OPINION OF THE COURT
ALDISERT, Circuit Judge.
A judgment of $270,982 was entered on a jury verdict against appellant shipowner and in favor of appellee, a longshoreman who sustained personal injury while loading a ship in port. The jury accepted appellee’s contention that his injury was caused by the unseaworthy condition of the vessel and by the failure of the shipowner to provide a safe place to work.
Appellant concedes the severity of the injury: appellee suffered herniated discs in his back; only one was corrected by surgery, while the other caused continuing disability. Past loss of earnings amounted to $28,000, medical expenses totaled $3,000, and loss of future earning power over a projected 28 year period approximated $100,000. Appellant contends, however, that the verdict was tainted, and excessive, because the jury (1) failed to adhere to the court’s instructions, (2) rendered its verdict under the influence of passion and prejudice purposely induced by appellee’s counsel, and (3) deliberated under the mistaken impression that the award would be subject to federal income tax obligations.
I.
The first assignment of error relates to an incident that occurred in the courtroom at the’ time the verdict was received. The jury had been given special written interrogatories which, together with the replies, were handed by the forelady to the deputy marshal for transmittal to the court. In submitting the interrogatories, however, the fore-lady inadvertently included two sheets of paper containing certain written matter. It is conceded that these papers were not a part of the jury’s verdict and probably constituted scratch paper utilized by the forelady or others during deliberations in the jury room. The trial judge notified counsel that “these papers had inadvertently come into my possession and that I had glanced at them and seen some figures which would cause me to wonder whether they [the jury] had followed the Court’s instructions precisely.” Subsequently, the court declared: “Upon further reflection I think that what I did was improper in looking at what the jury did, and rather than compound that error, I have impounded these papers. * * * I happen to know, by that inadvertent glance at that piece of paper, how they arrived at [the verdict]. I shall have to do my best to wipe clean from my mind that information which I now have in my head. *. *
*»
Appellant then moved for a new trial, grounding its motion on the theory that a new trial should be granted when it is apparent that the jury has not followed the court’s instructions on damages. Although we do not quarrel with this statement of the controlling abstract principle, the circumstances here preclude our reaching this question. Neither a trial court nor an appellate court has the authority to inquire into the jury’s decisional processes, even when information pertaining to the deliberations is volunteered by one of the jurors. “[A]fter reception of the verdict and discharge of the jury, testimony of jurors should be incompetent, under the no-impeachment rule * * *, to illuminate the suspicion [of a failure to follow instructions] by inquiring into their mental processes.” 6A Moore’s Federal Practice § 59.08 [4], at 3804.
Long settled considerations of public policy dictate “that mistake of the testimony, misapprehension of the law, error in computation, irregular or illegal methods of arriving at damages, unsound reasons or improper motives, misconduct during the trial or in the Jury Room, cannot be shown by the evidence of the jurors themselves, as the ground of disturbing the verdict, duly rendered,” Capen v. Stoughton, 82 Mass.
(16 Gray) 364, 366 (1860)
The sound justification for the concept that “[such] matters all inhere in the verdict itself,” Chicago, R.I. & Pac. RR v. Speth, 404 F.2d 291, 295 (8 Cir. 1968), is the salutary desire to protect participants in the jury system from being “harassed and beset by the defeated party. * * * If evidence [obtained from jurors] could be thus used, the result would be to make what was intended to be a private deliberation, the constant subject of public investigation — to the destruction of all frankness and freedom of discussion and conference.” McDonald v. Pless, 238 U.S. 264, 267-268, 35 S.Ct. 783, 784, 59 L.Ed. 1300 (1915). In short, the district court, 312 F.Supp. 374, properly concluded that the information to which he accidentally became privy was incompetent to provide a basis for a finding that the jury failed to adhere to the court’s instructions.
II.
Appellant also insists that a new trial should be granted due to the prejudice allegedly created when appellee’s counsel suggested that the shipowner would have recourse against any third party responsible for the unseaworthy condition of the ship. Upon objection, the court instructed the jury to “ignore” such remarks: “Members of the jury, you are trying one law suit. You are not here to determine whether the ship has any rights against anybody else.” The court previously had told the jury: “You are here to try the case of Marion Domeracki against the Humble Oil and Refining Company. That is the only case you are here to try. Whatever reference may have been made to other litigation, just disregard it. This is the case you are here to try, you are sworn to try, and this is the only one I want you to consider.” We are satisfied that these cautionary statements were adequate and that no prejudicial error resulted.
