Court Opinion

ID: 9724440
Source: CourtListenerOpinion
Date Created: 2023-08-26 10:56:34.27228+00
Date Added: 2024-06-11T18:25:00.411389
License: Public Domain

MILLER, Chief Justice
(concurring specially).
I concur with the majority that the insurance policy provides no coverage for punitive damages.
I strenuously disagree and disassociate myself from the language in the last paragraph of the majority writing which would suggest that certain language in Fort Pierre v. United Fire and Cas. Co., 463 N.W.2d 845 (S.D.1990), dealing with public policy considerations, is “dicta.” To the contrary, rather than being dicta, we specifically held that “the award of punitive damages (against a wrongdoer’s insurance carrier) would violate public policy.” Id. at 849.
I remind the readers of this writing, as well as the author of the majority opinion (who was a dissenter in Fort Pierre), of the precise language of our holding:
*517Although there is a split in authority, as a general rule, it is against public policy to allow the insured wrongdoer to shift the burden of payment of punitive damages to its insurer. Two interests implicated by an award of punitive damages are punishment to the wrongdoer and deterrence of the wrongdoer’s conduct. Here, City committed the “wrong” and is attempting to shift responsibility for its actions to its insurer. To allow City to do so would allow it to act with impunity. City would not be punished, nor would it be deterred from similar actions. ‘Were a person able to insure himself against economic consequences of his intentional wrongdoing, the deterrence attributable to financial responsibility would be missing.’ (Citation omitted.)
Thus, because we have determined that the civil penalties prayed for by the federal government were punitive in nature and that in this instance the award of punitive damages would violate public policy, we hold that United had no duty to defend City under the policy.
Id. at 848.
Irrespective of the majority’s suggestion to the contrary, under our settled law, it is contrary to the public policy of this state to require an insurer to pay punitive damages based on the conduct of its insured. (I would agree with the majority’s implication that we have not yet specifically concluded whether it would violate public policy when the insurance policy specifically contains a provision that would provide coverage for punitive damages, however, that case is not now and never has been before us.) Even appellee recognizes the settled law in this state, since she asked us to reverse our holding in Fort Pierre, supra.
I respectfully suggest that the majority author is using the term “dicta” when referring to our Fort Pierre holding, to preserve or revive his prior dissent. It seems to me that it only serves to cause unnecessary confusion to the bench and bar on an issue which has already been judicially determined.