Keith Mack
Damages are a remedy in the form of monetary compensation awarded to a claimant in a civil lawsuit. The purpose of damages is to compensate the claimant for losses, injuries, or harm suffered as a result of another party's actions or breach of duty. The specific types of damages that may be awarded vary depending on the case and can include compensatory damages, nominal damages, and punitive damages. Compensatory damages aim to restore the claimant financially, physically, and emotionally, covering economic losses such as medical expenses, lost wages, and property damage, as well as non-economic losses like pain and suffering. Nominal damages, on the other hand, are sought when significant damages cannot be proven, often in cases involving alleged violations of constitutional rights. Lastly, punitive damages are intended to punish the defendant for willful, malicious, or fraudulent behaviour and to deter similar conduct in the future.
| Characteristics | Values |
|---|---|
| Purpose | To compensate the injured party and/or to punish the defendant |
| Types | Compensatory, nominal, punitive, general, special, reliance, restitution, liquidated, expectancy |
| Compensatory damages | Monetary compensation for loss, injury, or harm suffered by the claimant |
| Nominal damages | Awarded when the claimant is unable to prove significant damages, but their rights have been violated |
| Punitive damages | Awarded to reform or deter the defendant from pursuing the course of action that damaged the plaintiff |
| General damages | Payment for non-financial damages, such as pain and suffering |
| Special damages | Economic losses such as loss of earnings, property damage, and medical expenses |
| Reliance damages | The economic position the party would have been in had they not relied on the contract |
| Restitution | An equitable remedy to take away profits from the party that breached |
| Liquidated damages | Contract parties can agree to these in advance in the event of a breach |
| Expectancy damages | Used in contract law to put an injured party in the position it would have occupied but for the breach |
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Compensatory damages
Damages are the remedy that a party requests in court in order to be compensated for harm caused by another party. Compensatory damages are one of the types of damages that can be awarded in a lawsuit, the other being punitive damages. Compensatory damages are awarded in civil court cases where a loss has occurred as a result of the negligence or unlawful conduct of another party. They are designed to restore the injured party to their previous position by reimbursing the plaintiff for the losses incurred due to their injury. They are calculated based on the harmed party's actual losses and can be divided into two categories:
Special damages
Also known as actual damages, this category of compensatory damages compensates victims for monetary losses. These are intended to provide the monetary amount necessary to replace what was lost and nothing more. For example, this could include medical expenses, the cost of repairing or replacing damaged property, and lost wages.
General damages
General damages compensate victims for non-monetary losses and are more complex as they do not represent a monetary expenditure. These can be difficult to assess and include damages for pain and suffering, emotional distress, and loss of consortium.
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Nominal damages
In civil cases, damages are the remedy that a party requests the court to award to compensate for losses and injuries endured due to the defendant's actions. Damages are typically monetary and are awarded to the harmed party. They can be compensatory, punitive, or nominal.
Compensatory damages, on the other hand, aim to restore the plaintiff to their pre-injury state by reimbursing them for out-of-pocket expenses and financial losses. This includes medical expenses, lost wages, and property damage. Compensatory damages can also include non-monetary losses, such as pain and suffering, emotional distress, and loss of consortium.
Punitive damages are not designed to compensate the victim but to punish the defendant for inflicting the victim's injuries and to deter others from engaging in similar behaviour.
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Punitive damages
In the context of a lawsuit, damages refer to the monetary compensation that an injured party seeks from the offending party. Damages are typically awarded in personal injury lawsuits to compensate the victim for their losses and restore them to their pre-injury state.
In a landmark case, Whiten v. Pilot Insurance Co. in 2002, the Supreme Court of Canada set out 11 guiding principles for awarding punitive damages. These principles are meant to be considered based on the unique facts of each case and are not intended as a rigid checklist. While punitive damages are uncommon in contract disputes, they may be awarded in exceptional cases, such as insurance bad faith cases in the US, where the breach of contract is considered a tort cause of action.
The calculation of punitive damages is not based on the injured party's losses but rather on the severity of the defendant's conduct and the need for deterrence. Courts typically impose a cap on punitive damages, often limiting them to four times the amount of compensatory damages awarded.
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General damages
In contrast to special damages, which involve monetary awards for tangible expenses such as medical bills, lost wages, and property damage, general damages do not involve financial loss. Instead, they focus on the intangible impacts of an injury or breach. General damages are often referred to as non-economic damages because they are challenging to quantify in monetary terms. However, it is important to note that general damages can still have a significant impact on an individual's life and well-being.
The calculation of general damages can be complex and may require expert witnesses to help ascertain the value. These damages are estimated using formulas that consider the unique circumstances of each case. While there may be no precise invoices or receipts associated with general damages, they are crucial in recognising the harm caused and providing compensation to the plaintiff.
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Special damages
In the case of a car accident, special damages would include the costs of repairing or replacing the plaintiff's vehicle. If someone is injured in a car accident caused by another driver, their special damages would include any expenses related to the accident and their injuries, such as ambulance fees and emergency room treatment.
In a cancer misdiagnosis lawsuit, special damages typically cover the plaintiff's medical costs for additional treatment resulting from the misdiagnosis, as well as lost earnings due to time out of work. Special damages for medical bills can include past, present, and future medical expenses if the patient suffers a permanent disability or requires lifetime medical treatment.
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Frequently asked questions
Damages refer to the legal term for the different types of compensation that can be requested or awarded in a lawsuit.
Compensatory damages are awarded to restore the victim financially, physically, and emotionally. They are calculated based on the harmed party's actual losses, including special damages (economic losses) and general damages (non-economic losses).
Punitive damages are not designed to compensate the plaintiff but to punish the defendant for their actions and to deter them and others from similar behaviour in the future. Punitive damages are awarded in special cases where conduct was egregiously insidious and are over and above compensatory damages.
Nominal damages are awarded when a party has been wronged but is unable to prove significant damages. Nominal damages are usually sought in cases involving alleged violations of constitutional rights.
Examples of compensatory damages include medical expenses, lost wages, property damage, pain and suffering, and funeral expenses.
