ICBC Law

BC Injury Law and ICBC Claims Blog

Erik MagrakenThis Blog is authored by British Columbia ICBC injury claims lawyer Erik Magraken. Erik is a partner with the British Columbia personal injury law-firm MacIsaac & Company. He restricts his practice exclusively to plaintiff-only personal injury claims with a particular emphasis on ICBC injury claims involving orthopaedic injuries and complex soft tissue injuries. Please visit often for the latest developments in matters concerning BC personal injury claims and ICBC claims

Erik Magraken does not work for and is not affiliated in any way with the Insurance Corporation of British Columbia (ICBC). Please note that this blog is for information only and is not claim-specific legal advice.  Erik can only provide legal advice to clients. Please click here to arrange a free consultation.

Archive for the ‘ICBC Wage Loss’ Category

BC Court of Appeal – OK for Judges To Use Male Earnings Statistics for Female Plaintiff

April 3rd, 2019

Reasons for judgement were published today by the BC Court of Appeal confirming it was not an error in law for a trial judge to rely on male labour market contingencies when assessing damages for an injured female plaintiff.

In today’s case (Gill v. Lai) the Plaintiff was injured in two collisions and proceeded to trial where she was compensated for various losses including future diminished earning capacity.   In assessing this loss the trial judge relied on statistical evidence for men.  ICBC appealed arguing it was legally wrong to do so for a female plaintiff.  The BC Court of Appeal rejected this argument finding that in the circumstances of this case there was no error in relying on male statistics in part because “income statistics may incorporate historic and inequitable gender-based pay differences“.

The Court provided the following reasons:

[52]         The respondent’s expert economist, Mr. Benning, used labour market statistics for males in British Columbia when making an allowance for the negative contingencies of part-time employment and non-participation in the workforce. The trial judge accepted this approach and rejected the submission statistics for females should be used. He did so for two reasons: factors specific to the respondent and a reluctance to use statistics that have the effect of perpetuating discrimination. He wrote:

[130]     In adopting the male labour market approach, I note:

a)    since a young age, the plaintiff has shown a particular adherence to the work force and, in particular, the pharmacy profession;

b)    the plaintiff values financial independence (she saved the funds for the down payment for the Cloverdale home while her future husband studied dentistry in Manitoba); and

c)    the plaintiff’s parents are in their mid-sixties and are still working.

[131]     I am also reticent to give weight to female labour market contingencies which may have embedded discrimination: see Justice Morellato’s discussion in Jamal v. Kemery-Higgins, 2017 BCSC 213 at paras. 96–99.

[53]         The appellants say there was no evidence of any such embedded discrimination. They say Mr. Benning confirmed statistically females are more likely than males to work on a part-time basis and, the appellants say, “there was no suggestion in the evidence such difference arose because of any issues relating to discrimination”.  The appellants argue the only evidence before the judge was female labour market contingencies accurately reflect the real and substantial possibilities for the respondent.

[54]         Judges can and do recognize income statistics may incorporate historic and inequitable gender-based pay differences and, as such, have increasingly taken a cautious approach to gender-based income statistics. In Crimeni v. Chandra, 2015 BCCA 131, this Court said:

[23]        Experts are frequently asked to estimate the income losses by using gender-specific historical income figures. Such figures may be useful where they can fairly be said to be the most accurate predictor of the lost stream of earnings. However, there is authority for the proposition that the use of female earning statistics may incorporate gender bias into the assessment of damages. There is also authority for taking judicial notice of convergence in gender incomes: Steinebach v. O’Brien, 2011 BCCA 302.

[24]        It is certainly not an error, in my view, for a trial judge to recognize that the use of historical data can reflect such bias and, to the extent, the circumstances giving rise to the bias may be expected to diminish, to view the evidence as conservative.

[25]        I can see no error in the judge’s consideration of the plaintiff’s pre‑injury earning potential.

[55]         In my view, the same can be said of labour market contingencies. It is not an error to recognize gender-based contingencies can incorporate bias. Having said that, we must bear in mind the quantification of damages necessitates an individual approach.

