When Stan was injured in an automobile accident between his car and a tractor trailer operated by one of the largest shipping contractors in the U.S., his wife Maria wanted to “sue them for all they are worth.” When Stan and Maria consulted counsel, their attorney started by explaining the type of damages which were potentially available for them to pursue.
Economic Damages – assessed to provide compensation for monetary losses such as past and future earnings, past and future medical expenses, value of domestic services and loss of employment.
Non-economic Damages – subjective compensation for non-monetary losses such as pain and suffering, emotional distress, loss of consortium and loss of enjoyment of life.
Punitive Damages – awarded with the purpose of punishment; not awarded to compensate a loss but to deter intentional or reckless behavior.
Stan and Maria’s attorney retained a forensic accountant to calculate the amount of economic damages attributable to Stan’s accident. The forensic accountant was tasked with preparing a personal injury economic damages report which provided an analysis of any monetary amounts Stan would have realized “but for” the injuries sustained in the accident.
The forensic accountant’s report included damages related to:
Lost Earnings – expected earnings capacity of the injured party “but for” the accident.
Fringe Benefits – the loss of fringe benefits available to the injured party “but for” the accident.
Household Services – value of services which can no longer be performed by the injured party.
Medical Care – costs incurred and expected to be incurred in the future related to the medical conditions sustained in the accident.
Stan and Maria were able to settle prior to trial for $1,500,000 of economic damages and $1,000,000 for pain and suffering.
For more information of damages in a personal injury case, see the article “Determination of Damages in a Personal Injury Case” in the March 2015 BV/Lit Essentials e-Newsletter.
By Melissa Loughlin-Sines, ABV/CPA, CVA, CFE, CFF