Types Of Compensatory Damages

If you've been injured or suffered a loss that is the fault of someone else, whether to file a civil lawsuit or not is a big decision. Obviously, consulting with an attorney is something you should give priority. But, before taking that step, you'll want to do a little research and learn the basics of lawsuits. One of the first things to learn is the different types of damages, usually in the form of money awarded in civil cases.

Compensatory and punitive damages are the two basic types of awards you could seek in a civil lawsuit. While punitive damages may be more exciting in a made-for-TV way, this article will concentrate entirely on compensatory damages. By knowing what they are, you'll have a better understanding of what to expect from a potential lawsuit and be able to talk with your attorney more intelligently.

What Are Compensatory Damages?

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The definition of compensatory damages is an award of money in compensation for actual economic loss, property damage, or injury. Again, compensatory damages are separate from punitive damages in a civil lawsuit. Compensatory damages are broken down further into the following two categories.

Special (or Actual) Damages

This is an award designed to reimburse the injured party for expenses related to property damages, medical costs, and loss of income. The award will be in the amount of actual losses. For example, a car totaled in an accident would be valued at its retail price minus any depreciation. This award is designed to replace real losses to return the injured party to the financial condition they were in before the loss took place.

General Damages

These may be awarded for personal harm suffered by the injured party including pain and suffering, mental anguish, loss of consortium, and lost opportunity for the future enjoyment of life. Due to the often difficult circumstances involved in these awards, the court will use outcomes of similar prior cases to determine amounts awarded.

Types of Compensatory Damages 

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Now that we've defined the major types of compensatory damages, we'll break down the specifics of each condition in which they may be applied.

Medical Expenses

When you are injured, you could be left with some costly medical bills. As part of a civil lawsuit, your medical expenses could be a large percentage of the damages to which you're entitled. The greater the amount of money owed for medical services, the greater the amount of damages the lawsuit will pursue.

There could be damages after initial treatment, in the form of long-term care, to be factored in. Examples of medical expenses include:

  • Ambulance services
  • Emergency room and hospital care
  • Physician care
  • Diagnostic testing
  • Physical rehabilitation
  • Occupational rehabilitation
  • Home care

As you can see, the list of potential medical expenses is long. Medical bills can be presented as evidence of initial care costs while your attorney can find experts to assist in determining potential long-term care needs.

Property Damage

The injured party may also seek compensation for the repair or replacement of any property damaged in an accident. In an automobile accident, for example, not only is damage to the car recoverable, but lost or damaged property inside the car (tools, golf clubs, child seat, etc.) may also be eligible for compensation. Cost of a rental car or other alternate means of transportation may also be eligible while repairs are being completed.

Valuing damaged property may require an appraiser, whose job it is to determine the extent of the property damage. If the property is not salvageable, the victim can seek compensation in the amount of its value before the accident. If repairs can be made, the loss of use by the injured party, besides the repair itself, becomes part of the total damages.

Another factor in total costs could be interest and loss of profit. For example, if the injured party loses business equipment or tools used in their employment, these are damages that could be added to a lawsuit.

Loss of Income 

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If there is an injury, and it prevents the injured party from working or running their business, damages may apply in the amount normally earned during the recovery period. This is known as lost wages. Time missed from work due to a doctor's appointments, physical or occupational therapy or other related treatments of the injury would also be considered as lost wages.  

A permanent injury that prevents the injured party from working for the rest of their life may also be eligible for compensation to cover the loss of future earnings. Finally, if a person dies due to an accident, the deceased party's family can bring a civil lawsuit for the lost income that the victim would have earned based on their age and current salary.

A younger person has a longer work-life expectancy and would suffer a substantial loss of future earnings in the event of untimely death compared to an older person.

Pain and Suffering 

The amount of pain and suffering an injured party goes through is difficult to assess. Everyone's pain threshold is different, but there are ways to measure and document the injured party’s level of suffering.

Information can be collected from medical records and providers concerning the amount of medication the injured party required, the kinds and duration of treatments needed, and the expected length of the recovery period. Family members and friends of the injured party can be interviewed to find out if the accident caused any effect on the victim’s quality or enjoyment of life.

Pain and Mental Anguish and Emotional Distress Suffering 

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Different from pain and suffering, the effects of these mental conditions include terror, shock, apprehension, confusion, humiliation, and sorrow. Some states make it difficult to prove with strict guidelines such as the “zone of danger” test which considers how physically close the injured party was to the accident.

Another limit is the “physical manifestation rule” which requires that the emotional distress experienced by the injured party be exhibited by physical conditions such as depression and anxiety intense enough to cause ulcers or loss of appetite and weight. Proving these conditions is difficult and requires expert guidance.

