Indiana Law Review


Notes

Punitive Damages for Crime Victims:
New Possibilities for Recovery in Indiana

I. Introduction

In its 1978 decision in Glissman v. Kutt,^ the Indiana Court of

Appeals held that plaintiffs injured in an automobile accident could

not recover punitive damages against a defendant convicted of reckless

driving for the same accident. The court found that it would be "contrary

to the basic concerns of punitive damages . . . [to] permit both criminal

prosecution and the sanction of punitive damages where the defendant's

conduct merely exhibited a 'heedless disregard of the consequences' to

his victim. "2 The Glissman decision reaffirmed the rule first announced

by the Indiana Supreme Court in 1854 in Taber v. Hutson:^

[T]here is a class of offenses, the commission of which, in

addition to the civil remedy allowed the injured party, subjects

the offender to a state prosecution. To this class the case under
consideration belongs, and if the principle of the instruction be

correct"* Taber may be twice punished for the same assualt and
battery. This would not accord with the spirit of our institutions.

The constitution declares, that 'no person shall be twice put in
jeopardy for the same offense,' and though that provision may
not relate to the remedies secured by civil proceedings, still it

serves to illustrate a fundamental principle inculcated by every

well-regulated system of government, viz., that each violation

of the law should be certainly followed by one appropriate

punishment and no more.^

Since Taber, Indiana has been among the minority of states dis-
allowing punitive damages in a civil action where the defendant is also

subject to criminal prosecution arising from the same act.^ In light of

475 Ind. App. 493, 372 N.E.2d 1188 (1978).

^Id. at 497, 372 N.E.2d at 1191.

^5 Ind. 322 (1854).

"At the plaintiff's request, the lower court had instructed that 'it is the true policy

of the law . . . not only to give compensation for the actual loss, but to give such

additional damages as will tend to prevent such conduct, and give peace and security to

private rights and the community in general." Id. at 324.
^5 Ind. at 325-26.

*A sampling of other cases espousing the double jeopardy safeguard includes Murphy
V. Hobbs, 7 Colo. 541, 5 P. 119 (1884) (legislatively overruled); Angelloz v. Humble Oil
& Ref. Co., 196 La. 604, 199 So. 656 (1941); Winkler v. Koeder, 23 Neb. 706, 37 N.W.
607 (1888); Fay v. Parker, 53 N.H. 342 (1872). Cf. Louisville, New Albany & Chicago

655



656 INDIANA LAW REVIEW [Vol. 18:655

the unjust results often fostered by the appHcation of Taber in various

types of htigation'' and in an effort to placate increasing judicial dis-

satisfaction with the rule/ the Indiana State Legislature in 1984 reversed

long standing precedent by eliminating criminal prosecution as a defense

to a civil claim for punitive damages.^ The new statute reads in relevant

part:

It is not a defense to an action for punitive damages that

the defendant is subject to criminal prosecution for the act or

omission that gave rise to the civil action. '°

In enacting the statute, Indiana has adopted the majority rule." The

legislature's conformity to the majority position will inevitably increase

a plaintiff's opportunities for recovery of punitive damages.

This Note will initially trace the downfall of the Taber rule in

Indiana and uncover several areas of litigation where the rule's previous

application has produced unsatisfactory results. The discussion will then

turn to defining the criminal activity most likely to be affected by the

new statute as evidenced by other states, and an analysis will be made

of the legislative and anticipated judicial efforts to control its possible

misuse. The Note will conclude by assessing the crime victim's realistic

chances for recovery under the new statute and the statute's impact on

Indiana's victim compensation program. Before defining the limits of

the new statute, a brief examination of the purposes and historical

development of punitive damages is necessary.

Ry. Co. V. Wolfe, 128 Ind. 347, 27 N.E. 606 (1890) (punitive damages award justified

because conduct complained of was not punishable criminally). Contra Smith v. Bagwell,

19 Fla. 117 (1882); Saunders v. Gilbert, 156 N.C. 463, 72 S.E. 610 (1911).

''See infra notes 53-55 and accompanying text.

^See Smith v. Mills, 179 Ind. App. 459, 385 N.E.2d 1205 (1979) (stating that the

rule was ripe for reconsideration).

''Act of Feb. 29, 1984, Pub. L. No. 172, 1984 Ind. Acts 1462 (codified at Ind.

Code § 34-4-30-2 (Supp. 1985)).

'°/(i. Other jurisdictions have enacted similar laws. See, e.g., Colo. Rev. Stat. §

13-21-102 (1973) (allowing assessment of punitive damages for wrongs committed against

an individual, or to personal or real property); Ga. Code § 51-12-5 (1982) (punitive damages

allowed in tort actions in which aggravating circumstances are present); Mont. Code Ann.

§ 27-1-221 (1983) (civil punitive award permitted where the defendant has been guilty of

oppression, fraud, or malice); N.C. Gen. Stat. § 99A-1 (1979) (recovery of punitive

damages allowed for interference with property rights). A punitive damages provision has
also been incorporated within the Texas constitution. Tex. Const, art. XVI, § 26 gives

a surviving spouse or heir a claim for punitive damages against a person or corporation

guilty of homicide.

"In determining the propriety of a punitive damages award, the vast majority of

courts have considered it immaterial that the defendant is also subject to criminal prosecution

for the same act. One decision in this state has even recognized, "Indiana is in the distinct

minority of states which disallows exemplary damages in a civil action if the party against

whom they are levied is subject to criminal prosecution arising out of the same act."
Cohen v. Peoples, 140 Ind. App. 353, 356, 220 N.E.2d 665, 668 (1966).



1985] PUNITIVE DAMAGES 657

II. An Overview of Punitive Damages

A. The Origins and Purposes of Punitive Damages

The doctrine of punitive or exemplary damages'^ originated in the

18th century English courts as a justification for jury money awards
greatly in excess of the tangible harm suffered by the plaintiff.'^ Juries
were endowed with a judicial grant of unlimited discretion in gauging

the severity of a punitive award. '"^ Their verdicts were rarely reviewed

by the courts, especially where the conduct in question had caused

personal suffering. ^^ This grant of unlimited discretion was bestowed

upon juries very early in several American jurisdictions.'^ The awards

rendered by juries in these jurisdictions involved elements of intangible

harm.'^

By the nineteenth and twentieth centuries, however, punitive damages

were used almost exclusively to deter and punish the defendant where

compensatory damages failed to achieve similar results.'^ In short, they

'^"Punitive" and "exemplary" are terms most commonly applied to this class of

money damages. Throughout this Note, these damages will be referred to as punitive

damages.

Punitive damages are distinguished from compensatory damages in that an award of

the latter is merely intended to make the plaintiff whole, replacing the loss caused by
the wrong or injury and nothing more. Punitive damages transcend actual damages and

are inflicted not because of any special merit in the injured party's case, but to punish

the defendant and to make an example for similar wrongdoers. Because of this punitive

purpose, punitive damages are usually not covered by liability insurance. See Northwestern

Nat'l Cas. Co. v. McNulty, 307 F.2d 432, 440 (5th Cir. 1962). For a general discussion

of punitive damages in a tort action see W. Prosser, Law of Torts § 2 (4th ed. 1971).
''The case generally cited as establishing the rule of punitive damages is Huckle v.

Money, 2 Wils. 205 (K.8. 1763). In Huckle, Lord Camhen sanctioned the jury's con-
demnation of the defendant's abuse of state authority by upholding a large money award

even though the plaintiff's actual damages were negligible. For a general discussion of

the law of punitive damages, see K. Redden, Punitive Damages §§ 2.1-2.9 (1980); 1 T.

Sedgw^ick, a Treatise on the Measure of Damages § 348 (9th ed. 1912).
'"See K. Redden, supra note 13, § 2.2(A)(2), at 26; see also W. Hale, Law^ of

Damages, 201-10 (1896). (It is within the province of the court to determine whether the

evidence supports an award; however, it is within the exclusive province of the jury to

determine whether or not it should be awarded.).

T. Sedgwick, supra note 13, § 349, at 688.
'"See, e.g., Tillotson v, Cheetham, 3 Johns 46 (N.Y. Sup. Ct. 1808).

'^W. Hale, supra note 14, at 202. Some examples include mental anguish, humiliation,
and injury to reputation.

''See Tillotson v. Cheetham, 3 Johns 56 (N.Y. Sup. Ct. 1808). In a New York action
for libel. Judge Spencer emphasized the objectives of the punitive damages rule: "In

vindicative actions such as for libel, defamation, assault and battery, false imprisonment,

and a variety of others, it is always given in charge to the jury that they are to inflict

damages for example's sake, and by way of punishing the defendant." Id. at 64.

The dual objectives of deterrence and punishment are also a part of the Indiana law
on punitive damages. See, e.g.. Riverside Ins, Co. v. Pedigo, 430 N.E.2d 796, 809 (Ind.

Ct. App. 1982); Monte Carlo, Inc. v. Wilcox, 180 Ind. App. 669, 672, 390 N.E.2d 673,
675 (1979); Vaughn v. Peabody Coal Co., 176 Ind. App. 474, 481, 375 N.E.2d 1159,



658 INDIANA LAW REVIEW [Vol. 18:655

protected society "against a violation of personal rights and social

order.
'"^

B. The Culpability Requirements of Criminal

and Civil Punishment: A Comparison

In a criminal proceeding, the prosecutor must prove that the de-

fendant had the intent, or mens rea, to commit the offense. This criminal

intent is found in the actor's desire to cause the consequences of his

act, or in his belief that the consequences are substantially certain to

result from it.^^ This element must also be established to recover punitive

damages in a civil action.^'

To support an award for punitive damages in a civil action, however,
the plaintiff has the additional burden of proving some aggravating

circumstance such as malice, fraud, ill will, or a conscious disregard for

the rights or interests of others. ^^ It is this element of wantonness for

which the law inflicts punishment. This added requirement is generally

satisfied by offering either direct or circumstantial evidence of the de-

fendant's state of mind or underlying motive. ^^

Punitive damages are generally not awarded for simple acts of

negligence. ^"^ Rather, conduct resulting in a punitive damages award often

involves ''some element of outrage similar to that usually found in a

1163 (1978).

In addition to the punitive aspect, punitive damages may also serve as a revenue
mechanism. See, e.g., Gostkowski v. Roman Catholic Church of the Sacred Heart, 262
N.Y. 320, 324-25, 186 N.E. 798, 800 (1933) Gury permitted to award damages which

express indignation at the defendant's conduct rather than establish a value for plaintiff's

loss).

'''W. Hale, supra note 14, at 201.

^°See Note, The Imposition of Punishment by Civil Courts: A Reappraisal of Punitive
Damages, 41 N.Y.U. L. Rev. 1158, 1163 (1966).

'^Id.

