Aggravated, Exemplary and Restitutionary ... - Law Commission

1.100 The existing ‘if, but only if’ test, as formulated in Rookes v Barnard, is based on the
idea that even a compensatory award may have an incidental ‘punitive’ effect. To
the extent that this is so, the justification for an award of punitive damages is
correspondingly reduced or even eliminated. But clearly other remedies which a
court may award in respect of a wrong (other than punitive damages) may have
similar incidental effects. A good example is an award of a restitutionary
remedy. 683
If punitive damages are truly to be made a remedy of ‘last resort’, a
court must be entitled to take into account the effect of any remedy which it
awards, in judging whether an additional sum of punitive damages is necessary to
punish and deter. 684
1.101 It is appropriate at this point to emphasise that a minimum condition of the
availability of an award of punitive damages is that the court must want to punish
the defendant for his conduct. It should also be a sufficient condition, in the sense
that the court need only want to punish the defendant (and need not want to do
anything else). But we recognise that the court may also, in punishing the
defendant, properly seek to deter the defendant and others from similar conduct.
Our recommendations 685
clarifying that an object of punishment may be to deter
the defendant and others from similar conduct are intended to deal with this issue.
1.102 The basic question for the judge will therefore always be, “Are the remedies which
are available to me inadequate to punish and deter?”. If the plaintiff has only
established an entitlement to compensation, the judge should proceed to ask
himself whether the compensation which he is minded to award will be inadequate
to punish and deter. If the plaintiff has only established an entitlement to
restitution, the judge should proceed to ask himself whether the restitution which
he is minded to award will be inadequate to punish and deter. And if the plaintiff
has established an entitlement to both compensation and restitution - and it is a
controversial question whether there can ever be an entitlement to both, as we
have discussed in Part III - the judge should proceed to ask himself whether the
total sum which he is minded to award as compensation and restitution is
inadequate to punish and deter.
of compensation were paid by an insurer, “any punitive effect otherwise inherent in such a
compensatory award would be rendered ineffective” (pp 53-54). We consider, however, that
a last resort test which makes any remedy - and in particular the availability of restitutionary
damages - relevant to the question ‘is a punitive award required?’, can have a substantial
role in limiting the availability of exemplary damages.
682 [1964] AC 1129.
683 Other remedies might include an injunction, or delivery up for destruction (see
Mergenthaler Linotype Co v Intertype Co Ltd (1926) 43 RPC 381).
684 Notwithstanding the Ontario Law Reform Commission views on the relevance of
compensatory damages to the availability and/or quantum of punitive damages (see para
5.99, n 137 above), it recognised that restitutionary remedies should be taken into account:
Report on Exemplary Damages (1991) pp 73-74.
685 See para 5.44, recommendations (20) and (22), and draft Bill, clauses 3(10) and 5(3)
above.
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