ASSESSING DAMAGES Once the court is satisfied that the defendant has been negligent, it then must proceed

to assess damages. Damages are generally assessed as a lump sum on a "once and for all" basis. Such an assessment finalises the injured party's rights and there is no right to come back to the court to have damages further assessed at a later stage. However, theWrongs Act 1958 (Vic) now allows a court to make an order for a "structured settlement" by way of periodic payments funded by an annuity or other means (Part VC). The lump sum is assessed by adding together various amounts assessed under individual heads of damages. The courts make a distinction between special damages and general damages. Special damages: This generally refers to out-of-pocket expenses. These may include medical and like expenses such as ambulance fees, loss of earnings to the date of trial, and other incidental expenses such as home help. Because of their very nature, special damages are generally easily quantifiable. General damages: This covers such matters as loss of earning capacity in the future, pain and suffering, loss of enjoyment of life and disfigurement. They are of their very nature incapable of precise mathematical calculation. The court looks at these individual aspects of general damages and assesses the suitable amount of money that is fair and reasonable to both parties to compensate the plaintiff. Where the injured person has died as a result of the negligence of the defendant, the dependants have their own claim for damages. It is important to note that the dependants are not entitled to any damages for grief or suffering as a result of the death, but only to damages for the monetary loss that they have suffered. In calculating this loss, courts must take into account the financial benefit the dependants would have received from the deceased had the deceased lived, less certain benefits that they have received arising on the death. If there are no dependants, the deceased's estate can commence or continue an action for negligence, but damages are generally limited to such matters as loss of earning capacity before the death and medical, hospital and other expenses incurred before the death. To assess loss of earning capacity in the future, the court must consider to what extent the plaintiff's ability to earn income will be affected in the future and for how long this restriction will continue. The extent to which a plaintiff's earning capacity has been affected will depend on the individual facts of each case. The Judge or jury then must calculate a present value of this future monetary loss (comprising loss of earning capacity and future medical expenses). In most actions for damages for personal injuries the present value of such future loss is assessed by adopting a discount rate of 5% (s.28I Wrongs Act). However, the Transport Accident Act 1986 (Vic) and the Accident Compensation Act 1985 (Vic) (for injuries on or after 20 October 1999) specify 6%. This rate is intended to make the appropriate allowance for inflation, for future changes in rates of wages and prices and for taxation upon income from investment of the sum awarded. The High Court has directed that no allowance should be made for those matters. This has now made it easier to assess the present value of future economic loss. By giving the plaintiff damages assessed at the 5% or 6% rate, the plaintiff may be able to invest at a higher rate and thus hopefully limit the effects of inflation and taxation on the award of damages.