^^"Punitive damages may be awarded when there is a finding of fraud, malice, gross
negligence, or malicious or oppressive conduct on the part of the defendant." Vaughn

V. Peabody Coal Co., 176 Ind. App. 474, 480, 375 N.E.2d 1159, 1163 (1978). Accord

Klam V. Koppel, 63 Idaho 171, 118 P.2d 729 (1941); Brademas v. Real Estate Dev. Co.,
175 Ind. App. 239, 370 N.E.2d 997 (1977); Jones v. Ross, 141 Tex. 415, 173 S.W.2d

1022 (1943); Baker v. Marcus, 201 Va. 905, 114 S.E.2d 617 (1960). While "intentional"

or "willful" denotes a mental state accompanying the defendant's act, "malice" describes

an act known to be harmful to another. See Ellis, Fairness and Efficiency in the Law
of Punitive Damages, 56 S. Cal. L. Rev. 1, 35 (1982).

"Wantonness may be inferred from the surrounding facts and circumstances. See,
e.g., Watkins v. Layton, 182 Kan. 702, 324 P.2d 130 (1958); Hannahs v. Noah, 83 S.D.

296, 158 N.W.2d 678 (1968).
^'E.g., Hibschman Pontiac, Inc. v. Batchelor, 266 Ind. 310, 362 N.E.2d 845 (1977);

Louisville, New Albany & Chicago Ry. Co. v. Shanks, 94 Ind. 598 (1883); Prudential
Ins. Co. of Am. v. Executive Estates, Inc., 174 Ind. App. 674, 369 N.E.2d 1117 (1977);
Sinclair Ref. Co. v. McCullom, 107 Ind. App. 356, 24 N.E.2d 784 (1940); McNamara v.
St. Louis Transit Co., 182 Mo. 676, 81 S.W. 880 (1904).



1985] PUNITIVE DAMAGES 659

crime. "2^ Punitive damages are subject to the discretion of the jury,^^

and, unlike compensatory damages, are not recoverable as of right. ^^

Furthermore, a punitive award is predicated upon the finding of actual

damages^^ and must generally bear some relation to the amount of the

compensatory damages award.^^

Punitive damages have not been favored in the law^° and throughout

their long history have been widely criticized.^' Nonetheless, the majority

of jurisdictions, including Indiana, have continued to follow the doctrine

*'more because of precedent than anything else.''^^

"Restatement (Second) of Torts § 908 comment b (1979).

^"See, e.g., Hall-Hottel Co. v. Oxford Square Co-op., Inc., 446 N.E.2d 25 (Ind.

Ct. App. 1983); American Family Ins. Group v. Blake, 439 N.E.2d 1170 (Ind. Ct. App.

1982). In fact, it is error to instruct the jury to award punitive damages. See McClellan,

Exemplary Damages in Indiana, 10 Ind. L.J. 275, 283 (1935).
^^E.g., Travelers Indem. Co. v. Armstrong, 442 N.E.2d 349 (Ind. 1982); Indianapolis

Bleaching Co. v. McMillan, 64 Ind. App. 268, 113 N.E. 1019 (1916).

''See Hubbard v. Superior Ct. of Maricopa County, 111 Ariz. 585, 535 P. 2d 1302

(1975); Martin v. United Sec. Serv., Inc., 314 So.2d 765 (Fla. 1975); Baker v. American

States Ins. Co., 428 N.E.2d 1342 (Ind. Ct. App. 1981); Newton v. Yates, 170 Ind. App.

486, 353 N.E.2d 485 (1976); Stratton v. Jensen, 64 Mich. App. 602, 236 N.W.2d 527

(1975).

'^See Morris, Punitive Damages in Tort Cases, 44 Harv. L. Rev. 1173, 1180 (1931);
see also Murphy Auto Sales v. Coomer, 123 Ind. App. 709, 112 N.E.2d 589 (1953). Under
current Indiana law, there is no rule that the amount of punitive damages must be within

a certain ratio to compensatory damages. See Hibschman Pontiac, Inc. v. Batchelor, 266

Ind. 310, 362 N.E.2d 845 (1977); Nate v. Galloway, 408 N.E.2d 1317 (Ind. Ct. App.

1980). But see Bangert v. Hubbard, 127 Ind. App. 579, 126 N.E.2d 778 (1955), trans,

denied, 237 Ind. 5, 143 N.E.2d 285 (1957).

'°See Aladdin Mfg. v. Mantle Lamp Co. of Am., 116 F.2d 708, 717 (7th Cir. 1941);
see also Walther & Plein, Punitive Damages: A Critical Analysis, 49 Marq. L. Rev. 369,
380 (1966). Although arguments have been advanced both for and against the doctrine

in every state, nearly every state has accepted the concept of punitive damages to some

degree. Id.

"The doctrine of punitive damages has been attacked from many corners. It has
been argued frequently that punishment is not a proper object of the civil law and that

the state alone has the power to inflict penalties. See Morris, supra note 29, at 1176.

Moreover, if the wrongdoer has been sufficiently punished in a criminal court, a further

intrusion into his economic resources as a deterrent to future wrongful acts is not necessary.

Id. at 1195.

Another criticism of the doctrine of punitive damages relates to the unregulated

power of the jury to determine the amount of the award. For a critique of jury awards

against corporate defendants, see DuBois, Punitive Damages in Personal Injury, Products
Liability and Professional Malpractice Cases: Bonanza or Disaster, 43 Ins. Counsel J.
344 (1976). To eliminate the "Robin Hood" philosophy — the practice of taking from
a wealthy corporation and giving to a needy plaintiff — DuBois suggests that the jury should
be restricted to determining if the defendant should be punished, while the court would

be solely responsible for fixing the amount of damages awarded. Id. at 353.

Despite these criticisms of the rule, punitive damages have been defended "as an

incentive to bring into court and redress a long array of petty cases of outrage and

oppression which in practice escape the notice of prosecuting attorneys occupied with

serious crime, and which a private individual would otherwise find not worth the trouble

and expense of a lawsuit." W. Prosser, supra note 12, § 2, at 11 (footnote omitted).
^'See McClellan, supra note 27, at 286. Indiana courts have sometimes disagreed



660 INDIANA LAW REVIEW [Vol. 18:655

C. Criminal and Civil Penalties: Similarity of
Purpose, Differences in Effect

Because the purposes of criminal penalties and punitive damages are

identical — deterrence, retribution and punishment — an award of such
damages with the goal of civil punishment has been described as a legal

anomaly." Despite similarity of purpose, the effects of civil and criminal

punishment are unequal. Whereas a punitive damages award only invades

the defendant's pocketbook, criminal penalties often include a loss of

freedom,^'* warranting the protection of special procedural safeguards. ^^

A criminal conviction also carries with it a social stigma not found with
a determination of civil Hability.^^

Notwithstanding the disparate impact of civil and criminal sanctions,

both constitute a form of punishment. Where conduct results in both
civil and criminal accountability, the defendant is not only confronted

with a potential loss of liberty, but with an intrusion into his financial

resources as well. It is for this reason that the Indiana Supreme Court

adopted a seemingly broad interpretation of the constitutional protection

against double jeopardy in the Taber decision. ^^

with the entire doctrine. See, e.g.. Western Union Tel. Co. v. Bierhaus, 8 Ind. App. 563,

36 N.E. 161 (1893). In an attempt to Hmit punitive damage awards to the most deserving

plaintiffs, the Indiana Legislature has raised the standard of proof for punitive damages

to "clear and convincing" evidence. See infra note 156 and accompanying text.

"See Note, Criminal Safeguards and the Punitive Damages Defendant, 34 U. Chi.
L. Rev. 408, 409-11 (1976) [hereinafter cited as Note, Criminal Safeguards].

^•The threat of imprisonment also accompanies a criminal fine. See, e.g., Ind. Code

§ 35-50-2-6 (1982) (Class C felonies in Indiana are punishable by both a fixed term of
imprisonment and a criminal fine.).

"Examples include the higher standard of proof of "beyond a reasonable doubt"

and the protection against self-incrimination. See W. LaFave & A. Scott, Criminal Law
§§ 4, at 16, 22, and 161 (1972).

""There is no blank on a job application for listing past punitive damages judgments."

See Note, Criminal Safeguards, supra note 33, at 411.

"U.S. Const, amend. V provides in relevant part: "[N]or shall any person be subject
for the same offense to be twice put in jeopardy of life or limb . . . ." The double

jeopardy clause applies to the states through the due process clause of the fourteenth

amendment. Benton v. Maryland, 395 U.S. 784, 794 (1969). Ind. Const, art. I, § 14

reads, "No person shall be put in jeopardy twice for the same offense. No person, in
any criminal prosecution, shall be compelled to testify against himself." The Taber rule

outlawing punitive damages in a civil action where the tortious act is also criminally

punishable was founded on the spirit, not the letter, of the fifth amendment's prohibition

against double jeopardy. Note, Criminal Safeguards, supra note 33, at 413. The fifth amend-

ment's prohibition is applicable solely to successive criminal punishments for the same of-

fense and does not relate to the remedies secured by civil proceedings. See Breed v. Jones,

421 U.S. 519 (1975) (the risk to which the double joepardy clause refers is not present in pro-

ceedings that are not essentially criminal); Rex Trailer Co. v. United States, 350 U.S. 148

(1956) (a liquidated damages clause was found to be remedial in nature, therefore not consti-

tuting a second criminal penalty); Helvering v. Mitchell, 303 U.S. 391 (1938) (double jeopardy

clause merely prohibits punishing the defendant twice for the same act or omission, or

attempting for a second time to punish him criminally).



1985] PUNITIVE DAMAGES 661

Prior to the legislative enactment of Indiana Code section 34-4-30-

2, the Taber rule had been criticized for disregarding the practical inner

workings of the modern criminal justice system. The rule had also been

discredited for its incongruous effects when applied to certain classes

of lawsuits. ^^

III. The Inadequacies of the Taber Rule

A. The Taber Rule Ignored the Practicalities of the Modern
Criminal Justice System and Failed to Distinguish

Criminal and Civil Redress

With respect to the practical realities of the criminal justice system,

the most troublesome flaw of the doctrine announced in Taber was its

failure to acknowledge the distinction between private and public redress. ^^

The majority of jurisdictions have long recognized that an act punishable

as a tort and as a crime is both an offense against society at large, for

which the state, as the public's representative, will prosecute to vindicate

the interests of society as a whole, and a personal wrong committed

against an individual, for which he may seek private vindication in a
civil court. "^^ Thus, punitive damages are not granted in lieu of criminal

punishment, nor do they have any necessary relation to the penalty

incurred for the injury done to the public.'*' Rather, punitive damages

supplement criminal penalties by addressing the interests of the individual

victim.

Under the Taber rule, those plaintiffs who had been willfully and
intentionally injured and who were in the best position to advance the
punishment and deterrence objectives of punitive damages were com-

pletely precluded from seeking punitive relief.'*^ As a consequence of a

variety of factors, such as the prosecutor's unHmited discretion in trying

cases, problems of proof, or the difficulty in meeting the procedural

requirements of a criminal proceeding, the same reprehensible conduct

for which the culpable party escaped civil liability for punitive damages

^*Note, Double Jeopardy and the Rule Against Punitive Damages o/ Taber v. Hutson,
13 IND. L. Rev. 999, 1004 (1980) [hereinafter cited as Note, Double Jeopardy].

^^McClellan, supra note 26, at 279.

•"W. Prosser, supra note 12, at 7.

