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McKeand v. Gerhard

May 30, 2000

KATHLEEN MCKEAND,
PLAINTIFF-RESPONDENT,
V.
RONALD F. GERHARD,
DEFENDANT-APPELLANT.



Before Judges Baime, Eichen and Wecker.

The opinion of the court was delivered by: Wecker, J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued April 12, 2000

On appeal from the Superior Court of New Jersey, Hudson County.

The sole issue on this appeal is whether the trial court erred in granting prejudgment interest on that portion of the jury's personal injury award that represents future lost wages. We conclude that the trial court followed the law as it now stands, and we therefore affirm. See Ruff v. Weintraub, 105 N.J. 233 (1987); Statham v. Bush, 253 N.J. Super. 607 (App. Div. 1992) (following Ruff, while urging review of the issue); R. 4:11-2(b). *fn1 We add these comments.

Both Ruff and Statham recognized that so long as future economic losses are separately awarded, there is a rational argument against awarding prejudgment interest on the present value (as of the trial date) of a future stream of income. In Ruff, the Court said: "[t]he applicability of a compensation rationale for prejudgment interest may be questionable in the case of future losses, since it can be argued that those damages accrue after the judgment." 105 N.J. at 245 (emphasis added). The Court nevertheless found that "encouraging settlements is an adequate independent basis for the application of the prejudgment interest rule in this case." Id. The Court at footnote 6 in Ruff referred the matter to the Civil Practice Committee, citing Jones & Laughlin Steel Corp. v. Pfeiffer, 462 U.S. 523, 103 S. Ct. 2541, 76 L. Ed. 2d 768 (1983). There the United States Supreme Court suggested that prejudgment interest on a stream of earnings would be appropriate if those earnings were discounted back to the date of injury rather than the date of judgment. Jones & Laughlin Steel, 462 U.S. at 538 n.22, 103 S. Ct. at 2551 n.22, 76 L. Ed. 2d at 784 n.22.

Plaintiff here suffered significant injuries as a result of a defective repair to the steps of an apartment building owned by defendant. Approximately four years after her injury, the jury awarded plaintiff the following damages:

Past medical expenses $58,200

Future medical expenses $6,000

Past lost wages $100,000

Future lost wages $350,000

Pain, suffering, disability, loss of enjoyment of life $500,000

TOTAL $1,014,200

As a basis for an award of future lost wages, the parties stipulated to the flat sum of $37,550 for each future year of plaintiff's lost earnings, without discounting to present value. Although plaintiff sought compensation for fourteen years of future loss at $37,500 per year, for a total of $525,000, the jury awarded $350,000 as future lost earnings, obviously concluding that plaintiff was likely to have continued working for somewhat less than ten years. We have considered whether by expressly omitting any discount to present value, the parties' stipulation itself establishes an "exceptional case" under R. 4:42-11(b). However, the stipulated annual loss actually may reflect an average of present values over some number of years and not a ...


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