Compensatory Damages Vs Punitive Damages: Everything You Need to Know
Compensatory damages are the monetary awards given to the plaintiff who wins a civil lawsuit. 3 min read
Compensatory damages are the monetary awards given to the plaintiff who wins a civil lawsuit. They are intended to repay that individual for their loss or injury they suffered as a result of the defendant's unlawful or fraudulent conduct.
Also referred to as “actual damages,” compensatory damages restore the defendant to the financial condition they had before the action took place, or they replace what has been lost. The plaintiff must prove that the loss did occur and the defendant was responsible for the loss. It is also necessary that the plaintiff be able to put a dollar amount on the amount of the loss, which the judge or jury must agree upon.
Compensatory damages are frequently awarded in cases of medical malpractice. In those sort of cases, the compensation pays for medical bills, expenses incurred due to rehabilitation, hospital bills, and lost earnings. However, they can be difficult to quantify. Someone who is retired, unemployed, or working a minimum-wage job will have a different amount of lost wages as compared to a plaintiff who ordinarily earns a high income.
Another type of case in which compensatory damages are paid is an automobile accident. The damages paid would be equivalent to the vehicle's fair market value, which may not be enough to buy a new car. It's also possible, however, that you would be awarded an additional amount to compensate you for the loss of your transportation source or any loss of profits you would normally earn from using the car.
Compensatory damages are not the only kind of damages that are awarded in a civil suit. While compensatory damages are intended to repay the person for their loss, punitive damages are intended to punish the defendant for their wrongful actions. Punitive damages will provide a monetary award over and above the amount of actual loss that was incurred. The intention is to prevent the defendant from ever repeating the wrongful act.
Compensatory damages are intended to reimburse the plaintiff with enough funds to cover any loss that the defendant cause and pay related expenses, but nothing more. Punitive damages, which are also called “exemplary damages” are typically only awarded when a court finds the actions of the defendant were particularly harmful and intentional.
Actual Compensatory Damages
Some examples of actual compensatory damages include:
- Cost of ambulance use
- Medical treatments and hospital bills
- Costs of rehabilitation services and physical therapy
- Medicine, prescription drugs, and medical equipment
- Expenses from staying in a nursing home
- Domestic services and home healthcare
- Lost wages
- Increases in living expenses due to medical circumstances
- Replacement or repair of affected property
- Transportation to and from medical appointments
The plaintiff must prove that the losses they have incurred are equal to the stated monetary value for actual compensatory damages to be received.
Special damages refer to a monetary award that is given to cover losses that were incurred due to the defendant's wrongdoing. These may cover medical expenses, damage to property, and loss of earnings if applicable. These are awarded according to the actual loss, and are restricted to the value of the items at the time of loss, specifically the “used” or “depreciated” property value.
General Compensatory Damages
General damages are typically awarded to an individual who has incurred personal harm from the actions of another. These include:
- Pain and suffering, including any limitations the person has as a result of the injury.
- Emotional distress, which includes not just physical injury but also sexual harassment, slander, or physical abuse.
- Loss of consortium, which refers to the loss of a normal family relationship and dynamic that results from death or disability.
- Defamation, which involves the spread of false information intended to harm an individual's reputation within the community. This may be either written or spoken.
- Disfigurement, which means a permanent alteration of the individual's appearance, such as scars.
- Loss or impairment of physical or mental capacity, including the loss of that person's ability to make their own decisions or provide for their own care.
- Loss of enjoyment of life.
These types of damages do not involve actual expenditures of money. Many different methods are employed to place a dollar value on these intangible assets.
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