State Advocacy Issue

 Non-economic Damages: Animal Health Institute Issue Paper

November 2005

Non-economic damages – would it improve pet care?

Pets play an important role in our lives, and it is common to refer to them as "companion" animals. Increasingly, in fact, Americans think of their pets as extended members of the family.

That's why it is troubling that some organizations have proposed dramatic changes to some of the laws governing pets. Would pets and their owners benefit if juries were allowed to award large, open-ended financial awards in lawsuits involving injury to pets? That is what is behind current efforts now underway to change the laws regarding pets. While proponents of these efforts claim that new laws would raise the status of animals, they would more likely harm pets and hurt people's ability to care for their pets properly. Changes to the law, like those proposed currently in a number of states, would be especially likely to affect pets, their owners and their health care providers adversely in several ways:

  • They would create economic and legal liability for pet owners that could make the cost and risk of owning a pet prohibitive for some households.
  • They would set off a chain of events that would inevitably increase of the cost of pet health care.
  • And, as a result of increased costs, they would end up significantly limiting access to affordable pet health care.

To protect against these undesirable effects and other unintended consequences, pet owners should carefully consider the possible ramifications of any legislative or regulatory proposal that comes before local and state lawmakers or and the courts.

Are you looking for more lawsuits—and more expensive ones?

A proposal that has been introduced in some state legislatures is one that has been tried already in human health – and has succeeded in raising costs and reducing the availability of health care significantly. Some animal activists—and some plaintiffs' attorneys—are supporting bills to allow pet owners to recover losses for emotional distress and loss of companionship – legally called "non-economic damages" – in cases involving their pets. By raising the financial incentive to litigate, the availability of such non-economic damages would, by itself, stimulate a sharp increase in the volume of pet litigation. After all, if there's real money to be made, won't some of the lawyers whose income is based on winning lawsuits want to develop this new courtroom opportunity?

Already, legislation has been introduced in a number of states to allow pet owners to recover non-economic damages in cases involving a deliberate or negligent act that harms pets. If these bills became law, pet owners would be entitled to request an open ended amount of damages for the "loss of companionship" or the "emotional distress" they feel over the loss of a pet.

If pets are so important, then what's wrong with this proposal? There are two problems: 1) it will lead to worse care, not better care, for pets; and 2) it goes beyond what the laws and courts in some states allow for cases involving humans.

Increased liability for medical doctors has diminished, not improved human health care. The opportunity to sue for larger awards has invited more suits, leading to skyrocketing malpractice insurance costs. The costs involved are staggering and involve much more than a jury award. Attorney fees, expert witness expenses, and discovery costs can rival or exceed verdicts, leading to defensive settlements. As a result, the costs of human health care and health care products have increased, and the availability has decreased. In many of the less populated areas of the country, the cost of malpractice insurance has completely dried up the delivery of health care services as practitioners have been forced to close their doors.

It is all but certain that inviting more lawsuits in the veterinary care field will have the same result. Pet owners could claim huge awards for the "emotional loss" of a pet, inviting additional lawsuits, forcing insurance companies to raise malpractice rates, driving up the costs of veterinary care and driving out practitioners. The increase in the amount of litigation alone will increase the number of settlements – settlements reached not because the defendant admits liability, but because the insurance carrier believes settlement will be a cheaper resolution than a successful court defense. Since most people will limit the amount of money they spend on pet health care, these increased costs would lead to less care provided for pets.

Costs would also be driven up as veterinarians resort to "defensive" medicine. The threat of large-payout suits would likely cause a veterinarian to run additional, expensive tests prior to undertaking surgery or treatment in an effort to eliminate all uncertainties. Are pet owners willing to pay these additional costs?

Or consider your own liability if you swerve to miss an oncoming car and run over your neighbor's cat. While you would surely be willing to compensate your neighbor for the full value of the cat, would you want to be liable for tens or hundreds of thousands of dollars to compensate for emotional pain?

What is ironic about this idea is that in only very limited situations can humans collect emotional distress damages for injury to another person, such as a spouse or child. The law should not place human-pet relationships above parent-child and spousal relationships.

Economic vs. non-economic damages

Proponents of allowing owners to sue for non-economic damages claim pets are worth more money than just the cost of replacing them by the purchase of a new pet. In fact, many state laws and courts already recognize that value goes beyond "fair market value." While laws are different in states across the nation, many courts have allowed owners to be compensated for a broad range of "economic" damages, including veterinary costs (such as vaccinations and certain treatments), special training costs, costs of breeding, the pet's purchase price, its breeding potential and other specific, economically measurable items.

But proponents of non-economic damages are not satisfied: they want to be able to sue not only for money to compensate for measurable economic damages but also for more money in the form of non-economic damages. Fortunately, the line between economic and non-economic damages can be drawn clearly. "Economic" damages are measurable. A price tag measured in dollars and cents can be attached, providing a finite measure of loss suffered by a pet owner. "Non-economic" damages are not measurable, however, and they are also intangible. In fact, their very subjectivity—i.e., the arbitrary measurement of a person's feelings—is what primarily characterizes them. The opportunity to collect huge non-economic awards from juries reacting on a purely emotional basis is what invites a rash of spurious lawsuits by lawyers and plaintiffs hoping to cash in on a perceived loss.

Pets are important and valued companions. That's why laws that protect pets from abuse and regulate pet trade are already on the books. But the passage of laws that claim to elevate the status of pets by translating their companionship role into dollars will only invite frivolous lawsuits and reduce the ability of pet owners to adequately protect their pets and to provide them with affordable health care.

Reproduced by courtesy of the Animal Health Institute (AHI)
Source:    Animal Health Institute (AHI), created November 2005
Contact:  Dr. Kent McClure, General Counsel, Animal Health Institute.