Assignment -
You have been engaged by plaintiff's counsel to prepare a damage analysis for Peter Smith who was injured while working at ABC Transportation as a warehouse worker on November 24, 2011. Mr. Smith was earning approximately $59,000 annually at the time of the incident. Mr. Smith returned to work at ABC Transportation after the incident, but was unable to continue due to the physical requirements of his job. He earned $0 in 2011 after the incident and $3,200 in 2012.
In 2015, Mr. Smith obtained work at JJ Supermarket as a night stocker and earned $8,500 in 2015. He was unable to continue the job due to pain. Mr. Smith has been employed part-time by Valley Springs Sales since December 15, 2015. Mr. Smith earns approximately $12,000 annually.
Jane Jones, Rehabilitation Consultant, prepared a life care plan for Mr. Smith based on recommendations from Dr. Lu.
In addition to future medical care detailed in the life care plan, Mr. Smith will need help with household services for the remainder of his life.
Other facts and assumptions:
1) Plaintiff - Peter Smith
2) 1/8/1983; Date of birth
3) Married (2011)
a) Paula Smith; date of birth 11/19/1984
4) One child
a) Michael; date of birth 1/3/2014
b) Assume Michael lives in the home until the end of the year he turns 22
5) Injured 11/24/2011 at work. Mr. Smith suffered leg and back injuries.
6) Mr. Smith was employed at ABC Transportation at the time of the incident - located in Sacramento, California.
i) Earnings
(1) At the time of the incident, Mr. Smith was
(2) Mr. Smith worked an average of 40 hours a week for the past several years, and had no plans to change his schedule.
(3) Mr. Smith received an employer 401(k) matching contribution equal to 2.5% of his earnings.
(4) Mr. Smith received a health insurance contribution from his employer of $400 per month.
(5) Mr. Smith has received pay increases over the years that have averaged the rate of the national increase in compensation inflation.
(6) Mr. Smith contributed $100 a month for Union Dues.
7) Due to his injuries, Mr. Smith has pain and it is difficult for him to do manual labor.
8) In 2015, Mr. Smith was employed at JJ Supermarket as a night stocker and earned $8,500 that year. He was unable to continue due to pain. He receives no benefits.
9) Mr. Smith has been employed part-time by Valley Springs Sales since December 15, 2015. Mr. Smith earned $300 in 2015, $12,500 in 2016, $12,800 in 2017, and is expected to earn $13,000 in 2018.
10) Mr. Smith is not expected to be able to work more than part-time and anticipates he will stay at Valley Springs Sales because they accommodate him - allowing him to work part-time and deal with his pain.
11) Mr. Smith has been seen by a medical expert and a life care planner. The future expected medical expenses (related to the accident) are as follows (all in 2018$):
a) Pain Management Specialist - $2,300 annually for life
b) Spinal Cord Stimulator - Trial ($19,900) and Implant ($100,000) - one-time cost in 2018
c) Spinal Cord Stimulator Replacement - $50,000 - every 10 years for the remainder of life expectancy
d) Spinal Cord Stimulator Analysis and Programing - $600 annually for life
e) Functional Restoration Program - one-time cost in 2018 of $25,000
f) Medications - $1,200 annually for life
12) Trial is scheduled to start 9/1/2018
13) Work life expectancy at time of injury was 31.7 years (pre and post work life expectancy is assumed to be the same).
14) Since the incident, Mr. Smith has been unable to perform the same household services as he did prior to his injuries. It is unclear what he will be able to do in the future. Calculate the full value of household services so that the jury can decide on the loss amount. Assume the general rate of inflation for household services.
a) Annual value of household services for married male with one child in home; $16,000
b) Annual value of household services for married male who works full time with no children in home; $12,500
c) Annual value of household services for married male who does not work, living only with spouse; $20,000
d) The values noted above are national averages. The local area adjustment for Sacramento is 1.05
15) Life expectancy - 42.3 years from date of loss calculation
a) Note - Ms. Smith's life expectancy exceeds that of Mr. Smith.
16) General inflation rate of 2.0%
17) Compensation inflation rate of 2.5%
18) Medical inflation rates
a) Medications - 3.5%
b) All other times - 2.7%
19) Discount rate of 2.9%
Please prepare an analysis of the present value of damages (using Excel) for Mr. Smith.
Attachment:- Assignment Files.rar