What Is Difference Between Compensatory and Punitive Damages?

Difference Between Compensatory and Punitive Damages

The law defines two different types of damages that a plaintiff can receive following an accident. These are called compensatory and punitive damages. While compensatory damages pay the victim for their loss, punitive damages are meant to punish the defendant and deter others from engaging in similar conduct.

In most personal injury cases, the jury is instructed to consider both objective and subjective factors when determining whether or not to award punitive damages. Objective criteria may include the reprehensibility of the defendant’s misconduct and its relation to the severity of the injury sustained by the plaintiff. Subjective factors may include the financial status of the defendant and its ability to pay.

It is not easy to determine what the appropriate amount of punitive damages should be in any given case. This is why most personal injury lawsuits include a jury trial. The judge is not allowed to set a limit on punitive damages, but the jury is expected to base their decision on both objective and subjective criteria. Usually, the amount of punitive damages awarded will be based on how grossly negligent or reckless the defendant was in their actions and behavior.

What Is Difference Between Compensatory and Punitive Damages?

If a defendant’s conduct was particularly outrageous, the courts can award punitive damages in addition to compensatory damages. Typically, these kinds of circumstances involve very dangerous activities that expose the public to high risks of harm. Examples of this kind of conduct may include performing the wrong surgery or leaving a surgical instrument inside a patient, but it can also include things like drawing a gun in a crowded area or making bomb jokes at a concert.

The reason why punitive damages are more geared towards the defendant’s financial situation and its ability to pay is because it is believed that financial loss is an effective deterrent for many kinds of misconduct. For example, if someone steals your credit card and spends thousands of dollars, they are likely to think twice about it in the future. It is not so easy to forget about the ten times larger financial penalty that a defendant could face for engaging in particularly egregious behavior.

As a general rule, emotional distress does not fall under punitive damages. Instead, these kinds of damages are covered by compensatory damages. This could include the fear, anxiety, and loss of enjoyment of life that you suffer as a result of the defendant’s actions.

While there are certain exceptions, the vast majority of personal injury claims do not involve the issuance of punitive damages. Those that do have a lot of variables to take into account which is why it is so important to have a skilled legal professional by your side as you move forward with your claim. If you or a loved one has been injured in an accident, contact us for a free consultation. A member of our team can review your case and help you determine what your claim might be worth.