AN ACT to amend and reenact sections 32-03.2-01 and 32-03.2-11 of the North Dakota Century Code, relating to when a court or jury may give exemplary damages.
Summary
SB 2290 revises North Dakota law governing exemplary damages, also known as punitive damages, in civil cases that do not arise from contract. The bill keeps the existing requirement that a defendant must be shown by clear and convincing evidence to have acted with oppression, fraud, or actual malice, but it adds a formal procedure for seeking exemplary damages after a lawsuit has already been filed. Under the new process, a party must move to amend the pleadings, support the request with affidavits or deposition testimony, and obtain a court finding that there is sufficient evidence for a factfinder to consider the claim.
The bill also adds several limits and evidentiary rules. It requires bifurcation if requested, bars evidence relevant only to exemplary damages from the compensatory-damages phase, prohibits admission of a defendant’s financial condition or net worth, and caps exemplary damages at the greater of two times compensatory damages or $250,000. It further sets out factors a factfinder must consider, creates a product-liability defense for manufacturers and sellers who complied with applicable federal requirements, and specifies when a principal may be held liable for an agent’s conduct. In motor-vehicle injury cases, it allows exemplary damages to be considered when the driver had a recent conviction for impaired-driving-related offenses and was operating under specified intoxication or drug-related conditions.
Impact
SB 2290 amends sections 32-03.2-01 and 32-03.2-11 of the North Dakota Century Code, changing both the definition section for fault/malice and the rules for awarding exemplary damages in tort actions. It affects civil litigants, courts, manufacturers and sellers in product-liability cases, principals and employers in agency-based liability cases, and defendants in certain motor-vehicle injury cases. The bill imposes a new pleading-and-proof procedure, limits admissible evidence, and places a statutory ceiling on punitive awards, while preserving the ability to seek such damages in qualifying cases.
Sentiment
The bill appears to have been broadly supported. It passed the Senate unanimously and the House by a strong margin, indicating general agreement on tightening and clarifying the standards for exemplary damages. The voting pattern suggests lawmakers viewed the measure as a procedural and substantive refinement rather than a controversial expansion of liability.
Contention
There is little evidence of major contention in the available record, and no committee testimony is provided. The most likely points of debate would have been the new cap on exemplary damages, the restriction on using a defendant’s net worth, the product-liability safe harbor for federally compliant products, and the specific rule allowing exemplary damages in certain drunk-driving or drug-impaired driving injury cases. The House vote of 86-7 suggests some concern remained, but the bill still received strong bipartisan support.
AN ACT to amend and reenact sections 32-03.2-01 and 32-03.2-11 of the North Dakota Century Code, relating to when a court or jury may give exemplary damages.
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AN ACT to amend and reenact sections 32-03.2-01 and 32-03.2-11 of the North Dakota Century Code, relating to when a court or jury may give exemplary damages.