*'See Soucy v. Greyhound Corp., 27 A.D.2d 112, 276 N.Y.S.2d 173 (1967), where

the court held, "While an award of such damages is concededly punitive, it is in our

opinion, in fact, a private remedial remedy rather than a public criminal sanction." Id.

at 113, 276 N.Y.S.2d at 175.

"^Thus, the victim of an aggravated assault and battery was barred from seeking

punitive damages against the culprit, despite his ability to satisfy the lower standard of

proof required in a civil action because of the culprit's possible exposure to criminal

prosecution. See, e.g., Borkenstein v. Schrack, 31 Ind. App. 220, 67 N.E. 547 (1903).



662 INDIANA LAW REVIEW [Vol. 18:655

as a result of Taber frequently went unpunished at the criminal level /^

The possibility existed for what was in all practical effects total exon-

eration of the defendant in the majority of these cases."^ In this manner,

the rule not only afforded blanket protection against double jeopardy,

but succeeded in warding off initial jeopardy as well.

Although originally rooted in the constitutional protection against

double jeopardy, the Taber rule ironically failed to serve the fundamental

objectives of the constitutional guarantee upon which it was based. One
of the underlying objectives of the constitutional protection against double

jeopardy is eliminating the fear of having to endure multiple trials."*^

But where the state decided to prosecute conduct which was the subject

of a civil suit — this situation was more typical of an aggressive act,
such as a violent assault — the defendant was still made to suffer two trials
despite the doctrine's restraints. "^^ Although plaintiffs were prohibited

from seeking punitive damages against individuals subject to criminal

prosecution, they were still permitted to bring claims for compensatory

damages. "^^ Moreover, while a criminal trial did not prohibit a tort

claimant from seeking reasonable compensation for his loss, the fact

that a defendant was being sued in tort barred the state from seeking

criminal punishment. "^^ Although the Taber rule might have lessened the

defendant's exposure in a civil trial, it failed to fully and "effectively

implement the double jeopardy purpose of diminishing the uncertainty

*^See Note, Double Jeopardy, supra note 38, at 1004-05; see also McLemore, Punitive

Damages and Double Jeopardy: A Critical Perspective of the Taber Rule, 56 Ind. L.J. 71, 82-83
(1980). See generally Pound, Discretion, Dispensation and Mitigation: The Problem of
the Individual Special Case, 35 N.Y.U. L. Rev. 925 (1960); Tieger, Police Discretion and

Discriminatory Enforcement, 1971 Duke L.J. Ill (1971).
""^See McLemore, supra note 43, at 82. The victim could still bring an action for

compensatory damages, however.

'*^See McLemore, supra note 43, at 85.

'"See Stone v. United States, 167 U.S. 178, 188-89 (1897) noted in McLemore, supra

note 43, at 85.

Interestingly, double jeopardy principles do not prevent the double conviction

and punishment of a defendant for a crime and conspiracy to commit that crime, even

though both offenses stem from the same prohibited conduct. See lannelli v. United

States, 420 U.S. 770 (1975); Blockhurer v. United States, 284 U.S. 299 (1932); see also

Elmore v. State, 269 Ind. 532, 382 N.E.2d 893 (1978) (where the court focused on the

identity of the offenses, not on the identity of their source); Durke v. State, 204 Ind.

370, 183 N.E. 97 (1932); Collier v. State, 173 Ind. App. 120, 362 N.E.2d 871 (1977). It

is well established in Indiana that the legislature may prescribe both criminal and civil
penalties for the same act without transgressing the spirit of the double jeopardy provision.

See State ex rel. Beedle v. Schoonover, 135 Ind. 526, 35 N.E. 119 (1893). See generally

Aldridge, The Indiana Doctrine of Exemplary Damages and Double Jeopardy, 20 Ind.
L.J. 123 (1945).

"•individuals may always seek civil redress for actual losses suffered because the
allowance for compensatory claims is premised on the wholly remedial nature of such

damages. Stone v. United States, 167 U.S. 178, 188-89 (1897).

'"*"[T]his court does not view the rule ... as being one based on the probability

of criminal prosecution but rather on the possibility of such prosecution." Moore v. Waitt,
157 Ind. App. 1, 8, 298 N.E.2d 456, 460 (1973).



1985] PUNITIVE DAMAGES 663

which a defendant faces from the possibiHty of enduring multiple trials

as a result of a single act or course of conduct."'*^

B. Types of Litigation Where the Taber Rule

Has Produced Inconsistent Results

The doctrine also created anomalous results when applied to certain
types of litigation. For example, when an individual had suffered harm

to his character or reputation because of the culpable acts of another, ^^

he was permitted to recover punitive damages. Because the tort of

defamation was not punishable as a crime in Indiana, such recovery

was not precluded.^' Yet, when a plaintiff was physically injured, his

claim against the wrongdoer was restricted to compensatory relief. Plain-

tiffs who were victims of aggravated assault — punishable as a crime in
Indiana — provide an illustrative example. ^^ With regard to these acts,
Taber created the unusual situation of increasing the opportunities for

relief for one whose name had been slandered while limiting the monetary
recovery for one whose body had been beaten."

The Taber rule fostered other disturbing results. For instance, while

minors were generally held civilly accountable for their tortious acts,^'*

only after the age of fourteen were they presumed capable of committing

crimes. ^^ Thus, a victim of an intentional wrongdoing committed by a

'''^See McLemore, supra note 43, at 85.

^°See Ind. Code § 34-4-13-1 (1982) (general statute governing the standard of proof

in a civil action for libel and slander).

"See Note, Double Jeopardy, supra note 38, at 1005.

^^Compare Ind. Code § 34-4-13-1 (1982) (libel and slander) with Ind. Code Ann.

§ 35-42-2-1 (Burns Supp. 1984) (battery).

"See Note, Double Jeopardy, supra note 38, at 1005-06.

^^Daugherty v. Reveal, 54 Ind. App. 71, 78, 102 N.E. 381, 384 (1913); accord,

Patterson v. Kasper, 182 Mich. 281, 148 N.W. 690 (1914); Rozell v. Rozelle, 281 N.Y.

106, 22 N.E.2d 254 (1939); Lowery v. Cate, 108 Tenn. 54, 64 S.W. 1068 (1901); Wisconsin

Loan & Fin. Corp. v. Goodnough, 201 Wis. 101, 228 N.W. 484 (1930).
'^See Note, Double Jeopardy, supra note 38, at 106; 5ee also Bottorff v. South Constr.

Co., 184 Ind. 221, 227, 110 N.E. 977, 978 (1916) noted in McLemore, supra note 43, at 89;

accord. State v. Dillon, 93 Idaho 698, 471 P.2d 553 (1970), cert, denied. 401 U.S. 942 (1971).

Many jurisdictions have codified this common law rule. See, e.g.. State v. Taylor,
109 Ariz. 481, 512 P.2d 590 (1973); Stanley v. State, 248 Ark. 787, 454 S.W.2d 72 (1970).

The presumption that children under the age of fourteen are incapable of committing

crimes is, however, rebuttable. See Senn v. State, 53 Ala. App. 297, 299 So. 2d 343 (1974);

In re Davis, 17 Md. App. 98, 299 A.2d 856 (1973).
Even minors who have been processed through the juvenile court system are not

characterized as "criminals." Ind. Code § 31-6-3-5 (1982) provides:
(a) A child may not be charged with or convicted of a crime . . . unless

he has been waived to a court having criminal jurisdiction.

(b) A child may not he considered a criminal by reason of an adjudication
in a juvenile court nor may such an adjudication be considered a conviction
of a crime. Such an adjudication does not impose any civil disability imposed

by conviction of a crime.

(c) A child's contact with the juvenile justice system does not disqualify
him from any governmental application, examination, or appointment.



664 INDIANA LAW REVIEW [Vol. 18:655

child under the age of fourteen would not have been prohibited from

seeking punitive damages. Such victims however, would have been pre-

cluded from requesting punitive relief from an adult under the same

circumstances. Similarly, an individual deliberately injured by a defendant

of unsound mind could have conceivably recovered a punitive damages

award because such defendant under Indiana law was liable for his torts,

but immune from criminal prosecution.^^ A similar award, however,
would have been denied to a victim of a wrongdoing committed by one

adjudged competent. These situations illustrate incongruities that the

Taber court did not foresee.

C. Indiana Courts Have Nonetheless Disfavored
the Limitations of Taber

Following the Taber decision, Indiana courts produced distorted

constructions of the rule in an endeavor to escape its application. For

example, although the judiciary had consistently denied punitive damages

where the defendant was subject to a criminal prosecution for the same

act, compensatory damages were expanded liberally in these early cases

to include all injuries, both mental and physical, directly stemming from

the defendant's wrongdoing." Included within this seemingly limitless

category were such elements as loss of reputation, bodily pain, humil-

iation, and loss of peace of mind and individual happiness.^* More recent
opinions carved out various exceptions to the rule in attempts to coun-

teract its often inequitable results. ^^ Several such holdings openly called

^''Ind. Code § 35-41-3-6 provides:

(a) A person is not responsible for having engaged in prohibited conduct
if, as a result of mental disease or defect, he lacked substantial capacity either

to appreciate the wrongfulness of the conduct or to conform his conduct to

the requirements of law.

(b) "Mental disease or defect" does not include an abnormality manifested

only by repeated unlawful or antisocial conduct.

For cases on point, see Buzynski v. Oliver, 538 F.2d 6 (1st Cir.), cert, denied, 429 U.S.

984 (1976); Law v. State, 406 N.E.2d 1185 (Ind. 1980); Hill v. State, 252 Ind. 601, 251
N.E.2d 29 (1969); Woods v. Brown, 93 Ind. 164 (1883).

"Lake Erie & W. Ry. Co. v. Fix, 88 Ind. 381, 388 (1882) Gury not restricted to
the pecuniary loss of the sufferer).

'^See Wolf V. Trinkle, 103 Ind. 355, 3 N.E. 110 (1885); Stewart v. Maddox, 63 Ind.

51 (1878).

'^See, e.g., Cohen v. Peoples, 140 Ind. App. 353, 220 N.E.2d 665 (1966) (punitive

damages allowed for an assault where statute of limitations had run on the criminal

prosecution of the offense; double jeopardy principles would not be violated where threat

of criminal prosecution ceased to exist). Compare Nicholson's Mobile Home Sales, Inc.
V. Schramm, 164 Ind. App. 598, 330 N.E.2d 785 (1975) (defendant whose actions were

in complete disregard of the consequences was assessed punitive damages despite probable

criminal prosecution for the same conduct) and True Temper Corp. v. Moore, 157 Ind.

App. 142, 299 N.E.2d 844 (1973) (punitive damages assessed despite criminal prosecution

where defendant exhibited a heedless disregard of the consequences) with Glissman v.

Kutt, 175 Ind. App. 493, 372 N.E.2d 1188 (1978)(rejecting the heedless disregard exception

as contrary to the principles of double jeopardy).



1985] PUNITIVE DAMAGES 665

for total abrogation of the Taber rule by either legislative action or

judicial pronouncement. ^°

In response to this mounting judicial pressure to correct the ine-

quitable situations created by the Taber rule, the legislature enacted the

new punitive damages statute in 1984. One of the legislature's consid-
erations in enacting the new statute may have been a desire to substitute
private for public law enforcement as a means to effect a more efficient

level of compliance.^' Despite its motives, by exposing the defendant to

both criminal and civil liability upon the commission of certain crimes

in Indiana, the legislature has given crime victims an opportunity to

seek greater relief.

