E.G. DEATH OF A 33 Y.O. MALE, EARNING US$8,000* A MONTH, MARRIED, 2 MINOR CHILDREN
E.G. DEATH OF A 33 Y.O. MALE, EARNING US$8,000* A MONTH, MARRIED (SPOUSE HAS NO INCOME), 2 CHILDREN AGED 5 AND 8
(KRW1,608,479,741)
c.US$1.35 million
Principles of tort would be applicable upon the calculation of damages in an aviation accident. In this respect, the damages will mainly be consisted of three parts: (i) direct economic loss (i.e. medical costs, funeral expenses); (ii) indirect economic loss (i.e. loss of earnings) and; (iii) emotional damages.
Breakdown:
(assuming retirement at 65 and no contributory negligence)
(i) Direct economic loss
Assume an estimated funeral cost of KRW 5,000,000 (c. USD 4,200) to be the only direct economic loss of this case.
(ii) Indirect economic loss
The estimated future loss of earning amounts to KRW1,453,479,741 (c. USD1,220,000), after applying the Hoffman coefficient* and the deduction of the cost of living (i.e. one-third of the future loss of earnings).
*to allow for the interest benefit of receiving the damages as a lump sum
(iii) Emotional damages
The amount of emotional damages awarded in each case will vary according to the specific facts of the case and the handling judge’s discretion thereof. In the case regarding Air China accident at Busan in April 2002, the Supreme Court ruled that the claimants should be awarded emotional damages in the amount of KRW150,000,000 (c. USD125,000) per person.
An estimated amount of emotional damages in this scenario would be KRW100,000,000 to 150,000,000 (c. USD83,333 to 125,000). For convenience of discussion, assume KRW150,000,000 (USD125,000).
(iv) Allocation of the damages
The Civil Act provides that the share inherited by the spouse of a deceased should be 50% higher than that of the deceased’s children. In this regard, it is likely that the wife would receive about KRW689,348,460 (c. USD 580,000) whereas 2 children would inherit KRW459,565,640 (c. USD 385,000) each.
A general note on loss of earnings (indirect economic loss)
If the deceased was being employed at the time of the accident, the actual income would be applied upon calculating the loss of earnings.
The Supreme Court of Korea recently ruled that the legal maximum age for physical work should be extended from 60 to 65 but this ruling is not reflected in most of the company regulations in Korea and the retirement remains at 60 years old or younger, in many cases.
Accordingly, if the deceased's employer's company regulations provide the retirement age is 60, the loss of earnings from the day after the retirement (i.e. the date the person reaches 60 years old) until the date in which the person reaches 65 years old would be calculated based on the daily worker’s earnings [as of 2018, the daily worker’s earnings is about KRW 120,000 (c. USD100) per day].
If the deceased was unemployed at the time of the accident, the aforementioned daily worker’s earnings would be applied.
If the deceased was a minor at the time of the accident, then the daily worker’s earnings from the date the person becomes 20 years old until the date the person becomes 65 years old will be applied.
PUNITIVE DAMAGES
Generally, no, with limited exceptions pursuant to legislation in the fields of Product Liability, Patents and Data Protection (capped at triple the sum of damages awarded).
The Private International Law Act of Korea restricts the application of punitive damages that are not recognised under Korean law, even if the governing law is not Korean law. In this regard, it is possible that punitive damages under foreign law may not be recognised and/or enforced by the Korean court.
LITIGATION COSTS
In principle, the losing party pays the legal fees and court costs. However, the handling judge is given the discretion to determine the legal costs and therefore may order the parties to share the legal fees despite the outcome of the case.
Although the Civil Procedure Act provides that the lawyers’ fees are recoverable, this expense may not be fully retrieved by the winning party in many cases.
This is because the maximum amount of lawyers’ fees recoverable is capped by the Regulation on the Inclusion of Lawyers’ Fees in Litigation Costs which provides a set of formula to calculate the lawyers’ fees recoverable. For example, in case the claim amount is KRW 100,000,000 (c. USD 84,000) the maximum amount of lawyers’ fee recoverable under this regulation is KRW7,400,000 (c. USD 6,200).
INTEREST
In accident and injury claims, interest of 5% per annum will apply, accruing from the date of the accident.
Where legal proceedings brought, interest of 12% per annum will be applied from the day after the date of the delivery of the judgment