Court Awards Punitive Damages for Debtor’s Bad Conduct
Paralegal Services Case Study
A dentist provided dental services to a patient, Mike. The dentist provided Mike with a financial predetermination of the dental work that was to be done. Mike submitted that predomination to his insurance company and, at some point, Mike received payment from his insurer which the insurer paid directly to him.
When the dental work was completed, Mike provided payment to the dentist in the form of a cheque. Mike then stopped payment on the cheque, thereby being unjustly enriched because he received payment from the insurer but did not pay for the dental services that had been provided to him.
It was at that point that the dentist retained my firm to recover his money.
We issued a Plaintiff’s Claim in the small claims court for the principal sum of $3,451.70 plus interest and costs. Additionally, we asked for punitive damages alleging that Mike had committed civil fraud by keeping the money that he had received from his insurance company and not providing it to my client.
Mike did not defend the claim. At an assessment hearing to obtain judgment, the court awarded full damages and costs to my client with a further award of $1,000.00 for punitive damages.
Ultimately, the full amount of the judgment was paid when we issued a garnishment against Mike’s employer.
Generally speaking, punitive damages are awarded for the outrageous and egregious conduct of a party and/or to reform or deter that party and others from engaging in conduct similar to that which formed the basis of the lawsuit. The conduct of Mike was at the lower end of that threshold, but the court felt that a small award of punitive damages was nonetheless appropriate and warranted in this circumstance.