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What Is a Damages Cap?

A damages cap legally limits how much you can recover from a defendant in a personal injury case. Suppose you're injured, and someone else is at fault. You can sue the other person for your damages. A damages cap will determine your maximum recovery of non-economic damages.

When you sue someone, particularly in a personal injury case, you hope to get monetary damages to compensate you for your injury. There are generally two classes of damages: economic damages and non-economic damages.

Economic damages are specific costs to you as a result of your injuries, such as:

  • Medical bills
  • Money spent to repair property damage

Non-economic damages are all the other types of damages, such as:

  • Emotional distress
  • Pain and suffering

Each state has its own damages cap. States can also place caps on non-economic damages for medical malpractice claims.

This article gives a general overview of damage caps, including why caps exist. The article discusses the relationship between damages caps and punitive damages. It also addresses gross negligence and its impact on damages caps. Finally, the article discusses wrongful death cases and damages caps and whether there's any way around damages caps.

Why Do We Have Damages Caps?

Damages caps are an attempt to manage the high business costs by reducing service providers' liability. It might seem like damages caps are unfair to plaintiffs, the people bringing personal injury cases. Suppose a jury of the plaintiff's peers determines that a plaintiff deserves $10 million in damages. In that case, it may seem unfair for the court to override that decision. But, high awards can put a drag on the economy.

Consider a medical malpractice case. A doctor's mistake can have devastating consequences for the patient. Juries might want to award millions of dollars to the patient in non-economic damages. The doctor's medical malpractice insurance company usually pays those damages. This starts a chain reaction of increasing costs and can set a precedent.

To compensate for the millions paid in damages (and the risk of future extensive damages awards), the insurance company will increase the costs to the doctor associated with medical malpractice insurance. This means it will cost more for doctors to practice medicine. Patients then pay more on their medical bills to cover these increased costs.

Aside from managing business costs, damages caps discourage people from playing the "lawsuit lotto" or bringing a suit simply because they think they can win a large amount of money. Courts want to ensure the justice system is for injured people when seeking compensatory damages.

Punitive Damages and Their Relation to Damages Caps

Punitive damages are different from compensatory damages. Compensatory damages are there to make a plaintiff whole again after an injury. Punitive damages punish the defendant for egregious conduct and deter similar behavior in the future.

In some states, punitive damages are also subject to caps. These caps can be a specific dollar amount or a ratio to compensatory damages. The laws surrounding punitive damages are complex and differ from state to state. Consult a personal injury lawyer to understand how punitive damages might affect your case.

Gross Negligence and Its Impact on Damages Caps

Gross negligence refers to conduct that is more than just carelessness. It involves a conscious disregard for the safety of others. In cases where there is gross negligence, some states may allow punitive damages on top of compensatory damages.

Some states don't cap damages when there is gross negligence. Others have higher caps for cases involving gross negligence compared with ordinary negligence.

Non-Economic Losses

Non-economic losses cover a wide range of damages. These include:

  • Disfigurement
  • Loss of companionship
  • Loss of enjoyment of life

These damages can't be easily quantified, but they significantly affect the injured party's quality of life.

As these damages are non-economic, they may be subject to caps in your state. But these are serious losses. A personal injury lawyer can help you argue for the most compensation possible under the law.

Wrongful Death Cases and Damages Caps

Wrongful death cases are lawsuits brought by the family of a deceased person against the party responsible for their loved one's death. Damages in wrongful death cases can include economic losses, such as the loss of the dead person's earning capacity, and non-economic losses, like the loss of companionship.

Wrongful death cases are subject to damages caps like other personal injury lawsuits. This can limit the total amount of non-economic damages a family can recover.

Can a Jury Get Around Personal Injury Damages Caps?

Juries usually can't get around damages caps in a personal injury case. This is because most juries don't know about damages caps. Judges and lawyers don't instruct the jury about damages caps in these cases — they don't want juries to use a cap as a starting point when awarding verdicts. Instead, juries award the amount they think is fair. The judge later modifies the damages award according to that state's cap.

Learn More About Damages Caps by Speaking to a Personal Injury Lawyer

Perhaps you have questions about how damages caps may affect your personal injury lawsuit, or you've suffered severe injuries after a car crash and are wondering if you should start a lawsuit. In that case, consult with a local personal injury attorney.

A car accident attorney in your area can suggest possible next steps. Some experienced personal injury attorneys can even give you a free case evaluation tailored to you.

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