Possibility of Jail Not a "Negative Contingency" When Assessing Diminished Earning Capacity

This week the BC Court of Appeal provided reasons explaining that it is not appropriate for a judge or jury to reduce damages for diminished earning capacity when there is a possibility the Plaintiff will be incarcerated in the future.
In this week’s case (Albert v. Politano) the Plaintiff was seeking substantial damages for a collision caused injury which impeded him in his usual occupation.  Prior to his injury trial the Plaintiff was charged with a criminal offence which he was disputing.  The Defendant argued that the jury could consider the possibility of conviction and incarceration in assessing injury caused diminished earning capacity.  In finding this inappropriate the BC Court of Appeal provided the following comments:
 42]        I do not agree the judge erred as alleged. I reach this conclusion for three reasons. First, the judge was not asked to give the instruction now advocated, notwithstanding the opportunity given to counsel to comment on the proposed instructions. Second, there was no evidence upon which a jury could assess the value of such a contingency. Third, and most important, I do not consider it would have been appropriate for the jury to reduce the future damage award for the negative contingency of a possible future jail sentence, in the circumstances before the Court. Mr. Albert stood in the courts, and in the community, as innocent until proven guilty. Even if proven guilty, there was no certainty that he would receive a jail sentence. In my view, it would have been entirely speculative for the jury to reduce the damage award to reflect the chance that he might be convicted on the outstanding charges. This is unlike the case relied upon by the appellants, British Columbia v. Zastowny, [2008] 1 S.C.R. 27, (2008) S.C.C. 4, wherein the Supreme Court of Canada, on appeal from this court, affirmed the appropriateness of a deduction in damages to take account of a period of incarceration that was established as a fact at the trial.

BC Court of Appeal Upholds Canadian National Boxing Champions $1,000,000 ICBC Hand Injury Case

(Cross-Published at the Canadian MMA Law Blog)
Last year a Vancouver Jury awarded professional boxer  Jegbefumere ‘Bone’ Albert  just over $1,000,000 following a traumatic hand injury caused in a motor vehicle collision which negatively impacted his boxing career.  He was a professional cruiser weight at the time with a 4-0 professional record and a 251-3 amateur record.  The collision caused a chronic hand injury which flared with training/fighting.  The Jury accepted this impacted him in his chosen profession and awarded substantial damages for diminished earning capacity.
ICBC appealed arguing numerous errors at the trial level.  In unanimous reasons for judgement (Albert v. Politano) the BC Court of Appeal dismissed ICBC’s appeal and in doing so the Court provided the following comments addressing the lost opportunity of the plaintiff –
[50]        This brings us to the assessment of damages itself. The appellants say that each of the heads of damages assessed is wholly out of proportion to the evidence before the Court.
[51]        Damages are a question of fact and we may interfere with the quantum, absent an error of law or principle, only if there is a palpable and overriding error.
[52]        I deal with the loss of earning capacity first. I conclude, from the fact the jury awarded a significant sum, that the jury rejected the appellants’ submission that Mr. Albert would have withdrawn from a boxing career, soon after the accident, in any event. Clearly Mr. Albert had boxing ability. The jury must have considered that his boxing ability was diminished as the result of the injuries from the accident. It is true that Mr. Albert did not earn very much money from boxing prior to the accident. It is also true that there was not a great deal of evidence about the size of the purses available in professional boxing. Nonetheless there was some evidence. Witnesses from the world of boxing did testify to some extent as to the purses won in certain matches, particularly in Canada. There was evidence, therefore, before the jury from which they could conclude that Mr. Albert had the skills to fight for, and win, purses in the time between the accident and the trial, amounting to $60,000. The period of past loss is close to four years. The sum awarded is well within the range of the purses that were discussed in the evidence as available, in Canada, over that period of time. Given the positive evidence as to Mr. Albert’s abilities, one cannot say the award of $60,000 for past income loss is unsupported by the evidence, disproportionate, or wholly erroneous.
[53]        I have come to the same conclusion in respect to the award for future loss. That sum may be a small portion of what Mr. Albert otherwise would have earned, or it may be more than he would have earned. We do not know. There was, however, evidence of his considerable abilities and evidence of the purses available in the boxing world, even in Canada, that would support an award of $838,000. I would not interfere with the award for future loss of earnings.
I‘d like to thank Vancouver lawyer John Cameron for sharing this development with me for publication.

