Helpin v. Trustees of U. Penn: Lost Profits Not Discounted to Present Value in Pennsylvania Breach of Contract Cases

A Pennsylvania case decided on December 21, 2010 has extended the reach of the personal injury and wrongful death damage calculation rules of Kaczkowski v. Bolubasz (Pa. 1980)1 to breach of contract cases involving the loss of business profit. In Mark L. Helpin v. Trustees of the University of Pennsylvania, et al. (Pa. 2010), there was no personal injury but rather the constructive discharge of a dentist with a contract allocating to him 50% of the net income of a dental clinic. The question decided by the Court was, ‘‘Should a loss of future income based in part on business profits be discounted to present value?’’ By a margin of 4-3, the court answered ‘‘no’’ to this question, applying the damage rules for personal injury cases promulgated in Kaczkowski. The opinion by Justice McCaffery and the dissent by Justice Saylor provide reasoning and arguments with which every economic expert preparing damage appraisals in Pennsylvania should be familiar. The arguments put forward in the dissent of Justice Saylor will likely be a part of any future challenge to the Court’s rulings in Kaczkowski and Helpin.