Damages

“Damages” are basically the measure of how you have been hurt. If you have no damages, your recovery will likely be little or nothing even if someone is at fault with regard to some action toward you. Damages can be divided into three parts: (1) economic, (2) non-economic; and (3) punitive.

  • Economic Damages
    • Economic damages are also sometimes referred to as “special damages” or “specials.” If you hear a lawyer talking about how much damages he or she can “blackboard,” that lawyer is talking about economic damages (blackboard comes from the days when lawyers stood in front of juries and wrote their damages on a blackboard).
    • Economic damages include things like medical expenses, lost wages, funeral expenses, etc. Past damages are pretty easy to prove – the lawyer just introduces receipts or testimony into evidence. Future economic damages are much more difficult to prove, and a lawyer often must hire expert witnesses and invest much money to prove such damages.
  • Non-economic Damages
    • Non-economic damages include things like emotional distress, pain and suffering, annoyance, inconvenience, etc. In most jurisdictions, a lawyer cannot suggest a number to a jury for this type of damages. Instead, the lawyer puts on detailed evidence about how someone has suffered. This might include psychological testimony.
  • Punitive Damages
    • Punitive damages are exactly as the name implies – meant to punish someone for especially bad conduct. Punitive damages are hard to get in any case, and generally require grossly negligent conduct or intentional misconduct.

Do lawyers have to spend a lot of time proving damages in every case?
No. Proving damages in some cases can be very time consuming and expensive for the victim’s lawyer. Insurance companies and other defendants will spend money on their own lawyers and litigate for months or longer to minimize damages in big cases.

But in small cases, including most traffic accident cases, a settlement is often reached relatively quickly for the amount of insurance available because the law limits damages or the damages exceed the insurance company’s “liability limit.” Hospitals and doctors are very expensive, and an accident victim who isn’t hurt all that badly could have $10,000 in legitimate medical bills. If the insurance liability limit is only $20,000 (the minimum required in West Virginia), the insurance adjuster will likely pay the policy limit without much of a fight and without hiring a lawyer. This is because insurance companies are practical – they don’t hire lawyers and fight much when they could pay a small amount and get out.

This doesn’t mean the victim’s lawyer has to stop with the insurance coverage – he or she could still pursue more money from the person who is at fault. But only in rare cases will a victim recover anything more than the insurance coverage. Most people have few if any assets, the assets are exempt from creditors, or the person you sue could just file bankruptcy.

How does the law value life?
This is a difficult question, and it arises in wrongful death lawsuits. Wrongful death cases against defendants with the ability to pay can be very complicated, and the skill of your lawyer definitely matters. Many factors are considered in valuing a person’s life, not the least of which is the jurisdiction in which the death occurred. In some jurisdictions, wrongful death settlements are low because the law only allows economic damages to persons dependent in some way on the decedent (person who was killed). Other jurisdictions are much more liberal, allowing both economic and non-economic damages regardless of dependency on the decedent.

One of the most important elements of economic damages in wrongful death cases is lost income of the decedent. Generally, a person’s lifetime earnings are estimated by extrapolating their income at death to retirement age (or later) and reducing the total amount to present value. Reasonable anticipated pay increases are taken into account, but there can be many deductions from the total depending on the jurisdiction and situation. The law provides guidelines on how to compute lost income, and both sides will usually hire expert witnesses – usually forensic accountants – to give their opinions. Since lost income is such a large part of economic damages, the lives of working people are generally valued much higher than the lives of children, retired people, and others not in the workforce.

To illustrate, consider three 35-year-olds who are killed by the wrongful conduct of someone else. Victim A is a high school dropout making minimum wage. Victim B is a construction worker earning $30 per hour. Victim C is a surgeon who makes $800,000 per year. The simple calculation would be to multiply the annual wage by 32 years (to retirement age of 67) and reduce that amount to present value. This would be a starting point, but there are other factors to consider. A high school dropout would likely have long periods of unemployment. Construction work is seasonal and sporadic, and it causes disabilities that could shorten life or at least the time that someone works. And a surgeon may work well into his or her 70s or 80s – if not performing surgery, in some other medical capacity or teaching. All of these factors and many others are often litigated in arriving at an appropriate amount for lost income.

There are many other factors that come into play in a wrongful death case. Was the death instant, or did the victim suffer? Were there substantial medical bills due to a long hospital stay before death? Those expenses are usually recoverable even if paid by a third party such as health insurance (although the third-party may have to be repaid or partially repaid from the settlement).

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