IV. The Scope of the New Statute in Light of Practices
Adopted by Other States

A. Possible Retroactivity of the New Statute

The new punitive damages statute became effective on September

1, 1984." One issue yet to be decided is the statute's retroactive ap-
plication to crimes committed before its effective date.

In determining whether a statute is to operate retroactively, Indiana

courts are likely to look first for specific language in the act which

would indicate that the legislature intended to give it retroactive appli-

cation." In Indiana, statutes are to be construed and appHed pro-

spectively, unless a contrary intent is manifested in clear and unambiguous

terms. ^"^ Therefore, without unmistakable language sanctioning retroac-

tivity, courts will presume that the new statute is to be given prospective
effect only.^^ This presumption may be rebutted, however, where re-

"^See, e.g., McCarty v. Sparks, 180 Ind. App. 251, 388 N.E.2d 296 (1979); Smith

V. Mills, 179 Ind. App. 459, 385 N.E.2d 1205 (1979) (rule ripe for reconsideration).

^'See generally Ellis, supra note 22, at 1-9. The value of punitive damages as an

effective deterrent against a culpable corporate defendant in a products liability action

was acknowledged in Grimshaw v. Ford Motor Co., 119 Cal. App. 3d 757, 174 Cal.

Rptr. 348 (1981) where the court stated:

It is precisely because monetary penalties under government regulations prescribing

business standards or the criminal law are so inadequate and ineffective as

deterrents against a manufacturer and distributor of mass produced defective

products that punitive damages must be of sufficient amount to discourage such

practices.

Id. at 820, 174 Cal. Rptr. at 389.

"Act of Feb. 29, 1984, Pub. L. No. 172, 1984 Ind. Acts 1462 (codified at Ind.

Code § 34-4-30-2).

"See State ex rel. Uzelac v. Lake Criminal Ct., 247 Ind. 87, 91, 212 N.E.2d 21,

22 (1965) (application of a new criminal statute requiring that criminal proceedings be
brought against the accused within six months from the initial charges was expressly

limited to arrests made on or after the effective date).
'*Id. at 24.

''See, e.g., Shelton v. State, 181 Ind. App. 50, 390 N.E.2d 1048 (1979) (criminal

sentencing provision not retroactive).



666 INDIANA LAW REVIEW [Vol. 18:655

troactivity would further a legislative purpose, or where the statute would

not impose a new duty or create a new obligation, or attach a new

disability with respect to transactions already past.^^

Indiana's new statute contains no language, explicit or otherwise,

that the act shall apply retroactively. Additionally, the statute increases

the potential Hability to be borne by the defendant and hence, attaches

a new disability to past acts. Thus, from a strict construction of the

statute and without further analysis it would appear that acts punishable

as crimes committed before September 1, 1984, will not subject wrong-

doers to civil actions for punitive damages. Strong public policy reasons

exist, however, which would favor retroactive application of the new

statute.

These public policy reasons were outlined by the California Supreme

Court in Taylor v. Superior Court.^'^ In Taylor, the California Supreme

Court held that an accident victim who had suffered personal injury as
a result of another's drunk driving could sue that person for punitive

damages.^^ The court reasoned that because drunk drivers were the cause

of many serious accidents, the threat of a punitive damages award might
operate to deter such similar conduct in the future. ^^

The California Supreme Court had the opportunity to determine the

retroactivity of the rule announced in Taylor in Peterson v. Superior

Court.^^ The plaintiff in Peterson was injured by the reckless driving

of an intoxicated driver before Taylor was decided. The plaintiff sub-

sequently filed suit against the driver and attempted to amend his com-
plaint to include an additional claim for punitive damages. The lower

court refused his motion for leave to amend, and he appealed that

decision to the California Supreme Court. ^' In entertaining the plaintiff's

appeal, the court relied on the decision of the United States Supreme

Court in Stovall v. Denno^^ for guidance in its retroactivity analysis.

In Stovall, the Court was asked to determine whether a constitutional

rule of criminal procedure issued that same day could be applied ret-

"^See Standard Accident Ins. Co. v. Miller, 170 F.2d 495 (7th Cir. 1948); Stewart

V. Marson Constr. Corp., 244 Ind. 134, 191 N.E.2d 320 (1963); see also Malone v.

Conner, 135 Ind. App. 167, 189 N.E.2d 590 (1963). In Malone, the court held that an

intervening rule giving an administrator of an estate a cause of action for reasonable

medical expenses incurred by the decedent from the date of his injuries caused by the

defendant until the date of his death should not be retroactively applied. A retroactive
statute must not take away an existing right or give a new right, but can only provide

a new remedy to enforce an existing right.

Id. at 170, 189 N.E.2d at 591.
^^24 Cal.3d 890, 598 P.2d 854, 157 Cal. Rptr. 693 (1979).

""Id. at 900, 598 P.2d at 858-59, 157 Cal. Rptr. at 698.

^°31 Cal. 3d 147, 642 P. 2d 1035, 181 Cal. Rptr. 784 (1982).

''Id. at 147, 642 P.2d at 1306, 181 Cal. Rptr. at 784.

^^388 U.S. 293 (1967).



1985] PUNITIVE DAMAGES 667

roactively.^^ In deciding that issue, the Court examined "(a) the purpose

to be served by the new standards (in this case, a rule of criminal
procedure), (b) the extent of the reliance by law enforcement authorities

on the old standards, and (c) the effect on the administration of justice

of a retroactive application of the new standards."^"* After considering

these factors, the Court held that because retroactivity would have a

devastating impact upon the administration of criminal law, the new

rule should only be applicable to events occurring after that date.^^

The Peterson court applied the same criteria and held that the punitive

damages rule announced in Taylor could be retroactively applied. ^^ Al-

though Stovall involved a criminal rule, the court in Peterson noted

that civil rules of retroactivity were not inconsistent with those present

in criminal decisions, both being dependent upon principles of public

policy and fairness. "Public policy considerations include the purpose

to be served by the new rule, and the effect on the administration of

justice of retroactive application. Considerations of fairness would meas-

ure the reliance on the old standards by the parties or others similarly

affected . . . ."^^

In Peterson, the defendant argued against retroactivity, claiming that

the rule would not have a deterrent effect and would instead inflict

hardship upon litigants who had relied upon prior law.^^ The court found
both arguments unpersuasive. Instead, the court held that the change

in the law had not been unforeseeable and that retroactivity would

"create a greater, more immediate deterrent impact on the consciousness

of the driving public . . . ."^^

In resolving the issue of retroactivity, the Peterson court balanced

the potential harm caused by a retroactive application of the rule against

a determination of whether any discernible public purpose justified its

effects.^° In making its determination, the court accorded great weight

to the foreseeability of the change in the law.^' Indiana's new punitive

^^Id. at 296. In Stovall, the petitioner, without benefit of counsel, was identified in

a Uneup by a woman from her hospital bed the day after she underwent life-saving
surgery. The petitioner was convicted of murder and attempted murder and sentenced to

death. In seeking habeas corpus, the petitioner argued for retroactive application of a

rule decided that same day in United States v. Wade, 388 U.S. 218 (1967), and Gilbert
v. California, 388 U.S. 263 (1967), requiring the presence of counsel at lineups.

''•388 U.S. at 297.

''Id. at 300.

^'31 Cal.3d at 164, 642 P.2d at 1315, 181 Cal. Rptr. at 794 (1982). See generally

Note, Retroactivity of Punitive Damages Rule in Drunk Driving Cases: Peterson v. Superior
Court, 10 Pepperdine L. Rev. 232 (1982)

"31 Cal.3d at 153, 642 P.2d at 1307, 181 Cal. Rptr. at 786-87.

'^Id. at 156, 642 P.2d at 1308, 181 Cal. Rptr. at 788.

""Id. at 164, 642 P. 2d at 1315, 181 Cal. Rptr. at 794.

*°The balancing approach used by the Peterson court was advocated in DeMars,

Retrospectivity and Retroactivity of Civil Legislation Reconsidered, 10 Ohio N.U.L. Rev.

253, 272-75 (1983).

"'31 Cal.3d at 153, 642 P.2d at 1307-08, 181 Cal. Rptr. at 786-87 (citing Neel v. Magana,

Olney, Cuthcurt & Gelfand, 6 Cal. 3d 176, 193, 491 P. 2d 421, 432, 98 Cal. Rptr. 837,
848 (1971)).



668 INDIANA LAW REVIEW [Vol. 18:655

damages statute was similarly not unexpected. For many years, Indiana's
minority position has been criticized and condemned by both commen-

tators and the Indiana judiciary. ^^ Arguably, conformity to the majority

position was only a matter of time.

Greater civil accountability might be construed to be in the public

interest. Not only would retroactive application deter the wrongdoer and

others from repeating such antisocial conduct, but it would also reimburse

the crime victim for any uncompensated financial loss. Thus, in balancing

considerations of fairness and public policy against any harm which

might befall a defendant by way of increasing his potential Hability, the

scales weigh in favor of retroactivity. Even though retroactive application

of the new statute might add to civil court dockets, it is likely that

many victims of pre-act crimes have already sought compensatory relief,
in which case an additional claim for punitive damages would not

necessitate an extra court date. Whether or not the courts rule in favor

of retroactivity, the new statute will doubtless have a far-reaching effect

on the types of criminal activity within its purview. ^^

B. Criminal Activity Likely to Be Affected by the New Statute

The following discussion surveys the classes of criminal activities for

which punitive damages may now be awarded under the new statute.
This survey is not intended to be exhaustive of all conceivable areas

where punitive damages might be justified. Instead, the more common
situations where the defense of criminal exposure has previously been

invoked to bar a claim for punitive damages have been selected. Because

the defendant's state of mind, rather than the particular tort or crime

committed, is determinative of a punitive damages award, ^'^ the litigant

who decides to pursue punitive relief should probably be guided more
by the degree of culpability common to all punitive damages cases than
by analysis of prior punitive damages awards under any particular factual

situation.

1. Offenses Against the Person.—From a very early date, many
jurisdictions acknowledged the propriety of awarding punitive damages

in cases involving violent crimes against the person, such as assault and

^^See supra notes 59-60 and accompanying text.

"To date, no court has ruled on the possible retroactive application of the new
punitive damages statute. After the passage of the new statute but before its effective date,
the case of Gomez v. Adams, 462 N.E.2d 212 (Ind. App. 1984) was decided. In Gomez,
the Indiana Court of Appeals denied a punitive damages award on the ground that the

defendant bore potential criminal liability for the same conduct complained of in the civil

suit. The court did note in its decision the passage of the new statute removing possible

criminal sanctions as a defense in an action for punitive damages, but declined to speculate

as to its possible retroactive application. Id. at 227 n.l2.

^'*See supra notes 20-25 and accompanying text.



