Key Takeaways
- In a civil lawsuit, you can seek compensatory damages, which are classified into pecuniary and non-pecuniary damages.
- Pecuniary damages cover the quantifiable losses directly linked to your injury. They’re also known as actual damages, and include medical costs, lost wages, and physical damage to property.
- Non-pecuniary damages are losses that can’t be quantified in financial terms. They’re also referred to as intangible, general, or non-economic damages. Examples include emotional distress, pain, and suffering.
- Calculating both pecuniary and non-pecuniary damages can be a complex process. So, consult an experienced personal injury lawyer.
A personal injury lawsuit aims to make you (the victim) feel ‘whole again.’ It seeks the financial resources you need to undo the effects of the injuries and losses you suffered. What complicates the process of seeking this financial help is the fact that not all losses are quantifiable or obvious.
To address this, the Supreme Court of Canada played a key role in shaping the approach to compensatory damages, which are further classified into pecuniary and non-pecuniary damages. For example, in a series of landmark cases in 1978, the Supreme Court of Canada established clear guidelines for assessing non-pecuniary losses and set an upper limit for the amount that can be awarded in such cases.
What Are Compensatory Damages?
Compensatory damages are awarded to cover the actual losses that you (the claimant) suffered. If you were injured due to another person’s carelessness, willful wrongdoing, or negligence, you have grounds to pursue an injury claim.
An important component of a successful claim is the financial compensation awarded to the injured individual. The legal term for these monetary payments is damages. These damages fall under two broad categories – compensatory damages and non-compensatory or punitive damages.
Here are different damage types you should know. Generally, compensatory damages usually happen as a direct consequence of the injuries you suffered. Examples include:
- Emergency and ambulance expenses
- Hospital bills
- Physical therapy bills
- Medical treatment costs and future care costs
- Rehabilitation expenses
- Lost wages or earnings and loss of future earnings
- Nursing home care expenses
- Property damage
- Medical equipment costs
The term ‘injury’ in a personal injury case refers to both bodily harm and damage to personal property. For instance, your car or motorcycle may be damaged in an accident, or the vehicles involved in the incident may damage another person’s property.
Note that compensatory damages can be classified into pecuniary (actual compensatory) damages and non-pecuniary (general compensatory) damages.
Pecuniary Damages
Pecuniary damages cover the quantifiable losses directly linked to your injury. They’re also known as actual damages, and include medical expenses, lost income, and physical damage to property. All other losses incurred due to the accident that can be expressed in monetary terms can be classified as pecuniary damages. Such costs include legal fees, travel expenses, and court costs.
How Are Pecuniary Damages Calculated?
Pecuniary damages equal the real financial cost or financial loss associated with the severe or minor injuries caused by the accident. In most cases, these damages are straightforward to calculate and are usually accompanied by credible proof, such as receipts and detailed medical records. Just add the totals.
Suppose you suffered a spinal cord injury, traumatic brain injury, or other similar injuries that can lead to long-term disability. In that case, calculating the actual damage plus future losses associated with your injuries can be challenging.
For instance, an injury that causes permanent disability can prevent you from returning to your job and getting employed in any other profession. You should work with an experienced personal injury lawyer to assess the current and future medical care costs for the injuries sustained.
Your lawyer will also consider other financial losses associated with the car accident to ensure the money awarded can financially compensate you for all losses you suffered due to the defendant’s conduct.
Your future lost earnings should also include the lost opportunity to grow your income through promotions. Similarly, your ongoing care could include personal care and long-term nursing. It can also include the cost of medication and necessary medical treatment you’ll need for the rest of your life. Having a skilled lawyer on your side means you can accurately calculate your pecuniary damages. Your personal injury claim should reflect the true value of the quantifiable damages you suffered.
Non-Pecuniary Damages
Also known as general damages, these are compensatory damages that cannot be quantified in monetary terms. They’re difficult to assess or measure since they’re more subjective and don’t involve straightforward financial expenses that can be tracked. That’s why you need a skilled lawyer who understands the legal principles of personal injury law to fight for your right to fair compensation. Examples of non-pecuniary damages include:
- Pain and suffering damages are awarded when the injured party experienced severe pain or suffering due to the accident.
- Emotional suffering damages are awarded if the injured person experienced emotional distress caused by the incident. Emotional distress may include anxiety, depression, or other forms of emotional harm due to the incident.
- Impairment of life damages are awarded if the claimant suffered a long-term negative impact on the quality of their life.
- Impairment of relationship damages may be awarded if the claimant’s relationship with colleagues, friends, and family deteriorates due to the impact of the incident.
- Damages related to the impairment of mental abilities may be granted if the claimant’s mental capabilities were significantly reduced due to the accident.
Generally, non-pecuniary damages are usually awarded for intangible losses. Therefore, all losses incurred in an accident that aren’t easily quantifiable in monetary terms can be classified as non-pecuniary damages.
How Are Non-Pecuniary Damages Calculated?
These types of losses can’t be easily quantified in financial terms. Therefore, the non-pecuniary damages awarded are estimated by the court after considering the relevant factors. In practice, the amount awarded may be suggested by assessing previous cases involving the same injury or circumstances. Note that general damages are usually awarded as a lump sum financial payment.
The reality is there’s no objective yardstick or standard for translating non-pecuniary losses like loss of amenities or pain and suffering caused by the incident into monetary value. That’s why this area is often open to widely extravagant claims.
Gross Up Rate Consideration
Certain damages awarded may not be taxable. However, the interest rate you earn from investing such damages may be subject to taxation. The court calculates the gross-up to offset any income tax liability associated with the investment of the financial compensation you received.
When calculating the gross-up, the court assumes that you’ll invest the entire compensation amount as a fixed-income security and determines the rate that will be assumed for future inflation. These are complex calculations, and it’s recommended to have an experienced lawyer to guide you.
Nominal Damages
Nominal damages are a small amount of monetary compensation awarded to a plaintiff in a lawsuit where a negligent act or a wrongful act was committed against them, but not the actual monetary or physical loss. For example, if someone trespassed on your property but didn’t cause damage, you can file a lawsuit for this type of damage against the other party.
Seek Legal Support to Calculate Damages in a Personal Injury Case
If you suffered injuries or other losses due to someone’s negligence, carelessness, or wrongdoing, consult a skilled personal injury lawyer. He or she can help determine the financial value of all the losses you suffered as a direct result of the incident. Schedule a free consultation and discuss your case with our experienced lawyers.
