ing the basis of damages the ability of the offending person to pay, rather than the injury done, as finding "no sanction in principle," and said that, if applied, the rule would "lead to results most embarrassing in the administration of justice," several of which results the court mentions specifically.

Punitive damages are not allowed in Nebraska, and the supreme court of that state declared in Rosewater v. Hoffman (1888) 24 Neb. 222, 38 N. W. 857, that evidence of the wealth of a defendant is incompetent in a defamatory action, to show the standing and influence of the defendant as bearing on compensatory damages.

Morris v. Barker (1847) 4 Harr. (Del.) 520, was a nisi prius case of which the report shows only that the evidence was offered by the defendant and excluded by the court. Nailor v. Ponder (1895) 1 Marv. (Del.) 408, 41 Atl. 88, was also a nisi prius case in which Lore, Ch. J., in charging the jury, told it that in estimating the damages it should consider the rank and influence of the defendant in the community, but not his pecuniary condition, as "the damages are to be measured by the injury done, and not by the poverty or riches of either the plaintiff or defendant."

II. View that pecuniary circumstances are relevant.

a. In general.

The general rule that the pecuniary condition of the parties is immaterial in civil cases is in harmony with the idea that rich and poor stand alike before the law, but it seems that in certain cases the courts universally consider the financial condition of one or the other of the parties pertinent, and a class of cases which has found wide support is that where damages are sought for a libel or slander. And, while it may be said that by the decided weight of judicial authority the pecuniary condition of the defendant in a defamatory action is a proper consideration for the jury in determining the amount of damages to be awarded, the cases are not in harmony as to the purposes for which evidence of the fact may be considered, or as to the method of proof.

-

Illinois. Hosley v. Brooks (1858) 20 III. 115, 71 Am. Dec. 252; Harbison v. Shook (1866) 41 Ill. 141; Holmes v. Holmes (1872) 64 Ill. 294; Storey v. Early (1877) 86 Ill. 461; Schmisseur v. Kreilich (1879) 92 Ill. 347; Hintz v. Graupner (1891) 138 Ill. 158, 27 N. E. 935; Geringer v. Novak (1904) 117 Ill. App. 160; Beeson v. H. W. Gossard Co. (1912) 167 Ill. App. 561; Gallagher v. Singer Sewing Mach. Co. (1913) 177 Ill. App. 198; Slaughter v. Johnson (1913) 181 Ill. App. 693; Mercy v. Talbot (1914) 189 Ill. App. 1; O'Malley v. Illinois Pub. & Printing Co. (1915) 194 Ill. App. 544; Dowie v. Priddle (1905) 216 Ill. 553, 75 N. E. 243, 3 Ann. Cas. 526. But compare Szimkus v. Ragauckas (1914) 189 Ill. App. 407, holding evidence of wealth admissible only if malice is shown to entitle the plaintiff to punitive damages. But see cases infra, II. a, 2.

Indiana.-Binford v. Young (1888) 115 Ind. 175, 16 N. E. 142; Miller v. Cook (1890) 124 Ind. 101, 24 N. E. 577; Fowler v. Wallace (1891) 131 Ind. 347, 31 N. E. 53. Compare Wilson v. Shepler (1882) 86 Ind. 275. And see Taber v. Hutson (1854) 5 Ind. 322, 61 Am. Dec. 96.

Iowa. Karney v. Paisley (1862) 13 Iowa, 89 (distinguished in Guengerech v. Smith (1872) 34 Iowa, 348, an action for assault); Hunt v. Chicago & N. W. R. Co. (1868) 26 Iowa, 363 (dictum); Herzman v. Oberfelder (1880) 54 Iowa, 83, 6 N. W. 81; Perrine v. Winter (1887) 73 Iowa, 645, 35 N. W. 679; Bailey v. Bailey (1895) 94 Iowa, 606, 63 N. W. 341; Mills v. Flynn (1912) 157 Iowa, 477, 137 N. W. 1082; Hahn v. Lumpa (1912) 158 Iowa, 560, 138 N. W. 492; Cain v. Osler (1914) 168 Iowa,

59, 150 N. W. 17, Ann. Cas. 1918C, 1126. Compare Sclar v. Resnick, infra, II. b, 3.

