Apostolos Georgiades & Associates

Punitive Damages in Europe and the USA: Doctrinal Differences and Practical Convergence

Originally published in "Revue Hellénique de Droit International" (RHDI), 58 (2005), p. 1 f.

INTRODUCTION

The concept of the law of damages in common law systems is dualistic: damages can be recovered for the losses incurred, including loss of profit, and for punishment of the wrongdoer. On the contrary the concept of the law of damages in civil law systems is purely monistic, at least if taken at face vale. Damages are strictly restricted to compensation. Punishment of the tortfeasor is under no circumstances a legitimate function of damages. The latter function might only be pursued in the context and by the means of criminal law.

This “apparently irreconcilable gap” that has separated common and civil law systems for more than a century is particularly visible in the case of the USA and Germany because of the former’s extensive use of punitive damages and the latter’s persistence on doctrinal coherence in their tort systems. Interestingly enough, “what seems to be but a theoretical distinction turns out to be of practical relevance when an American money judgment creditor applies for enforcement of his judgment in Germany”. The German Federal Supreme Court held, back in 1992, that American punitive damages awards are not to be enforced in Germany because they are contrary to German public policy.

This latter decision has confirmed the German legal system’s traditional hostility towards punitive elements in private law. Nevertheless during the last decade tort law has proven less static than one might initially think. It is still to be examined whether any recent developments have brought the two systems any closer to each other, so as at least to narrow that apparently unbridgeable gap. [...]

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