Loss of Consortium 

This is another type of compensatory damages available in the case of a permanently disabling injury. Loss of consortium is the inability of the injured party to engage in acts of companionship with their spouse or loved one at the level they once did. Damages awarded tend to be less but can still be significant in a case involving a permanent outcome such as paraplegia.

Lost Opportunity 

These compensatory damages are sometimes recoverable in addition to lost wages and loss of future earnings. They refer to a business opportunity of the injured party that has been impeded due to an accident. A claim of this type must be supported entirely. Failure to do so could damage the merits of the entire case and cause a judge or jury to reject other damages sought by the injured party.

When Are Compensatory Damages Awarded? 

Compensatory damages are awarded in civil court cases where the injured party's loss has occurred as a result of the negligence or unlawful conduct of another party. For compensatory damages to be awarded, a judge or jury must be able to determine the actual monetary value of the loss suffered by the injured party. Some examples include:

  • Automobile accidents
  • Work-related injuries
  • Medical malpractice
  • Municipal infrastructure failures
  • Institutional neglect of safety issues
  • Business or corporate negligence
  • Certain criminal offenses

Examples of Lawsuits Involving Compensatory Damages

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Here are a few examples of real-life lawsuits that resulted in compensatory damages being awarded:

1. $80 Million Verdict Reached in Medical Malpractice Suit

A defective medical stapler almost cost a retired police officer her life. She went into the hospital for routine hemorrhoid surgery, but the surgeon used a defective stapler. The damage caused her bowels to rupture. She went into sepsis and shock. She eventually recovered, then took the stapler manufacturers to court and netted a verdict of $80 million.

2. Lawsuit Over Toxic Water  

An Ohio woman successfully sued a Teflon company after her attorney proved that they knew that their products contaminated local water. She was awarded $1.6 million in damages, and her case was followed by more than 3,000 others claiming that their water was affected too.

3. Fast-Food Hot Coffee Lawsuit 

A jury awarded a woman $200,000 in compensatory damages to pay for medical bills and other related expenses due to being burned by a cup of hot coffee purchased through the drive-in window at a fast-food chain. Because the company had prior knowledge that their coffee could cause serious injury, yet did nothing to remedy the situation, the jury also awarded the woman over $2 million in punitive damages.

Conclusion 

As you can see, there's a lot to learn about the world of civil litigation. Seeking the guidance of an experienced personal injury attorney should be one of the first things you do in case of an injury or loss that's the fault of another. It's also helpful to educate yourself to be of help to your attorney and to know you're getting sound legal advice.

Knowing the ins and outs of topics like compensatory damages will only help you be a better plaintiff. Your legal team will appreciate it, and it will increase your chances of achieving the outcome you desire. Arming yourself with a basic knowledge of your rights under the law is the first step to a successful civil lawsuit.

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How To Pick A Real Estate Attorney

Buying or selling your home can be a stressful process, with many steps you may be unfamiliar with. Most people only buy a house once or twice in their entire lives. Since this can be such a big investment in your life, you want to make sure you have trained professionals on your side to help you through the process. Having a real estate agent helps, but having an experienced one is invaluable. Involving a real estate attorney in your transaction can protect your interests and ensure that your closing goes as smoothly as possible.

What Is a Real Estate Attorney?

In many states, lawyers can help regular people with many issues they run into, from traffic tickets to buying a house. Real estate attorneys are lawyers who specialize in dealing with matters related to property, from buying a home to boundary disputes. They often handle closings—the final step in a real estate purchase transaction where the documents finalizing the transaction are completed. They also work with mortgage lenders and title insurance companies to make sure the transaction goes smoothly and that your property is protected.

Why Do I Need One? 

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There are many reasons to have a real estate attorney involved in your property transaction. In most cases, the real estate attorney is the go-to expert in providing legal advice should you run into an unexpected situation. They ensure that the transfer of property is legally binding and done in their client’s best interest and can help you navigate issues if there is a dispute.

Personal Interest

The real estate attorney does not have a personal interest in the outcome of the transaction other than making sure their client’s best interests are taken care of. Other people involved in the transaction (including real estate agents) may have a great financial interest in the outcome because they are working on a commission basis. While those with a financial interest in the transaction may try to steer your decision-making process, your attorney is there to provide the information to help you make the best decision for yourself.

Legal Advice 

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Most states have rules against the unauthorized practice of law. In a real estate transaction, the real estate attorney is the only person who can accurately explain the law to you and provide legal advice. Whether you are involved in a residential or a commercial transaction, a skilled real estate attorney can be a great resource if you have questions.

Real estate attorneys also have the legal training to help you handle property issues that may pop up unexpectedly, or help you navigate complications in your transaction. The attorney is the person best equipped to help you figure out what to do if it is discovered that there are disputes over property lines, easements, or other matters related to the transaction.

