Punitive damages curbs pass House, await Senate fight

March 04, 1992|By David Conn VTC | David Conn VTC,Annapolis Bureau

ANNAPOLIS -- A bill to limit how punitive damages are awarded in Maryland cleared the House of Delegates yesterday but faces a tough battle in the Senate.

The House voted 83-43 for House Bill 329, which its supporters say would bring some much-needed element of predictability to the awards.

Business groups say the restrictions are needed to help reduce the growing costs of undeserved lawsuits and to make Maryland and U.S. companies competitive with their foreign counterparts.

Opponents argued that the bill would remove the incentives for companies to guard against employee wrongdoing.

"Do we want to improve the business climate, or do we want to allow the ability to punish wrongdoing?" Del. Paul G. Pinsky, D-Prince George's, said on the House floor.

The bill moves to the Senate Judicial Proceedings Committee, where Chairman Walter M. Baker, D-Cecil, has expressed general support for limiting punitive damages.

Senate President Thomas V. Mike Miller Jr., D-Prince George's, said he won't play a role in the panel's decision but noted that the bill lacks some of the drive it had in the House.

"It's important on the House side only because John Arnick sponsored it and rammed it through his committee on a very close vote," he said, referring to the House Judiciary Committee chairman.

Lacking that support, lobbyists and legislators said, the bill will have trouble passing the Senate.

The bill's most important element is a restriction that would protect a company from punitive damages if its top officials didn't authorize and were unaware of an employee's malicious behavior.

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