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Legal Memorandum: Limits on Punitive Damages

Issue: When are punitive damages capped due to an absence of gross negligence or willful conduct?

Area of Law: Litigation & Procedure, Personal Injury & Negligence
Keywords: Punitive damages; Limit or cap; Absence of gross negligence or willful conduct
Jurisdiction: Federal, Virgin Islands
Cited Cases: 763 P.2d 771
Cited Statutes: 20 V.I. Code § 555, § 555(a); Restatement (Second) of Torts §§ 282 and 500
Date: 11/01/2006

According to 20 V.I. Code § 555, non-economic, or punitive, damages in automobile accident cases must be capped at $75,000 unless there is a finding of “gross negligence” or “willful conduct.”  Under Virgin Islands law,

[t]he total amount recoverable for non-economic damages for any injury to a person in an action arising out of a motor vehicle accident may not exceed seventy-five thousand dollars ($75.000); provided, however, that this limitation shall not apply upon a finding of gross negligence or willful conduct.

20 V.I. Code Ann. § 555(a) (1999).  Because § 555(a) does not define “gross negligence” or “willful conduct,” the court may look to the Restatement (Second) of Torts §§ 282 and 500.  The Restatement equates “gross negligence” with “reckless disregard” and indicates that reckless disregard or reckless misconduct requires some element of intent. 

The intent sufficient to support a punitive damages award does not rise to level of an intent to cause injury; rather, willful indifference to or reckless disregard of the rights or safety of others supports a punitive damages award.  Johnson v. Rogers, 763 P.2d 771, 775 (Utah 1988).  “[I]n order to recover [punitive damages], a plaintiff must show that the defendant acted with actual malice or a reckless disregard of the rights of others.”  Id. at 775.  See also Anderson v. Amundson, 354 N.W.2d 895 (Minn. Ct. App. 1984) (driving while intoxicated, for example, can, by itself, constitute recklessness or willful indifference to the rights or safety of others sufficient […]

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