Home > West's Encyclopedia of American Law > Compensatory Damages

A sum of money awarded in a civil action by a court to indemnify a person for the particular loss, detriment, or injury suffered as a result of the unlawful conduct of another.

Compensatory damages provide a plaintiff with the monetary amount necessary to replace what was lost, and nothing more. They differ from PUNITIVE DAMAGES, which punish a defendant for his or her conduct as a deterrent to the future commission of such acts. In order to be awarded compensatory damages, the plaintiff must prove that he or she has suffered a legally recognizable harm that is compensable by a certain amount of money that can be objectively determined by a judge or jury.

One of the more heated issues facing the U.S. legal system during the past quarter century has been the call for reform of states' TORT LAWS. HEALTH CARE providers and other organizations have...