Fair Compensation Following an Accident

Question to Attorney Stephen Gorey:

Following an auto accident, what steps should be taken if the 'at fault' party's insurance company proposes a settlement?

The answer to your question depends on what you lost.

You can probably negotiate without a lawyer if the accident only involved damage to your car and the insurance company is offering to fix it or to replace it for what it is worth.

The same is true if your injuries were very minor, such as one or two days of minor pain.   On the other hand, you are probably going to need the advice of a good personal injury lawyer if your losses go beyond these easily fixed problems.

Why? Because in order to know if you are being offered a fair settlement you have to add up all of the things that were taken away from you in the accident.

In an accident, it is possible to lose more than just your car and some minor medical bills. If you have been seriously hurt, another thing that has been taken away from you is your health. Before the accident, you had pain free days or disability free days. You were able to go where you wanted in comfort and do what you wanted without problems. You were able to sleep well and get up feeling good about yourself. You get the idea.

Here is a legally recognized list that judges instruct juries to take into consideration when someone has personal injuries. This jury instruction is entitled “Measure of Damages” and the judge fills in everything in the brackets [.....] and then reads this to the jury at the end of the trial.

“If you find [any] [name of defendant] liable to [name of plaintiff], you must then decide the full amount of money that will reasonably and fairly compensate [name of plaintiff] for each of the following elements of damages proved by the evidence to have resulted from the fault of [any] [name of defendant] [party][person]:

1. The nature, extent and duration of the injury;

2. The pain, discomfort, suffering, disability, disfigurement, and anxiety already experienced, and reasonably probable to be experienced in the future as a result of the injury.

3. Reasonable expenses of necessary medical care, treatment, and services rendered, and reasonably probable to be incurred in the future.

4. Lost earnings to date, and any decrease in earning power or capacity in the future.

5. Loss of love, care, affection, companionship, and other pleasures of the [marital][family] relationship.

6. Loss of enjoyment of life, that is, the participation in life’s activities to the quality and extent normally enjoyed before the injury.”

This is quite a list and it takes a very experienced attorney to correctly interpret this instruction and explain it to a jury.

Now, you are going to be a jury member for a little while and I am going to explain it to you. I am going to go through the instruction with you and explain the key words so that you can understand it.

Here is the instruction again with the key words in the beginning of the instruction put in capital letters and bolded.

“If you find [any] [name of defendant] liable to [name of plaintiff], you must then decide the FULL AMOUNT of money that will reasonably and fairly compensate [name of plaintiff] FOR EACH of the following elements of damages proved by the evidence to have resulted from the fault of [any] [name of defendant] [party][person]:”

What is the “full amount” “for each” element of damages? This means that you need to put a number of dollars for each of the losses suffered in as a result of the defendant’s (bad guy’s) negligence. It doesn’t mean “give them something” and it doesn’t mean “give them a little.” It means exactly what it says “give them the full amount” of money necessary to compensate the innocent victim for each and every one of the losses.

How do you figure that out?

Well, some of the losses are relatively easy and are usually proved at trial by the lawyer who has hired an expert to be your witness. For instance, for wage losses and future loss of the capability of earning wages the lawyer will probably hire a person who works in the field of vocational rehabilitation and someone who works as a labor market consultant. These are people who have special training and experience that they can use to explain a number to the jury.

So much for item number 4. Relatively straightforward.

Item number 3 is also pretty easy. It is easy to know how much medical care ran in the past by getting the doctor and hospital to submit these records. Your doctor or a doctor hired by the lawyer or even a “life care planner” hired by the lawyer can explain to the jury how much medical care will cost going as far into the future as medical care will be needed.

So much for item number 3. Also relatively straightforward.   Now the jury has numbers put on their sheet for those items of damages.   But what about numbers 1, 2, 5 and 6? Look at 2 especially. It has a list within the list!

A doctor can tell us in number 1 what the nature of the injury is, how serious it is and how long it is expected to last, but how do you put a value on it so that you can fill in the amount on your list?

Begin by thinking about this. After the accident, through no fault of your own, you have been robbed of these things because someone was careless. That person had a duty to act as a reasonable driver who would obey the law and drive carefully and they didn’t. Or that person had a duty to act as a reasonable doctor and treat you up to the standard of care of other doctor’s in your State and didn’t. Or that person had a duty to act as a reasonable store owner and keep aisle’s clean and didn’t. And something has been taken away from you that has to be restored. The law can’t make that person who wrongfully hurt you give you back your health. They can only give you back money.

The key to understanding how to come up with a rational number is to come up with a rational method of calculation. There are several ways to do this. I am going to give you two.

The Daily Method:

The first method is the “daily” method (per diem method). This method is allowed in some states, Arizona being one of them, and not allowed in others, such as California.

How are losses, such as pain and suffering experienced in life? They are experienced minute by minute and hour by hour and day by day for as long as they last. Ever had a bad night’s sleep? Remember tossing and turning and thinking you’d give anything for some proper rest? Remember how miserable the next day was? Ever been sick with the flu or have a bout with back pain or a really bad headache?

After a serious accident, some people have problems like this every day, possibly for the rest of their lives.

Most hard labor jobs are paid at least minimum wage. The “daily” method says “Assign a dollar figure for hard labor and multiply it times the number of hours the injured person would be awake, times the number of days in their life expectancy.

Once you have that basic number for a “hard life” you can enter it on the jury list next to number 1. Now go down to item number 2 and use the same method. If a minimum wage doesn’t fit what a reasonable person would be willing to put up with on the job to fit each item in number 2, use a higher figure to start the multiplication.

Now do the same for number 5. Then do the same for number 6.   Finally, add up all the figures and you have your total losses that the law will recognize.

The Free Society Method:

The free society method of figuring damages uses the same tool that any business uses in a rational business model. It is supply and demand. What will a reasonable person pay for this good or for this service? It is the basis for how you earn money or how your company earns money to pay your salary. It is therefore a rational way to put a value on a loss.

This method has to look at what the injured person, the plaintiff, would pay for certain things, not what you as a jury member would pay.

Here is something to think about in this regard. If someone has a business or a family to care for and doesn’t have time to do their own fence painting or yard work, they might pay someone else to do it. People are willing to pay other people to do certain things to avoid having to do it themselves. People are also willing to pay to avoid the pain that can come from digging a ditch to put in irrigation lines themselves. I’m sure you get this idea also.

This method says: “Look at the seriousness of the injuries and the terrible impact on the plaintiff (the victim) and ask yourself what the plaintiff would pay to avoid this pain and these problems.”
However, it is important in this method, just as in the “daily method” to go through each and every item of damages in this consideration and to put a dollar figure by each one.

A Final Thought:

Outside many courtrooms is a statue of a woman with a blind across her eyes and a scale in her hand. This is the statue of justice. She wears a blind because she does not want to know the color, the creed, or anything else about the person. She simply wants to restore the balance.

Before an accident, the scales of a person’s life are balanced. Afterwards, they are out of balance. Something has been taken away from the victim. Maybe it is money that needs to be paid for medical bills. Maybe it is money that was lost from being out of work after an accident. If so, the scale has to be put back into balance by having the negligent person or negligent company put the same amount of money on the scale to even things back up.

But there is no way to put back someone’s health and their happiness. Only money can be put back in. Enough money has to be put back in to balance out their suffering. It has to be enough money that the injured person no longer cares that he or she is in so much pain. It is an even swap.

This is why pain and suffering damages must be high. It is the only fair thing to do in our country which values fairness - fights for fairness - and teaches fairness every day to our children from a perspective of what is right and good.