"Nonsensical" Objection to Statistical Evidence Rejected

Statistics have their place in trial.  When proving average earnings of certain occupations the shortcut of referencing statistical data can be of great value and save time and money.  Reasons for judgement were released last week by the BC Supreme Court, Victoria Registry, addressing this.
In last week’s case (Smith v. Fremlin) the Plaintiff was injured in a 2009 collision.  She was a recent law school graduate at the time just entering her career in law.  It was found that, as a result of the injury, she likely could not compete in private practice and would have lifelong limitations in her working capacity.  The Plaintiff introduced statistical evidence of the present day value of a lifetime of earnings for legal professionals.  The Defendant objected to this arguing witnesses of fact instead should be called to address this.  In rejecting this “fundamentally flawed” objection Mr. Justice Groves provided the following reasons:
[43]         Counsel for the defendants took significant objection to the report of Robert Wickson.  At trial, I rejected their argument that the report should not be admitted as evidence.  The substance of that argument is worth considering in these Reasons. 
[44]         It was the position of the defendants that any report which attempts to provide evidence to the court as to average income of persons within certain employment designations is fundamentally flawed.  It was the position of the defendants that the court should require the plaintiff to produce evidence of persons, working as practicing lawyers, who could testify as to what they earn.  The suggestion was further made that these witnesses should be women practicing law in British Columbia. 
[45]         One must keep in mind that all parties appear to have agreed to this matter being litigated under the Fast Track model in three to four days.  It is nonsensical to require a party to prove a claim by calling a potentially large number of witnesses, in this case, female lawyers in British Columbia of the same age, to testify.  It is folly not only as to the time and cost, but also as to the possibility of finding this information in advance.  It would require people to willingly disclose their income.  Additionally, it is folly when one considers the number of persons that would have to be called to create any level of statistical reliability. 
[46]         What this Discovery Economic Consulting report shows is that for persons who fall within the NOC classification of ”Lawyers and Quebec Notaries”, the potential earning capacity is approximately $1.94 million over the course of their career.  Importantly, the persons that fall within this classification are a much larger body of persons then simply practicing lawyers.  Although numerous types of lawyers and notaries are included in this classification, it also includes judicial assistants, advisory counsel, articling students, advisors of law and corporate affairs, and a number of other job classifications which may not require law degrees, such as legal officers and legislative advisors. 
[47]         I accept that this report is evidence of lifetime capacity for someone with the career path that Ms. Smith was undertaking.  In fairness, however, the number should be increased as a number of persons falling within the classification are not lawyers and employed in occupations, likely to be earning less, such as articling students.  I find that working to age 69 is not unreasonable.  As such, I would find that a reasonable dollar figure for lifetime earnings for a lawyer is $2,000,000.

Undeclared Income And Tort Recovery Difficulties

Although income loss from ‘undeclared’ sources is recoverable in a BC personal injury claim attempting to do so can create some practical difficulties.  First off testifying to actual income differing from declared income can open the door to consequences to Revenue Canada.  Second, proving the loss can become a real barrier for a Plaintiff.  This second concern was highlighted in reasons for judgement released recently by the BC Supreme Court, Prince George Registry.
In the recent case (Welygan v. Willms) the Plaintiff was injured in a 2008 motorcycle accident.  While much of her claim was rejected at trial the Court did accept that she suffered from some injury and wage loss.   The Plaintiff worked in the food service industry and derived some of her income in tips.  Her tips were undeclared.  The Court did not accept the level of loss that the Plaintiff testified to and in doing so the Court provided the following comments highlighting the difficulty in assessing losses based on undeclared income:
[396]     Her only irregular employment was as a server in bars from time to time where she earned minimum income supplemented with undeclared income from tips.
[397]     Undeclared tips is a commonplace occurrence for young people working in the food service industry, although it makes it more difficult to determine the plaintiff’s actual pre-accident income when the only evidence of the value of the tips comes from her “estimate” at trial, unsubstantiated by any written record.
[398]     The plaintiff possessed a certificate from a medical terminology course that she never used, and says she had aspirations to go to hairdressing school although she had not made any inquiries or taken any steps towards that end.
[399]     I am unable to assess her pre-trial loss of income claim on any other basis than her history of earnings from the food service industry, using her income tax information, and adding a somewhat arbitrary amount for tips that I will accept she was receiving but not reporting, for the time period in which I conclude she was incapable of returning to that work because of injuries related to the accident.
[400]     I have found that the plaintiff recovered from her disabling pain from the accident by the end of 2008, and by that point in time her pre-existing psychiatric illnesses had settled back to their pre-accident level and were no longer exacerbating her physical pain.
[401]     The plaintiff says she intended to continue working at Steamers Pub until September 2008 and then go to hairdressing school.
[402]     She was making approximately $660 per month in 2008 from Steamers Pub, up to the time of the accident, from her income tax records.
[403]     In addition she says she was making about $900 per month from undeclared tips.
[404]     I am not prepared to accept a figure of $900 per month for tips without some independent proof. I will accept an amount of half that number of $450 per month for tips.

