A recent Florida Bar Journal article caught my eye this morning. The article (which, not surprisingly, was submitted on behalf of the Trial Lawyers Section) is a forceful argument in favor of allowing Florida trustees and personal representatives to be subject to punitive damages.
The premise of the article is that Florida courts should reject the traditional principles that prohibit the award of punitive damages against Florida fiduciaries. This traditional rule is based in the archaic common law distinction between courts of law and courts of equity. Courts of law typically involve jury trials, where jurors could decide on the need for additional damages beyond the amount necessary to make the plaintiff whole. Courts of equity were traditionally overseen by a single judge (chancellor), and folks just weren’t comfortable giving the chancellor the authority to award punitive damages in the absence of a jury trial.
Courts that follow the modern rule (which just sounds better than the minority rule) believe that the distinction between law and equity has been thrown out the window. Florida circuit courts are no longer bifurcated into law and equity, and the rules of civil procedure use only one form of action allow equitable claims to be joined with legal claims. The erosion of the distinction between law and equity lead some courts (and the authors) to conclude that there is no longer any basis for disallowing punitive damages in equitable cases, particularly in suits against fiduciaries.
But does the consolidation of claims into one form of action necessarily mean that there is no longer any distinction between law and equity? At least one court has answered in the negative. In R.S. #17 Corp vs. Cornblit, the 3rd DCA stated (with dissent):
We are of the opinion that the consolidation of law and chancery procedure, under the revised rules, did not abolish chancery or law, and that the substantive law should be applied to the actual allegations and relief sought in a complaint or petition as was done prior to the adoption of the revised rules. Rule 1.040, Florida Rules of Civil Procedure, 1967, 30 F.S.A., simply provides that there shall be one form of action to be known as “civil action.”
This is where the point of disagreement lies. Courts that adopt the modern rule believe that there is no longer any distinction between law and equity and that the traditional rule should be discarded. Those that still hold to the traditional rule believe that, while the concepts of law and equity have perhaps drawn closer to each other, there is still a distinction between the two that justifies the prohibition against the award of punitive damages in equitable matters.
The second part of the article is scheduled to be published in December, where the authors will advocate for the modern rule and apply it specifically to the fiduciary and probate context.
What do you think? Are there any policy reasons for protecting trustees and personal representatives from liability for punitive damages?