[56]         In the case at bar, the trial judge did not fail to deal with the parties before him. The respondent had borne children, made effective arrangements for childcare, participated on a full-time basis in the labour market, and was motivated to continue to participate full-time. It was certainly open to the trial judge to find she was unlikely to be affected by some of the contingencies reflected in female labour market statistics, and there was a reasonable basis upon which he could conclude the use of statistical evidence of contingencies affecting males in the labour market would result in a realistic prediction of the respondent’s future. I would dismiss this ground of appeal.


“Common Sense” Used to Uphold Diminished Earning Capacity Award

November 14th, 2016

Reasons for judgement were released this week by the BC Court of Appeal upholding an award for diminished earning capacity based on “common sense“.

In the recent case (Ali v. Glover) the Plaintiff was involved in two collisions and suffered chronic aggravation of degenerative issues in his neck and back.  The Plaintiff was able to continue working with his long-standing employer although some accommodations were made for limitations his injuries caused.  At trial the Court awarded $110,000 for diminished earning capacity on the basis that the Plaintiff’s injuries were permanent and very well could impact earning capacity in the future should he lose his present employment.

ICBC appealed arguing this award was rooted in speculation.  The BC Court of Appeal disagree noting it is simply a matter of common sense.  In upholding the assessment the Court provided the following reasons:

[19]         Mr. Ali’s case for damages for a loss in his earning capacity was based on the injury to his back precluding him from finding employment that would otherwise be available to him should the need arise.  The company for which he has worked for over 20 years has made adjustments to accommodate his limitations such that he does not do much of the “heavy lifting” that he once did, but for one reason or another his employment may be reduced in terms of the work available that he can do or be terminated altogether.  His loss is essentially one of a capital asset in that, because of his injury, he is less capable of earning income from all types of employment, less marketable, less able to take advantage of all employment opportunities which, save for his injury, may have been available to him, and less valuable to himself as an income earner, all as discussed in Brown v. Golaiy (1985), 26 B.C.L.R. (3d) 353 (S.C.).  The judge concluded:

[157]    I am satisfied the plaintiff has proven there is a real and substantial possibility of loss of income earning capacity in the future. He has an accommodating employer but she may retire and sell or reduce his wage to one commensurate with the hours he is working on set up and supervising and not allow him to draw on a dwindling overtime bank. If he loses his job he is less valuable to himself and potential employers because he is not fully able to do physical work.

[20]         The appellants do not challenge the judge’s determination of the quantum of the award; they contend that no loss has been proven.  They maintain the judge’s conclusion is based entirely on speculation that Mr. Ali may not be able to continue working in his present capacity earning the salary he is paid.  But the fact remains, Mr. Ali’s marketability has been impaired by the injury he suffered; he is not capable of doing heavy physical work so some employment that would otherwise be available to him is now foreclosed.  The judge made no fundamental error in concluding, as she did, there was a real and substantial possibility of Mr. Ali being able to earn less income in the future and giving what amount to examples of why there is no assurance Mr. Ali will always be employed as he is earning the income he does.  What is said to be speculation devoid of evidentiary support is largely a matter of common sense. 

[21]         I would not give effect to the fifth ground of appeal.


“Use of Vacation Time Does Not Represent Lost Income” in ICBC Claim

November 20th, 2014

Reasons for judgement were released today by the BC Supreme Court, Vancouver Registry, holding that used vacation time following an injury is not compensable as lost income in a personal injury lawsuit.

In today’s case (McCartney v. McArthur) the Plaintiff missed a week of work due to collision related injuries.  He used up vacation time during this period and was paid accordingly by his employer during the week off.  In finding that no claim for loss of income for this period can be advanced in his tort claim Mr. Justice Bowden provided the following brief reasons:

[82]         At the time of the accident the plaintiff was working about 32 hours a week at Oak Hills Woodcraft. He received a base salary of $1,200, plus a car allowance of $150 every two weeks, for a total of $1,350. He took seven days off after the accident; however, he used his vacation time for that time off and continued to receive his regular salary. In 2010 his income was $36,549 which is slightly more than he received in the years before the accident.

