Can I recover punitive damages if the “accident” was really intentional?
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UPDATED: May 24, 2013
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When an “accident” involves intentional wrongdoing, the victim may be entitled to recover, in addition to actual damages, additional damages know as punitive damages. Punitive damages are specifically designed to both punish the wrongdoer for his or her intentional misconduct and also to discourage others from engaging in intentional wrongdoing in the future.
While it is potentially possible to make claims for both actual damages and punitive damages, there may be some unanticipated negative consequences for the victim. Rather than collecting more in damages if you successfully prove that something that normally would have been presumed to be an accident was instead something that was done intentionally, you might wind up with even less, if you recover anything at all. That is because insurance companies deny coverage for their policyholders’ intentional misconduct and willfully improper acts. Thus, if you as a victim claim the “accident” was not really an accident at all but something that was done intentionally by the other party, his or her insurance company ultimately may be able to wash its hands of the claim, leaving you to try to collect directly from the other party – who may not have the assets to pay.
Let’s use a typical example. Let’s assume that Allen is angry at Brenda. One day Allen sees Brenda’s car in a parking lot and out of spite, drives his big truck into Brenda’s parked car, causing $2,000 worth of damage. Before Allen could drive away, a neighbor recognizes Allen who then claims that it was an accident. Under normal circumstances, a parking lot incident such as this would be assumed to have been an accident, resulting from Allen’s negligence – his failure to adhere to the standard of care that would be expected of a reasonable driver in his circumstances. Allen (or Allen’s insurance company) would then be liable to Brenda for the actual damages she sustained that were directly linked to the accident, such as the cost of repairing her car, rental of a replacement car, and, perhaps, “diminished value.” Assuming Allen carried auto liability insurance, his or her insurance company would typically work things out with Brenda to fix the car and pay the costs involved. Alternatively, if Brenda had collision coverage, she might turn to her insurance company to pay the claim, less any deductible, and let her insurance company recover from Allen or his insurance company.
Brenda, however, believes the accident was intentional, and let’s say Allen’s drinking buddy confirms that’s what Allen told him. Brenda has a potential claim against Allen for punitive damages above and beyond her right to compensation for the damage to her car and any personal injuries she may have suffered. However, if she seeks punitive damages against Allen claiming that the accident was really intentional, while Allen’s insurance company would defend Allen from the negligence charges, and would be liable to Brenda if all she proves is Allen was negligent, if she also successfully proves Allen intentionally caused the “accident,” then the insurance company would walk away without any obligation to pay her anything. For that reason, many lawyers recommend not even raising the possibility that an accident was intentional, as the opportunity to recover both actual and punitive damages has the potential to result in zero collectible dollars if the accident is found to have been intentional.