Statute bars punitive damages in power of attorney case

Where the court found that defendant breached fiduciary duties by violating the Uniform Power of Attorney Act, plaintiff’s damages are limited to recovery of the lost funds and reimbursement for attorney’s fees and costs.

The act does not authorize an award of punitive damages. Petitioner’s motion for the court to reconsider its denial of punitive damages is denied.

Background

The parents of Achilles Papadatos gave Kaur a power of attorney. Petitioner later sued Kaur for undue influence, fraud, breach of fiduciary duty, conversion and unjust enrichment.

“Of importance for this motion, Petitioner argued that the breach of fiduciary duties arose from Kaur’s violation of the powers of attorney and sought recovery pursuant to Uniform Power of Attorney Act (Code § 64.2-1600, et seq.) … to wit, that Kaur should ‘restore to Achilles, as successor in interest to his parents, the value of the Evangelos’ and Bonnie’s funds principal’s (sic) to what it would have been had the violation not occurred.’ …

“At trial, the court found that Kaur breached her fiduciary duties to Evangelos and Bonnie Papadatos in violation of the Act and ordered that Kaur restore to Achilles, as successor in interest to his parents, the sum of $140,519.19 based upon Kaur’s violation of the powers of attorney.

“The award was on Count III, the claim pursuant to Code § 64.2-1615. The court denied Petitioner’s request for punitive damages, but, pursuant to Code § 64.2-1614(E), awarded attorney fees as justice and equity so required.

“Petitioner now asks the court to reconsider its denial of punitive damages.”

No punitive damages

“In his motion for reconsideration, Petitioner appears to seek common law punitive damages or, alternatively, to seek punitive damages pursuant to the Act[.] … To recover common law punitive damages, Petitioner must have succeeded on one of his common law claims, i.e., Counts I, II, IV, or V.

“The court, however, awarded restoration of $140,519.19 (and attorney fees) to Achilles pursuant to the Act (Count III). …

“Having ordered recovery on the breach of fiduciary duties pursuant to Code § 64.2-1615 (Count III), the court may only award an additional monetary recovery (i.e., punitive damages) pursuant to the terms of the Act. …

“[T]he court must determine whether any provision of Chapter 16 (which is the Act) ‘displaces’ the right to punitive damages for an intentional tort under the common law of Virginia where a respondent has acted willfully and wantonly.

“In the court’s view, Code § 64.2-1615 displaces the common law right to punitive damages in that it makes the agent liable ‘for the amount required to:

“‘1. Restore the value of the principal’s property to what it would have been had the violation not occurred; and

“‘2. Reimburse the principal or the principal’s successors in interest for the attorney fees and costs paid on the agent’s behalf.’

“Had the General Assembly intended to allow punitive damages, it could have expressly authorized them. Instead, it authorized, for an agent’s violation of the Act, only restoration of the lost value of the principal’s property and attorney fees and costs.”

The motion for reconsideration is denied.

Papadatos v. Kaur, Case No. CL-2019-15656, Aug. 24, 2021, Fairfax County Circuit Court (Gardiner). Joseph W. Stuart, Christopher T. Craig for the parties. VLW 021-8-108, 7 pp.