[83]         The plaintiff seeks $1,181.25, representing his salary for the seven days that he did not work shortly after the accident when he used his vacation time. The plaintiff argues that by using seven days of his vacation entitlement he gave up something that should be compensated for as past wage loss.

[84]         While the use of days from a bank of sick leave days may entitle a plaintiff to compensation for the loss of past income because the plaintiff may have to pay to replace the sick days, in my view the use of vacation time does not represent lost income. (Roberts v. Earthy, 1995 CarswellBC 1800 (B.C.S.C.)). During that vacation time the plaintiff continued to receive his expected income.


ICBC Claim for “Disastrous Losses on the Stock Market” Fails at Trial

November 12th, 2014

Update February 23 2018An appeal of the below case was dismissed this week by the BC Court of Appeal

________________________

Reasons for judgement were released today by the BC Supreme Court, Vancouver Registry, considering whether a Plaintiff’s substantial losses in the stock market could be compensated as part of a personal injury lawsuit.  On the facts of the case the Court rejected this claim.

In today’s case (Barta v. DaSilva) the Plaintiff was involved in a 2007 collision caused by the Defendant.  The Plaintiff alleged that the collision caused a mild traumatic brain injury and this “destroyed his capacity to earn an income, trading securities on his own account, and has caused him to lose the capital he accumulated and invested in the stock market“.

Around the time of the crash the plaintiff’s total portfolio was valued around $1.8 million.  By the end of the 2009 the value plummeted to less than $400,000.  In rejecting the claim that a brain injury had anything to do with this diminished asset, Mr. Justice Affleck provided the following reasons:

[56]         By July 31, 2008, a year after the accident, the plaintiff’s portfolio had increased to $2,790,301.95.  He had made successful trades in that year increasing his portfolio by almost $921,000.  There is no possible inference to be drawn that cognitive impairment had damaged his trading ability during this time period.  Then disaster struck.  In September 2008 the market “crashed” and the plaintiff testified that he was “hit hard”.

[57]         The plaintiff had purchased Lehman Brothers Holdings prior to the crash and had made a considerable capital gain in a few days.  This appeared to have encouraged the plaintiff to hold Lehman Brothers even as his own financial crisis deepened, as did that of the market generally.  This the plaintiff argues indicates his impaired judgment following the accident.  However, I have no basis to conclude his decision to retain the Lehman Brothers stock was irrational at the time it was made.  He had made a substantial quick profit in a few days and I believe he concluded he could eventually continue to make money by holding on.  He did not foresee Lehman Brothers would be forced into bankruptcy.  Many investors suffered a similar fate…

…The plaintiff engaged in risky stock market trading over several years.  He developed a level of expertise that permitted him to earn a reasonable income.  However his unwise decisions made in 2008, coupled with the stock market collapse, and the judgment in favour of Mr. Palkovics created financial conditions from which he could not recover.  In my opinion the effects of the accident did not compromise his ability to trade on the stock market.   

[61]         It is impossible not to have sympathy with Mr. Barta’s disastrous losses on the stock market but the evidence does not satisfy me that he has proven that the defendant’s negligence caused them. 


The Evidentiary Value of Past Tax Returns In Undeclared Income Claims

July 23rd, 2014

Although damages for past loss of income can be assessed even if a Plaintiff does not accurately report income to Revenue Canada, the figures reported on tax filings have a high evidentiary value in Court.  This was demonstrated in reasons for judgement released this week by the BC Supreme Court, Vancouver Registry.

