Hugo Black

“ Filed in the federal court for the Middle District of Alabama, petitioner's complaint alleged that he had been induced to purchase an insurance certificate through fraudulent misrepresentations of respondents' agent bearing upon its actual value, and claimed $200,000 as actual and punitive damages. ”

“ Therefore even though the petitioner is limited to actual damages of $1,000, as both courts held, the question remains whether it is apparent to a legal certainty from the complaint that he could not recover, in addition, sufficient punitive damages to make up the requisite $3,000. If the controlling law is that of South Carolina, where the alleged fraudulent misrepresentations are said to have occurred, petitioner clearly might recover an award exceeding $3,000. [5] Respondents urge however that the law of Alabama, where the insurance certificate was issued and mailed, must control. ”

“ Respondents also maintain that, even if it would warrant some punitive damages, the complaint could not under Alabama law warrant enough to support a judgment of $3,000. It is true as respondents point out that the Alabama Supreme Court has said that the amount of punitive damages 'ought * * * to bear proportion to the actual damages sustained,' Mobile and Montgomery Railroad Co. ”