Divorce or separation can be complicated enough without the added dimension of working out who is entitled to what after a personal injury compensation settlement has been made. Mississippi is what is termed an “equitable distribution” state. Basically this means that all jointly owned assets are divided equally by a court on divorce or separation assuming that the court has been asked to resolve a disputed assets distribution. However, not all assets owned by one or the other spouse are necessarily considered jointly owned assets. For example, if one or the other spouse had entered the marriage with considerable personal assets, then this would be considered to be personal property which would not be divided after divorce. Similarly, if either spouse inherited money or other assets during or before the marriage, then this would also be considered to be the personal property of that spouse.
Personal injury settlement can amount to considerable sums, sometimes tens or hundreds of thousands of dollars if the injury was serious. If one of the spouses had had an injury before the divorce and had negotiated compensation with the at-fault party (assuming that the spouse in question wasn’t at fault), then this payment may very well be considered as assets to be distributed fairly on divorce according to state rules.
A personal injury settlement is normally a combination of two components: a component for economic damages and a component for no economic damages. Economic damages include generally easily calculated amounts such as:
• medical expenses related to the injury;
• lost wages or other income as a result of not being able to earn that income;
• compensation for any property lost or damaged.
Non economic damages are often harder to calculate as they are often based on more subjective criteria. They include such things as:
• compensation for the pain and suffering experienced by the injured plaintiff;
• compensation for loss of companionship or consortium, usually experienced by a spouse or partner;
• punitive damages awarded if the injury was caused by gross negligence.
When an injury is particularly serious, compensation for forecast long term treatment may be necessary and this may also extend to compensation for forecasted loss of earnings.
Mississippi court judgments on distribution of personal injury compensation awards
Mississippi’s Supreme Court developed what was called the “analytic approach” after a particular case under review in 1999 (Tramel vs. Tramel). The method used applies to the distribution of assets awarded as a result of personal injury settlement in the state. Each component of a personal injury settlement is considered separately and distribution of each component is determined according to which spouse the component was supposed to compensate.
Distribution of personal injury settlements according to the analytic approach
1. Economic damages, i.e. payment for medical expenses, lost earnings and property damage is determined to be part of the couple’s joint assets, so the total sum is then divided equally between each spouse.
2. Pain and suffering compensation. This is a payment meant to compensate the injured victim for the physical, mental and emotional pain and suffering that that person has had to endure as a result of the injury. This component is determined by the analytic approach to be the property of the spouse who was injured separately from any joint assets.
3. Loss of consortium / companionship is generally a payment meant to compensate the spouse or partner of the person who was so badly injured that it affected their married life. Any payment under this category is determined to be the property of the spouse of the injured person.
Payment made for forecasted future medical expenses and lost earnings may be more contentious as generally any property distribution after a divorce has been finalized and the marriage has been dissolved may not follow the formula adopted before divorce, i.e. any future payments as a result of the settlement may go to the injured party as separate property.
Call the Diaz Law Firm for an appointment if you need legal help over how to divide up a personal injury award.
Not all divorces are necessarily contentious, but when property distribution is disputed, it is best to talk to a knowledgeable and empathetic attorney. The Diaz Law Firm is uniquely placed to help you with any legal matters relating to personal injury compensation. Please call the Diaz Law Firm office for an appointment at 601-607-3456 or toll free at 800-459-2222.