In this week’s case (Saadati v. Moorhead) the Plaintiff was involved in a number of collisions.  The Plaintiff worked as a truck driver and advanced a claim for lost income of $6,000 per month for a period of two years.  Prior to trial the Plaintiff  was declared mentally incompetent and could not testify on his own behalf.   The Court was presented with evidence addressing the Plaintiff’s claim for past loss of income, most notably evidence of very low reported earnings in the years prior to the collision.  The Court relied heavily on this, accepting the reported earnings as accurate, and dismissed the Plaintiff’s claim for past loss of income.  In reaching this decision Mr. Justice Funt provided the following reasons:

[74]         It is also clear that the plaintiff earned very little income during his 2001 to 2004 taxation years. The plaintiff did not report any income for his 2001, 2002 and 2003 taxation years and for 2004 only $12,796 in taxable capital gains was reported. In sum, his tax returns for the years prior to the accident show very little income. I note that in 2007 the plaintiff reported $22,500 in employment income.

[75]         There was evidence that the plaintiff during the years prior to the July 5, 2005 accident did not appear to be in financial difficulties and was able to provide for his wife and two sons. The Court will not impute income to the plaintiff for these years. He filed tax returns which he would have certified to be correct (the Income Tax Act, RSC, 1985, c. 1(5th supp.) also provides significant penalties for a false tax return). As many people do, he may have kept his financial affairs to himself. The imputation of income would be tantamount to finding possibly gross negligence or tax evasion which is unwarranted, especially having regard to the fact that the plaintiff is not able to testify to explain matters and defend his reputation.

[76]         In Hoy v. Williams, 2014 BCSC 234, Justice Kent set forth the test to determine whether an award for past income loss should be made.

[141]    Compensation for past loss of earning capacity is to be based on what the plaintiff would have, not could have, earned but for the injury that was sustained: Rowe v. Bobell Express Ltd., 2005 BCCA 141 at para. 30; M.B. v. British Columbia, 2003 SCC 53 at para. 49. The burden of proof of actual past events is a balance of probabilities. An assessment of loss of both past and future earning capacity involves consideration of hypothetical events. The plaintiff is not required to prove these hypothetical events on a balance of probabilities. The future or hypothetical possibility will be taken into consideration as long as it is a real and substantial possibility and not mere speculation: Athey v. Leonati at para. 27; Morlan v. Barrett, 2012 BCCA 66 at para. 38.

[77]         As stated previously, I have found that the July 5, 2005 accident did not aggravate the plaintiff’s pre-existing physical injuries but that it did cause a personality change and cognitive difficulties.

[78]         The plaintiff has not provided sufficient evidence that “by reason of his [psychological] injuries, [he was] unable to do many things that, but for his injuries, he could have done to earn income” (Rowe v. Bobell Express Ltd., 2005 BCCA 141, at para. 34) or would have earned income.

[79]         The Court, therefore, dismisses the plaintiff’s claim for an award for past wage loss.

 


Statistical Census Data “Squarely Within the Admissible Class of Evidence”

July 4th, 2014

The BC Court of Appeal published reasons for judgement today confirming that it is entirely appropriate for an economist to rely on statistical census data in discussing average earnings.

In today’s case (Smith v. Fremlin) the Plaintiff was injured in a motor vehicle collision.   She was a recent law school graduate who just started her career.  The collision caused injuries which limited her capacity to work.  At trial the Court relied on an economists report which discussed average earnings for legal professionals in helping assess the Plaintiff’s diminished earning capacity.  The Defendant objected arguing the report relied on inadmissible hearsay, namely statistical census data.

The trial judge found the defendant’s objections to be ‘nonsensical’.  Despite this the Defendant appealed.   The BC Court of Appeal dismissed the appeal fining statistical evidence is entirely appropriate in these circumstances.  In reaching this conclusion the Court provided the following reasons:

[18]         The appellants say the Wickson report ought not to have been admitted into evidence at trial. They do not object to the qualification of Mr. Wickson as an expert but say his report is defective and inadmissible in two respects. First, it is said to be based upon evidence that is hearsay. Second, it is said to be irrelevant because it measures the income earning capacity of a group to which Ms. Smith does not belong.

