When may a court award punitive damages in addition to compensatory damages?

In the context of tort law, courts may award punitive damages—also known as exemplary damages—to punish a defendant and serve as a deterrent to others. These are distinct from compensatory damages, which are intended to cover actual losses such as medical expenses or lost wages.123

Punitive damages are generally reserved for extreme circumstances involving significant evidence of:
* Oppression1
* Fraud1
* Gross negligence1
* Malice1

In many jurisdictions, these damages are only available for tortious conduct rather than breaches of contract. While the primary goal of modern tort law is typically compensation rather than punishment, some common-law jurisdictions, particularly the United States, retain punitive awards to sanction defendants for egregious behavior. In England, such awards are limited to narrow instances, such as when a defendant engages in activity calculated to make a profit, ensuring that the wrongdoer does not benefit from their tortious conduct. Because these awards can be unpredictable, courts often consider the defendant's wealth and ability to pay when determining the final amount.12