Complaint of money damages: 1. Conversion 2. Breach of Fiduciary Duty 3. Fraud 4. Constructive fraud 5. Breach of contract Three plaintiffs, one officer and two CA corporations are filing a civil complaint against me. How would punitive damages be calculated? What if I only signed an employment agreement with only one corporation? I am going pro per and want to settle as fast as I can, I am willing to pay restitution but want to minimize punitive damages.
How would I go about negotiating punitive damages?
Punitive damages are only recoverable as to the conversion, breach of fiduciary duty, fraud and constructive fraud causes of action.
If you were negotiating a settlement, you would NOT be negotiating an amount for punitive damages. That's because an award of punitive damages requires a finding, by clear and convincing evidence, “that the defendant has been guilty of oppression, fraud, or malice . . . .” (Civ. Code, § 3294, subd. (a).)
In California, three factors are to be evaluated in assessing punitive damages:
(1) the reprehensibility of a defendant's conduct;
(2) proportionality: whether the amount of the award bears a reasonable relationship to the damage actually suffered by plaintiff; and
(3) whether the award is reasonable in light of defendant's financial condition. (Neal v. Farmers Ins. Exchange(1978) 21 Cal.3d 910, 928.)
An important consideration in assessing punitive damages is the net worth of the defendant. (Devlin v. Kearny Mesa AMC/Jeep/Renault, Inc. (1984) 155 Cal.App.3d 381, 390.) The award must bear some reasonable relationship to the net worth of the defendant, and where the award is grossly disproportionate to the defendant's wealth, a presumption arises that it was the result of passion and prejudice. (Little v. Stuyvesant Life Ins. Co. (1977) 67 Cal.App.3d 451, 469.) A punitive damages award is excessive if it is disproportionate to the defendant's ability to pay. (Mike Davidov Co. v. Issod(2000) 78 Cal.App.4th 597, 607.)
Frank W. Chen has been licensed to practice law in California since 1988. The information presented here is general in nature and is not intended, nor should be construed, as legal advice for a particular case. This posting does not create any attorney-client relationship with the author. For specific advice about your particular situation, consult with your own attorney.
There is no set rule on punitive damages. Punitive damages are a separate type of damages that are only recoverable in certain circumstances and are hard to get. The plaintiff have a higher burden to recover them. Usually, after the trial on liability/damages, there is a separate phase of the trial to argue punitive damages. Without knowing more facts, its hard to advise you. I would say if they lost X dollars and you are willing to pay it back immediatel, they would take it and punitives will not come into play.
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Family Law Attorney
Mr. Chen is right. Most corporations and defendants are not going to agree to include a provision for punitive damages in a settlement agreement. If you want to negotiate a settlement, which is usually a great way to proceed since it shows good faith, my suggestion would be to include that number in your settlement offer. Hire a lawyer who knows what they're doing.
Lawsuit / Dispute Attorney
Ack! Please see an attorney. If you are exposed to punitive damages then you need representation.
Best of luck to you.
Attorney Rebekah Ryan Main
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This response is intended to be a general statement of law, should not be relied upon as legal advice, does not create an attorney/client relationship and does not create a right to continuing email exchanges.