[19]         The first of these objections, the hearsay objection, is unfounded. Mr. Wickson expressly describes the source of the data used in the preparation of his report. In addition to relying on published census data, he obtained a special tabulation providing education-specific 5-year age group income data from Statistics Canada. In my view, this data falls squarely within the admissible class of evidence described by Sopinka J. inR. v. Lavallee, [1990] 1 S.C.R. 852; it is information derived from enquiries that are an accepted means of arriving at an opinion within an economist’s expertise. The reliability of the data is supported by strong circumstantial guarantees of trustworthiness. It is, in words cited with approval in Lavallee, evidence of a “general nature which is widely used and acknowledged as reliable by experts in that field.”

[20]         Such was the opinion of this Court in Reilly. There, the Court noted that while hearsay evidence cannot generally be introduced through the admission of expert reports into evidence:

[114]       It is otherwise…with respect to the opinions of … economic experts based on the census data, which are routinely used by experts in their field …

[21]         In my view, the words of Smith J.A. in Jones v. Zimmer GMBH, 2013 BCCA 21, are a complete response to the appellant’s objection to the Wickson report and support and justification for the judge’s decision to admit it:

[50]      … Proponents of expert opinions cannot be expected to prove independently the truth of what the experts were taught by others during their education, training, and experience or the truth of second-hand information of a type customarily and reasonably relied upon by experts in the field. Accordingly, the degree to which an expert opinion is based on hearsay evidence is a matter to be considered in assessing the weight to be given the opinion: R. v. Wilband, [1967] S.C.R. 14 at 21, [1967] 2 C.C.C. 6; R. v. Lavallee, [1990] 1 S.C.R. 852 at 896, 899-900, 55 C.C.C. (3d) 97.

[22]         The second objection, that the Wickson report is inadmissible, as “wholly or largely irrelevant to the Plaintiff’s circumstances,” is equally unfounded. The appellants say the weight of the evidence at trial supported the conclusion that Ms. Smith would likely work within a limited range of the occupations open to a qualified lawyer. They say it was not helpful to receive and not appropriate for the court to rely upon a report describing the earning potential of all female lawyers in British Columbia (rather than, for instance, female lawyers in British Columbia practicing environmental or Aboriginal law in a not-for-profit setting).

[23]         This objection should be considered in light of the generally accepted approach to assessment of claims for loss of income earning capacity, which is, first, to set the parameters of the claim by referring to statistical evidence with respect to the class of individuals to which the plaintiff belongs, and then to adjust the resulting preliminary measure of damages to take into account contingencies that are particular to the plaintiff.

[24]         Average earnings were found to be the proper starting point for the assessment of damages under this head in Reilly, even though there was some evidence of the plaintiff’s specific professional interests. This Court observed:

[122]    The trial judge should have considered the possibility that the respondent might not have realized his professional goals or might have changed his goals.  Qualifying as a lawyer opens up a number of career possibilities.  It is reasonable to assume that the respondent would have remained in the profession.  But he might not have developed the professional skills to achieve above-average earnings.  He might have decided that he did not want to make the personal sacrifices often required to compete professionally at that level.  Other interests, of which he had many before his head injury, or future family commitments, might have persuaded him to alter his goals.  He might have chosen other disciplines within the profession with lower remuneration, such as prosecuting, working in the civil litigation departments of the federal or provincial government, or becoming in-house counsel in the private sector.  It is well known that in the legal profession interests change and there is great mobility.  In addition, there are many above-average lawyers with below-average incomes.

[123]    As well, the possibility that the respondent might have earned more money than predicted should be considered, although we consider that the chance of this happening was relatively low given the evidence of the small numbers of lawyers in Vancouver who have achieved outstanding financial success.  This award is intended to cover the respondent’s working life to age 70, a period of approximately 36 years from the date of trial.  Many things can change during such a long period of time and present-day assumptions are far from immutable.

