Compensatory vs. Punitive Damages: How Are They Different?

Feb 04, 2014

When filing a personal injury lawsuit, the injured person (claimant) must prove that the other party (defendant) was negligent. If the claimant wins the lawsuit, he or she will usually recover compensation for losses suffered as a result of the defendant’s negligence.

Compensatory damages, also known as actual damages, are meant to redress direct and immediate harm, such as lost pay and medical expenses, or intangible harm like emotional distress and loss of privacy. Compensatory damages are awarded in most personal injury cases for losses that can be readily proven to have occurred. Compensatory losses may encompass the following:

  • Financial loss
  • Medical care
  • Pain and suffering
  • Disfigurement
  • Physical rehabilitation
  • Loss of wages (current and future)
  • Mental anguish
  • Legal fees incurred by the plaintiff

If the defendant’s behavior was especially harmful, injured victims may also be able to recover punitive damages, though it is quite rare. Punitive damages are the civil law equivalent of a criminal fine. Punitive damages are awarded in cases when the defendant acted in a reckless manner and clearly disregarded the rights of others. If a supermarket sells tainted food but was not aware of the problem before selling the food, the supermarket would probably be liable for compensatory damages to people who ate the food but not for punitive damages because they didn’t sell the tainted food intentionally.

Punitive Damages: Awarded as a Deterrent or Punishment

Punitive damages do not compensate victims for their losses. The purpose of punitive damages is to punish wrongdoers and deter others from behaving in a similar way in the future. Generally speaking, punitive damages are awarded to punish the worst types of wrongdoing. In most cases when punitive damages are awarded, the defendant is a corporation or business. For example, a manufacturing company that intentionally introduces a harmful substance into the water supply that makes many people ill would likely be required to pay both compensatory and punitive damages. It is rare for claimants to seek punitive damages from individuals, though it does happen. For instance, a drunk driver who injures a pedestrian may be required to pay punitive damages if he is a repeat offender.

Typically, punitive damages are awarded when a defendant injures a person and has harmed other people in the same way previously. Punitive damages are meant to give defendants an incentive to address the issue or fix the problem. The threat of punitive damages in a case may lead the defendant to offer an increased settlement. Punitive damages are controversial, however, because of the broad discretion adjudicators have in setting them. Punitive damages are often large and unpredictable.

Get Assistance with Your Personal Injury Claim

A personal injury can severely affect your ability to manage your day-to-day life, hold down a job, and take care of your family. If you’ve suffered an injury as a result of someone else’s negligence, hire a lawyer to ensure that your interests are protected. Agee Clymer Mitchell & Portman personal injury attorneys in Columbus, Ohio will strive for the best possible outcome in your case. Call 800.678.3318 or contact us online to request a consultation.

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Worker’s Comp Lawyers Columbus, Ohio - Agee Clymer

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