Court Opinion

ID: 9666894
Source: CourtListenerOpinion
Date Created: 2023-08-24 01:29:30.373226+00
Date Added: 2024-06-11T18:15:33.441673
License: Public Domain

HOLSTEIN, Judge,
concurring.
I fully concur in the majority opinion. However, I believe some additional observations are appropriate.
On occasion a punitive damages count is added to an ordinary action in contract or tort where there is no justification other than that a defendant is perceived to have a “deep pocket.” In such cases, the only conduct which may be characterized as evil *377is that the defendant is in business for profit and does not cease all operations when confronted with an inconclusive epidemiological study involving its product. In this case, had the defendant been an individual who had donated the asbestos containing material, it is likely no jury would ever return a punitive damages verdict.1 The crux of the “evil” is that, the defendants are in business for profit. As a result, punitive damages have occasionally been abused by becoming a method for redistributing wealth rather than carrying out the functions for which punitive damages were designed.
For that reason, I believe it is time for the courts to start placing reasonable restrictions on when and how punitive damages may be sought and obtained. A compelling argument can be made that punitive damages should not be permitted where there is no personal injury or illness and the claim arises solely because of a latent defect in a product or out of a breach of warranty. At least one state has held that in products liability cases where the only damages are to property, there can be no punitive damages. Eisert v. Greenberg Roofing & Sheet Metal Co., 314 N.W.2d 226, 228 (Minn.1982).
Another suggested restriction on such claims would be to increase the evidentiary standard. In this case, the punitive damages claim was submitted pursuant to the same burden of proof instruction as was the strict liability claim. See MAI4th 3.01. Without extensive discussion or citation to precedent, this Court recently declined to apply a “clear and convincing” evidence standard to punitive damages claims. Menaugh v. Resler Optometry, Inc., 799 S.W.2d 71, 75 (Mo. banc 1990). The only rationale cited was that requiring a higher evidentiary standard would be contrary to “the normal requirements in the submission of civil cases.” In a what I believe to be a prescient concurring opinion, Chief Justice Robertson suggested that Missouri should consider adopting a “clear and convincing” evidence standard regarding punitive damages. Because the legislature had never spoken on the subject, Chief Justice Robertson was reluctant to force the issue. 799 S.W.2d at 76 (Robertson, C.J.) I am now persuaded that we were wrong in Me-naugh and that Missouri, as to common law actions for punitive damages, should adopt a higher evidentiary standard.
Contrary to the holding in Menaugh, there are diverse classes of cases requiring a higher standard of proof than preponderance of the evidence. Examples include equitable actions to reform deeds or impose constructive trusts. Fix v. Fix, 847 S.W.2d 762, 764-65 (Mo. banc 1993); Bollinger v. Sigman, 586 S.W.2d 773, 775 (Mo.App.1979). Proceedings to establish mental illness or establish paternity after the death of the father by statute require a higher standard of proof. §§ 414-060.2(2) and 632.350.2. Termination of parental rights, enforcement of oral promises to pay debts of another, claims of gift and termination of life-sustaining treatment of an incompetent person all require proof exceeding the preponderance of the evidence. In re J.D.K., 685 S.W.2d 876, 879 (Mo.App.1984); Autoquip Corp. v. Nicholson and Associates, Inc., 740 S.W.2d 664, 668 (Mo.App.1987); In re Estate of Passman, 537 S.W.2d 380, 384 (Mo. banc 1976); Cruzan v. Harmon, 760 S.W.2d 408, 425 (Mo. banc 1988), aff'd, 497 U.S. 261, 110 S.Ct. 2841, 111 L.Ed.2d 224 (1990). Punitive damages may not constitutionally be awarded in defamation or slander cases under a “preponderance of the evidence” standard. Gertz v. Robert Welch, Inc., 418 U.S. 323, 350, 94 S.Ct. 2997, 3011, 41 L.Ed.2d 789 (1974). See also MAI 4th 3.06. These cases establish that the premise upon which this Court relied in Menaugh to support its conclusion regarding the burden of proof standard was not entirely supported by caselaw.
