Opinion ID: 2608727
Heading Depth: 1
Heading Rank: 3

Heading: recognized exception to public policy against allowing insurance protection from liability for punitive damages

Text: In almost all jurisdictions which disallow insurance coverage for punitive damages, an exception is recognized for those torts in which liability is vicariously imposed on the employer for a wrong of his servant. [18] In that class of litigation, public policy does not inhibit a shift in liability incidence to the insurer unless the employer's volition was either directly or indirectly an element in the commission of the harm. We are in accord with this view and hold that public policy against insurance protection for punitive damages does not preclude recovery of indemnity from the insurer by an employer to whom either willfulness or gross negligence of his harm-dealing employee became imputable for imposition of liability under the Oklahoma application of the respondeat superior doctrine. [19] We must remain mindful that contracts should not be declared void on the ground of public policy except in those cases that are free from doubt. [20] Prejudice to the public interest must hence be clearly apparent before a court is justified in pronouncing a solemn agreement to be of no effect. Contract right constitutes no small part of the liberty of a citizen. One of the law's important functions is to uphold the binding obligation of a promise rather than to enable the parties to escape from it on the pretext of public policy. Contracts must stand unless it clearly appears that public right or public weal is contravened. [21]