Louisiana. - Fatjo v. Seidel (1903) 109 La. 699, 33 So. 737; Meyers v. Fusilier (1917) 141 La. 131, 74 So. 790.

Massachusetts. See Bodwell v. Osgood (1825) 3 Pick. 385, 15 Am. Dec. 228 (where the court considered defendant's "wealth, and influence" in holding a verdict not excessive), and Shute v. Barrett (1828) 7 Pick. 82.

The inference is that in the majority of the cases cited above the evidence was held competent as bearing on punitive damages. Vide infra, II. b, 2.

As to the propriety of the rule admitting evidence as to the defendant's financial circumstances, the Iowa supreme court said in Karney v. Paisley (Iowa) supra: "Experience has not shown the propriety of abolishing such rules upon the ground that they are liable to abuse. It is always in the power of the court, in its instructions to the jury, to guard them against an improper use of such evidence." The rule adopted in the Karney Case was doubted in Herzman v. Oberfelder (1880) 54 Iowa, 83, 6 N. W. 81, and Perrine v. Winter (1887) 73 Iowa, 645, 35 N. W. 679, supra, and the court in Bailey v. Bailey (1895) 94 Iowa, 606, 63 N. W. 341, supra, while admitting that the evidence is admissible on behalf of the plaintiff in defamatory actions, held that in an action containing counts for slander and alienation of affections, an instruction upon damages relative to the latter count, that the jury might consider the rank and condition of the parties, was irregular, as the condition in life of the defendant in the particular case could in no way affect the amount of damages recoverable.

In Dowie v. Priddle (1905) 216 Ill. 553, 75 N. E. 243, 3 Ann. Cas. 526, supra, it was contended by counsel for defendant that since the case was not one in which punitive damages could be recovered, it was error to admit evidence of defendant's financial standing (which fact had been admitted on the trial), but the court dismissed the contention, saying that whether

exemplary damages were to be awarded was a question for the jury, and "in case of slander evidence that the defendant is wealthy is admissible." The effect of Holmes v. Holmes (1872) 64 III. 294, supra, seems to be that the jury should be directed not to consider the defendant's wealth as a separate item, but when taken with all the circumstances tending to aggravate or mitigate damages.

2. Exemplary, punitive, or vindictive damages; actual wealth.

The majority of the cases holding the financial condition of the defendant a material inquiry in a defamatory action do so upon the theory that in all malicious torts where, in addition to the compensatory damages given to make whole the plaintiff's injury, "added damages" are allowed by way of punishment to the defendant for his wilful conduct, and as an example to others to refrain from such acts, the amount of added damages must bear a ratio to the resources of the person punished in order to effect the purpose of such damages. While this rule has not met with universal approval (see cases supra, I.), it has been said to be a necessary corollary of punitive damages. The following cases have been found, which hold the defendant's financial condition a proper consideration for the jury in awarding punitive damages in an action for libel or slander, and that the plaintiff may introduce evidence to aid the jury in determining his circumstances:

United States. Washington Gaslight Co. v. Lansden (1899) 172 U. S. 534, 43 L. ed. 543, 19 Sup. Ct. Rep. 296; Brown v. Evans (1883) 8 Sawy. 488, 17 Fed. 912; Buckeye Cotton Oil Co. v. Sloan (1918) 163 C. C. A. 44, 250 Fed. 712 (in a later appeal before the same court the point was not reconsidered (1921; C. C. A.) 272 Fed. 615).