If there is a dispute over the contract for the property, a real estate attorney can also answer any legal questions you may have about your obligations under the agreement. Questions about backing out of a contract or getting your earnest money back are best directed to a professional who can explain to you the repercussions you may encounter if you cancel the contract.

Title Searches 

Real estate attorneys not only provide legal advice and answer questions. In many states, they also perform title searches to certify the title to the property is free and marketable. This usually entails a search of all the public records to determine ownership of the property and the status of any outstanding mortgages and liens on the property.  

The results of the title search determine what requirements may need to be met in the transaction to secure a title insurance policy for the new buyer. For example, if there is an existing mortgage on the property, a title insurance company may require the old mortgage be paid off to issue an insurance policy.

Working with Other Parties and Performing Closings

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The real estate attorney and their team also work with mortgage loan officers, the other party’s attorney, and the real estate brokers to make sure that the transaction proceeds smoothly. Most times they will help you sign your final mortgage loan package at closing and send your mortgage documents back to your lender to get authorization to fund your loan.    

In some states, real estate closing transactions are legally required to go through a real estate attorney’s office, and the law requires the funds to be disbursed through the attorney’s trust account.  

Drafting and Recording Documents 

One of the most important things that a real estate attorney does for a property transaction is review and draft the documents that will transfer ownership of the property. Attorneys can draft purchase contracts, deeds, and other agreements related to the transaction.  

It is also the attorney’s responsibility to make sure the documents for the transaction are correct. Mistakes in the legal description of the property being transferred can cause serious problems down the road, so you want to make sure you have a real estate attorney involved to cut down on any potential problems in your documentation.  

Some states require deeds and mortgage documents to be filed with county Register of Deeds offices to be effective. The attorney can facilitate this part of the process to make sure your transfer of property is legal, binding, and effective, and that official public notice of the transfer of ownership is available in your local property records.

How to Find a Good Real Estate Attorney

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Since having a real estate attorney is important to a successful and smooth transaction, you must know how to find an experienced attorney who will be a good fit for your needs.

Recommendations 

If you don’t already know a good attorney, you can always ask for referrals from people you know. Take recommendations from brokers involved in your transaction with a grain of salt because you don’t know what kind of arrangement they may have with the attorney’s offices. Sometimes, perfectly good attorneys may feel the need to help a transaction go through to keep getting business referrals from the brokers.  

State Bar Referrals 

In some states, you can contact your state bar association and ask for a referral to a licensed real estate attorney. Many bar associations keep records of licensed attorneys in their state and can direct you to someone with a good record with the state bar who also specializes in real estate transactions.

Lawyer Match Services 

There are also several online referral services. You can usually use these services to search for the area of law you require an expert in, and they can match you with law firms or attorneys in your area who work in the appropriate area of law.

Consultations 

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Once you have a list of potential real estate attorneys, you can always narrow down your options by asking for a consultation. Before you go to their office, you will want to ask about a consultation fee. Some attorneys may offer free initial consultations, but some charge a small fee for an initial interview. If the attorney charges for an initial interview, you will want to know what the fee is, and how long the consultation will last. You may get most of the information you need over the phone without an in-office consultation.

Some information you should consider before making a final selection of your attorney includes:

  • The fee arrangement required by the attorney
  • Whether the attorney is licensed in your area (and maybe how long)
  • Whether the attorney has been investigated or disciplined by the state bar
  • Whether the attorney has handled similar cases in the past
  • Whether the attorney has experience in real estate transactions
  • Whether the attorney fees are refundable if the transaction falls through

Starting Your Case or Transaction 

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Once you have selected the real estate attorney to handle your transaction, the attorney’s office may contact you to collect important information to get a file started for your case or transaction.  

Most times, the attorney’s office will have information sheets for you to fill out detailing the property address, your name and the proper spelling for names of the people or entities that will take title to the property, the sale price of the property, and other pertinent information. If you are selling the property, they may also ask you to confirm whether you have a current mortgage or home equity line of credit on the property (which they will verify in the public records during a title search). To help your transaction go quickly and smoothly, it is in your best interest to fill out and send the information sheets back to the attorney’s office.  

Conclusion 

While many people may think trying to go through a real estate transaction without an attorney involved may save them money, in reality, that is not the case. Having an experienced real estate attorney on your side can not only ensure that your transaction is legally binding, but it can also provide you with peace of mind. You can rest easy knowing the legal issues associated with transferring property are taken care of.  

If you are taking part in transferring real estate, it is in your best interests to reach out to a real estate attorney to help you navigate the process and answer any legal questions you may have.

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