Kamlar Corporation v. Jesse C. Haley, Jr.

Summary

The Supreme Court of Virginia held that punitive damages are not recoverable for breach of contract absent proof of an independent, wilful tort, regardless of the motives underlying the breach; malicious motive or wilful and reckless disregard of the plaintiff's rights alone cannot support such an award. Because the jury was instructed it could award punitive damages on the breach-of-contract count based on malicious motives alone, the $150,000 punitive damages award against Kamlar was reversed and vacated, while the $98,000 compensatory award stood, the challenged evidentiary rulings were found within the trial court's discretion, and the judgment was affirmed in part and reversed in part with final judgment entered. The court also advised that, now that tort and contract counts may be joined, a plaintiff seeking punitive damages should plead the wilful independent tort in a separate count. Justice Compton, joined by Justice Stephenson, dissented in part, contending the majority had narrowed the long-standing rule of Wright v. Everett and would have affirmed the punitive damages award because Kamlar's conduct was malicious, wanton, and oppressive.