Which type of damages is intended to punish a wrongdoer and deter similar conduct in the future?

Punitive damages are specifically designed to punish a wrongdoer for their harmful actions and to deter both the wrongdoer and others from engaging in similar conduct in the future. This type of damages goes beyond merely compensating the victim for their losses; instead, it aims to address the nature of the wrongdoing itself, especially in cases involving gross negligence, recklessness, or intentional misconduct.

The rationale behind punitive damages is rooted in the concept of justice and societal protection. By imposing significant financial penalties on offenders, the legal system seeks to discourage them and others from repeating such behavior, thus promoting general public safety and reinforcing legal standards.

In contrast, compensatory damages focus solely on making the injured party whole by covering their actual losses, consequential damages are concerned with indirect losses resulting from the wrongful act, and liquidated damages are pre-determined amounts stipulated in a contract for breach of that contract. Each of these serves a different purpose and does not carry the punitive aspect that punitive damages do.