 is “[p]urpose of punitive damages,” language in other sections of the Chapter indicates there are several “purposes” for awarding punitive damages. See N.C.G.S. §§ lD-5(6) (2007) (“ ‘Punitive damages’ means extracompensatory damages awarded for the purposes set forth in G.S. ID-1.”), -35(1) (“In determining the amount of punitive damages, if any, to be awarded” the jury “[s]hall consider the purposes of punitive damages set forth in G.S. ID-1.”); see also Town of Blowing Rock v. Gregorie, 243 N.C. 364, 371, 90 S.E.2d 898, 903 (1956) (stating that a statute’s caption cannot control the unambiguous text of the statute). Viewing Chapter ID in its entirety reveals the legislature’s intent that section ID-1 be interpreted as a broad policy statement that includes the three purposes of punitive damages recognized in North Carolina: (1) punishing defendants, (2) deterring defendants, and (3) deterring others. When section ID-1 is viewed as a list of purposes to be considered in determining the amount of an award rather than a list of prerequisites, the General Assembly’s use of the conjunctive rather than the disjunctive becomes irrelevant.

In addition, unlike the majority’s interpretation, concluding that Chapter ID permits a punitive damages award against a deceased defendant is consistent with North Carolina’s survival statute. See N.C.G.S. § 28A-18-1 (2007). A punitive damage award against a *150deceased defendant is permitted under the survival statute which states that “all demands whatsoever, and rights to prosecute or defend any action or special proceeding, existing in favor of or against” a deceased person “shall survive to and against the personal representative or collector of his estate.” Id. § 28A-18-l(a). Although certain rights of action in favor of a decedent do not survive, see id. § 28-18-l(b), no actions or demands against a decedent are excepted from section 28A-18-l(a).

Here, plaintiff’s allegations, treated as true, are sufficient to satisfy the eligibility requirements for a claim for punitive damages under section ID-15. As such, this claim should not have been dismissed. Plaintiff is not required to prove that all three statutory purposes of punitive damages will be furthered by an award. Rather, should it determine plaintiff’s allegations are true, the jury should decide the appropriate size of an award, if any, taking into consideration the death of the tortfeasor as it relates to the puiposes of punitive damages stated in section ID-1.

Justice HUDSON joins in this dissenting opinion.