Present Value Calculations In Personal Injury Cases
Brien Roche
In general, plaintiffs in personal injury cases should reduce future damages to present value. A present value calculation means that an economist or CPA projects out what the future cost of living adjustments are going to be. That amount is then reduced to present value. That calculation is done by projecting what future interest rates will be to determine what amount of money is necessary today to cover those future costs.
An economist can also help in terms of presenting evidence as to loss of services. Loss of services are such things as the value of household services that might have otherwise been performed by that person who is no longer able to do so.
Present Value Personal Injury
Must it be Done
There may be an issue of whether you must reduce any future award to present value. At least in federal court, one federal court has ruled that the question of whether or not an award has to be reduced to present value is a federal question and not a Virginia question. There are no 4th Circuit decisions requiring such reduction to present value for state claims. In any event the burden would be on the defendant to present evidence reducing future losses to present value. Aldridge v. Baltimore & Ohio Railroad, 789 Fed.2d 1061 (!986). In CSX Transportation v. Casale, 247 Va 180, 186 (1994) the court declined to require reduction to present value in a FELA case.
Life Care Plans
Future damages may come in the form of a Life Care Plan. There are expert witnesses who provide this type of proof. In Mavity v. MTD Products, Inc., 714 F.Supp.2d 577 (W.D. Va. 2010) the court dealt with federal statutory causes of action and indicated that future damages should be reduced to present value. The same would be true of future loss of earnings. Whether that is required in Virginia is a bit unclear but certainly the better practice would be to reduce it to present value since the jury award is to be based upon present value.
Several other judges in the federal courts in Virginia have refused to follow Mavity. In particular in Norman v. Leonard’s Express, Inc., the court held that the burden was on the defendant to reduce future losses to present value.
The defense frequently may offer their own life care planner who may dispute the need for certain items in the future. The best way to deal with that type of expert witness is to determine what is the foundation for the opinion and then further to ask the witness if they are wrong as to the need for future equipment, i.e., a wheelchair, then that means the plaintiff will not have a wheelchair when the need arises.
Another issue in regards to future damages arises where the plaintiff’s symptoms continue but there is no medical proof of how long they will last. Under Gwaltney v. Reed, 196 Va. 505, the jury should still be instructed as to these future damages. In that type of situation, a present value calculation is probably not called for.
Work With a Trusted Personal Injury Lawyer in Northern Virginia
Call, or contact us for a free consult. Also for more info on damages see the Wikipedia pages. Also see the post on this site dealing with damage issues.