FullCompensation: Pain and suffering damages shouldn’t be a lottery

by: in Law

The pain and suffering of accident victims does not have a price and, in claims for damages, no fixed economic value. Thus, quantifying the amount of money needed to compensate for pain and suffering is a subjective exercise often influenced by adjudicators’ biases.

This is despite the increasing use of aiding tools by adjudicators to increase consistency. This poses issues of equity (similar losses are compensated differently) and efficiency (variable and unpredictable damages discourage out-of-court settlements and force parties to systematically go to court).  

To encourage the adoption of more equitable and efficient pain and suffering awards, I developed through the FullCompensation project a model legislative proposal and guidelines. This proposal outlines a system that (1) prioritises the standardisation of recurrent non-pecuniary damages(e.g., health-related injuries and loss of a close one) and (2) provides clear pathways for personalisation, based on specific and objective individualising factors with an indication of their respective monetary weight.  

This proposal was developed using qualitative empirical research that examined critical perspectives of all stakeholders, including adjudicators (e.g. judges), laypeople (i.e. victim associations' representatives), and policymakers (e.g. advisors to legislators). This research revealed that stakeholders are concerned about perceived rationality and legitimacy of the guidelines themselves and the participation of all stakeholders in their development. It also revealed that when confronted with unclear instructions (e.g., unclear pathways of personalisation), adjudicators seem to tend to refer to different factors and assign them monetary values that do not have a clear rationale. This carries the risk of not necessarily ensuring adequate personalisation of awards and may, in turn, undermine equal treatment between victims. 

The model legislative proposal and the guidelines may provide a source of inspiration to EU Member States and adjudicators that are considering reforming of establishing their own national frameworks for the quantification of non-pecuniary damages, like pain and suffering. If adopted, these guidelines would help improve the perceived legitimacy and acceptability of guidelines (via transparent stakeholder involvement), along with the predictability of awards (via standardisation), with some room for personalisation (via clearly articulated and weighted factors). 

They would also promote a compensation system that is more equitable and efficient by reducing subjectivity in non-pecuniary damages awards, accelerating compensation procedures for accident victims, and reducing the workload for judges.  

The project FullCompensation was funded by the EU. (Grant agreement n. 101028723)