Cases of personal injury or wrongful death seek to recover economic compensation for harmed plaintiffs. Three ways that these civil cases can be concluded include a settlement, a trial, or an appeal. A settlement can be viewed as a “pre-trial compromise” that is reached through negotiations. Agreeing to a settlement is common, as it avoids further formal litigation. If no compromise can be made, then the case enters the trial phase. If the Plaintiff wins the trial, a judge or jury will issue a verdict which contains a monetary award. The losing party may or may not appeal this decision to an appeals court who will review the case.
Compensatory vs Punitive Damages
Damages are categorized as being either compensatory or punitive. Compensatory are such that reward the victim for their losses. These may include compensation for loss of past and future earnings, medical expenses, and pain and suffering. It is important to differentiate quantifiable economic losses like medical expenses from the non-economic ones explicitly for purposes of the maximum amount limits that can be awarded. Punitive damages are allowed in instances where it is determined that the defendant’s conduct was malicious, willful or fraudulent. Punitive damages are basically a punishment for their acts and are a way to create general deterrence in the community toward such conduct.
Maximum Possible Awards
Generally, there is no maximum limit that can be recovered for compensatory economic losses. General non-economic limits in cases of injury or death are $250,000, subject to inflation. However are subject to increases in many instances in accordance with (CRS 13-21-203) Punitive damages are generally limited to the amount of actual damages determined in the case.
Tax and Interest Considerations
For awards and settlements, the IRS considers money received for personal physical injury or emotional distress attributed to physical injury as non-taxable. All others are generally considered taxable income. In judgment awards, the plaintiff is eligible for interest accrued from the date the action accrued. (CRS 13-21-101) The rate of interest is reviewed annually by the secretary of state.
Can a Defendant’s Wealth Influence Awards?
Colorado prohibits considering the wealth of the defendant in determining these awards. Also, juries in the proceedings are not informed if the defendant has insurance, or how much coverage there is. Obviously, it is unlikely that a team for the plaintiff is going to proceed through a lengthy civil trial pursuing an indigent defendant.
The Law Firm of Jeremy Rosenthal is proud to represent and defend the rights of Colorado injury victims. The firm has a tremendous track record of securing compensation through settlements and verdicts in personal injury and wrongful death cases. Call the office for a free consultation today to review your case.