[25]         Evidence of the earnings of the class of workers to which the plaintiff belongs is clearly relevant to the assessment of a loss of earning capacity. At some point, the evidence may be so general or vague as to be of little assistance but, in my view, that cannot be said of the statistical evidence used in this case. Evidence of the lifetime earning capacity of female lawyers in British Columbia, according to Mr. Wickson’s testimony in cross-examination, was the most specific data available. No further breakdown of incomes of female lawyers in this province by areas of practice is available. The Wickson report therefore was the best available evidence of what has been recognized as the starting point of the assessment of the loss of income earning capacity. It was properly admitted by the judge.

 


“There is No Deduction for Income Tax” For Diminished Future Earning Capacity Awards

June 11th, 2014

When Courts in BC assess damages for future ‘diminished earning capacity‘ no deduction is to be made for income taxes to be paid on those funds.  Although this is not a new legal development, it is nice when Courts summarize the law in a concise statement as was done in reasons released this week by the BC Supreme Court, Vernon Registry.

In this week’s case (Kelly v. Kotz) the Plaintiff was awarded $16,000 for diminished earning capacity following injuries sustained in a vehicle collision.  The basis of the award was that the Plaintiff needed to attend a rehabilitation program to address her injuries and this was an assessment of her anticipated lost earnings during this time.  ICBC argued the award should be reduced by tax obligations.  Madam Justice Hyslop rejected this argument and provided the following concise reasons:

[4]             The burden of proof is whether there is a real and substantial possibility that the plaintiff will suffer a future loss of income. Ms. Kelly has met that burden. Ms. Kelly seeks $16,000.00 as a loss of wages while she pursues the program recommended by Dr. Brownlee. This future loss of income is based on Ms. Kelly’s annual income of $60,000.00 and benefits roughly estimated at $500.00 per month. Ms. Kelly will need to take three months off to attend this program; this is the basis of the loss.

[5]             The defendants did not dispute these numbers, but disputed whether it should be a net amount as opposed to a gross amount.

[6]             Past loss of income is a net amount after deduction of income tax. Future loss of earnings is an assessment and there is no deduction for income tax: Arnold v. Teno, [1978] 2 S.C.R. 287

[8]             I order that the plaintiff be awarded $16,000.00 for future loss of income.

 


$1.8 Million Diminished Earning Capacity Award Made Following Disabling Severe Brain Injury

May 21st, 2014

Reasons for judgement were released today by the BC Supreme Court, Vernon Registry, tacking an interesting problem, the assessment of damages for a lifetime of disability for a Plaintiff who has yet to enter the workforce.

In today’s case (Hermanson v. Durkee) the Plaintiff was involved in a motor vehicle collision and sustained a “severe traumatic brain injury“.  The injury rendered the Plaintiff competitively unemployable.  He was 18 at the time and had just graduated high school and had yet to enter the workforce.   He “did not excel academically” and “it became apparently that post-secondary education was not likely or realistic“.

The Court had to grapple with what the Plaintiff’s lifetime earnings would have been.  The Plaintiff argued that he would have likely worked in the trades in Alberta’s lucrative oil industry and had lifetime earnings between $2.8 and $3.3 million.  The Defendant argued that his earnings would be more in line with the statistical average for high school graduates and suggested an earning capacity of just over $1 million.

Mr. Justice Betton found both positions were went “too far in their respective directions” and found a likely lifetime earning capacity of $1.8 million.  In arriving at this figure the Court provided the following reasons:

[106]     In my view, both positions go too far in their respective directions.

[107]     It is my conclusion that Mr. Hermanson would have likely pursued a trade in the higher earnings spectrum of those that the economists have concluded he could have done pre-accident.

[108]     In considering the evidence of the individual earnings levels as presented by witnesses for the plaintiff, significant caution must be exercised. Neither economist was asked specifically why they did not consider specific earnings levels of specific individuals, but in circumstances such as these, there is a strong argument to be made that statistics which, by necessity, blend high income earners, such as those presented by the plaintiff, with those who have not achieved such earnings is a more reasonable approach. Not all of the witnesses who were called had indicated that it was their intention to stay in their high earnings positions in Northern Alberta, and it seems logical that many, including possibly Mr. Hermanson had he gone to the oil industry at all, would feel the same. On the other hand, one must recognize that Mr. Hermanson is part of a social group, many of whom had elected, at least in their early years of employment, to pursue such jobs.