We also find no merit in appellant’s additional contention that the jury was improperly influenced by an oblique reference during appellee’s closing argument to the financial capacity of Humble Oil.
See
United States v. Socony-Vacuum, 310 U.S. 150, 237-242, 60 S.Ct. 811, 84 L.Ed. 1129 (1939). In any case, appellant registered no timely objection to the remark.
Id.
at 239, 60 S.Ct. 811. See Fed.R.Civ.Pro. 46.
III.
Appellant submitted, and the district court refused, the following point for charge:
I charge you, as a matter of law, that any award made to the plaintiff
in this case, if any is made, is not income to the plaintiff within the meaning of the federal income tax law. Should you find that plaintiff is entitled to an award of damages, then you are to follow the instructions already given to you by this Court in measuring those damages, and in no event should you either add to or subtract from that award on account of federal income taxes.
Whether the refusal of this instruction resulted in prejudice sufficient to entitle appellant to a new trial is the question to which we now address ourselves.
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OPINION OF THE COURT
ALDISERT, Circuit Judge.
A judgment of $270,982 was entered on a jury verdict against appellant shipowner and in favor of appellee, a longshoreman who sustained personal injury while loading a ship in port. The jury accepted appellee’s contention that his injury was caused by the unseaworthy condition of the vessel and by the failure of the shipowner to provide a safe place to work.
Appellant concedes the severity of the injury: appellee suffered herniated discs in his back; only one was corrected by surgery, while the other caused continuing disability. Past loss of earnings amounted to $28,000, medical expenses totaled $3,000, and loss of future earning power over a projected 28 year period approximated $100,000. Appellant contends, however, that the verdict was tainted, and excessive, because the jury (1) failed to adhere to the court’s instructions, (2) rendered its verdict under the influence of passion and prejudice purposely induced by appellee’s counsel, and (3) deliberated under the mistaken impression that the award would be subject to federal income tax obligations.
I.
The first assignment of error relates to an incident that occurred in the courtroom at the’ time the verdict was received. The jury had been given special written interrogatories which, together with the replies, were handed by the forelady to the deputy marshal for transmittal to the court. In submitting the interrogatories, however, the fore-lady inadvertently included two sheets of paper containing certain written matter. It is conceded that these papers were not a part of the jury’s verdict and probably constituted scratch paper utilized by the forelady or others during deliberations in the jury room. The trial judge notified counsel that “these papers had inadvertently come into my possession and that I had glanced at them and seen some figures which would cause me to wonder whether they [the jury] had followed the Court’s instructions precisely.” Subsequently, the court declared: “Upon further reflection I think that what I did was improper in looking at what the jury did, and rather than compound that error, I have impounded these papers. * * * I happen to know, by that inadvertent glance at that piece of paper, how they arrived at [the verdict]. I shall have to do my best to wipe clean from my mind that information which I now have in my head. *. *
*»
Appellant then moved for a new trial, grounding its motion on the theory that a new trial should be granted when it is apparent that the jury has not followed the court’s instructions on damages. Although we do not quarrel with this statement of the controlling abstract principle, the circumstances here preclude our reaching this question. Neither a trial court nor an appellate court has the authority to inquire into the jury’s decisional processes, even when information pertaining to the deliberations is volunteered by one of the jurors. “[A]fter reception of the verdict and discharge of the jury, testimony of jurors should be incompetent, under the no-impeachment rule * * *, to illuminate the suspicion [of a failure to follow instructions] by inquiring into their mental processes.” 6A Moore’s Federal Practice § 59.08 [4], at 3804.
Long settled considerations of public policy dictate “that mistake of the testimony, misapprehension of the law, error in computation, irregular or illegal methods of arriving at damages, unsound reasons or improper motives, misconduct during the trial or in the Jury Room, cannot be shown by the evidence of the jurors themselves, as the ground of disturbing the verdict, duly rendered,” Capen v. Stoughton, 82 Mass.
