Punitive or Exemplary damages used interchangeably, has been the subject of controversy since its inception. Lawyers are quick to seek Punitive damages at any given instance, without taking into consideration what it means and the conditions for its application. They pray for it almost as a rite of passage. Courts too, have struggled to either, define its scope, or determine the quantum of the awards. The principal aim for the award of damages is to compensate a Claimant for the harm they have suffered by the actions or neglect of a defendant; it is to put the Claimant in the position, in so far as money could, before the harm was suffered. In common law, asides from the compensatory role of damages, the award may include additional aggravated damage features depending on the conduct of the defendant during the commission or omission of the harmful act, or even during the pendency of the suit. This is where punitive damages come to bear.
The Supreme Court in G. K. F. INVESTMENT (NIG) LTD v. NITEL PLC (2009) LPELR-1294(SC) defined it thus:
“Exemplary, Punitive, vindictive or Aggravated damages where claimed, are usually awarded, whenever the defendant or defendants’ conduct, is sufficiently, outrageous to merit punishment as where for instance, it discloses malice, fraud, cruelty, insolence, or flagrant disregard of the law and the like.”
Put more simply, punitive damages are extra-compensatory damages, the aim of which is to punish a Defendant for his wrongful conduct, and to deter him and others from similarly acting in the future.Punitive damage made its debut in England in the 1760s. English common law judges awarded non-compensatory damages (or allowed the juries to award them), where the behaviour of a defendant appeared bad enough to warrant same, without necessarily classifying the damage under a particular heading. Its history dates back more particularly to 1763, with its earliest usage found in the case of Huckle v Money, a false imprisonment case and Wilkes v Wood bordering on trespass to land. Other causes that attracted punitive damage at the time include: assault, defamation, and trespass to goods.
Punitive damage was to be qualified (in the United Kingdom) in 1964, in the popular case of Rookes v Barnard, wherein Lord Delvin, speaking for the House of Lords, disapproved the award entirely, but due to constraints by precedent, categorised the award in the following categories: a) cases of oppressive, ‘arbitrary or unconstitutional action’ by servants of the government acting in that capacity; b) cases where the Defendant calculated that he would make a profit by his conduct which may exceed the compensation payable to the claimant; and c) cases in which the award of punitive damages is authorised by statute.
Lord Delvin justified the first category on the basis that, servants of the government are equally servants of the people and therefore, the use of their power must at all times be subordinate to their duty of service. Cases under this category would include those involving the police, customs, road authorities, local authorities and similar government officials. The condition here is that, at all material times, the wrongdoer must be a servant of the government acting in that precise capacity. On the second type of case, involves situations where the Defendant calculated that the profit to be gained from the harmful action/omission, would be higher than the compensation the defendant could get. There need to exist the knowledge of the act being wrong in law, coupled with the calculation that the benefit therefrom would outweigh the liability to be suffered. Some causes that fall within this category include; conversion, trespass to land, conspiracy, false imprisonment, statutory competition torts, deceit and defamation. The third types of case are simply where a statute provides for an action to attract Punitive damages.
The scope of the cases that can attract Punitive damages has since been expanded, particularly after the decision of the House of Lords in Kuddus v Chief Constable of Leicestershire. As long as there is unacceptable behaviour on the part of the Defendant, or behaviours that have elements of malice, fraud, cruelty, insolence and similar behaviour, Punitive damages may run. This is seen in the earlier quoted decision of the Nigerian Supreme Court above, where it was held that:
“Exemplary damages, in particular, also known as punitive or vindictive damages can apply only where the conduct of the defendant merits punishment, and this may be considered to be so where such conduct is wanton, as where it discloses fraud, malice, cruelty, insolence or the like, or where he acts in contumelious disregard of the plaintiff’s rights. But exemplary damages, to some extent, are distinct from aggravated damages whereby the motives and conduct of the defendant aggravating the injury to the plaintiff would be taken into consideration in the assessment of compensatory damages.”