Punitive Damages: Court of Appeals Revoked Excessive Sanction

In Marval News # 108 we commented our concerns regarding the ruling in re “Teijeiro v. Cerveceria y Malteria Quilmes” where the defendant was sentenced to provide the plaintiff with a soft drink bottle of the same drink he had acquired, and also added moral damages and punitive damages estimated at AR$ 2,000,000.

The Civil and Commercial Court of Appeals of the City of Córdoba partially revoked the ruling and set aside the exorbitant sanction imposed.

We consider the decision adopted by the Court of Appeals and its reasoning regarding an accurate interpretation of Section 52 bis of the Consumer Protection Law (Law No. 23,361) to be proper and correct.

This Court explained that Section 52 bis does not contemplate any standards of conduct and that its applicability is optional for the judge, but not intended as a necessary consequence of any breach. It also added that the text is not clear enough given its vagueness and imprecision.

According to the manufacturing process of the soft drink, the Court underlined that the defendant demonstrated the adoption of precaution measures in order to preserve the hygiene and quality of the product regarding international standards. However, the existence of the defective bottle shows that the system is not infallible, but clarifies that “lucrative damage” does not exist since the defendant did not deliberately omit any precautions with the intention of reducing costs or increasing profits.

The ruling concludes that no evidence has been produced in order to establish the real and potential harm of the defective product on the plaintiff’s health.

Although punitive damages had been awarded by several Courts around the country since 2008, this ruling of the Court of Appeals of the City of Córdoba conducted a complete analysis of the concept copied from Common Law.