Daily Blast September 30, 2016

Yesterday, the Court of Appeal, Second Appellate District, Division Two (Los Angeles), articulated the standard to be applied in awarding damages for diminution in earning capacity particularly where the plaintiff has not yet begun his or her career. (Slip opn., p. 2.) In Licudine v. Cedars-Sinai Medical Center (Sept. 29, 2016, B268130) __ Cal.App.5th __, the court held that the value of such an award is only proper when it is based on what the plaintiff was “reasonably probable” to have earned in the absence of injury. In other words, “[t]he jury must fix a plaintiff’s future earning capacity based on what it is ‘reasonably probable’ she could have earned.” (Ibid.)

The plaintiff was permanently injured due to internal bleeding after undergoing gallbladder surgery during her senior year at the University of Southern California. (Slip opn., pp. 2-3.) She sued the surgeon and the hospital for malpractice seeking damages for past and future economic and noneconomic loss. (Id. at p. 3.) At trial, the plaintiff testified that she graduated from USC, was accepted into Suffolk Law School and planned to become a lawyer. (Id. at pp. 3-4.) The jury awarded the plaintiff $1,045,000 in damages including $730,000 for future economic loss. (Id. at p. 5.) Defendants moved for a new trial and for judgment notwithstanding the verdict arguing that the lost earnings award was “speculative and excessive” because the plaintiff failed to present sufficient evidence of her earning capacity. (Ibid.) The plaintiff also moved for a new trial arguing that the award for pain and suffering was grossly inadequate. The trial court granted both motions for a new trial on damages. (Ibid.)

The Court of Appeal affirmed. The court articulated a standard for assessing the value a jury awards for lost earning capacity. (Slip opn., p. 2.) In determining an award for future economic damages, the jury must decide: (1) whether the plaintiff was entitled to such damages at all, and if so, (2) how to value that loss. (Id. at p. 8.) The court held that, as to the second determination, the jury must value future earning capacity based on what is “‘reasonably probable’ [the plaintiff] could have earned.” (Ibid.) In other words, “the jury must look to the earning capacity of the career choices that the plaintiff had a reasonable probability of achieving.” (Id. at p. 10.) In this case, the court held that while the plaintiff presented sufficient evidence that she suffered a loss of earning capacity, she did not present sufficient evidence to value that loss at a lawyer’s salary. (Id. at p. 16.) The court concluded that because the plaintiff introduced no evidence regarding her likelihood of actually becoming a lawyer or any evidence of what lawyers typically earn, substantial evidence did not support the jury’s future economic damages award. (Ibid.)