Millo v. Delius and Losses that Are ‘‘Not Otherwise Compensable’’
Thomas R. Ireland. 2014. Millo v. Delius and Losses that Are ‘‘Not Otherwise Compensable’’. Journal of Legal Economics 20(1–2): pp. 49–60.
The reference to losses that are ‘‘not otherwise compensable’’ in the decision of Millo v. Delius specifically rejected a methodology for measuring two loss categories for non-market services of a decedent that was developed by Frank D. Tinari. The plaintiff’s economist, Pershing Hill, used the Tinari method to provide dollar values for ‘‘loss of advice and counsel’’ and ‘‘loss of companionship’’ that a decedent husband and father would have provided to his wife and three adult daughters. In rejecting Hill’s analysis, Judge Sharon L. Gleason provided a clear statement about what types of testimony can be valued by an economic expert and what types of testimony cannot. The unique aspect of her rejection of Hill’s testimony was contained in her reference to those types of damages as precluded in an earlier decision (not involving economic testimony) as losses that are ‘‘not otherwise compensable.’’ The distinction Judge Gleason made in rejecting Hill’s testimony focused on the notion that economic losses are losses that can be replaced by market equivalents, while the losses described by Hill were losses that cannot be replaced for any price in the commercial marketplace. Judge Gleason did not reject such losses as losses to the survivors, but indicated that they are not economic losses in the meaning of Alaska law because they had no market-equivalent value in the commercial marketplace. The mere fact that some kind of ‘‘advice and counsel’’ can be purchased in the commercial marketplace does not mean that the price for that type of ‘‘advice and counsel’’ is an appropriate replacement value for the type of advice and counsel that a husband and father would have provided to the Millo survivors. There must be a close enough relationship between the loss element and a substitute in the commercial market for the loss element to be an ‘‘economic loss.’’ If not, that element is of the type of loss that is ‘‘not otherwise compensable.’’
Thomas R. Ireland