A poor Colorado man is killed while purchasing firewood for his home, as the result of negligence on the part of business. The business is sued, and when preparing for trial the business asks the trial judge to allow the business to argue that even if it owes the widow for the loss of her husband’s income, the business should receive credit for taxes the poor guy would have had to pay had he lived.
Mrs. Hoyal’s husband died when a concrete wall fell on him while he was buying firewood from a local business, Pioneer Sand Co. In Hoyal’s wrongful death action against the business, Pioneer Sand sought to introduce evidence of the husband’s future income tax liability in determining the wife’s economic loss. The trial court granted Mrs. Hoyal’s motion in limine to exclude the evidence, and defendant filed an original proceeding to the state high court, disputing the ruling.
The Colorado Supreme Court agreed with the trial judge, noting that under the wrongful death act, Colo. Rev. Stat. §§ 13-21-201 to 204, surviving spouses are entitled to compensation for the loss of financial benefits they reasonably would have expected to receive had their spouses lived. Cases discussing the net pecuniary loss rule have applied several factors in determining the loss, including the deceased spouse’s life expectancy and willingness to assist the surving spouse. No Colorado cases include a consideration of future tax liability.
Noting that a majority of other jurisdictions generally do not allow taxation instructions to the jury, the court analyzed several reasons to exclude taxation discussions. First, tax issues are a matter between the taxpayer and the taxing authority and do not involve the defendant in a personal injury action. Further, an amount of future taxation is conjectural because tax rates change. Finally, determining future taxation is a complicated issue that would confuse juries and divert the focus of their fact-finding and decision-making responsibilities. Thus, the court held, evidence on future tax liability is inadmissible in a wrongful death action. The court remanded the case back to the trial court for trial.