(16 Gray) 364, 366 (1860)
The sound justification for the concept that “[such] matters all inhere in the verdict itself,” Chicago, R.I. & Pac. RR v. Speth, 404 F.2d 291, 295 (8 Cir. 1968), is the salutary desire to protect participants in the jury system from being “harassed and beset by the defeated party. * * * If evidence [obtained from jurors] could be thus used, the result would be to make what was intended to be a private deliberation, the constant subject of public investigation — to the destruction of all frankness and freedom of discussion and conference.” McDonald v. Pless, 238 U.S. 264, 267-268, 35 S.Ct. 783, 784, 59 L.Ed. 1300 (1915). In short, the district court, 312 F.Supp. 374, properly concluded that the information to which he accidentally became privy was incompetent to provide a basis for a finding that the jury failed to adhere to the court’s instructions.
II.
Appellant also insists that a new trial should be granted due to the prejudice allegedly created when appellee’s counsel suggested that the shipowner would have recourse against any third party responsible for the unseaworthy condition of the ship. Upon objection, the court instructed the jury to “ignore” such remarks: “Members of the jury, you are trying one law suit. You are not here to determine whether the ship has any rights against anybody else.” The court previously had told the jury: “You are here to try the case of Marion Domeracki against the Humble Oil and Refining Company. That is the only case you are here to try. Whatever reference may have been made to other litigation, just disregard it. This is the case you are here to try, you are sworn to try, and this is the only one I want you to consider.” We are satisfied that these cautionary statements were adequate and that no prejudicial error resulted.
We also find no merit in appellant’s additional contention that the jury was improperly influenced by an oblique reference during appellee’s closing argument to the financial capacity of Humble Oil.
See
United States v. Socony-Vacuum, 310 U.S. 150, 237-242, 60 S.Ct. 811, 84 L.Ed. 1129 (1939). In any case, appellant registered no timely objection to the remark.
Id.
at 239, 60 S.Ct. 811. See Fed.R.Civ.Pro. 46.
III.
Appellant submitted, and the district court refused, the following point for charge:
I charge you, as a matter of law, that any award made to the plaintiff
in this case, if any is made, is not income to the plaintiff within the meaning of the federal income tax law. Should you find that plaintiff is entitled to an award of damages, then you are to follow the instructions already given to you by this Court in measuring those damages, and in no event should you either add to or subtract from that award on account of federal income taxes.
Whether the refusal of this instruction resulted in prejudice sufficient to entitle appellant to a new trial is the question to which we now address ourselves.
It is true, as stated in the requested charge, that awards received by settlement or verdict in personal injury actions are not taxable under the federal income tax laws. Section 104 of the Internal Revenue Code of 1954, 26 U.S.C. § 104 provides:
(a)
In General
— Except in the case of amounts attributable to (and not in excess of) deductions allowed under section 213 (relating to medical, etc., expenses) for any prior taxable year, gross income does not include—
******
(2) The amount of any damages received (whether by suit or agreement) on account of personal injuries or sickness. * * *
But whether this is a fact of which a jury should be apprised, upon a defendant’s request for a proper cautionary instruction, is an open question in this Circuit. Other courts, both state and federal, which have considered the question have answered it in different ways.
The issue has also generated sharp disagreement among commentators, although a majority appear to favor an appropriately worded charge.
Our analysis begins with the elementary rule of damages in personal injuries actions: a plaintiff should be compensated (1) for monies of which he has been deprived and which presumably he would have received had he not been injured, including wages and earnings, past and future; and (2) for the expenses, inconveniences, and suffering
which have been thrust upon him by virtue of his injuries. The purpose, then of personal injury compensation is neither to reward the plaintiff, nor to punish the defendant, but to replace plaintiff’s losses.
Insofar as wages are concerned, an injured plaintiff loses only his net or take-home pay, that is, his gross earnings, less taxes. He does not in fact “lose” his gross earnings. Nevertheless, in the three states and one territory of this Circuit, as in most jurisdictions, the courts hold that the gross earnings of the plaintiff, rather than net earnings after taxes, are admissible as evidence for the jury's consideration in calculating this item of damages. Thus, the jury is presented not with evidence of wages which plaintiff has actually lost, but sums which, in fact, may be considerably higher depending upon his particular income tax bracket.