1985] PUNITIVE DAMAGES 669

battery/^ sexual assault, ^^ and homicide. ^^ As the Oregon Supreme Court

emphasized:

We are unable to understand why the additional determent of
punitive damages is considered unreasonable. Not only the crim-

inal justice system but every law-abiding citizen is concerned

with the increasing crime rate. If we are concerned with the

types of acts which may subject a defendant to a criminal charge
and civil liability such as violent crimes against the person, as

in this case, we see nothing wrong with the additional determent

of the allowance of punitive damages. ^^

In contrast, the Indiana Supreme Court refused to award punitive

damages to the victim of an assault in Taber v. Hutson,^^ as did the

Indiana Court of Appeals in Borkenstein v. Schrack.^^ Each court based

its decision on the fact that the offense was punishable criminally.^' In

courts which distinguish the separate functions of public and private

redress,^^ punitive damages are awarded despite the presence or absence

of a previous criminal conviction and accompanying prison sentence

imposed for the offense committed.^^ Some jurisdictions have even refused
to weigh the punitive effect of a criminal fine in determining civil

<"See McNamara v. St. Louis Transit Co., 182 Mo. 676, 81 S.W. 880 (1904); Roberts
V. Mason, 10 Ohio St. 278 (1957); Brown v. Swineford, 44 Wis. 282 (1878) (punitive

damages awarded an assault victim, albeit not without criticism of the doctrine); see also

Shelley v. Clark, 267 Ala. 621, 103 So.2d 743 (1958).

'"See Reutkemeier v. Nolte, 179 Iowa 342, 161 N.W. 290 (1917). Indiana's present
rape statute is codified at Ind. Code § 35-42-4-1 (1982).

^'See Pratt v. Duck, 28 Tenn. App. 502, 191 S.W.2d 562 (1945).

««Roshak v. Leathers, 277 Or. 207, 212, 560 P. 2d 275, 278 (1977) (defendant criminally

charged with attempted murder and convicted of the crime of assault in the third degree).
«*5 Ind. at 322, 327.

^31 Ind. App. 220, 67 N.E. 547 (1903).

"Indiana's current assault and battery statute punishes the offense as either a

misdemeanor or a felony, depending upon the attendant circumstances. Ind. Code § 35-42-2-1

(Supp. 1985) reads:

A person who knowingly or intentionally touches another person in a rude,
insolent, or angry manner commits battery, a Class B misdemeanor. However,

the offense is:

(1) [a] Class A misdemeanor if it results in bodily injury to any other
person, or if it is committed against a law enforcement officer or against a

person summoned and directed by the officer while the officer is engaged in
the execution of his official duty;

(2) [a] Class D felony if it results in bodily injury to . . . such an officer
or person summoned and directed; . . . and

(3) [a] Class C felony if it results in serious bodily injury to any other
person or if it is committed by means of a deadly weapon.

^^See supra notes 39-41 and accompanying text.

"'See, e.g., Roberts v. Mason, 10 Ohio St. 278 (1857); Stark v. Epler, 59 Or. 262,

117 P. 276 (1911).



670 INDIANA LAW REVIEW [Vol. 18:655

damages.^'* Thus, because federal courts^^ and most state courts recognize

the importance of punitive damages as both de facto compensatory rehef

for the plaintiff,'^ and a retaliatory tool of society it is highly probable

that Indiana will also ignore whether or not criminal punishment has

been imposed in gauging a punitive award, at least with respect to claims

involving injury to the person.

The following cases illustrate the many factual circumstances which
have resulted in punitive damages awards. In each of these cases, the

act complained of was one that was also criminally punishable.

In Jones v. Fisher,^'' the Wisconsin Supreme Court allowed punitive

damages for an assault and battery where defendants had forcibly

extracted a dental plate from the plaintiff's mouth. Although the de-

fendants were entitled to the property as security for repayment of a

loan, the court seemed to object to the unreasonable methods employed

by the defendants to recover the plate. ^^

An award of punitive damages was upheld for assault with intent
to murder by the Oregon Supreme Court in Koshak v. LeathersJ^^ The

plaintiff, a law enforcement officer, instituted civil proceedings against

the defendants for injuries he received after the defendants violently

protested traffic violation charges. '°° In permitting punitive damages, the

court was unmoved by the fact that the defendants had already been
convicted for assault in the third degree.'^'

The plaintiff received punitive relief in the Pennsylvania Supreme

Court case of May v. Baron .^^^ In May, the defendant demanded payment
from the plaintiff for a debt owing. When the plaintiff refused to tender
payment, the defendant kicked him repeatedly, eventually rendering him

unconscious. •^^

As a precondition to considering punitive relief, all three courts

either required the plaintiff to offer direct proof of malice or inferred

malice from the nature of the act committed. '^'^ Furthermore, all instances

of offenses against the person were intentional torts. Thus it appears

"'E.g., Bundy v. Maginess, 76 Cal. 532, 18 P. 668 (1888); Hartman v. Logan, 203

S.W. 61 (Tex. Civ. App. 1918).

^^Punitive awards have often been upheld by federal courts in assault cases. See,

e.g., Shimman v. Frank, 625 F.2d 80 (6th Cir.), reh'g denied (1980); King v. Nixon, 207
F.2d 41 (D.C. Cir. 1953) (per curiam).

''^In addition to the deterrence and punishment aspects of punitive damages, the

award compensates the plaintiff for litigation costs and counsel fees. See W. Prosser,
supra note 12, at 11.

"HI Wis.2d 209, 166 N.W.2d 175 (1969).
"'Id. at 217, 177 N.W.2d at 180.
^"277 Or. 207, 560 P. 2d 275 (1977).

''''Id. at 209, 560 P. 2d at 276.

'°2329 Pa. 65, 196 A. 866 (1938).

'°'Id. at 65, 196 A. at 866.

'°^277 Or. at 209, 560 P.2d at 276; 329 Pa. at 65, 196 A. at 866; 42 Wis. 2d at

218, 166 N.W.2d at 180.



1985] PUNITIVE DAMAGES 671

that courts are influenced by aggravated or humiliating circumstances

when attempting to distinguish those offenses which justify a punitive

award from their less egregious counterparts.

2. Offenses Against Property Rights.—Classes of criminal activity
affecting property rights now subject to punitive awards under the new
statute include arson, '°^ criminal mischief,'^ burglary, '^^ trespass, '^^ theft, '^

conversion"^ and forgery.'" Other jurisdictions have granted punitive

rehef on several of these grounds.

For example, a punitive damages award was upheld by the South

Carolina Supreme Court in St. Charles Mercantile Co. v. Armour &
Co."^ In St. Charles Mercantile, the defendant's agent had altered the

plaintiff's postdated check and presented it to the bank for immediate

payment. He was subsequently convicted for forgery and his employer
was held vicariously liable for punitive damages."^ Because the agent's

willful and malicious act had resulted in harm to the plaintiff's credit

and commercial reputation, the civil award was upheld, notwithstanding

the prior criminal conviction. "The violation of a criminal law, which

results in any actual damage to a person, is entirely sufficient as the

foundation for punitive damages."""^

Punitive damages were levied against the defendant for conversion

in the Kentucky case of Hensley v. Paul Miller Ford, Inc.^^^ The court

held that such damages were recoverable for gross neglect and disregard

for the plaintiff's rights where the defendant car dealer sold the plaintiff's

car, along with certain private property within the car, in violation of

a prior mutual understanding and without the plaintiff's permission."^

Prior to the enactment of the new punitive damages statute in

Indiana, a person suffering a pecuniary loss as a consequence of the

defendant's interference with his property rights could bring a claim for

an amount equal to three times his actual damages."^ The new act now

'°5Ind. Code § 35-43-1-1 (1982).
"^IND. Code § 35-43-1-2 (1982).
'°nND. Code § 35-43-2-1 (1982).
'°«lND. Code § 35-43-2-2 (1982). See Skufakiss v. Duray, 85 Ind. App. 426, 154 N.E.

289 (1926) (prejudicial error to instruct jury to assess punitive damages if the trespass

committed was found to be wanton and willful). But see Cosgriff v. Miller, 10 Wyo.

190, 68 P. 206 (1902).

'""iND. Code § 35-43-4-2 (1982).
"°lND. Code § 35-43-4-3 (1982).
'"Ind. Code § 35-43-5-2 (1982).
"M56 S.C. 397, 153 S.E. 473 (1930).
'''Id. at 399, 153 S.E. at 474.

'''Id. at 406, 153 S.E. at 478.

"'508 S.W.2d 759 (Ky. Ct. App. 1974).

'"•Id. at 762.

"^An amount "equal to" has been amended to read an amount "not to exceed"

three times his actual damages. See Act of Feb. 29, 1984, Pub. L. No. 172 § 1, 1984

Ind. Acts 1462, (amending Ind. Code § 34-4-30-1) (1982)).



672 INDIANA LAW REVIEW [Vol. 18:655

permits a choice between punitive or treble damages, but recovery of

both is expressly precluded."^

Neither the legislature nor the judiciary has yet indicated at what

stage of the litigation the plaintiff must choose between the two statutory

remedies. There is nothing to prohibit, however, a request for treble

damages or alternatively, punitive damages, recovery being limited to

the greater of the two. Such a complaint would not be violative of the

Indiana trial rule governing the general rules of pleading."^

Furthermore, the doctrine of election of remedies would not appear

to compel a litigant to choose at the pleadings stage between treble and

punitive damages for injury to property rights. The doctrine of election

of remedies applies only when there are two or more coexisting, but

inconsistent, remedies available to the litigant, and the choice and un-

interrupted prosecution of one would preclude pursuit of all others. '^°

Indiana courts have generally applied this definition to claims involving

conflicting theories of action. For example, a plaintiff who has entered
into a compromise agreement of a tort claim and who, upon breach of

the compromise agreement, chooses to prosecute the original tort action

to final judgment is barred under the doctrine from also maintaining

an action for breach of the compromise agreement.'^' The plaintiff may
treat the compromise agreement as rescinded and sue on the original

tort or he may sue on the contract; however, he may not prosecute one
of the remedies to judgment and subsequently sue on the other. '^^

In contrast, what is presented in the statute is not a choice between

differing courses of action, but between two statutory awards for a

single property claim. The choice between distinct statutory awards has

been found to be within the province of the jury. In Curtis Publishing

Co. V. Butts,^^^ the Fifth Circuit held that under Georgia law,'^'^ the jury

was responsible for determining whether punitive damages were to be

awarded as a deterrent to the wrongdoer or for compensation for the

>'«See Act of Feb. 29, 1984, Pub. L. No. 172 § 2, 1984 Ind. Acts 1462 (codified at

IND. Code § 34-4-30-2 (Supp. 1985)).
"^Ind. R. Tr. p. 8(A) provides:

(A) Claims for relief. To state a claim for relief, whether an original claim,
counterclaim, crossclaim, or third-party claim, a pleading must contain:

(1) A short and plain statement of the claim showing that the pleader
is entitled to relief; and

(2) A demand for the relief to which he deems himself entitled. Relief
in the alternative or of several different types may be demanded.

'^"See New York Cent. R.R. Co. v. Churchill, 140 Ind. App. 426, 218 N.E.2d 372
(1966). The doctrine only applies "where a party has chosen one remedy and later pursues

another remedy which is repugnant to or inconsistent with the remedy selected." Id. at

429, 218 N.E.2d at 374.

