Nevada law permits the recovery of punitive damages (a.k.a. exemplary damages) when the defendant’s wrongdoing in a personal injury case is particularly egregious. Specifically, these damages may be awarded when the conduct consists of “fraud,” “malice,” or “oppression.”
- To punish wrongdoers, and
- As an example to deter others from behaving similarly.
When granted, Nevada punitive damages awards are in addition to whatever compensatory damages you receive in a personal injury lawsuit.
To help you better understand Nevada’s law on exemplary damages, our Nevada personal injury lawyers discuss the following, below:
- 1. What is Nevada law re punitive damages?
- 2. Is there a cap on punitive damages in Nevada?
- 3. What is the process for collecting the money?
- 4. Are punitive damages available in a labor claim?
Nevada’s law on punitive damages is set forth in Section 42.005 of the Nevada Revised Statutes (NRS).
Under NRS 42.005, a plaintiff can receive an award of punitive damages when the defendant’s conduct consists of “fraud,” “malice,” or “oppression.”
These terms are defined in NRS 42.001 as follows:
- “Fraud” is an intentional misrepresentation, deception or concealment of a material fact known to the defendant and made with the intent to:
- deprive you of your rights or property or
- otherwise injure you;
- “Malice” is conduct which is:
- intended to injure you, or
- despicable conduct which is engaged in with a conscious disregard of the rights or safety of others;
- “Oppression” is despicable conduct that subjects you to cruel and unjust hardship with conscious disregard of your rights; and
- “Conscious disregard” is the knowledge of the probable harmful consequences of a wrongful act and a willful and deliberate failure to act to avoid those consequences.
Example: Mike gets into an argument with Ned, a bouncer at an exclusive Las Vegas strip nightclub. During the argument, Ned punches Mike. Mike holds up his hands up in an “I surrender” gesture, but Ned keeps hitting him anyway. As a result of the beating, Mike suffers a fractured jaw and a brain injury. Mike sues both Ned and the nightclub. A jury determines Mike is entitled to $1,200,000 in compensatory damages for his medical bills, lost wages and future lost earnings.
But Mike’s Las Vegas personal injury lawyer also introduces copies of letters to the nightclub’s owner by other patrons complaining that Ned is too violent. The jury determines that both Ned and the nightclub owner’s actions were despicable and engaged in with a conscious disregard for the safety of the club’s patrons. They award Mike another $800,000 in exemplary awards, bringing Mike’s total award to $2,000,000.
Under NRS 42.005, punitive damage awards in Nevada are generally capped at (limited to):
- $300,000 if the amount of compensatory damages awarded to the plaintiff is less than $100,000, or
- Three times the amount of compensatory damages awarded to the plaintiff if the amount of compensatory damages is $100,000 or more.1
However, there is no limit on the amount of punitive damages you can recover in Nevada if your case involves:
- A manufacturer, distributor or seller of a defective product;
- An insurer who acts in bad faith regarding its obligations to provide insurance coverage;
- A person who violates a state or federal law prohibiting discriminatory housing practices (sometimes),
- Damages or an injury caused by the emission, disposal or spilling of a toxic, radioactive or hazardous material or waste;
- Defamation;2 or
- A Nevada motor vehicle accident caused by a driver who willfully consumed alcohol and/or drugs.3
Example: Lisa is driving her new car home from work when she is front-ended by an uninsured motorist. Her driver’s side airbag fails to deploy and, as a result, Lisa suffers several serious fractures as well as a traumatic brain injury (TBI)
Lisa’s Las Vegas car accident lawyer files a lawsuit against the automaker and the airbag manufacturer. The jury determines that Lisa is entitled to compensatory damages of $2,000,000 for her medical bills, physical therapy, lost wages, and pain and suffering.
But after Lisa’s lawyer learns that the automaker knew about the defect but failed to issue a recall, she asks for an exemplary award in the amount of $10,000,000. The jury agrees. Because the company sold a defective product, there is no cap on exemplary awards. Unless the automaker can prove it is unable to pay the award, the judge should let it stand.
Getting an exemplary award in a Nevada accident or personal injury case is a three-step process:
- You must win your case.
- You must ask for exemplary damages and the jury (or in a bench trial, the judge) must agree that an exemplary award is warranted.
