In 2022 the Florida Rules of Appellate Procedure changed to allow district courts of appeal to review orders granting or denying leave to amend to add a claim for punitive damages by interlocutory appeal. That rule change has triggered a flood of appellate decisions clarifying the pleading and evidentiary requirements necessary to claim punitive damages in all sorts of cases, including cases against trustees for breach of fiduciary duty.
Link to When can you claim punitive damages? When can you claim punitive damages?
If you’re looking for a quick primer on the procedural rules underlying claims for punitive damages, I recommend an excellent article by Kimberly Berman and Gabrielle Wright entitled Where Are We Now? Punitive Damages Claims in Fla. 2 Years Post-Interlocutory Review Rule Change. Here’s an excerpt:
To pursue a claim for punitive damages, litigants must comply with the pleading requirements set forth in Florida Rule of Civil Procedure 1.190(a) and (f) and Section 768.72, Florida Statutes. Rule 1.190(a) requires litigants to obtain court approval before amending a claim to request punitive damages.
Rule 1.090(f) provides that a motion for leave to amend a pleading to assert a claim for punitive damages shall make a reasonable showing, by evidence in the record or evidence to be proffered by the claimant, that provides a reasonable basis for recovery of such damages. The motion to amend can be filed separately and before the supporting evidence or proffer, but each shall be served on all parties at least 20 days before the hearing.
Section 768.72(1) provides that no claim for punitive damages shall be permitted unless there is a reasonable showing by evidence in the record or proffered by the claimant, which would provide a reasonable basis for recovery of such damages. Subsection 2 further provides that a defendant may be held liable for punitive damages only if the trier of fact, based on clear and convincing evidence, finds that the defendant was personally guilty of intentional misconduct or gross negligence.
Link to Does a trustee’s breach of fiduciary duty — without evidence of fraud or malice — warrant punitive damages? NO Does a trustee’s breach of fiduciary duty — without evidence of fraud or malice — warrant punitive damages? NO
Wells Fargo Bank, N.A. v. Gopher, 397 So.3d 1033 (Fla. 4th DCA October 30, 2024)
In this case the trial court found a reasonable basis for the plaintiffs to recover punitive damages based on Wells Fargo allegedly breaching its fiduciary duties and charging more than $7 million in unauthorized and undisclosed fees while acting as a trustee. Even assuming this claim is true, a breach of fiduciary duty isn’t enough to warrant punitive damages. The plaintiff needs to also proffer evidence of fraud, malice, or other misconduct by the trustee. That didn’t happen here, so no punitives for you! So saith the 4th DCA:
Wells Fargo allegedly violated its fiduciary duties by charging fees not properly disclosed on a fee schedule. However, a breach of a fiduciary duty, alone, does not create an automatic right to plead punitive damages. Rather, the plaintiff also must proffer evidence of fraud, malice, or other misconduct that would justify punitive damages. See Air Ambulance Pros., Inc. v. Thin Air, 809 So. 2d 28, 31 (Fla. 4th DCA 2002) (reversing punitive damage award because, although the jury found a breach of a fiduciary duty, the plaintiff did not present any evidence of fraud, malice, or other culpable misconduct). Here, the plaintiffs did not proffer any such evidence.
Similarly, the plaintiff did not proffer any evidence that any “managing agent” of Wells Fargo participated in or condoned the improper charging of the fee. Napleton’s N. Palm Auto Park, Inc. v. Agosto, 364 So. 3d 1103, 1106–07 (Fla. 4th DCA 2023). As a result, the plaintiffs did not proffer a reasonable evidentiary basis to find employer or corporate liability for punitive damages. § 768.72(3), Fla. Stat. (2023).