New York is in a minority of states in America that has a wrongful death statute that does not allow the decedent’s family to be compensated for their emotional grief over their loss. So when a family recently came to see me about the completely unexpected loss of their son who was in his 20’s they were shocked to learn that the law prohibited them from recovering for their “pain and suffering” – only the decedent’s pain and suffering is recoverable. New York law does allow for the awarding of interest from the date of death, and the Court of Appeals recently expanded the amount of interest recoverable when it decided that interest from the date of death to the date of verdict should be added to the recovery for future wrongful death damages.
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In Toledo v. Christo, 2012 WL 42906 (Jan. 10, 2012), the Court of Appeals held that in awarding preverdict interest, the lower court properly discounted future wrongful death damages back to the date of decedent’s death and awarded interest from the date of death to the date of verdict. This holding took a total jury award for future damages in the sum of $3,562,000.00 and increased it, with interest, to $4,295,595.00.
The Toledo court concluded that the proper method for calculating preverdict interest in a wrongful death action is to discount the verdict to the date of liability, i.e., the date of death, and award interest on that amount from the date of death to the date of judgment.
To give New York some credit, in wrongful death cases interest begins to run from the date of death, which at the statutory annual rate of 9% can become quite significant. This is in contrast to personal injury cases, where interest does not begin to run until a favorable verdict or decision on the issue of liability is rendered. Yet some of the language of the Court’s decision in Toledo raises questions as to the logic of that distinction.
For example, Toledo includes quotes from precedential case law (whose citations are omitted herein) as follows:
“The purpose of interest is to require a person who owes money to pay compensation for the advantage received from the use of that money over a period of time”
“The plaintiff has been deprived of the use of money to which he or she was entitled from the moment that liability was determined. That is a loss for which the plaintiff should be compensated.”
“[A] rule that would permit the defendant to retain the cost of using the money (i.e., interest) would provide the defendant with a windfall”—a result we do not countenance.
The Court of Appeals gave no indication in Toledo that it wanted to eliminate the distinction between wrongful death and personal injury cases insofar as pre-verdict interest is recoverable in the former but not the latter case. Nonetheless, the Court’s arguments concerning the fairness of who should derive the benefit from the use of the money apply no more or less to either of these types of cases.
Furthermore, were interest from the date of accident recoverable in personal injury cases, there might be less stalling and delay tactics employed by defendants and their insurance companies with accident victims able to receive more prompt justice.
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