Document Category:
State: Tennessee
Subject Matter: Goff v. Greer & Sons
Document Title:
Comments:

Here is the report on the Goff v. Greer & Sons
Constr. Co. case released by the TN Supreme Court.  In this case the
Court revisited Tennessee’s punitive damages jurisprudence and held that
in light of the circumstances presented, the jury’s $1M punitive damages
award was excessive (punitive to compensatory ratio of 302:1) and in
violation of the Defendant’s due process rights.  The Court remitted the
punitives amount to $500,000, reasoning that while Defendant’s conduct
created a financial and nuisance injury, it did not result in an
environmental hazard or a threat to the health or safety of any
individual.

           Although this is not a health care case, the facts are
instructive.  Plaintiff property owners filed suit against a
construction company ("Defendant") who had contracted with the State to
widen a highway adjacent to Plaintiffs’ property.  The proof as
developed at trial supported Plaintiffs’ allegation that, despite his
repeated overtures to Defendant "not to bury any tires or solid waste
under Plaintiff’s property," Defendant had intentionally or recklessly
done just that.  The tires were buried 8-9 feet deep under compacted
Limestone rocks, some of the rocks being the size of a pick-up truck.
Further, one of the buried tires was eight feet tall and weighed at
least one ton.  Plaintiffs’ expert geologist testified that "given their
size the buried tires could not have been accidentally covered up. . .it
had to be an intentional act to bury them."  The jury determined that
Defendant had "created a nuisance" and awarded $3,300 in compensatory
damages.

After finding material evidence in the record to support the jury’s
finding of reckless or intentional conduct, the Court then turned to a
discussion of the "three guideposts" set forth in the US Supreme Court
Case, BMW v. Gore, 517 U.S. 559 (1996) to determine whether the
punitives award was excessive and in violation of Defendant’s due
process rights under the Fourteenth Amendment.  The three guideposts
(and the Court’s findings on each) are as follows:

1)      the degree of reprehensibility of the defendant’s conduct – The
Court found that Defendant’s conduct was intentional, done in order to
avoid overhead costs and maximize profits, and that Defendant knew its
conduct was illegal and also in violation of the contract with the
Plaintiffs;

2)      the disparity between the actual or potential harm suffered by
the plaintiff and the punitive damages award – The Court found that the
300:1 ratio of punitive to compensatory damages was excessive in light
of the absence of any long term health or safety risks on the property;
and

3)      the difference between the punitive damages award and the civil
penalties authorized or imposed in comparable cases – The Court found
that this guidepost neither supported nor undermined the punitives
amount.  Although the $1M punitives amount was comparable to the civil
penalties that would be authorized by statute, no such penalties were or
would be assessed against Defendant for its actions.

Following the US Supreme Court’s opinion in Exxon Shipping Co. v. Baker,
128 S.Ct. 2605 (2008), this opinion underscores the Tennessee Supreme
Court’s
rejection of the notion that only single-digit ratios of punitive to
compensatory damages satisfy due process.  The proper approach for
determining a "constitutional amount" of punitive damages in Tennessee
is not to simply apply a mathematical formula and the 1:1 ratio is
merely a "guidepost" which can be largely disregarded in cases where
egregious conduct results in nominal compensatory damages.  Let us know
what comments or questions you may have and we will keep you informed of
further developments.

Rebecca

Rebecca Adelman, Esq.
THE LAW AND MEDIATION OFFICES
OF REBECCA ADELMAN, PLC
545 S. Main St., Suite 111
Memphis, Tennessee 38103
p] 901.529.9313
f] 901.529.8772

1801 Crane Ridge Rd., Suite B
Jackson, Mississippi 39216
p] 601.321.9413
f] 601.321.9421

www.adelmanfirm.com

 


Document Author: Rebecca Adelman
Firm/Company: The Law and Mediation Offices of Rebecca Adelman PLC
Document Date: November 3 2009
Search Tags: punitive damages due process twombly
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