January 21, 2022
Personal Injury Lawyer
Damages are the amount of money owed to a harmed party in a civil suit. A person may become legally liable for damages due to a breach of duty or a violation of a right. There are two main types of damages.
Compensatory damages are intended to compensate the injured party. The goal of compensatory damages is to put injured parties in the same position they were in before the injury occurred. Compensatory damages include items such as lost wages, medical expenses and pain and suffering. To receive compensatory damages, the injured party must prove that the at-fault party breached a duty or violated a right, resulting in harm to the injured party.
For example, if a driver negligently injures a person due to their failure to maintain safe driving practices, that driver may be obligated to pay compensatory damages to the injured party. This category also includes damages paid due to breaches of contract, unsafe products, slip and fall accidents and other situations where the at-fault party was either negligent or breached a duty owed to the other party.
Punitive damages are intended to punish the person who caused an injury. Punitive damages are not directly related to the amount of harm caused to the injured party, but may sometimes be calculated based on the amount of compensatory damages awarded. Punitive damages exist to discourage behaviors. For example, a company that manufactured a defective product, knew the product was defective and failed to warn consumers, could be assessed punitive damages on top of compensatory damages as a punishment for that lack of action.
How Damages Are Calculated
Compensatory damages are awarded based on the proven loss, harm or injury suffered by the plaintiff. Some compensatory damages are straightforward. Medical bills, for example, are generally paid out based on the amount charged by the medical provider, though in some cases the at-fault party or their insurance company may negotiate a lower rate. Other damages, such as pain and suffering, may be based on a formula, such as double the amount of medical expenses. These damages are often negotiated between the parties. Punitive damages are determined by the court, though they are often based on specific guidelines and the laws of the state.
Bankruptcy and Discharging of Damages
If you are in the middle of a business lawsuit while going through bankruptcy or paying damages as a result of a personal injury lawsuit, there are specific times and ways when those judgments can be discharged. It is crucial to consult a legal professional to determine what your options are when thinking about discharging your debts and judgments.