An interesting question that has split state courts; here’s a summary from Whetstone v. Binner (Ohio Ct. App. July 7, 2014) (2-to-1 vote) (some paragraph breaks added, some deleted):
The majority of other jurisdictions disallow punitive damage recoveries after the tortfeasor has died. [Citations omitted. -EV] Further, the Restatement of Torts advises that the death of the tortfeasor terminates liability for punitive damages.
In their decisions, these courts reasoned that the primary purposes of imposing punitive damages are not furthered if the tortfeasor is deceased because the element of deterrence requires a perception by others that the tortfeasor is being punished. Some of the majority courts also opine that the imposition of punitive damages punishes the innocent estate and beneficiaries rather than the tortfeasor and that therefore the element of deterrence becomes diffused and is speculative at best
A minority of courts in other states have held that a claim for punitive damages survives the death of a tortfeasor and may be pursued against his estate….
We are persuaded by the approach adopted by the minority of courts in other states and find that there is no per se prohibition against the imposition of punitive damages against a deceased tortfeasor…. [T]he death of the tortfeasor does not completely thwart the purposes underlying the award of punitive damages…. As noted by the Ohio Supreme Court, the purpose of punitive damages is to punish and deter certain conduct and the policy of awarding punitive damages is to punish the offending party and setting him or her up as an example to others so they might be deterred from similar conduct. The imposition of punitive damages on a decedent’s estate serves to deter others from similar conduct.
Further, we are not persuaded by the argument that imposing punitive damages punishes the innocent beneficiaries of the estate. It stands to reason that the tortfeasor’s beneficiaries have no right or entitlement to more than the tortfeasor would have had he or she lived and a judgment for punitive damages been imposed. Finally, as noted by the courts adopting the minority view, safeguards exist to protect against the arbitrary imposition of punitive damages such as a jury instruction that the award of punitive damages is being imposed against the estate or a remittiur by the trial judge….
[Judge John Wise, dissenting.] …
The purposes of punitive damages in the state of Ohio are not designed to compensate victims, but to punish and deter conduct. Upon the death of the tortfeasor, the law can no longer punish him or her from similar conduct in the future. Since punishment is no longer possible, deterrence is the only remaining goal.
Since deterring the actual tortfeasor is no longer a possibility or a necessity, it is likewise no longer possible to hold him or her out as an example to deter others. Punishing his or her Estate is one step removed and therefore waters down or dilutes any such deterrent effect. Assessing punitive damages against an estate serves to neither punish nor deter the tortfeasor. I believe that separating the punishment from the deterrent aspect frustrates the purpose of punitive damages and that any deterrence would be speculative at best….