Damage Caps on New Jersey Personal Injury Claims

Blog,Personal Injury • June 22, 2020

It may seem to go against your instinct for there to be limits on the damages that can be awarded in a personal injury claim, other than the proper compensation for all the elements of an accident. However, there is legislation that can place a cap on the amount that can be recovered in compensation for certain kinds of damages. In most cases, these laws are only applied to non-economic damages, as they can be much more subjective and do not directly correspond with financial losses sustained by the injured party. 

Types of Damages in Personal Injury Cases

In broad terms, there are two main categories of damages that an injured victim can seek compensation for:

  • Economic Damages. This includes any expenses of financial losses incurred by the victim as a result of their injuries, including medical expenses, property damage, and lost income. 
  • Non-Economic Damages. This includes damages that the law recognizes as real losses but do not have a fixed dollar value assigned to them, including pain and suffering resulting from the plaintiff’s injuries or the negative impact that those injuries have had on the plaintiff’s ability to engage in routine activities in their daily lives. 

Punitive damages are also included under non-economic damages. These damages are meant to punish and deter future negligent behavior on part of the defendant rather than providing compensation to the plaintiff. These damages are included by non-economic damages and are subjective in nature, lacking any specific dollar figure lost by the plaintiff. These are the damages usually targeted by legislative caps intended to curb frivolous lawsuits and excessive damage awards. 

There are many states which have enacted laws capping the amount that can be awarded for non-economic damages in medical malpractice cases due to the intense pressure from the medical community and concerns about the cost of medical liability insurance. These caps can range from $350,000 to $750,000, although in the case of a wrongful death or serious injury to a patient, the cap is usually lifted to a much higher figure. There are some states that also include caps like this on all kinds of personal injury claims, not just medical malpractice cases. 

Punitive Damages in New Jersey

Punitive damages are a common target for legislation intended to limit damage awards. The details of the injured party’s losses and suffering are less of a factor in determining the sum of punitive damages because these damages are meant to punish the negligent party and deter future wrongdoing. The major determining factor in these damages is the wealth of the negligent party. The typical individual or small business may be seriously burdened by a punitive damage award of $100,000, while a large, national corporation would hardly care about such a sum and would, therefore, be assigned a much higher damages value if they are meant to be punished. This can potentially cause damage awards that may be seen as grossly inflated if the negligent party is a large corporation with a lot of financial capital. 

In 2005, the U.S. Supreme Court made a decision that established guidelines to limit punitive damage awards, but many state legislatures have chosen that this decision did not do enough and enacted legislation to put further caps on punitive damages. Certain states use a fixed dollar-value cap, while others limit punitive damages to a specific multiplier of the value of the other damages in the case. In New Jersey, the law limiting punitive damages uses both these approaches. Punitive damages are limited to $350,000 or five times the value of the compensatory damages in the case, whichever figure is the highest. However, punitive damages are not often a factor in typical personal injury cases, which usually only involve negligent and not intentional or malevolent behavior. This means it is unlikely that the law will impact your own injury claim. 

Factors Impacting Compensation

Damage Caps on New Jersey Personal Injury ClaimsThere are other factors that can impact how injury damages are calculated. For example, the collateral source rule tends to work in favor of the plaintiff. This rule prevents the negligent party’s defense team from presenting evidence about any insurance payments or other compensation the injured plaintiff has received due to the accident. The issue of this kind of evidence is that the jury may potentially reduce the damages received by the plaintiff if they think that the injured party has already been fairly compensated, regardless of whether the defendant acted negligently and is liable for the resulting damages. 

In New Jersey, the judge will often “mold” a verdict in order to determine what has been paid by insurance, such as medical costs or disability payments for lost income. Also, health insurance plans can sometimes place a lien on any damage award obtained by an injured party for medical costs that are covered by the plain, up to the total amount that the medical benefits plan covered. If the jury reduced the amount that the plaintiff recovered in damages due to insurance payments, the plaintiff could end up with little compensation after the insurance company takes back what was covered. A skilled New Jersey personal injury lawyer with knowledge of how to handle these concerns for you can provide you with the right information you need to make an informed decision and recover the compensation you deserve. 

New Jersey Car Crashes

After an accident, pursuing a personal injury claim can leave victims seriously confused and frustrated. You need a firm understanding of the law to make sure that your legal rights are protected. Instead of trying to figure it out on your own, you should contact a New Jersey car crash attorney

Brady Reilly & Cardoso, LLC has over 50 years helping the residents of New Jersey by providing aggressive legal representation after being injured in an auto accident. We are known for our attention to detail and the ability to bring your case to a successful resolution. Give us a call today at (201) 997- 0030 to discuss your case.