[109]     In my view, such evidence is merely a consideration in assessing the value of the lost capital asset. There is certainly a substantial possibility that Mr. Hermanson would have, at least in the short term, pursued such work. It is difficult to measure the likelihood of that and even more difficult to determine how long he might have stayed in such a position.

[110]     The defence argued that the plaintiff might have retired early like his mother. While that is a possibility, such a decision would logically flow from a relatively high earnings stream and/or prudent savings habits to enable such a decision. It is not reasonable for the defence to say that the plaintiff would have both been a low earner with limited motivation and retired early.

[111]     In my view, the appropriate assessment of the plaintiff’s pre-injury earnings capacity is $1,800,000.

 

 


A Creative Sick Leave Benefits Award

April 24th, 2014

Reasons for judgement were released this week by the BC Supreme Court, New Westminster Registry, making an interesting award with respect to past wage loss covered by a sick leave plan.

In this week’s case (Bulpitt v. Muirhead) the Plaintiff, a firefighter, was injured in a  2007 collision.  He did not suffer an actual wage loss as “he received all of the wages he would otherwise have received had the accident not occurred as sick leave benefits to which he was entitled as an employee of the City of New Westminster“.   These benefits were subject to a subrogation agreement which was put into evidence.  The court expressed concern about whether this was a sufficient basis to make an award for past loss of wages.  Instead, the court did not award money for past wage loss but used its inherent jurisdiction to make a blanket order that the Defendant provide full indemnity to the plaintiff in respect of any amount of the judgement that the plaintiff is, or becomes, obligated to re-pay the City.  In reaching this decision Mr. Justice Weatherill provided the following reasons:

[102]     The only evidence proffered by the plaintiff during the trial in respect of a claim for past wage loss came in the form of a letter dated June 6, 2008 from a payroll clerk with the City of New Westminster to ICBC.  It states:

“Please find enclosed the completed Certificate of Earnings form for [the plaintiff].  I am also attaching a copy of the subrogation agreement from the Collective Agreement for The City Firefighters’ Union, Local 256.

The gross pay lost up to May 30, 2008 due to [the Accident] is $20,365.56.  Please be aware that his sick claim is still ongoing so this figure is not a final amount.

When a settlement has been reached, please forward to my attention the total amount of earnings lost due to this accident, plus any interest attributed to those earnings, payable to the City of New Westminster.  This will allow us to credit Mr. Bulpitt’s sick plan and return any gratuity hours that he lost due to the accident.               

[Emphasis added]

[103]     The attached “subrogation agreement” states:

Sick Leave Recovery

a) An employee may use sick leave credits for time lost through accidental injuries PROVIDED THAT prior to making a claim or commencing an action for damages against a third party in respect of such injuries, he shall notify the Employer of such claim and enable the Employer the opportunity to be represented in all proceedings or settlement discussions relating to the claim.  Any such claim shall include a claim for loss of wages including pre- and post- judgement interest, and to the extent that recovery is made, such amount will be reimbursed to the Employer.  The Employer will reimburse the employee, fifty percent (50%) of the cost of the legal fees certified by the employee’s legal counsel as being attributed to providing the wage/benefit loss claim.

[104]     During argument at trial, I expressed to plaintiff’s counsel my concern that this evidence was insufficient to prove the employer’s right to make a subrogated claim for the wage benefits it had paid to the plaintiff while he was unable to work due to his Accident-related injuries…

[108]     Regardless, it is my view that the June 6, 2008 letter and the excerpted portion of the Collective Agreement is evidence that the plaintiff’s sick leave benefits were not as they would have been but for the Accident.  Clearly, there was a benefit plan that had been negotiated by the City and the firefighters’ union the terms of which were contained in the Collective Agreement.  Further, this letter is evidence of what it will take to restore the plaintiff’s sick leave plan to its pre-Accident status.

