Question

A professional sport athlete, let’s call her Sue, has a nonguaranteed (meaning that she receives no salary if she is cut from the team or injured) contract that pays her $5 million per year for the next five years. Sue has been severely injured in an automobile accident and will no longer be able to work, let alone play for her team. When Sue sues the driver of the other vehicle in court, the jury awards her $25 million to cover the loss of earnings over the next five seasons. Given what we have learned in this chapter, was the jury correct? Show work and explain in detail.

Answer 1

Sue's sports contract payment was not guaranteed but was contingent upon her performance, ability, form and fitness levels among other things. Given that the future projected performance, form and fitness are difficult to adjudge and are subjective in nature, it is reasonable to extrapolate the ability for the next 5 years which leads us to a simplistic award of $25 million. Though prima facie it seems that Sue is getting more than she deserves since in normal course she would have to work hard and be upto the mark to stay in the league & injury free to be able to earn, from jury perspective since she got the contract in the first place is itseld a testimnoy of her abitliy and dedication and hence they are correct in awarding a straight line award of $ 25 million.