Rich v. Schwab, 75 Cal. Rptr. 2d 170 (1998)

Citation: Rich v. Schwab, 75 Cal. Rptr. 2d 170 (1998)
Parent Document: Rich v. Schwab, 75 Cal. Rptr. 2d 170 (1998)
Jurisdiction: California (state)
Effective Date: 1998-06-01
Original Source: https://www.courtlistener.com/opinion/2252538/rich-v-schwab/ ↗

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In Murakami the Supreme Court found punitive damages under section 3294[4] are designed to deter wrongful conduct, not leave the defendant financially ruined. (54 Cal.3d at p. 112, 284 Cal.Rptr. 318, 813 P.2d 1348.) "Because the quintessence of punitive damages is to deter future misconduct by the defendant, the key question before the reviewing court is whether the amount of damages `exceeds the level necessary to properly punish and deter.'" (Id. at p. 110, 284 Cal. Rptr. 318, 813 P.2d 1348.) Accordingly, "the absence of evidence as to financial condition `frustrates a meaningful appellate review of punitive damage awards (i.e., of whether the *176 award was "grossly disproportionate"), since the absence of evidence of net worth precludes an appellate court from deciding whether an award might, for example, bankrupt the defendant.'" (Id. at p. 114, 284 Cal.Rptr. 318, 813 P.2d 1348.) Thus, the court in Murakami held that no award of punitive damages under section 3294 may be sustained in the absence of evidence of a defendant's financial condition.

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