'^'Burrus v. American Casualty Co., 518 F.2d 1267, 1269 (7th Cir. 1975).

'"/c^. at 1269.

'^^351 F.2d 702 (5th Cir. 1965).

'^'See Ga. Code § 51-12-5 (1982).



1985] PUNITIVE DAMAGES 673

plaintiff's wounded feelings. '^^ Punitive damages satisfying either objec-
tive were allowed by statute, although recovery for both was expressly

forbidden. '2^ Conceivably, the methods used to calculate punitive damage
awards under either purpose may differ, resulting in unequal figures.
But because the duty of determining the final amount to be awarded
as well as the theory under which such relief is given is within the jury's

discretion, the litigant is not faced with having to choose between the

two remedies in his complaint.

The new Indiana punitive damages statute fails to distinguish the
purposes for which punitive relief is granted. It does, however, provide

for two different remedies from which the jury, and not the plaintiff,

could competently choose as an appropriate foundation for recovery.

If the litigant chooses one form of relief over the other prior to

final adjudication, certain factors should be weighed in the selection

process. In many cases, a punitive award may be more advantageous
than recovery of treble damages. For instance, in a suit for conversion

where the article unlawfully taken is of little value, relief in the form

of treble damages may be much lower than a punitive damages award
designed to reprimand the defendant for his acts and deter him from
repeating the same conduct in the future. '^^

3. Corporate Offenses and Securities Violations.—In Indiana, a cor-
poration, partnership, or unincorporated association can be criminally

prosecuted for acts committed by an agent acting within the scope of

his authority. '^^ A corporate entity, however, unlike an individual, cannot
be deprived of liberty upon conviction. Thus, punishment is effected
through the imposition of a criminal fine, the size of which is limited

by statute. '^^ However, fines which are negligible when compared to the
gross earnings and profit-generating capacity of a large-scale operation

often fail to achieve the objective of deterrence'^° or to impair seriously

'2^351 F.2d at 717-18.

'"^.g., Price V. Ford Motor Credit Co., 530 S.W.2d 249 (Mo. Ct. App. 1975)

(assessing $25,000 in punitive damages with $600 in actual damages for the wrongful

possession of a debtor's automobile; treble damages award would have been a fraction

of the punitive relief actually given).

'2«lND. Code § 35-41-2-3 (1982).
'^^ND. Code §§ 35-50-2-4 to -7.

^^°See McLemore, supra note 43, at 88. Recent concern with underpunishment of
corporations surfaced in the prosecution of the Ford Motor Company in State v. Ford
Motor Co., No. 11431 (Pulaski County Cir. Ct. Mar. 13, 1980) {noted in McLemore,
supra note 43, at 88), on charges of reckless homicide, a Class C felony. Ind. Code §
35-42-1-5 (1982). Criminal charges followed after three teenagers were killed when the gas
tank of their Pinto exploded after being hit from behind. Conviction was sought on the

ground that Ford management was aware of the gas tank's design defects, but marketed

the product despite this knowledge. Had Ford not won an acquittal, the maximum fine
levied would have been limited to $10,000. Ind. Code § 35-50-2-6.

With Indiana's new punitive damages statute, adequate punishment of corporations
for criminal offenses may be less difficult to achieve. In reference to the Ford case, the
requisite finding of malice might easily have been inferred from management's knowledge

of the vulnerability of the tank to rear-end collisions and the subsequent conscious decision

to incorporate the tank into the car's design. Such a finding was made in Grimshaw v.
Ford Motor Co., 119 Cal. App. 757, 174 Cal. Rptr. 348 (1981) (strict products liability).



674 INDIANA LAW REVIEW [Vol. 18:655

the financial interest of stockholders.'^' Furthermore, as one commentator

has noted, pursuance of corporate criminal convictions not only encum-

bers the state treasury, contrary to the public's best interests, but also

commands much effort and attention, impeding the state's ability to
prosecute other meritorious cases. '^^ Under the new statute, a punitive

damages claim sought through private initiative will further the goals

of punishment and deterrence while averting the drawbacks of a state

prosecution.

The new punitive damages statute may also affect securities violators,
as illustrated by the Colorado case of E.F. Button & Co. v. Anderson.^^^
A securities brokerage instituted civil proceedings against several options
buyers whose checks had been returned for insufficient funds. Although

the defendants had already received criminal convictions on separate

counts of theft and deceptive securities practices, the court granted

plaintiff's request for punitive damages. The court reasoned that the

added civil penalty did not violate double jeopardy principles, but was

necessary to punish the defendants and compensate the plaintiff for the

purchasing losses sustained. '^^

Under Indiana law, the unlawful sale or procurement of securities

is punishable both criminally and civilly, with civil liability limited to

recovery of consideration paid or accepted, together with interest and

attorney's fees.'^^ Unless Indiana's securities statute is construed to ex-

clude all other forms of civil relief, the introduction of punitive damages

as an added form of punishment may further assist both state and
national efforts to curb fraudulent securities practices.

4. Driving While Intoxicated.—Attention to the frequent under-
punishment of drunk drivers is highlighted by the legislature's recent

attempts to stiffen penalties against first-time and habitual offenders. '^^

With the passage of the new punitive damages statute, the arsenal of

judicial weapons against the drunk driver will be even greater. Unlike

the new repeat offender provision for drunk driving convictions,'^"^ how-

ever, the application of the new punitive damages statute to personal

'"Impairing the financial interests of innocent shareholders is arguably not a goal in

assessing criminal fines against corporate assets. Nevertheless, because corporations can

only act through their agents and servants, the alternative would leave many instances of
criminal conduct unpunished. See H. Ballantine, Ballantine on Corporations §§ 113-

14 (rev. ed. 1946).

'"See McLemore, supra note 43, at 88.
'"42 Colo. App. 497, 596 P.2d 413 (1979).

•"/of. at 501, 596 P. 2d at 415.

'"See Ind. Code § 32-2-1-18.1 (1982) (securities violations punishable as a Class C
felony); 5ee also Ind. Code § 23-2-1-19 (1982) (deceptive practices generally and civil
remedies therefor).

"*See Ind. Code §§ 9-11-2-1, -4, -5 (Supp. 1985) (driving while intoxicated is
punishable as a misdemeanor upon the showing of a blood-alcohol level of .lO^Vo or more,

but elevated to Class C and D felony status if the crime results in serious bodily injury
or death); see also Ind. Code § 9-11-2-3 (repeat offender provision).

'^^Ind. Code § 9-11-2-3 (Supp. 1985).



1985] PUNITIVE DAMAGES 675

injury claims against drunk drivers will likely escape constitutional attack.

To date, the application of similar punitive damages statutes in other

states to personal injury claims has not been challenged on constitutional

grounds. '^^

Notwithstanding the disqualification of criminal prosecution as a

defense to a punitive damages claim, Indiana courts must still decide

whether evidence of intoxication is sufficient to impute malice. '^^ Many
jurisdictions, focusing upon the defendant's conduct rather than upon

his actual state of mind, have inferred malice and a general disregard

for the safety of persons and property solely from the voluntary acts

of drinking and driving. '"^^ In furthering an already strong public policy

decision against drunk driving, the Second Circuit Court of Appeals

upheld a punitive damages award without first deciding whether evidence

of driving while intoxicated was sufficient in itself to prove willful and

wanton conduct. "*•

It remains to be seen whether Indiana courts will impute malice for

drunken driving in itself; however, it would unquestionably be in the

pubHc's best interest, and in the interest of effective law enforcement,

to increase civil penalties imposed upon the guilty defendant, especially

'^"See supra note 10 (listing similar statutes in other jurisdictions).

'^^Mere negligence is an insufficient basis for a punitive damages award. The plaintiff

must establish malice to recover punitive damages. See supra note 22 and accompanying

text.

'^°See Miller v. Blanton, 213 Ark. 246, 210 S.W.2d 293 (1948); Peterson v. Superior

Ct., 31 Cal.3d 147, 642 P.2d 1305, 181 Cal. Rptr. 784 (1982); Ingram v. Pettit, 340

So.2d 922 (Fla. 1976) (intentional infliction of harm or recklessness which is the result

of an intentional act authorized punishment which may deter future harm); Baker v.
Marcus, 201 Va. 905, 114 S.W.2d 617 (1960). But see Smith v. Chapman, 115 Ariz. 211,

564 P.2d 900 (1977) (intoxication plus negligent driving does not, per se, equal reckless

disregard for the safety and rights of others); Detling v. Chockley, 70 Ohio St. 2d 134,

436 N.E.2d 208 (1982) (although punitive damages are allowed for criminal activity, evidence

of driving while intoxicated alone is insufficient to impute malice); Ayala v. Farmers Mut.

Auto. Ins. Co., 272 Wis. 629, 76 N.W.2d 563 (1956). Cf. Thompson v. Pickle, 136 Ind.
App. 139, 191 N.E.2d 53 (1963) (punitive damages denied, but willful and wanton

misconduct present where evidence showed that the defendant was intoxicated and drove

seventy m.p.h. in a thirty m.p.h. zone). The merits of assessing punitive damages as an

added deterrent against convicted drunk drivers were discussed in Harrell v. Ames, 265

Or. 183, 508 P. 2d 211 (1973):

However, in the absence of a showing of substantial evidence to the contrary,

we are not prepared to hold that law enforcement officials and courts, who
have a heavy responsibility in this area, are wrong in their present apparent

assumption that both criminal penalties and awards of punitive damages may
have at least some deterrent effect in dealing with this serious problem.

Id. at 190, 508 P. 2d at 215. For a general discussion of the propriety of awarding punitive

damages in drunk driving cases, see Note, Detling v. Chockley: Punitive Damages and
the Drunk Driver - An Untimely Decision, 12 Cap. U.L. Rev. 271 (1982); Note, Punitive
Damages and the Drunk Driver, 8 Pepperdine L. Rev. 117 (1980).

'^•Brooks V. Wootton, 355 F.2d 177 (2d Cir. 1966).



676 INDIANA LAW REVIEW [Vol. 18:655

in light of the substantial number of traffic fatalities attributable each

year to drunk drivers."*^

5. Other Offenses.—Certain types of offenses generally escape crim-
inal prosecution, either as a result of the state directing its prosecutorial

efforts to more egregious crimes or simply because of the comparatively

benign nature of the criminally punishable activity itself. One example
is bigamy."*^ In Morris v. MacNab,^'^'^ a New Jersey court awarded the
plaintiff punitive damages in an action for fraudulent inducement to

enter a bigamous marriage, even though the defendant had previously

been convicted on a bigamy charge.'"*^ The court stated, "[I]t has been

pointed out that the inclusion of punitive damages in the plaintiff's tort

judgment, which is allowable for the private wrong to the individual

rather than the accompanying wrong to the public, may effectively
supplement the criminal law in punishing the defendant.""*^

More noteworthy offenses which are criminally punishable, and there-
fore subject to the purview of the new punitive damages statute, include

civil rights violations"*^ and criminal confinement."** With respect to civil

rights violations, the propriety of a punitive damages award was addressed

by the United States District Court for the Northern District of Iowa

in Amos v. Prom, Inc.^'^^ In Amos, a black plaintiff sued a corporate
defendant for its alleged willful and malicious refusal, in violation of

the Iowa Civil Rights statute, to admit him into a ballroom operated

by the corporation. The court, in overruling the defendant's motion to

dismiss for lack of jurisdiction, stated in dicta that punitive damages

would be allowable for such reprehensible conduct despite coexistent

criminal liability. '^°

Indiana's Civil Rights statute states:

A person who knowingly or intentionally denies to another
person, because of color, creed, handicap, national origin, race,

religion, or sex, the full and equal use of the services, facilities,

or goods in:

(1) an establishment that caters or offers its services, facilities

or goods to the general public; or

(2) a housing project owned or subsidized by a governmental
entity;

commits a civil rights violation, a Class B misdemeanor. '5'

'"^Presidential Comm'n on Drunk Driving, Final Report 1 (1983) (between 1973
and 1983, over 250,000 were killed in alcohol-related crashes; over 50% of all highway
deaths involve the use of alcohol).

