How Are Damages Established in a Tort Claim?

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The goal of damages in tort actions is to make the injured person “whole” through the award of money to compensate for injuries caused by the accident or incident.

Damages for Injuries to Personal Property

The measure of damages for injury to personal property is the difference between the market value immediately before and after the injury, unless the property is destroyed, in which case it is simply the fair market value of the item. Sometimes, the measure may also be the cost of repair, but the cost of repair cannot exceed the fair market value of the property or the damages may be said to constitute economic waste (in other words, it would be cheaper and make more sense to simply replace the item rather than repair it).

Damages for Losses to Real Estate

The measure of damages for permanent injury to real property (i.e., land) is the difference in the fair market value of the land before and after the injury. If the damage is only temporary, damages represent the reasonable cost of repairing the property which may include the value of the use of the property during the period of recovery or the diminution in the rental value of the property.

When the tort is nuisance, if the nuisance is permanent, full damages for permanent injury must be assessed in one action and will be for damages up that point as well as for prospective losses. When a nuisance is temporary, on the other hand, an injured party can bring a subsequent action for injuries sustained by the continuation of a temporary nuisance. The recovery for a temporary nuisance is usually for damage actually sustained up to the point of starting the lawsuit, but not for prospective losses.

Lost Earnings

Loss of future earnings is proved with reasonable certainty by evidence of (1) the amount of wages lost for some determinable period of time and (2) the future period over which wages will be lost or diminished.

The measure of damages for a wage loss is the gross amount of wages. Social Security, retirement contributions or other withholdings may not be used to reduce a plaintiff's recovery for lost wages.

Loss of Consortium

At common law "consortium" was defined as consisting of services, society and sexual relations. The original common law action was only available to the husband for loss of consortium of the wife. There is a split of authority as to whether a minor child has a legally recognized claim for loss or impairment of parental consortium. Damages are calculated as the value of such services.

Wrongful Death

These actions are pretty new to the law. Historically, a tortfeasor was better off killing his victim than injuring him, as a dead victim's family would not have been entitled to a civil remedy for his loss. However, today every state has a statute attaching civil liability for wrongful death or by providing that personal injury claims "survive" the death of the decedent.

The damages prior to death will go to the decedent's estate and be subject to claims of creditors of the estate. Anything left over will go to the beneficiaries of the decedent's will (if he or she had one) or the decedent's heirs at law. Damages after death will go to the decedent's survivors (usually the decedent's immediate family) who may not necessarily be the beneficiaries of any will. Such damages will not be subject to claims by creditors of the decedent's estate.

Prejudgment Interest

One purpose of prejudgment interest is to compensate the plaintiff for the loss of the use of money from the date of the injury until the date of judgment, and to prevent the defendant from unjust enrichment from the use of the money while it should have been at the plaintiff's disposal. The prevailing rule is to deny prejudgment interest except where damages can be easily ascertained prior to trial. Prejudgment interest is appropriate only for past losses and not for future losses. However, there is a long standing rule that, with only a few exceptions, interest is not allowed on monetary claims against the federal government unless Congress (or a contract) plainly authorizes such an addition.

Punitive Damages

Punitive damages may be imposed to further a state's legitimate interests in punishing unlawful conduct and deterring its repetition. The most important indicator in whether punitive damages will be allowed is the degree of reprehensibility of the defendant's conduct. Punitive damages should reflect the enormity of the offense. Punitive or exemplary damages must bear a reasonable relationship to compensatory damages. The proper inquiry is whether there is a reasonable relationship between the punitive damages award and the harm likely to result from the defendant's conduct as well as the harm that actually has occurred.

In addition to bearing a reasonable relationship to the actual injury, the amount of punitive damages should account for the profitability of the defendant's misconduct, the plaintiff's litigation expenses, the punishment the defendant will probably receive from other sources, the defendant's financial condition, and the effect on its condition of a judgment for the plaintiff. Defendant's financial status is a relevant factor in all punitive damage awards (after all, what good would punitive damages of a few thousand dollars be against a multi-billion dollar corporate defendant?).

Collateral Source Rule

Courts have split over the application of the collateral source rule, in particular with regard to whether the collateral source rule should be applied to allow an injured party to recover the reasonable value of gratuitously supplied medical treatment or services. Under the collateral source rule, a plaintiff may recover damages from a defendant, although the plaintiff has received money or services in reparation of the injury from a source other than the defendant. The benefit conferred on the injured person from the collateral source is not credited against the defendant's liability although it may partially or completely reimburse the plaintiff for his injuries. The rule has been applied where plaintiff has received insurance proceeds, employment benefits, gifts of money or medical services, welfare benefits or tax advantages.

Emotional Distress Damages

There are basically three types of emotional distress: that which is intentionally inflicted, that which is negligently inflicted, and emotional distress of bystanders. In the first two instances, damages are established by examination of a mental health expert and evidence of the effect on the plaintiff's health, earning capacity, and expected expenses and loss of wages those cause.

Bystanders may recover for emotional distress damage only under very limited circumstances. The emotional disturbance suffered must be "serious and verifiable," and must be tied as a matter of proximate causation to the observation of the serious injury or death of an immediate family member. Finally, the plaintiff himself must have been in the "zone of danger" (i.e., must have been exposed to a risk of bodily harm by the conduct of the defendant).

Economic Loss

The majority of jurisdictions have not permitted the recovery of purely economic loss in a products liability action sounding in tort. In actions for negligence, a manufacturer's liability is limited to damages for physical injuries and there is no recovery for economic loss alone. In other words, if a product breaks and the only thing damaged is the product itself, tort damages will not be allowed where a contract theory of recovery might apply (e.g., return the product to the store for a refund).


Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer.

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