California. - Barkly v. Copeland (1887) 74 Cal. 1, 5 Am. St. Rep. 413, 15 Pac. 307; Greenberg v. Western Turf Asso. (1903) 140 Cal. 357, 73 Pac. 1050; Tingley v. Times Mirror Co. (1907) 151 Cal. 1, 89 Pac. 1097; Marriott v. Williams, 152 Cal. 705, 125 Am. St. Rep. 87, 93 Pac. 875; Scott v. Times

Humphries

5 B. Mon. 20. Maine. V. Parker (1864) 52 Me. 502; Stanwood v. Whitmore (1874) 63 Me. 209; Johnson v. Smith (1875) 64 Me. 553; Jones v. Grindal (1922) 121 Me. 348, 117 Atl. 308.

Maryland. Wilms v. White (1867) 26 Md. 380, 90 Am. Dec. 113; Cairnes v. Pelton (1906) 103 Md. 40, 63 Atl. 105. And see Groh v. South (1913) 121 Md. 641, 89 Atl. 321.

Missouri.-Buckley v. Knapp (1871) 48 Mo. 152; Trimble v. Foster (1885) 87 Mo. 49, 56 Am. Rep. 440; Taylor v. Pullen (1899) 152 Mo. 434, 53 S. W. 1086; Carpenter v. Hamilton (1904) 185 Mo. 603, 84 S. W. 863; Cook v. Globe Printing Co. (1910) 227 Mo. 471, 127 S. W. 332; Sotham v. Drovers Teleg. Co. (1911) 239 Mo. 606, 144 S. W. 428; Unterberger v. Scharff (1892) 51 Mo. App. 102; Arnold v. Sayings Co. (1897) 76 Mo. App. 159; Leavell v. Leavell (1905) 114 Mo. App. 24, 89 S. W. 58 (later appeal in (1907) 122 Mo. App. 654, 99 S. W. 460); Williamson v. Eckhoff (1914) 185 Mo. App. 234, 170 S. W. 322; Cotton Lumber Co. v. La Crosse Lumber Co. (1918) 200 Mo. App. 7, 204 S. W. 957; Hickman v. Nelson (1919) Mo. App. 211 S. W. 131.

Montana.-Downs v. Cassidy (1913) 47 Mont. 471, 133 Pac. 106, Ann. Cas. 1915B, 1158.

New Hampshire.-Symonds v. Car

ter (1855) 32 N. H. 467. Compare Knight v. Foster (1859) 39 N. H. 582. New Jersey. - Flaacke v. Stratford (1905) 72 N. J. L. 487, 64 Atl. 146, 5 Ann. Cas. 854; Weiss v. Weiss (1920) 95 N. J. L. 125, 112 Atl. 184; Bahrey v. Poniatishin (1920) 95 N. J. L. 128, 112 Atl. 481.

New York.-Fry v. Bennett (1855) 4 Duer, 247. But see Lewis v. Chapman (1855) 19 Barb. 252, reversed in (1857) 16 N. Y. 369.

North Carolina.-Adcock v. Marsh (1848) 30 N. C. (8 Ired. L.) 360; Reeves v. Winn (1887) 97 N. C. 246, 2 Am. St. Rep. 287, 1 S. E. 448. And see Bowden v. Bailes (1888) 101 N. C. 612, 8 S. E. 342.

Ohio. Stevens v. Handly (1832) Wright, 121; Waggoner v. Richmond (1832) Wright, 173; Sexton v. Todd (1833) Wright, 316; Hayner v. Cowden (1875) 27 Ohio St. 292, 22 Am. Rep. 303; Steen v. Friend (1900) 11 Ohio C. D. 235, 20 Ohio C. C. 459; Mauk v. Brundage (1903) 68 Ohio St. 89, 62 L.R.A. 477, 67 N. E. 152. See also Alpin v. Morton (1871) 21 Ohio St. 536.

Oklahoma.-Smith v. Autry (1917) 69 Okla. 28, 169 Pac. 623.