[109]     In all cases, the court retains residual power to grant appropriate relief through its inherent jurisdiction: Anderson v. Buydens, [1998] B.C.J. No. 2675 at para.16 (S.C.).  In this case, a miscarriage of justice would result if the plaintiff was awarded nothing for past wage loss because he received benefits from his employer yet the employer was able to “claw back” those same benefits by way of a right of subrogation.  I am satisfied that there ought to be a provisional award for past wage loss in this case.  The plaintiff is entitled to full indemnity from the defendants in respect of any amount to which the plaintiff is or becomes obligated to re-pay to the City of New Westminster in respect of benefits he received as a result of the Accident.

 


BC Court of Appeal Strips Modest Diminished Capacity Award “As a Matter of Principle”

February 19th, 2014

Reasons for judgement were released today by the BC Court of Appeal stripping a Plaintiff of modest damages awarded for diminished earning capacity.

In today’s case (Kim v. Morier) the Plaintiff was injured in a collision and sued for damages.   Despite her injuries she was able to work 12-15 hour days as a floor plan technician. She had no lost income by the time of trial.  Her injuries lingered and were expected to indefinitely though the “degree of disability would be mild, that her level of disability is “fairly small” “.

In overturning the $10,000 damage assessment for this loss the BC Court of Appeal provided the following comments on the evidentiary foundation needed for diminished earning capacity damages:

[6]           On appeal, the defendant submits that the Court erred in making an award under this head in the absence of a finding of a “real and substantial possibility” that Ms. Kim’s earnings in future would be impaired. The defendant relies in particular on Roberts v. Kidd (1998), 52 B.C.L.R. (3d) (C.A.), where Mr. Justice Hollinrake for the majority noted that it is not sufficient for an award under this head for the plaintiff to testify as to a loss of confidence or ability to project herself without showing a “functional” element. (Mr. Justice Lambert dissented on this point.) In the result in Roberts, this Court set aside the award for diminished income and incapacity.

[7]           More recently, in Perren v. Lalari, 2010 BCCA 140, 3 B.C.L.R. (5th) 303, this court emphasized at paras. 21, 32, and 33 the requirement for the plaintiff to meet the onus of showing at least a “real possibility” of future loss, as opposed to a theoretical loss. Similarly, in Steward v. Berezan, 2007 BCCA 150, 64 B.C.L.R. (4th) 152, the Court discussed the comment of Madam Justice Southin in Palmer v. Goodall (1991), 53 B.C.L.R. (2d) 44, to the effect that it was “impossible to say” the plaintiff in that instance would not suffer reduced earning capacity in the future. Mr. Justice Donald wrote in Steward at para. 17

But the language in question there was used in the context of appellate review and, with respect, it cannot be transposed to an original analysis at the trial level. The claimant bears the onus to prove at trial a substantial possibility of a future event leading to an income loss, and the court must then award compensation on an estimation of the chance that the event will occur: Parypa v. Wickware, 1998 BCCA 88, 169 D.L.R. (4th) 661¶ 65.

This is not a heavy onus, but it must be met for a pecuniary award to be justified.

[8]           In my view, the trial judge here did err in equating the loss of capital asset here with the plaintiff’s own perception. As the cases demonstrate, that is not enough. The plaintiff must show that it is a realistic possibility she will be less able to compete in the marketplace – with economic consequences, not merely psychological ones. In my view as well, the trial judge’s statement made after the award was pronounced, that Ms. Kim “may” be less capable of maintaining her disciplined approach to work also fell short. As we suggested to counsel this morning, the word “may” is essentially speculative and does not equate to a finding of a real possibility.

[9]           Mr. Carta said all that could be said in support of the award, but I agree with the defendants that as a matter of principle the findings here did not support an award for loss of earning capacity.

[10]        I would allow the appeal and set aside the award under this head. I would also order that the parties bear their own costs, given that this appeal was brought as a matter of principle.