In August 2022, the Arizona Supreme Court had an opportunity to clarify the standard for punitive damages in a typical negligence case. The Court in Swift Trans. Co. of Az., LLC v. Carman in and for County of Yavapai, 515 P.3d 685, held that to be entitled to punitive damages in a negligence action, a plaintiff must generally show that the defendant’s conduct was outrageous, oppressive, or intolerable; and created a substantial risk of tremendous harm, thereby evidencing a conscious and deliberate disregard of the interests and rights of others.
The Swift case was precipitated by a tractor-trailer accident which involved multiple vehicles. The Swift Transportation driver was operating the tractor-trailer in the rain while utilizing a hands-free telephone. The driver was apparently on a telephone call at the time and had cruise control set 13 mph below the speed limit. The driver was also traveling on a downhill sloping curve. The driver attempted to pass a vehicle in the right lane when the tractor-trailer hydroplaned, jackknifed, and ended up blocking traffic in the left lane. Shortly thereafter, another tractor-trailer arrived at the scene and attempted to avoid the stopped Swift Transportation tractor-trailer. Unfortunately, the second tractor-trailer driver was unable to avoid colliding with two other vehicles which resulted in significant injury and death to several other people in the roadway.
In the lawsuit arising from the accident, Plaintiffs asserted a punitive damage claim against Swift Transportation and its driver and sought to secure financial records to support the punitive damage claim. At the Trial Court level, the Judge ruled that Plaintiffs were entitled to the financial records because it found the facts demonstrated that the Swift Transportation driver consciously disregarded the unjustifiable substantial risk of significant harm to others. As a result of this ruling, Swift Transportation filed a Special Action Petition and the Court of Appeals granted jurisdiction. The Court of Appeals denied relief and found the records supported the Trial Court’s finding. The matter was then brought before the Arizona Supreme Court.
The Supreme Court, in its Opinion, initially went through the evolution of Arizona’s standard for punitive damages. The Court pointed out that previous Arizona precedent in a negligence case, specifically Volz v. Coleman Co., 155 Ariz. 567 (1987), found the proposition that the punitive damages standard in Arizona require something more than gross negligence, and that something more is an evil mind. The Volz Court indicated that this evil mind may be shown by: (1) evil actions; (2) spiteful motives; or (3) outrageous, oppressive, or intolerable conduct that creates a substantial risk of tremendous harm to others. Therefore, Arizona law required that absent evidence of evil actions or spiteful motives, the evil mind motivating a defendant’s conduct must be demonstrated by outrageous, oppressive, or intolerable conduct that creates a substantial risk of tremendous harm to others.
The Swift Court next dealt with the rationale for compensatory damages versus punitive damages in Arizona and highlighted the limited availability of punitive damages in Arizona. Specifically, the Swift Court explained that compensatory damages deter negligent conduct. However, the Court pointed out that punitive damages deter and punish outrageous conduct. The Court added that it does not aim to punish and deter all negligent conduct by way of punitive damages, rather, only that conduct which involves some element of outrage similar to that usually found in a crime.
Finally, the Swift Court explained that in negligence cases, outrageous conduct is often the only way to establish the “evil mind” necessary for punitive damages. To establish such an evil mind requires clear and convincing evidence that the defendant’s actions either (1) intended to cause harm, (2) were motivated by spite, or (3) were outrageous, creating a substantial risk of tremendous harm to others. In negligence cases, the Court pointed out that, by definition, there is not an intent to injure the Plaintiff, and a negligence defendant is unlikely to be motivated by spite or ill will. Therefore, the Swift Court held that the outrageousness of the Defendant’s conduct is the only means by which a plaintiff may prove the requisite evil mind for punitive damages in a negligence case.
Thomas Rubin & Kelley has extensive experience in defending negligence cases involving punitive damages. Please feel free to reach out directly to Brian Rubin at brubin@trkfirm.com or Michael Kelley at mkelley@trkfirm.com with any of your questions. We are always happy to help.