Pennsylvania.-M'Almont v. M'Clelland (1826) 14 Serg. & R. 359; Mix v. North American Co. (1903) 29 Pa. Co. Ct. 137. And see Matheis v. Mazet (1894) 164 Pa. 580, 30 Atl. 434, and Harter v. Whitebread (1909) 38 Pa. Super. Ct. 10.

South Carolina. Rowe v. Moses (1856) 43 S. C. L. (9 Rich.) 423, 67 Am. Dec. 560; Burckhalter v. Coward (1881) 16 S. C. 435. And see Webber v. Jonesville (1913) 94 S. C. 198, 77 S. E. 860.

Tennessee.-Price v. Clapp (1907) 119 Tenn. 433, 123 Am. St. Rep. 730, 105 S. W. 864. But compare Dush v. Fitzhugh (1879) 2 Lea, 307.

Vermont.-Rea v. Harrington (1886) 58 Vt. 181, 56 Am. Rep. 561, 2 Atl. 475; Kidder v. Bacon (1900) 74 Vt. 263, 52 Atl. 322.

It must be noted that the foregoing collection of cases is not exhaustive of the authorities which support the rule that in determining the amount of punitive damages to be awarded for a tort the jury may properly consider the pecuniary circumstances of the parties, inasmuch as there are a number of other tort actions-e. g., malicious prosecution, assault, malicious. trespass, seduction, etc.-in which the jury is usually allowed to consider the defendant's financial condition in assessing punitive damages. See annotation in 16 A.L.R. 838, as to evidence of the pecuniary circumstances of the parties as bearing on exemplary damages in actions for assault. No case has been found in which any distinction has been drawn between any of this class of torts in respect of this question, it being often broadly asserted that the wealth of the defendant is a material consideration in all cases where punitive damages are sought (see Courvoisier v. Raymond (1896) 23 Colo. 118, 47 Pac. 284, an action for an assault), and it seems that a court which has held the consideration proper in a tort action of a class other than for a defamation as determinative of punitive damages would fall in line with the authorities cited above. For a collection of the early authorities on all this class of torts, see note in 67 Am. Dec. 565.

While there may be exceptional cases (see opinion in Palmer v. Haskins (N. Y.) supra, I.) it cannot be denied that as a general rule damages assessed by way of punishment, for example, or as "smart money," must, to be effective, bear some relation to the total resources of the person punished. As said by Kent, Ch. J., in Fry v. Bennett (N. Y.) supra: "It cannot be an indifferent consideration whether a defendant is rich or poor. Damages which would be exemplary when inflicted upon a person in moderate circumstances would be trivial, and in

no practical sense exemplary, when imposed upon a person whose property and income were very much larger."

And the idea has been expressed elsewhere that the cases holding that evidence of the defendant's wealth is relevant where punitive damages are recoverable hold so because "the damages which would operate as a proper punishment to one man might be inadequate to that effect upon another, by reason of their difference in pecuniary condition; and, on the contrary, a verdict that would be scarcely regarded by a wealthy man might be ruinous to a poor man." Handy, J., in Bell v. Morrison (1854) 27 Miss. 68 (holding such evidence admissible in an action for assault, and saying it is necessary to consider the defendant's financial condition in all cases where exemplary damages are recoverable). And the argument was forcefully made in Guengerech v. Smith (1872) 34 Iowa, 348, an action for assault and battery, wherein the majority held evidence of defendant's wealth inadmissible in computing exemplary damages, but admitted that such evidence is admissible in defamatory actions. Beck, Ch. J., dissenting, argued that in cases where exemplary or punitive damages are recoverable, as "the law permits such damages to be recovered for the correction and punishment of the defendant, and as an example to the community, . . it is plain that a verdict of a few dollars, which would operate as a punishment if assessed against a poor man, would utterly fail to have that effect upon a man of wealth. Verdicts for punitive damages ought, therefore, to be graduated according to the ability of the offender to pay. Nothing else would be just or reasonable."

