Litigation is a long and expensive process. The question that is always brought up at some point is “What is my case worth?” This is a loaded question that brings a variety of questions that must be answered. After assessing the liability concerns of a lawsuit, a prudent attorney must assess the nature and extent of a party’s damages. The basics of damages is the focus of this month’s article. The purpose of damages in tort actions has been defined as something paid in recompense for the infringement of a plaintiff’s legal right by the defendant’s wrongful conduct and as compensation for a loss or legal injury sustained. The purpose is to not make people wealthy. The goal of damages is to put people in a position as near as possible equivalent to their position before they were wronged. Damages for torts, civil wrongs other than contracts such as negligence, can be structured in a few ways. Damages can be compensatory, which are damages that compensate you for your actual damages such as financial losses as well as compensation for physical and mental suffering. Damages can also be punitive where damages are used to punish wrongful conduct and to deter others from acting in the same way. Punitive damages can be awarded when a party has engaged in willful, wanton, or reckless conduct that has injured another.

Damages for contracts focus more on protecting the expectation interest of a party. Contractual damages are designed to put a party in the position they expected to be in had the breach of contract not occurred. It is for this reason that punitive damages are not normally awarded in contract cases as the goal is to protect a party’s expectation interest and not to assess damages to punish the breaching party. If you have any questions about damages, please feel free to give me a call.