Whether you’ve been in a car accident, suffered a slip and fall, or you were injured by a faulty product or bad drug, you could be entitled to financial compensation. If you can’t reach a settlement with the at-fault party’s insurance company, your personal injury attorney may suggest that you file a formal lawsuit in court. If you win, the money you get is called damages – and there are two types of damages: compensatory and punitive.
So when you look at punitive damages vs. compensatory damages, what are the differences between the two? Here’s what you need to know.
Punitive Damages vs. Compensatory Damages: The Basics
Punitive damages are designed to punish bad actors. They’re typically awarded to an injury victim whose injury was clearly preventable, especially when the person or business responsible for the injury should’ve known better.
Compensatory damages are designed to make up for, or compensate, the victim’s losses. Compensatory damages can cover things like medical bills, lost wages, pain and suffering, and other measurable losses.
Here’s a closer look at punitive damages vs. compensatory damages.
Judges or juries can award punitive damages in addition to compensatory damages in some lawsuits. California Civil Code 3294 allows juries to award them – but the victim in the case has to prove that the defendant’s conduct amounted to malice, oppression or fraud, such as when the case involves intentional harm or extreme recklessness. They’re typically awarded at the court’s discretion, such as when the defendant’s behavior was especially harmful and shows a blatant disregard for other people’s safety. Statistically, courts award punitive damages in about 5 percent of cases. It’s much more common for injury victims to receive compensatory damages.
Judges or juries can award compensatory damages in a lawsuit. This money is intended to pay back the victim for losses, and it could be intended to cover:
- Medical bills, including emergency treatment, ambulance fees and hospital bills
- Future medical expenses, including physical therapy and rehabilitation, as well as medications and prescription drugs
- Lost pay from missing work, a reduced capacity to work or the loss of a job
- Lost pay in the future
- Increased living expenses
- Nursing home care
- Medical equipment
- Property damage or loss
- Mental anguish
- Long-term physical pain and suffering
- Loss of consortium
- Loss of enjoyment of life
- Loss of opportunity
Punitive Damages vs. Compensatory Damages: What’s Worth More?
No two lawsuits are exactly the same, so the damages can vary greatly from one case to another. Because the courts base compensatory damages on a victim’s losses, they’re generally calculated by tallying up medical bills, lost wages and other losses (as well as adding future expenses and lost wages). When compensatory damages are calculated based on things like the loss of enjoyment of life or long-term physical pain and suffering, things get a bit fuzzy – but it’s up to judges and juries to decide what award is appropriate.
Punitive damages are also up to the courts to decide. In California, there’s no cap on the amount of punitive damages a court can award (some states set limits) – but the 14th Amendment to the U.S. Constitution does prohibit courts from imposing “grossly excessive” or “arbitrary” punishments. Additionally, the U.S. Supreme Court has held that punitive damages have to be reasonably proportional to the victim’s compensatory damage; the justices have said “few awards exceeding a single-digit ratio between punitive and compensatory damages, to a significant degree, will satisfy due process.” Often, a 5-to-1 ratio is seen as appropriate. Your attorney can talk to you about asking for punitive damages in your case, and he’ll be able to explain how the courts determine how much to award in more detail.
Do You Need to Talk to a Lawyer About Punitive Damages vs. Compensatory Damages?
If someone else’s carelessness has caused you injury, or if a defective product or drug harmed you, we may be able to help you. We can visit you at home, in the hospital or elsewhere to talk about your case – and if you’re entitled to financial compensation, we can help you get it. Call us right away at 818-230-8380 or fill out the form below to tell us what happened.