What is my case worth?

This is the most common question asked and the most difficult one to answer. We’ll answer it by going through a few terms. First, in order to succeed, a case requires three things: liability, damages, and collectability.

Liability is whether someone can be found legally responsible for what happened.

Damages are the harm that was suffered—that can include medical expenses, wage loss, loss of life, and damages to the person (also known as pain and suffering). The calculations for these and how they relate to exposure are discussed below.

Collectability means whether the potential defendant can afford to pay for the damage that defendant caused. The defendant may be fully responsible, you may have suffered terrible injuries, but if that defendant has a $15,000 insurance policy and absolutely no assets, collectability is an issue.

A side note: you should consider the following. First, one in three drivers in California is either uninsured or are carrying a minimum $15,000 car insurance policy. Second, if you are hurt by one of these drivers, your own uninsured/underinsured motorist coverage will cover you so long as your UIM limits exceed their coverage. Third, the cost of serious injuries adds up quickly. It takes very little for an ambulance bill, emergency room visit, doctors’ visits, and time lost from work to add up to a large sum of money. Fourth, most people do not carry enough UIM coverage. If you are carrying the minimum you should consider upping it immediately. Fifth, unless you are independently wealthy or have a few years’ living expenses in savings, you should have disability insurance. It can take a long time for a case to resolve—even if it is your own UIM policy. If you cannot cover your living expenses during that time you may be faced with losing your home. Pass the word along on this issue—it may make a dramatic difference for someone you know.

ExposureThis is the number the defendant may be ordered to pay by a jury on its worst day. In order to calculate exposure we need to go over a few definitions.

Economic damages

Economic damages are damages to the pocketbook. They can be calculated in some fashion. They include past and future medical expenses and past and future wage loss. The past numbers can be determined by adding up your medical bills and your lost time from work. Future medical expenses are determined by doctors offering opinions about what future medical needs you will require. The future wage loss is calculated by determining whether you can return to your occupation and how much longer you may be off work. If you cannot return to your job, you may have to be retrained into another job. Frequently this means a job where you may earn less since it has not been your primary occupation in the past. The sum total of these past and future medical and wage loss expenses are economic damages. Note that some lawyers may also refer to these as “special damages.”

Non-Economic Damages

Non-economic damages are damages to the person. They are frequently known as pain and suffering damages. This is what a defendant has to pay for the harm to your life. You may have permanent pain. You may be restricted to a wheelchair for the rest of your life. You might have severe burns, meaning your skin is fragile, you cannot go out in the sun, and people may have a tendency to stare. Under civil law, money is the only way to balance the books. Old Testament concepts of an eye for an eye do not apply. While money may at times feel inadequate for your loss, it is the best method that civil law over the centuries has found. Note that some lawyers may also refer to non-economic damages as “general damages.”

The best measurement of non-economic damages is to look at how significant the harm is and how long it will last. Historically, juries have frequently used the extent of the economic damages as a measuring stick for non-economic damages. They may find the non-economic damages to be half, one times, or many times the economic damages.

In other cases this might not be an appropriate measure. For example, imagine someone with a permanent minor head injury, limited medical expenses (frequently there is not a great amount of treatment for a minor head injury), and the ability to continue in the person’s job. The economic damages may be minor but the permanent change to that person’s brain and life has major significance to that person.

Fault Percentages

A jury looks at an incident and determines who is responsible. In some cases, several different parties may be responsible. Sometimes you might be found to be partly responsible for what happened. The jury allocates fault to all the involved parties. For example, in a disputed intersection car crash where a witness says the defendant ran a yellow-turning-red light but you started to cross early on the green, the jury might determine that you are 50% at fault and the defendant is 50% at fault.

Calculating exposure

Once you get a handle on the economic damages, the non-economic damages, and the fault percentage issue, you can start to make estimates on exposure. For example, imagine a case where the medical expenses and wage loss are $500,000 (the economic damages), the damages to the person are severe and lifelong (perhaps we use a 3x multiplier of the economic damages to determine non-economic damages, or $1,500,000) and the jury most likely will find the defendant 50% at fault and you 50% at fault. The best estimate for that Exposure number is $1,000,000, or half the combined total of the economic and non-economic damage estimates.

This exposure number is not a guarantee of what a jury will do—it is an estimate. And a case’s settlement value generally is less than the exposure estimate.

Calculating case value is a difficult issue. Sometimes case value cannot be determined until well into a case—when issues about liability and the extent of damage are better understood. And this is also why most lawyers in your first meeting will not tell you that your case is worth a certain dollar amount.