- If the jury decides such damages are warranted, there will a subsequent proceeding to determine the size of the exemplary award you should get.4
There are many ways to prove negligence in Nevada. And under Nevada’s comparative negligence (shared fault) rule, as long as someone else is more than 50% responsible for your injuries, you are entitled to compensation.
However, every cause of action has slightly different elements that you need to prove in order to prevail. Some are more complex than others. For instance, winning a Nevada defamation case requires proof of four elements:
- A false and defamatory statement by a defendant concerning the plaintiff;
- An unprivileged publication of the statement to a third party;
- Fault, amounting to at least negligence; and
- Actual or presumed damages.
To get an exemplary award, you must prove that the defendant acted with fraud, oppression or malice. This usually requires proof that the defendant acted intentionally (or at least with a conscious disregard for the well-being of others).
This can be done with documents (such as memos or emails) showing the defendant’s intent. It can also be established with testimony.
Example: Rhoda is out walking one day when she is attacked by her neighbor Sam’s Rottweiler. The dog bites her face, causing serious injury and permanent scarring. Rhoda retains an experienced Las Vegas dog bite lawyer to make a claim against Sam’s homeowner’s insurance policy for her medical bills and pain and suffering.
But Rhoda’s lawyer discovers that other people in the neighborhood have made repeated calls and sent letters to the police about the dog’s threatening behavior. Under Nevada’s law against keeping a dangerous dog, Sam is required to keep the dog chained up. Because Sam failed to do so, he has acted with a conscious disregard for his neighbor’s safety. Rhoda’s lawyer is able to get Sam’s insurer to settle for a larger sum of money.
It is not always easy to prove that a defendant acted with fraud, malice or oppression. An experienced Las Vegas injury lawyer has a number of ways to discover the crucial evidence. These include interviewing potential witnesses and carefully reviewing documents for the necessary proof — or evidence that there are documents missing.
Sometimes this will be enough to allow your attorney to settle your case out-of-court for more than you expected. If your case does go to trial, however, you must specifically request an exemplary award and establish that they are warranted. Depending on the terms of the settlement, exemplary awards may be paid on one lump sum or may be paid over time as part of a structured settlement.
In this stage of the trial, the focus is on the defendant’s actions and condition rather than your injuries.
If your case is being tried in front of a jury, the jurors will not be told about the cap on exemplary awards or how much the defendant is able to pay. They will simply be asked to return a special verdict stating:
- Whether exemplary awards are warranted and,
- If so, how much they think is fair and reasonable.
The judge will then reduce the exemplary award, if necessary, to keep it within the legal limits. At this stage of the hearing, the judge may also take into account the defendant’s financial condition and reduce the award if the defendant is unable to pay.5
If you are suing an employer for the wrongful acts of an employee, there is an additional hurdle to clear. To recover an exemplary award from an employer who is an individual you must show that:
- The employer knew the employee was a risk to the rights or safety of others;
- The employer authorized or approved the employee’s wrongful act; or
- The employer him- or herself was personally guilty of oppression, fraud or malice.6
If the employer is a corporation, the employer is not liable for exemplary damages unless:
- An officer, director or managing agent of the corporation committed one of the above acts, and
- That person was authorized to direct or ratify the employee’s conduct on behalf of the corporation.
Example: Jane is a clerk at a hardware store. At the store’s holiday party, Jane is sexually assaulted by her co-worker, Ken. During discovery, Jane’s lawyer finds an email to the owner from another female employee complaining that Ken has groped her on several occasions. Because the owner was on notice about Ken, the store may be liable to Jane for Ken’s actions.
However, if the email was simply sent to another clerk, the store would not be liable unless there was some other proof that the owner knew about Ken’s behavior. It is the employer him- or herself that must be put on notice.
Note that this limitation on employers does not apply if the case is one against an insurer who acts in bad faith regarding its obligations to provide insurance coverage.7
- NRS 42.005 (1); Smith’s Food & Drug Centers, Inc. v. Bellegarde, 114 Nev. 602, 958 P.2d 1208 (Nevada Supreme Court 1998).
- NRS 42.005 (2).
- NRS 42.010.
- NRS 42.005 (3).
- NRS 42.005 (4).
- NRS 42.007 (1).
- NRS 42.007 (2).