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What Are Compensatory Damages?

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Our Guide to Compensatory Damages in Arizona

Personal injury cases often arise from unexpected accidents, leaving individuals physically, emotionally, and financially burdened. When pursuing a personal injury claim, understanding the concept of compensatory damages is crucial. In this comprehensive guide, we’ll demystify the world of compensatory damages, shedding light on what they are, how they work, and why they matter in your pursuit of justice.

Defining Compensatory Damages

Compensatory damages, also known as actual or special damages, are a fundamental component of personal injury law. They aim to compensate the injured party for losses incurred due to the actions or negligence of another person or entity. These damages are designed to “make the injured party whole again” by providing financial reparation for various types of losses.

When a party’s legal rights were technically breached, yet no actual harm or losses were incurred, a court might opt to award nominal damages instead.

What Are the Two Types of Compensatory Damages?

  1. Special Compensatory Damages: These damages are quantifiable and involve direct monetary losses. They include medical expenses, lost wages, property damage, and any other out-of-pocket costs incurred as a result of the injury.
  2. General Compensatory Damages: General damages are less tangible but equally vital. They encompass non-monetary losses such as pain and suffering, emotional distress, and a decreased quality of life. Calculating general damages involves assessing the impact of the injury on the individual’s overall well-being.

How to Calculate Compensatory Damages

Calculating compensatory damages requires a meticulous evaluation of various factors, including:

  • Medical Expenses: This includes costs for past and future medical treatments, prescriptions, therapy, and rehabilitation.
  • Lost Wages: Any income lost due to the injury, including potential future earnings, may be included in the calculation.
  • Property Damage: If the injury resulted in damage to personal property, such as a vehicle in a car accident, those costs are factored in.
  • Pain and Suffering: These damages are more challenging to quantify but are essential. They consider the physical pain, emotional distress, and psychological suffering endured due to the injury.

Quantifying economic damages, such as medical expenses and lost wages, is relatively straightforward. However, assessing the worth of intangible elements like emotional distress introduces complexity. Typically, two mathematical approaches are employed to calculate noneconomic damages: the multiplier method and the per diem method.

  1. The Multiplier Method: This technique begins by taking the plaintiff’s economic damages and applying a multiplier, typically ranging from 1.5 to 5. The specific multiplier used depends on a variety of factors that a jury would consider when evaluating the severity of pain and suffering.
  2. The Per Diem Method: In certain jurisdictions, an alternative calculation is allowed, based on the number of days an injury caused pain and suffering. Each day is assigned a standard value, often equivalent to a person’s daily wage or salary.

Who Pays Compensatory Damages?

In personal injury cases, the responsible party’s insurance typically covers compensatory damages. For example, in a car accident case, the at-fault driver’s auto insurance may cover the injured party’s medical bills and property damage expenses.

Take note, however, that compensatory damages can be affected by the plaintiff’s actions or inactions.

Comparative Fault in Arizona

Arizona follows a comparative fault system, which means that if you were partially responsible for the accident, your damages will be reduced by your percentage of fault. For example, if you are found to be 20% at fault for a car accident, and your total damages are $10,000, you can still recover $8,000.

Failure to Mitigate Damages

In personal injury cases, the injured party is expected to take reasonable steps to mitigate their damages. This means seeking timely medical treatment, following medical advice, and taking actions to minimize the impact of the injury. Failure to do so can mean a reduction in the amount of compensation awarded.

FAQs About Compensatory Damages

Q: Are lost wages considered compensatory damages?

A: Yes, lost wages are a key component of compensatory damages, covering both past and future income that couldn’t be earned due to the injury.

Q: Is emotional distress a compensatory damage?

A: Yes, emotional distress is a type of general compensatory damage. It encompasses the psychological and emotional suffering endured as a result of the injury.

Q: Is pain and suffering a compensatory damage?

A: Absolutely, pain and suffering are significant general compensatory damages. They address the physical and emotional pain experienced due to the injury, and their calculation varies depending on the severity of the suffering.

Seeking Justice Through Compensatory Damages

Compensatory damages play a pivotal role in personal injury cases, offering a means of redress for those who have suffered harm due to the negligence or wrongful actions of others. If you’ve been injured and believe you’re entitled to compensatory damages, don’t hesitate to seek legal representation

Our experienced team at Wood Injury Law is here to help you navigate the complexities of personal injury law and ensure you receive the compensation you deserve. Contact us today to discuss your case and take the first step towards seeking justice and reclaiming your life.

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