The general rule is that, where punitive damages are recoverable, the jury should be permitted to consider all the circumstances surrounding both parties, including financial condition, social status, size of family, ete. Huckle v. Money (Eng.) supra. The Huckle Case was not for a defamation, but libel and slander are mentioned among the actions in which "the state, degree, and quality" of the parties

should be considered in awarding damages, and the case presents the only authority whch can be found in the English books touching on the subject.

Such is the reason of the rule, and while it is open to some objection (see supra, I.), it would seem to be necessary in measuring punitive damages, and little harm seems to arise from the rule where the jury is cautioned, against allowing its knowledge of the defendant's ability to respond to be put to an improper use.

Inasmuch as, under the theory supported by the above cases, the jury is allowed to consider the financial condition of the defendant as a basis by which to graduate punitive damages, it would seem necessary that the inquiry as to his resources should be definitely confined to his actual or approximate means. While it appears that, in the majority of them, evidence was given as to the actual condition of the defendant's finances, the point made above is not brought out in the majority of the cases. But a number of the cases insist that, in so far as the jury is allowed to consider the defendant's circumstances to determine punitive damages, evidence touching on that subject should be limited to his actual means. Johnson V. Smith (1875) 64 Me. 553 (approved in Webb v. Gilman (1888) 80 Me. 188, 13 Atl. 688. And see rule applied in Jones v. Grindal (1922) 121 Me. 348, 117 Atl. 308); Leavell v. Leavell (1905) 114 Mo. App. 24, 89 S. W. 58 (subsequent appeal in (1907) 122 Mo. App. 654, 99 S. W. 460); Downs v. Cassidy (1913) 47 Mont. 471, 133 Pac. 106, Ann. Cas. 1915B, 1158; Weiss v. Weiss (1920) 95 N. J. L. 125, 112 Atl. 184; Bahrey v. Poniatishin (1920) 95 N. J. L. 128, 112 Atl. 481; Rea v. Harrington (1886) 58 Vt. 181, 56 Am. Rep. 561, 2 Atl. 475.

Whether the actual or reputed pecuniary circumstances of the defendant are to be inquired into has been briefly explained in Weiss v. Weiss (1920) 95 N. J. L. 125, 112 Atl. 184 (holding evidence of defendant's wealth admissible on behalf of plaintiff), where Trenchard, J., speaking for the court of errors and appeals of New Jersey, said: "The mode of proving

the wealth of defendant for the purpose of increasing damages depends upon the question whether the damages to be allowed are compensatory or punitive in their nature. In the former case the damages are enhanced by the reputation of the defendant as to his circumstances and standing, and therefore the evidence should relate to his reputed wealth and standing. In the other case the inquiry should be as to his actual pecuniary ability, and hence the amount of his property should be stated by persons having knowledge of the subject."

The supreme court of Wisconsin refused in Draper v. Baker (1884) 61 Wis. 450, 50 Am. Rep. 143, 21 N. W. 527, to follow the rule represented by the foregoing cases, and held that the financial condition of the defendant can be shown by proof of his reputed wealth. The court quoted with approval a statement made by an Illinois court (in White v. Murtland (1873) 71 Ill. 250, 22 Am. Rep. 100), which, after an observation that "the practice has grown up, though not generally customary, of raising a sort of collateral issue upon the question of pecuniary circumstances, involving a detail as to lists, kind, and value of property. This is not within the purpose or scope of its admissibility-"said that "the inquiry in the first instance should be general, whether the party be in poor, moderate, or good circumstances; if good, how good, leaving special inquiries to be made on cross-examination." The court further said that while the defendant's actual wealth may be proved in cases where exemplary damages are recoverable, his reputed wealth may also be given in evidence, giving as another reason for its conclusion the opinion that in most cases "evidence of reputed wealth would be the only evidence the plaintiff could make upon the point, and in cases where such reputed wealth is not to conclude the defendant, he always has it in his power to present the real facts to the jury in answer to the general proofs of the plaintiff," and illustrated the reason in the case at bar, where the defendant was reputed to have been wealthy, but had disposed of