There are two distinct crossroads between legal practice claims and the issue of punitive damages. In one scenario, a victim of legal malpractice may seek to recover compensation for the amount of punitive damages a jury or judge imposed upon it. In the other scenario, the client may seek to recover punitive damages it sought from another party, but failed to obtain, allegedly as the direct result of some form of malpractice. The first scenario is referred to in legal literature as “punitive damages imposed” while the latter is referred to as “lost punitive damages.” Various courts around the nation have applied public policy considerations in evaluating both types of claims.
Less than 10 states have evaluated whether or not a legal malpractice plaintiff can recover punitive damages imposed upon them due to their prior counsel’s legal malpractice. All but one of those states has answered the question in the affirmative, allowing the claim to proceed. See e.g. Haberer v. Rice, 511 N.W.2d 279 (S.D.1994); Scognamillo v. Olsen, 795 P.2d 1357 (Colo. Ct. App 1990); Jacobsen v. Oliver, 201 F. Supp 2d 93 (D.D.C. 2002); Hunt v. Dresie, 740 P.2d 1046 (Kan. 1987); Elliott v. Videan, 791 P.2d 639 (Ariz. Ct. App. 1989) Only one state court - in Georgia - has seemingly misapplied the public policy concerns and prohibited the imposition of liability for punitive damages imposed. See e.g. Paul v. Smith, Gambrell, & Russell, 599 S.E.2d 206 (Ga. Ct. App. 2004)
The public policy bar to lost punitive damages is far more rationale, and therefore to no surprise, its adoption has been far more common. See e.g. Cappetta v. Lippman, 913 F. Supp 302 (S.D.N.Y. 1996), Summerville v. Lipsig, 704 N.Y.S. 598 (App. Div. 2000), Forrow v. Arnold, 47 A. 693 (R.I. 1900).
Any outright public policy prohibition, does, however, seem inappropriate to this author. While lost punitives may be far too speculative in most instances, it makes little sense to deprive an innocent plaintiff recovery in those circumstances in which causation is sufficiently established. The fact that the ultimate “wrongdoer” was not punished is no excuse for barring compensation. Imagine if a surgeon had complete immunity for botching a post-gunshot operation. As for the scenario in which punitive damages were imposed, Georgia at least seems to ignore the prospect that the malpractice itself may have been the cause for the former client’s qualification for punitive in the first place. Food for thought.