Careers Business Ownership What are the Types of Damages in a Lawsuit? Damages in Personal Injury and Contract Lawsuits Share PINTEREST Email Print Types of Damages in Lawsuits. Chris Ryan/Getty Images Business Ownership Operations & Success Business Law & Taxes Sustainable Businesses Supply Chain Management Operations & Technology Marketing Market Research Business Insurance Business Finance Accounting Industries Becoming an Owner Table of Contents Expand Damages in Lawsuits Damages in Personal Injury Cases Damages in Wrongful Death Damages in Business Lawsuits Damages in Tort Reform How Damages are Set By Jean Murray Jean Murray Jean Murray, MBA, Ph.D., is an experienced business writer and teacher. She has taught at business and professional schools for over 35 years. Learn about our Editorial Process Updated on 02/04/21 What is the Purpose of Damages? The original concept of damages, continuing to today, is to restore someone to the position they had before the incident if they have been damaged by someone. For example, let's say your car is damaged and you are injured because someone hit you in traffic. You may be awarded damages to restore the vehicle to its previous value and to pay your medical bills from the injury. You might also be able to receive damages for lost earnings or lost business income while you are recovering. In more recent years, the original concept of damages has been expanded to include punitive damages, to punish the wrongdoer. Punitive damages include payment for pain and suffering. These types of damages are more difficult to define and put a dollar value on. They aren't generally available for breaches of contract unless there is proof that the action was "wanton, willful and deliberate. Damages in Personal Injury Cases Sometypes of damages are intended to compensate someone who has suffered a personal injury because of the negligence of someone else. Personal injury lawsuits are civil cases brought by one individual against another person or business. These damages include: Loss of earnings or loss of future earnings Medical bills Cost of future medical care Household expenses, because the injured party was not able to care for the house (not able to do the cleaning or make repairs, for example) and Costs associated with canceled trips or altered plans. Other damages in personal injury cases are a little more challenging to calculate. They include: Pain and suffering , both physical (like broken bones, body aches and pains) and mental (emotional anguish, PTSD, humiliation, and more). Personal enjoyment (not being able to enjoy the outdoors, for example) Mental anguish, which can be included in pain and suffering Loss of consortium or companionship, usually loss of family relationships, including sexual relations, sometimes brought by a spouse Damages in a Wrongful Death Lawsuit A wrongful death legal action is a particular type of lawsuit that is brought by loved ones of someone who dies because of the negligent, reckless, or deliberate act of someone. One classic wrongful death lawsuit was the one brought by the families of Nicole Brown Simpson and Ron Goldman against O.J. Simpson. Damages in wrongful death lawsuits can include: Medical bills and burial expensesCompensation for lost wages their loved one would have earned had the person lived to their normal life expectancyCompensation for the pain and suffering endured by the surviving family members due to their loved one's absencePunitive damages that are intended to punish the person who caused the death Damage Types in Business Contract Lawsuits In a contract dispute, one party often claims that the other party breached (didn't comply with) the contract. For example, a company might claim that a contractor didn't finish a project on time or didn't do the work required. In this type of lawsuit, the damages are intended to bring the injured party up to the economic position that was expected from the success of the contract. In the example above, damages could be set based on the profits the company would gain from the project if it had been successful. Sometimes the damages are set based on the economic position of the injured party before the other party breached the contract. Some other typical damages might include: Compensatory damages - payment as agreed in the original contractRestitution - paying the other party back for payments or deposits madeLiquidated damages - Agreed-upon damages that were set in the original contractPunitive damages, if the court finds that the actions were intentional or morally reprehensibleMinimal damages. If the court finds that the plaintiff was damaged, but the loss was minimal, the court might award minimal damages (the "$1 payment" you might have heard about). Other remedies for breach of contract might include specific performance, when only the specific party is required to do what was promised, like selling the painting or finishing the project. Damages in Tort Reform Tort reform is a movement in the U.S. to limit the costs of lawsuits. A critical part of tort reform is the limitation on damages like pain and suffering and punitive damages. Both federal and state laws have been enacted to put caps on damages for medical malpractice, class action lawsuits, and product liability. Who Sets the Damages? If the case is heard in a criminal court, there are specific sentencing guidelines set by the court. In civil cases, the plaintiff may ask for different kinds of damages.