What are damages?
Damages are about compensating the claimant for the harm/loss they suffered. The point of damages is to put the claimant back in the position they would have been in if the defendant had not been negligent(falling below the standard of the reasonable man). This means that the claimant won't make a profit from the incident.
Pecuniary and non-pecuniary.
Damages are classified into one of two groups: 'Pecuniary'/'Non-Pecuniary'.
Pecuinary damages are those that cover finacial losses. For example the cost of repairing a car.
Non-pecuniary damages are those that involve a loss which is not financial but the court still gives financial compensation. For example pain and suffering/the loss of a limb.
To calculate quantum-Special damages.
Quantum-the amount of the award.
Special damages- This is the compensation paid for financial losses from the incident to the date of the trial. They are given compensation for the cost of repairing a car, this can be given in an exact figure. However there may be additional medical expenses for example any emergency medical treatment is normally paid by the insurance company. However deductions may be made to the compensation if the claimant recieves state benefits as a result of the incident.
This is compensation for things which are not eaily quantifiable, so the amount of compensation given to the claimant is unclear.
There are three areas that need to be explored within general damages:
- Pain, suffering and loss of amenity
- Future medical care and personal assistance
- Loss of future earnings.
General damages- Pain and suffering.
This is very difficult to caluculate, as it can include both mental and physical suffering and also any loss of amenity(the loss of being able to do everyday things)The court will consider a number of factors when deciding the quantum. For example, treatment recived and how long the claimant spent in hospital, is the claimants life expectancy reduced, are they left with scars?
General damages- Future medical care and personal
Personal assistance- this is when the claimant is left unable to look after themselves which may result in a member of the family becoming a carer and losing their means of income as a result.
Compensation may be paid to cover the cost of care even if the care is given free of charge by the family member/friend.
General damages- Loss of future earnings.
This like pain and suffering is very difficult to calculate the amount of quantum awarded. The courts will therefore rely on evidence and arguments put forward.
Claimant's net annual loss 'x' Number of years left at work '=' Damages for loss of earnings.(Multiplicand) (Multiplier)
Lump sums and structured settlements
Until the late 1900's, damages could only be awarded in a lump sum, this is where the claimant recieved their payment and did with it what they wished. This meant that the lump sum could be invested and interest could be earned, resulting in the claimant much more than they would have earned if they had not been injured.
Lump sums are appropriate for loss of damaged goods. However periodical payments are more suitable when the claimant is going to need a regular income to carry on with their lives. This means the claimant could recieve a monthly payment.
Damages for personal injuries paid in this way are known as 'structured settlements' and are governed by the Damages Act 1996. Structured settlements is a good way of avoiding the Claimant being compensated incorrectly.