'''See IND. Code § 35-46-1-2 (1982).
"^25 N.J. 271, 135 A.2d 657 (1957).
'''Id. at 279, 135 A.2d at 662-63. C

''"Id. at 280, 135 A.2d at 663.

"'See iND. Code § 35-46-2-1 (1982) (Class B misdemeanor).
'""iND. Code § 35-42-3-3.
""115 F. Supp. 127 (N.D. Iowa 1953).

"°/c^. at 134.

"'See iND. Code § 35-46-2-1 (1982).



1985] PUNITIVE DAMAGES 611

Before the passage of the new punitive damages statute, an individual

or establishment could selectively discriminate in furnishing goods and

services in Indiana, without the fear of being civilly liable for any-

thing more than any actual damages sustained. Such liabiHty in many
instances would be an ineffective deterrent in light of the fact that a

plaintiff's pecuniary loss resulting from the unjust discrimination is

generally inconsequential.'" Thus, because the principal justification

for punitive damages is deterrence,'" imposition of punitive awards

will likely encourage strict compliance with state and federal anti-dis-

crimination laws.'^'*

V. Potential Obstacles to Recovering Punitive

Damages for Criminal Acts

A. Actions by the Legislature

Judicial decisions invoking the Taber safeguard against double jeo-

pardy have done so in reliance upon the rule's underlying principles of

fairness in prescribing punishment for the defendant. '^^ Notwithstanding

abrogation of the rule, the legislature has attempted to preserve this

objective by increasing the plaintiff's burden of proof in a punitive

damages action from a mere preponderance of the evidence to clear and

convincing proof. '^^ Although different in form from criminal penalties,

the consequences of civil liabiHty are unmistakably penal in nature.'"

Despite this similarity in effect, and the potential magnitude of a punitive

award, the defendant in a civil action for punitive damages is not afforded

the same safeguards which accompany the criminal trial and protect the
criminal defendant. '^^ In criminal courts, the state is required to establish

'"See Wills v. Trans World Airlines, Inc., 200 F. Supp. 360, 367 (S.D. Cal. 1961).

'"See Note, Criminal Safeguards, supra note 33.

'''See, e.g., Title VIII of the Civil Rights Act of 1968, 42 U.S.C. § 3601 (1976).

'"See, e.g., Glissman v. Rutt, 175 Ind. App. 493, 497, 372 N.E.2d 1188, 1191 (1978).

"*See Act of Feb. 29, 1984, Pub. L. No. 172, 1984 Ind. Acts 1462-63 (codified at

iND. Code §§ 34-4-34-1, -2 (Supp. 1985)) which reads:

(1) This chapter applies to all cases in which a party requests the recovery of

punitive damages in a civil action.

(2) Before a person may recover punitive damages in any civil action, that
person must establish, by clear and convincing evidence, all of the facts that

are relied upon by that person to support his recovery of punitive damages.

This higher standard of proof for punitive damages claims was first enunciated

in Travelers Indem. Co. v. Armstrong, 442 N.E.2d 349 (Ind. 1982), where the

court stated: "The stricter standard is utilized when fundamental rights are

involved and the legal and social ramifications of the civil proceeding are serious."

Id. at 32.

'"See Note, Criminal Safeguards, supra note 33.

""See id., at 430.



678 INDIANA LAW REVIEW [Vol. 18:655

the defendant's guilt beyond a reasonable doubt, '^^ while in civil pro-

ceedings the plaintiff must generally prove his case by a preponderance

of the evidence.'^ By changing the civil evidentiary rule to require proof

by clear and convincing evidence, the legislature has increased the plain-

tiff's burden of proof in accordance with the increase of possible con-

sequences to the defendant.

B. Judicial Decisions

In addition to the increased burden of proof now borne by the
plaintiff in a punitive damages action, Indiana case law furnishes an

inherent safeguard against potential misuse of the statute. In actions for

which punitive damages are sought, the defendant's financial condition

is admissible in evidence as bearing upon the amount of punitive damages

recoverable. •^' Such information is material in calculating the amount

necessary to meet the punishment and deterrence functions of punitive

damages. As one New York court stated, "[The] defendant's wealth . . .
is only relevant with respect to what should be awarded to plaintiff as

punishment to defendant and to deter defendant and others of similar

mind from engaging in mahcious acts."'^^

Although the introduction of the defendant's pecuniary resources

has primarily been used as a plaintiff's weapon, '^^ most courts also

permit a punitive damages defendant to show evidence of his wealth in

diminution of an award. '^"^ Tailoring punitive awards to the defendant's

financial resources both preserves the laudable objectives of the Taber

rule and protects against the possibilities for overpunishment long char-

acteristic of the majority position. The defendant is sufficiently deterred,

"•^C. McCoRMiCK, Evidence § 341, at 962 (3d ed. 1984).
"^'F. James and G. Hazard, Civil Procedure § 7.6, at 243 (2d ed. 1977).
""See Nate V. Galloway, 408 N.E.2d 1317 (Ind. Ct. App. 1980). In addition to the

defendant's financial condition, the court in Nate considered the nature of the tort and

the extent of the actual damages sustained in reviewing a punitive damages award. In

light of the fact that the defendant owned three apartment buildings, a $3,500 punitive

damages award was held not to be excessive. Id. at 1323. See also Chapin v. Tampoorlos,

325 111. App. 219, 59 N.E.2d 334 (1945); Joseph Schlitz Brewing Co. v. Central Beverage

Co., Inc., 172 Ind. App. 81, 359 N.E.2d 566 (1977); Gierman v. Toman, 77 N.J. Super.

18, 185 A.2d 241 (1962).

'"Rupert V. Sellers, 48 A.D.2d 265, 368 N.Y.S.2d 904 (1975).

"•'This is especially true against large corporate defendants where assets and holdings

information frequently contribute to large punitive damages awards. For an examination

of jury verdicts in a corporate setting, see Belli, Punitive Damages, 13 Trial 40 (1977),

where the author noted, "Courts and insurance companies hate punitives; juries and

plaintiffs savor them. Judges are doing everything in their power to restrict them; plaintiffs

are clamoring for them as the silver bullet that can hurt even the invulnerable corporate

defendant."

Id. See also Silliman, Punitive Damages Related to Multiple Litigation Against a Cor-
poration, 16 Fed'n Ins. Coun. Q. 91 (1966).

"^See Grimshaw v. Ford Motor Co., 119 Ca.3d 757, 174 Cal. Rptr. 348 (1981) (trial

court reduced a jury punitive damages award of $125 million to $3.5 million after considering

evidence of the company's profit-generating capacity.)



1985] PUNITIVE DAMAGES 679

yet is not confronted with a liability grossly disproportionate to the

crime committed.

C. The ''Supplemental Approach" to Punitive Damages

The objective of the Taber rule was merely to prevent the imposition

of excessive or unwarranted punishment. '^^ Despite misgivings relating

to the rule's continued vitality in judicial decision making, Indiana courts

have remained loyal to this doctrine for one hundred thirty years. '^^

Although the recovery of punitive damages is no longer precluded by

the possibihty of criminal prosecution, it is unlikely that courts will now
ignore the well-established concern for the rights of the defendant. Under

the new statute, a defendant who is sufficiently punished at the criminal
level may later be subject to punitive damages in a civil trial. This would
overpunish the defendant and violate the spirit of the prohibition against

double jeopardy. '^^ A more consistent approach in confronting the double
jeopardy concern would be to focus upon the effectiveness of the pun-

ishment actually given, rather than the number of sanctions to which

the defendant may be subjected. '^^

The principle of this "supplemental approach," a term developed

by Harvard University Professor Morris, has been adopted in several

jurisdictions'^^ and entails the reciprocal adjustment of both civil and

criminal penalties. '^° Under this theory, double punishment is permitted

"^-^5 Ind. at 325-36.

^^^See generally Aldridge, supra note 46.

''^"However, the subsidiary functions of exemplary damages — compensation and re-
venge — seem to justify making the award to the plaintiff even though it may be largely
a windfall." Note, Exemplary Damages in the Law of Torts, 70 Harv. L. Rev. 517, 525
(1957).

"^''This suggestion was propounded in Note, Double Jeopardy and the Rule Against

Punitive Damages of Taber v. Hutson, 13 Ind. L. Rev. 999, 1020 (1980).
'^^The "supplemental approach" provides that the factfinder should be allowed to

consider criminal hability as one factor in determining whether a punitive damages award

would serve a meaningful deterrent function. See Badostain v. Grazide, 115 Cal. 425, 47

P. 118 (1896) (assault and battery conviction); Hanover Ins. Co. v. Hayward, 464 A.2d

156 Me. (1983); Wirsing v. Smith, 222 Pa. 8, 70 A. 906 (1908) (prison sentence imposed

following attempted murder conviction). The vast weight of authority, however, holds

otherwise. See, e.g., Irby v. Wilde, 155 Ala. 388, 46 So. 454 (1897); Edwards v. Wessinger,

65 S.C. 161, 43 S.E. 518 (1903) (evidence of a prior acquittal for the same act is inadmissible

in the mitigation of damages) (overruled on other grounds); DuBois v. Roby, 84 Vt. 465,

80 A. 150 (1911). In Hoadley v. Watson, the court maintained.

The fact that in a civil action founded on a criminal act, the guilty party had

been compelled to pay exemplary damages to the party injured on account of

the act, would be no bar to a prosecution in a criminal proceeding for the

same act, nor to any part of the fine imposed by law upon such offenses.

Neither should the liability to, nor the actual imposition of, a fine in a criminal

proceeding, bar any portion of the liability in a civil action for the same act.

45 Vt. 289 (1873). See also Bannister v. Mitchell, 127 Va. 578, 104 S.E. 800 (1920) (award

of punitive damages wholly uninfluenced by criminal sanctions imposed).

'^"Professor Morris contributed a thorough analysis respecting both the merits and

the shortcomings of the supplemental approach in Morris, Punitive Damages in Tort
Cases, 44 Harv. L. Rev. 1173, 1195-97 (1931).



