Court Opinion

ID: 9726888
Source: CourtListenerOpinion
Date Created: 2023-08-26 13:11:29.189811+00
Date Added: 2024-06-11T18:25:31.755783
License: Public Domain

PRESIDING JUSTICE SULLIVAN, specially concurring: In view of the reasoning in National Bank v. Norfolk & Western Ry. Co., as set forth in the majority opinion, I concur in the result reached. However, that case involved an action under section 73 of the Public Utilities Act (Ill. Rev. Stat. 1977, ch. Ill 2/3, par. 77), which expressly provides for punitive damages and, because it was not specifically stated in National Bank that common law punitive damages were recoverable under the Survival Act, there remains a question in this regard. I am in accord also with the suggestion of the majority that in class litigation, to avoid punitive damages “overkill,” Illinois could adopt the “Dalkon Shield” concept of a separate trial to award a single sum as punitive damages for all plaintiffs present and potential, with percentage to each based upon the compensatory damages received.1 Nevertheless, the Daikon Shield concept would not satisfy the contention of the 22 law firms appearing for defendants that public policy should prohibit awards of punitive damages. While I disagree with this contention, it cannot be denied that the spectre of the destruction of companies, and even individuals, as a result of punitive damage awards is a threatening, present reality. Such awards have become increasingly greater in recent years, as indicated by the recent single personal injury jury verdict in the amount of $127.8 million, of which $125 million was for punitive damages. (Richard Grimshaw v. Ford Motor Co., Superior Court, Santa Ana, Cal., February 1978.) The punitive damages in that case were reduced by the trial court to $3.5 million, but the amount of the initial award and the many others rendered in considerable amounts2 point out the problem, as stated by Judge Friendly in Roginsky v. Richardson-Merrell, Inc. (2d Cir. 1967), 378 F.2d 832, 841: “[T]he apparent impracticability of imposing an effective ceiling on punitive awards in hundreds of suits in different courts may result in an aggregate which, when piled on large compensatory damages, could reach catastrophic amounts. * * * [A] sufficiently egregious error as to one product can end the business life of a concern that has wrought much good in the past and might otherwise have continued to do so in the future, with many innocent stockholders suffering extinction of their investments for a single management sin.” Punitive damages, sometimes referred to as exemplary damages, appears to have been first recognized in Huckle v. Money (1763), 2 Wils. K.B. 206, 95 Eng. Rep. 768, as a means of justifying damage awards in excess of plaintiff’s tangible harm to punish defendants in instances of malice, oppression or gross fraud, i.e., where the manner of performance made the conduct “outrageous.” It has developed in this country to the extent that the amounts of such awards in the aggregate could not only result in the end of a business, as suggested by Judge Friendly, but also the financial destruction of an individual. This is particularly so in Illinois, because it has been held in a recent case (Beaver v. Country Mutual Insurance Co. (1981), 95 Ill. App. 3d 1122, 420 N.E.2d 1058) that public policy prohibits insurance against liability for punitive damages arising out of one’s own conduct. The possible catastrophic effect of this ruling is evident when it is realized that awards of punitive damages are readily obtainable in this State. The recovery may be had where the defendant is guilty of “wilful and wanton misconduct,” with the jury instructed as follows: “If you find that defendant was guilty of wilful and wanton conduct which proximately caused injury to the plaintiff and if you believe that justice and the public good require it, you may, in addition to any damages to which you find plaintiff entitled, award plaintiff an amount which will serve to punish the defendant and to deter others from the commission of like offenses.” Illinois Pattern Jury Instructions, Civil, No. 35.01 (2d ed. 1971) (hereinafter IPI Civil). Willful and wanton misconduct has been defined for the jury as “a course of action which shows actual or deliberate intention to harm or which, if not intentional, shows an utter indifference to or conscious disregard for a person’s own safety and the safety of others.” (IPI Civil No. 14.01.) Under these instructions, as a practical matter, awards of punitive damages may be obtained where the conduct is only slightly greater in degree than mere negligence. It appears that four States disallow awards of punitive damages— Massachusetts, Louisiana, Nebraska and Washington — and that England, which invoked the doctrine, has done away with it except in cases (1) “of oppressive, arbitrary or unconstitutional action by the servants of the government”; (2) “in which the defendant’s conduct has been calculated by him to make a profit for himself which may well exceed the compensation payable to the defendant”; and (3) “in which exemplary damages are expressly authorized by statute.” Rookes v. Barnard (1964), AC 1129, 1220, 1223. While it may be true, as defendants contend, that punitive damages are a windfall to plaintiffs who have already been fully compensated, it is noted that they are provided for in certain statutes and that there are extreme circumstances where such awards might serve some societal need. However, because of the problems as outlined above, particularly the possible unavailability of liability insurance, it does appear that the concept should be examined to determine, among other things, (1) whether the reason for punitive damages has ceased to exist and, if not, should they be awarded only for extremely flagrant conduct; (2) whether recovery should be allowed only by statute; (3) whether the amount recovered should bear some relation to the harm involved and the compensatory damages received; (4) whether the awarding of unlimited damages as a punishment to deter like offenses is unfair compared to the fixed minimum and maximum criminal penalties which are also imposed as punishment and deterrence; (5) whether the standard of proof should be “clear and convincing” rather than preponderance; and (6) whether payment of such awards should be made other than to the already fully compensated plaintiffs, such as to a public fund.   It should be noted (a) that the district court decision promulgating the Daikon Shield concept is presently on appeal in the ninth Circuit Court of Appeals and (b) that the concept could be used only if Miner v. Gillette Co. (1981), 87 Ill. 2d 7, 428 N.E.2d 478, which held that a class action may be maintained on behalf of nonresident plaintiffs, is not reversed by the United States Supreme Court — where a petition for certiorari has been granted.    Such as $10,500,000 in Rosendin v. Avco-Lycoming (Santa Clara County, Cal., March 1971) and $850,000 in a MER-29 case in New York, where hundreds of similar cases were filed throughout the country.