Defense attorneys have sought to avoid this result in at least two ways.
They have attempted to present evidence of the amount of federal income tax that the plaintiff was paying prior to his injuries in order to offset the “gross income” evidence introduced by the plaintiff. Alternatively, they have requested an instruction that any award will not be subject to federal income tax, and that the jury “should not consider such taxes,”
or, more specifically, should not “add or subtract” from any award on account of taxes.
The avowed purpose of such a request is to discourage a jury from enlarging an award to the extent it erroneously believes that the plaintiff will be called upon to pay income taxes.
We readily recognize the problems which could result from the introduction of income tax evidence. Shifting tax rates, together with other variables, could give rise to great conjecture, at least as to
in futuro
earnings.
Indeed, the tax computation itself could completely overshadow the basic issues of liability and damages. Moreover, recovery for pain, suffering and medical expenses is not measured by one’s income and, in any case, would probably not be taxable.
Although some courts and writers have confused the evidentiary issue with the question of a cautionary instruction,
we believe that the considerations relating to the former issue have
no relevance to the second. The instruction requested in this case would not require the introduction of any additional evidence. No reference to any IRS regulation or to any specific statute would be necessary. No tax expert would need be summoned as a witness. No tax tables would be hauled into the courtroom. No additional computation would be required. In brief, such an instruction would not open the trial to matters irrelevant to traditional issues in personal injury litigation, and thus would in no way complicate the case or confuse the-jury.
Moreover, there are positive and persuasive reasons for giving the instruction. We are not unaware of the pervasive impact of taxation — federal, state, and local — in the lives of Americans. It has been properly observed that what we know as men, we should not ignore as judges. We know of the widespread attention given by the media to the tax consequences affecting winners of the Irish Sweepstakes, state-eon-ducted lotteries, and contests conducted on television. We take judicial notice of the “tax consciousness” of the American public.
Yet, we also recognÍ2ie, as did the court in Dempsey v. Thompson, 363 Mo. 339, 251 S.W.2d 42 (1952), that few members of the general public are aware of the special statutory exception for personal injury awards contained in the Internal Revenue Code.
[T]here is always danger that today’s tax-conscious juries may assume (mistakenly of course) that the judgment will be taxable and therefore make their verdict big enough so that plaintiff would get what they think he deserves after the imaginary tax is taken out of it.
II Harper & James, The Law of Torts § 25.12, at 1327-28 (1956). The very purpose of a cautionary instruction is merely to dispel a possible misconception in the minds of the jury that the government will make a valid claim to a portion of the award. Its effect is simply to dissuade juries from improperly increasing the award because of this mistaken belief.
Given the absence of complications that an instruction would engender, the tax consciousness of the American public, and the general lack of knowledge about the statutory exclusion, we hold that in personal injuries actions the trial courts in this Circuit must, in the future, upon request by counsel, instruct the jury that any award will not be subject to federal income taxes and that the jury should not, therefore, add or subtract taxes in fixing the amount of any award.
We decline, however, to reverse the judgment of the court below. Two important considerations influence this determination. First, the purpose of the rule which we promulgate for nrosnective application
in this Circuit is to remove the possibility that juries will increase awards based on mistaken considerations of tax consequences. In the case at bar, however, there is no evidence that the jury was in fact so motivated,
and because of the settled rule, heretofore discussed, that the sanctity of jury deliberations may not be invaded subsequent to the rendition of the verdict, any inquiry is now foreclosed.
Secondly, we recognize that our approach to this problem represents a new view in this judicial circuit as well as in other Circuits.
Indeed, the position we adopt has been accepted by only a handful of state jurisdictions. In this situation, it cannot be said that the trial court erred in refusing the instruction at the time it was proffered. Paying even the most scrupulous attention to the sometimes subtle shifting of appellate winds, the district court could not have been expected to forecast the decision we reach here.
In conclusion, after considering all the arguments presented by appellant, we hold that there was no reversible trial error. Moreover, we cannot say that the amount of the verdict shocks the conscience of the court.
The judgment of the district court will be affirmed.