680 INDIANA LAW REVIEW [Vol. 18:655

only when the first penalty fails to achieve the goals of adequate pun-
ishment and deterrence. Where the civil case precedes a criminal hearing,
the jury remains free to assess damages without considering the possibility

of criminal punishment.'^' If a criminal action is subsequently brought,

any inadequacy in the money judgment may he remedied by the criminal
court judge by imposing a longer jail term than he would have given

the defendant had there not been a civil suit.'^^ If an adjustment is not

deemed necessary, the court may suspend sentences or impose minimum
penalties if mandated by the evidence. '^^

If the defendant has been prosecuted prior to the civil proceeding,

the jury should be apprised of all criminal sanctions levied against such

defendant in order to adjust the civil punishment accordingly.'^'^ Because

the legislature predetermines many criminal penalties without taking into
account the specific circumstances of the unlawful act,'^^ the jury would

be able to tailor further punishment to redress the conduct of the

particular culprit. To avoid the danger that the jury might misuse the
information to assume guilt and inflict greater punitive damages, '^^ the

defendant's liability and punishment should be separately determined. '^^

In such a bifurcated trial, the defendant's financial condition and prior

criminal conviction would be withheld until after the defendant's liability

has been established.

The major flaw with the supplemental approach relates to the burden

of predicting what amount of punishment will best further the goals of

punishment and deterrence. '^^ This problem is particularly acute when
an often inexperienced jury must decide the appropriateness of the

penalties. Moreover, because no set standards exist by which a judge

or a jury may accurately gauge the value of the plaintiff's emotional
duress or loss of reputation, it would likewise be difficult "for them

to determine the amount of punitive damages that would produce an

efficient level of deterrence . . . ."'^^

The judiciary's enduring adherence to the Taber rule might indicate

its wiUingness to implement the supplemental approach. Theoretically,

'"See Note, Criminal Safeguards, supra note 33, at 415,

'^^Better protection against double punishment lies with the criminal rather than the

civil courts because the former have ample power of preventing any great injury from

excessive punishment. For instance, if the complainant refuses to release his private injury,

the court may, following conviction, either impose a merely nominal fine or stay proceedings

until termination of the civil suit, and then govern itself accordingly in the final deter-

mination of punishment. See Cook v. ElHs, 6 Hill 466 (1884).

''"See Morris, supra note 170, at 1197.

'''See, e.g., Ind. Code §§ 35-50-2-4 to -7 (1982).
^

''''See Morris, supra note 170, at 1197. Again, the likelihood of this occurring would

probably be greater in proceedings against well established corporations.

"'The bifucated trial was recommended in Note, Double Jeopardy, supra note 38, at

1020-21 to overcome the pitfalls endemic to punitive damages determinations.

"«See Morris, supra note 170, at 1178-79.

""Ellis, supra note 22, at 31.



1985] PUNITIVE DAMAGES 681

such acceptance would temper the new statute's potential misuse by
striking an equitable balance among the defendant's interest in protection
against excessive punishment, the victim's interest in seeking private

retribution, and the public's desire to check undesirable behavior. The

shortcomings, however, may outweigh any benefits generated by the
doctrine. For example, the task of balancing criminal and civil penalties

to effect an "adequate" punishment is a highly subjective process. One
court's determination of an equitable balancing may in fact be detrimental
to the public good. The crime involved may be of such an egregious
nature that public interests would best be served by a mandatory jail

sentence, despite any previously imposed punitive awards. Furthermore,

although separate determinations of liability and damages are designed

to produce a fair punishment, they may actually encumber the admin-
istration of justice by causing unnecessary delays.

Other practical obstacles exist. As previously mentioned, judges and
juries are simply not equipped with the appropriate standards by which

to weigh and adjust different forms of punishment to each defendant.

Also, the propriety of a jury second-guessing the decision of a criminal

court judge might be questionable where the civil trial follows the criminal

proceeding. Moreover, the extent of penalties inflicted should not rest

on the unpredictable timing of the two trials.

Review of a penalty, either criminal or civil, might also pose prob-

lems. Although a balancing of different forms of punishment may
originally have been struck at the trial court level to the satisfaction of

some parties, an appeal and subsequent reversal of one or both judgments
would render such initial efforts at balancing mere exercises in futility.

Additionally, a court or jury might hesitate to adjust a second penalty

where the first had been appealed.

Ironically, the supplemental approach also fails to satisfy fully the

double jeopardy principle Taber championed for so long. The defendant
remains subject to multiple trials and hence is twice placed in fear of

punishment. ^^° But because supplementation supposedly individualizes

punishment, thereby making it more effective and less uncompromising,
the legal community may choose to tolerate having the defendant undergo
two proceedings.

Ostensibly, the greatest advantage of the mitigation approach is

evident when the illegal act complained of completely evades prosecu-
tion. •^^ AppHed to the facts of Glissman v. Rutt,^^^ set out in the
introduction of this Note, the defendant's prior conviction of reckless

driving would not operate as a bar to plaintiff's request for punitive

damages for personal injuries sustained, but instead would be considered

'*°The concern is not so much whether the defendant will suffer two trials, whereby
he might be doubly punished, but whether the total punishment inflicted transcends the

objectives of retribution and deterrence.

'*'See Note, Double Jeopardy, supra note 38, at 1021.

'«M75 Ind. App. 493, 372 N.E.2d 1188 (1978).



682 INDIANA LAW REVIEW [Vol. 18:655

by the jury in determining civil relief designed to deter and punish the

wrongdoer sufficiently.

D. The Defendant's Insolvency

A higher standard of proof and possible employment of the sup-
plemental approach both serve to limit the plaintiff's recovery of punitive

damages. The defendant's lack of resources, however, will probably

represent the greatest deterrent to recovering a punitive claim.

Although the plaintiff may now recover punitive damages for conduct
that is both tortious and criminal, statistical studies uniformly show that

perpetrators of property offenses and crimes against the person are apt

to be penniless. '^^ The results from a sample study of ninety-three non-

southern cities with populations of over fifty thousand clearly indicate

a high correlation between lower income and the offenses of robbery,

burglary, and crimes against the person. '^'^ Thus, of all defendants named
in civil proceedings, the criminal is generally least able to satisfy a

punitive damages judgment.

Nor will the unpaid civil claimant find adequate relief from state-
run victim compensation programs. Indiana's own program, like its
counterparts, does nothing more than its name implies — compensate
victims of crime. '^^ In 1979, the total budget for Indiana's victim com-

pensation program was only $120,000 with the maximum award estab-
lished at ten thousand dollars for a minimum loss of one hundred
dollars. '^^ Such a meager budget is hardly sufficient to compensate

adequately the actual losses, including mental anguish, humiliation, and

harm to reputation, suffered by thousands of claimants each year.'^^
Excessive reliance upon state programs seems to indicate the high per-

centage of convicted criminals unable to pay compensatory damages.

'"Winning the civil suit is the easy step; the difficulty lies in enforcing the judgment.

Kiesel, Crime and Punishment, 70 A.B.A. J. 25-28 (1984).
'''"The data was drawn from the 1970 U.S. Census of the Population and the 1971

Uniform Crime Reports. See Carroll & Jackson, Inequality, Opportunity, and Crime Rates
in Central Cities, 21 Criminology 178 (1983). Similar statistical studies were conducted

with reference to the homicide rate in two hundred four standard metropolitan areas. See

Messner, Poverty, Inequality, and the Urban Homicide Rate, 20 Criminology 103, 112

(1982) ("Homicidal offenders are recruited disproportionately from the ranks of the poor,

yet a large poverty population appears to be associated with a low homicide rate.").

'**'Indiana's victim compensation fund was established in 1978. The provisions gov-
erning its operation are codified at Ind. Code §§ 16-7-3.6-1 to -19 (1984).

"'''A comparison of other state budgets is provided in Hoelzel, A Survey of 27 Victim
Compensation Programs, 63 Judicature 485, 486 (1980).

"'See Ashby, New Crimes Laws Push Restitution, Increase Penalties, L.A. Daily J.,
Dec. 30, 1983, at 1, col. 6; Cox, Underpayments Add to Woes of Fund to Aid Crime
Victims, L.A. Daily J., Apr. 17, 1984, at 2, col. 4; L.A. Daily J., Nov. 1, 1982, at 4,

col. 1.



1985] PUNITIVE DAMAGES 683

not to mention punitive awards. Therefore, the new punitive damages

statute will probably not alleviate the financial misfortunes currently

plaguing program operations.

Unhampered exercise of the newly-created opportunity to recover

punitive damages is further compromised by the fact that many criminals
escape apprehension. But "such a right is nonetheless limited only by

the shortcomings of private initiative rather than by the shortcomings

of the criminal justice system. "'^^

VII. Conclusion

Until the legislature acted, the courts had unbendingly prohibited

punitive damages where the defendant was subject to a criminal pros-

ecution for the same act, primarily because of the constitutional pro-

hibition against double jeopardy. In consideration of the often

unprosecuted or underpunished criminal defendant and the inequities

frequently generated by the application of Taber to various classes of

litigation, the Indiana General Assembly has finally heeded the pleas of

Indiana courts for a reevaluation of the rule against punitive damages.

The new statute exposes all offenders, whose acts are punishable as
felonies or misdemeanors, to increased civil Hability. In doing so, the

deterrence and punishment purposes of punitive damages are more readily

effected. While the legislature did not expressly Umit the statute's scope

of applicability, it did, however, pass a simultaneous measure upgrading

the plaintiff's burden of proof from a preponderance of the evidence

to clear and convincing proof, reserving the award for the most clear-

cut cases of malicious or reckless conduct.

The Taber doctrine was founded on the principles of fairness un-

derlying the constitutional prohibition against double jeopardy. A con-
tinuation and revitalization of this fairness rationale by Indiana courts

in the form of mitigation of punishment might, at least in theory, guard

against the pitfalls peculiar to the majority position, which ignores the

possibility of punishment at both the criminal and civil levels. The

supplemental approach would attempt to strike an equitable balance

between the defendant's concern for overpunishment and the public's

desire to check undesirable behavior. The adjustment of a punitive

damages award to reflect a prior fine or prison sentence and the cor-

responding consideration of civil relief as a mitigating factor in deter-

mining punishment at the criminal level would apparently achieve both

objectives. '^^ The practical obstacles of the supplemental approach, how-

^^^See McLemore, supra 43, at 83.

'"''The greatest advantage of the new punitive damages statute is, other than increasing

monetary reUef for civil claimants, the opportunity to make the punishment proportional

to the crime:

My object all sublime-
I shall achieve in time-

To let the punishment fit the crime.
W. Gilbert, The Mikado and Other Plays 42 (1917).



684 INDIANA LAW REVIEW [Vol. 18:655

ever, particularly the possibility that judges and juries will not be truly

capable of determining fair cumulative punishment, may persuade Indiana
courts to reject its adoption. Furthermore, the requirement of clear and

convincing proof, coupled with the permissible introduction of the de-

fendant's financial status into evidence, should guard against overpun-

ishment. For these reasons, it would appear that the Indiana judiciary

will choose to avoid the pitfalls of the supplemental approach. Despite

the potential for awards of punitive damages because of the new statute,
the biggest obstacle to the effectiveness of the statute may be the
insolvency or limited financial resources of the majority of the defendants

who commit criminal acts.

Elizabeth Gingerich