In each of the classes of civil cases noted above, an evidentiary standard of “clear *378and convincing” or “clear, cogent and convincing” evidence has been applied. While apparently unrelated, the cases to which the higher evidentiary standard has been applied do have a common thread. In each class of cases the remedy is so extraordinary or harsh that it should be applied only sparingly. The question which necessarily must be examined is whether the punitive damages remedy falls in that category of cases to which a higher evidentiary standard should be applied.
Punitive damages are not designed to compensate injured parties. They are designed for punishment and deterrence of misconduct. State ex rel. Smith v. Greene, 494 S.W.2d 55, 60 (Mo. banc 1973). The fundamental difference between civil law and criminal law is that the role of the former is to make those persons whole who have been injured or wronged by the conduct of another party. The purpose of the criminal law is to protect and vindicate the interests of the public as a whole, to punish the offender and deter others. W. Prosser, Handbook of the Law of Torts § 2, at 7 (4th ed. 1971). Punitive damages serve a function normally attributed to the criminal law. Because the criminal law imposes harsh sanctions as a punishment, it requires evidence beyond a reasonable doubt.
The penal nature of the punitive damages remedy has led a growing number of jurisdictions to conclude that exemplary damages must be established by the middle level standard of proof, clear and convincing evidence. Acosta v. Honda Motor Co., Ltd., 717 F.2d 828, 839 (3d Cir.1983); Roginsky v. Richardson-Merrell, Inc., 378 F.2d 832, 850 (2d Cir.1967); Raynor v. Richardson-Merrell, Inc., 643 F.Supp. 238, 245 (D.D.C.1986); Linthicum v. Nationwide Life Ins. Co., 150 Ariz. 326, 332, 723 P.2d 675, 681 (1986); Travelers Indemnity Co. v. Armstrong, 442 N.E.2d 349, 362-63 (Ind.1982); Tuttle v. Raymond, 494 A.2d 1353, 1363 (Me.1985); Owens-Illinois, Inc. v. Zenobia, 325 Md. 420, 601 A.2d 633, 657 (1992); Wangen v. Ford Motor Co., 97 Wis.2d 260, 294 N.W.2d 437, 458 (1980).
Punitive damages are not favored in the civil law. They carry a stigma and have the potential for economic debilitation of the defendant against whom such damages are rendered. Because the amount is left to jury discretion, punitive damages are unpredictable. In a case where a product is claimed to be defective, many customers may punish the same defendant repeatedly for the same conduct. A heightened evi-dentiary standard puts the fact-finder on notice that the remedy has so great a risk of harm that it should not be applied unless there is a high probability that the facts supporting the claim are true. Although punitive damages serve a valid purpose, a heightened evidentiary standard is appropriate. For these reasons, I would overrule Menaugh to the extent it is in conflict.
There is a secondary question as to whether a higher standard of proof is prohibited because of the legislative enactment of §§ 510.263 and 537.675, RSMo Supp. 1992 (providing for a bifurcated trial where actual and punitive damages are sought, remittitur and additur of punitive damages awards, and requiring that half such award be paid into the tort victims’ compensation fund). See Menaugh, 799 S.W.2d at 76 (Robertson, J., concurring). These statutory provisions make no mention of the standard of proof required to establish a punitive damages claim. Prior to Menaugh this Court had never spoken on what standard proof was applicable in a punitive damages case. Menaugh was decided three years after the enactment of §§ 510.-263 and 537.675. Thus, it cannot be implied that the legislature intended by their silence to enact a particular standard of proof. Punitive damages is entirely a product of the common law as developed by the courts of this state. To the extent the common law punitive damages doctrine is not defined, limited or modified by the legislature, this Court may articulate the standards by which the doctrine will be measured and applied.
For these reasons, I fully concur in the majority opinion, but add these comments in the hope that someone will pick up on the cue and raise such issues on appeal in *379the near future. Neither issue was directly addressed in this case.

. Dean Dorsey D. Ellis, Jr., of Washington University, reports that a recent study by the RAND Institute of Civil Justice found that punitive damages awards were on the increase in number and amount in product liability cases. The RAND study further disclosed that the average award against businesses was substantially larger than such awards against an individual. Ellis, Punitive Damages, Due Process, and the Jury, 40 Ala.L.Rev. 975, 985-86 (1989).