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Supreme Court of Georgia affirms decision that cap on punitive damages is constitutional

9/26/23

By: Michelle Yee and Sean R. Riley

In a recent decision, Taylor v. Devereux Found., Inc., 316 Ga. 44, 92, 885 S.E.2d 671, 707 (2023), the Supreme Court of Georgia ruled that a statutory cap on punitive damages did not violate the Georgia constitution. In this case, a teenage resident of a behavioral health facility asserted various tort claims arising from her alleged sexual assault by an employee of the facility. The jury returned a verdict in favor of the resident which included an award of $50 million in punitive damages. However, the trial court reduced the jury’s punitive damage award to $250,000 consistent with the statutory cap on punitive damages set forth in OCGA § 51-12-5.1 (g).

On appeal, the resident argued that OCGA § 51-12-5.1 (g) violates (1) the rights to trial by jury, (2) separation of powers, and (3) equal protection guaranteed by the Georgia Constitution. The Supreme Court of Georgia gave short shrift to the separation of powers and equal protection arguments, holding that the statutory cap did not infringe on the judicial power of remittitur, which involves a judge weighing evidence to reduce an award “so excessive […] as to be inconsistent with the preponderance of the evidence,” and the statutory cap passed the rational basis test.

The Court’s analysis of the right to trial by jury argument, however, was a closer issue. The Court generally agreed with the resident’s argument that the right to trial by jury prohibits the Georgia legislature from enacting laws abridging an individual’s right to trial by jury (which encompasses the jury’s valuation of damages) so long as those claims existed at the time of the enactment of Georgia’s constitution in 1798. The Court further acknowledged that claims for punitive damages were recognized before 1798 but only for tort claims involving intentional misconduct. As the resident’s claims were premised on the facility’s “entire want of care,” a standard that authorizes an award of punitive damages under OCGA § 51-12-5.1 but which falls short of intentional misconduct, the Court held that the constitutional right to trial by jury was not implicated.

While the Court’s holding addresses only Georgia’s punitive damages statute OCGA § 51-12-5.1, it bears noting that the Court’s reasoning may nonetheless influence how other states resolve constitutional challenges to punitive damages caps.

For more information, please contact Michelle Yee at myee@fmglaw.com, Sean R. Riley at sriley@fmglaw.com, or your local FMG attorney.