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Can a Corporation Drive Drunk?: A Look at Employer Liability for Punitive Damages

The power to punish is generally the role of the criminal courts. Civil courts concern themselves with making a plaintiff “whole.” In fact, it would be legal error for a civil court to impose recovery against a defendant as a form of punishment–with one notable exception. When “punitive damages” are allowed, a civil court may “punish” a defendant.

In Louisiana, punitive damages are only allowed when a statute specifically says they may be awarded. One of these statutes is La. Civil Code article 2315.4, which allows punitive damages when the plaintiff’s injuries were caused “by a defendant whose intoxication while operating a motor vehicle was a cause in fact of the resulting injuries.” Based upon the words used, punitive recovery for drunk driving would appear limited to recovery against the individual who was “operating a motor vehicle.”  However, what if the driver was intoxicated while “on the clock,” in the “course and scope” of his employment? Can his employer also be liable for punitive damages? Unfortunately, the answer to these questions is unclear and may vary depending upon where the case was filed.

 

The First and Third Circuits indicate that an employer should not be liable for these damages. In Darby v. Sentry Ins. Auto. Mut. Co., the First Circuit held that an employer could not be liable for punitive damages when its intoxicated employee was at fault for an accident, even when the employer was aware the employee had a history of alcohol abuse. The court reasoned that the principle of strict construction of punitive statutes prevented it from holding anyone other than the driver liable. 2007-0407 (La. App. 1 Cir. 3/23/07), 960 So. 2d 226, writ denied, 2007-0638 (La. 3/28/07), 953 So. 2d 59. Similarly, in Romero v. Clarendon Am. Ins. Co., the Third Circuit ruled that an employer could only be liable for the compensatory damages caused by its employee, to the exclusion of punitive damages. 2010-338 (La. App. 3 Cir. 12/29/10), 54 So. 3d 789, writ denied, 2011-0551 (La. 4/25/11), 62 So. 3d 96. A federal court decision from the Western District of Louisiana also supports this conclusion. See Lankford v. Nat’l Carriers Inc., 2015 WL 518736 (W.D. La. Feb. 6, 2015).

 

In contrast, the Fourth and Fifth Circuits have found that an employer can be liable for its intoxicated employee’s punitive damages. The Fourth Circuit, offering little commentary, found that an employer could be responsible for damages caused by its employee’s acts, including punitive damages under art. 2315.4. See Curtis v. Rome,  98-0966 (La. App. 4 Cir. 5/5/99), 735 So. 2d 822. Punitive damages were also awarded against an employer in a Fifth Circuit case, Levet v. Calais & Sons, Inc., 751 So.2d 153 (La. Ct. App. 1987).  However, in Levet, the employer stipulated to liability and essentially agreed to be responsible for punitive damages.

 

While the Louisiana Supreme Court has not squarely addressed the issue, language from Berg v. Zummo tends to indicate that the employer may not be liable for drunk-driving punitive damages. In Berg, the Supreme Court examined art. 2315.4 to determine whether a bartender could be liable for providing an intoxicated driver with alcohol prior to the accident. In that context, the Court held that art. 2315.4 did not extend to someone who “contributed to” the intoxication because that Article  “reflects the legislature’s intent to penalize only the intoxicated driver.” 2000-1699 (La. 4/25/01), 786 So. 2d 708, 718. However, the Berg Court specifically acknowledged lower court decisions that permitted such liability for employers, reserving its judgment on that issue for another day.

 

So, if someone asks you whether a corporation can drive drunk, the proper answer may be this: depends on who you ask.

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