Harris Creech Ward and Blackerby, P.A.: Punitive Damages in North Carolina

In North Carolina, the court may award punitive damages to the plaintiff in order to discourage others (like the defendant) from engaging in similarly egregious conduct. Read on to learn more.

In the state of North Carolina, as in other jurisdictions throughout the country, plaintiffs are rarely awarded punitive damages.  Still, as the defendant in an injury lawsuit, it’s important that you prepare for the possibility of punitive damages if the circumstances of the case are such that such damages could potentially be awarded.

• If you are being sued in a personal injury lawsuit, or if you believe that you could be exposed to liability due to an incident involving an injury caused to another, then it’s important that you consult with a North Carolina injury attorney.  In North Carolina, as in other states, punitive damages are quite uncommon.  When awarded, however, they can be significant. Effective liability avoidance requires the skilled guidance of a seasoned attorney.

What are punitive damages, exactly?

Fundamentally, punitive damages are imposed as a means of deterring certain behaviors in society at-large.  Punitive damages are bonus, or exemplary damages.  In other words, they are awarded in addition to the compensatory damages (that are awarded on the basis of actual losses suffered by the plaintiff).  For example, in a product defect injury lawsuit, if you — the defendant manufacturer — have acted in an egregious or malicious manner, then the court may award punitive damages in order to discourage other manufacturers from engaging in similarly wrongful behavior.

Punitive damages are at the center of many national lawsuits with a media spotlight, as punitive damages operate as a multiple of the compensatory damages, which can lead to significant, multimillion dollar damage awards.  Given this spotlight, many people unfamiliar with litigation believe that punitive damages are quite common — this is not the reality, however.

Qualifying Conduct

Punitive damages are awarded in a very narrow range of circumstances.  In North Carolina, specifically, a court will only award punitive damages if the plaintiff can prove that the conduct of the defendant (i.e., your conduct) was fraudulent, malicious, or willful and wanton.  Mere negligence is not enough.  In the motor vehicle context, for example, a speeding driver may not be exposed to punitive damages liability for driving 10 miles per hour over the speed limit.  On the other hand, if the same driver were traveling at 40 miles per hour over the speed limit, and in a residential zone, then punitive damages are much more likely to be awarded (as the driver has evidenced willful and wanton conduct).

Limitations on Damages 

Even if the plaintiff brings forth evidence that convinces the court to impose punitive damages on you, it’s important to note that North Carolina law sets a cap on such damages.  As a North Carolina defendant, you may not be exposed to punitive damages in excess of three times the compensatory damages total, or $250,000 (which is higher).  The hard limit for punitive damages is therefore $250,000.  For example, if you are liable for $100,000 in compensatory damages in a slip-and-fall case, you cannot be exposed to punitive damages liability in excess of $250,000.