The Wisconsin Supreme Court ruled today that a plaintiff is not entitled to punitive damages in cases where the plaintiff seeks equitable damages and where no compensatory damages are awarded.

The case, Groshek v. Trewin, 2010 WI 51 involves a lawsuit against an attorney who entered into an agreement to purchase a farm and saw mill from one of his clients, and then offered to lease the land back to them. The attorney’s clients stopped making payments and sued the attorney for breach of fiduciary duty and sought rescission of the contract. The trial court ruled that the attorney breached his fiduciary duty to his clients and granted rescission of the conveyance of the property. The circuit court also determined that punitive damages were appropriate citing the vulnerability of the clients, access the attorney had gained as counsel to his clients, and the attorney’s repeated discipline for improperly making similar transactions with other clients. The attorney appealed the decision. The court of appeals upheld the lower court’s decision finding breach of fiduciary duty and rescission. However, the court of appeals reversed the lower court’s decision to award punitive damages when no compensatory damages were awarded. Writing for the majority, Justice Patrick Crooks upheld the court of appeals and lower court and found that the attorney breached his fiduciary duty to his clients. The Supreme Court further ruled that the plaintiffs were not entitled to punitive damages when the lower court did not award the plaintiffs compensatory damages. Citing Tucker v. Marcus, 142 Wis. 2d 425, 439 (1988), the Wisconsin Supreme Court stated that “punitive damages are not available where there has been no ‘award’ of actual damages.” According to the majority, because the plaintiff in the case did not seek compensatory damages, nor were any awarded, existing Wisconsin case law barred the plaintiffs from recovering punitive damages.