Lost "Fringe Benefits" Must Be Taken Into Account When Calculating Diminished Earning Capacity

Reasons for judgement were released last week by the BC Supreme Court, Vancouver Registry, confirming that lost ‘fringe benefits’ are recoverable as part of a diminished earning capacity analysis.
In last week’s case (Combs v. Bergen) the Plaintiff was injured in a 2009 collision.   She missed several months from work causing a past loss of income of just over $18,000.  During her time off work she lost the benefit of employer contributions to her Canada Pension Plan and to her pension. She sought recovery of these losses.  Mr. Justice Steeves agreed these were compensable and provided the following reasons:
[61]         The plaintiff seeks past income loss in the amount of $18,287.25 and the defendant agrees with this amount. However, the plaintiff also seeks payment for her employer’s contributions to the Canada Pension Plan (CPP) and s to her pension. These amounts are $831.05 and $1,737.29, respectively. The defendant opposes any payment for these amounts.
[62]         There is authority for the plaintiff’s submission on benefits to the effect that “the compensatory principle requires that the full value of lost fringe benefits must be taken into account when computing loss of working capacity” (Ken Cooper-Stephenson, Personal Injury Damages in Canada, 2nd ed. (Toronto: Carswell, 1996) at 240). This reasoning was adopted by the Newfoundland Court of Appeal in Taylor v. Hogan (1998), 160 Nfld. & P.E.I.R. 93 at para. 41 (Nfld. C.A.). I conclude that is appropriate in this case.
[63]         Past income loss is set at $18,287.25 plus CPP and pension contributions. Total is $20,855.59.

Yes, Reimbursement of Sick Leave Benefits is a Recognized Damage in BC Injury Litigation

The law in BC has long recognized that a Plaintiff can seek damages to reimburse banked sick leave benefits which are depleted due to an injury caused throught the negligence of others. Despite this litigants occasionally still argue that the law does not allow such recovery as it amounts to ‘double recovery’.  Reasons for judgement were released this week by the BC Supreme Court, Vancouver Registry, disposing of this defence argument.
In this week’s case (Chingcuangco v. Herback) the Plaintiff was injured in a 2008 collison.  She missed time from work and used up over $7,000 of banked sick time.  In confirming that the Plaintiff can recover this loss Mr. Justice Weatherill provided the following reasons:
[209]     During a portion of the time when the plaintiff was unable to work, she was paid the wages that she otherwise would have received by drawing on her sick leave and vacation benefits.  She seeks damages to reflect the depletion of those benefits.
[210]     The parties have agreed that the value of the plaintiff’s hours missed (sick leave and vacation time used with pay) totals $7,371.09.
[211]     The defendants argue that an award to the plaintiff in this regard will result in double recovery because she did not lose any money – she continued to receive her wages by drawing on her sick leave benefits and vacation time.
[212]     This issue was addressed by this court in Bjarnason v. Parks, 2009 BCSC 48.  In that case, Madam Justice Ballance provided a thorough and helpful analysis:…
[213]     I agree with that analysis and I adopt it in its entirety.  Here, the plaintiff exhausted her accumulated sick leave.  She also used up several of her vacation days.  She has had illnesses unrelated to the accident that have resulted in her being unable to work.  She is likely to have them in the future.  Her plan is to stay and make a career at CRA. 
[214]     I am satisfied that the plaintiff is entitled to be compensated for her lost sick leave and vacation benefits which total $7,371.09.  There will be no deduction for income tax.
I have canvassed this topic before and you can click here to access my archived posts addressing the law of recovery of sick time benefits.

"It is Not for the Tortfeasor" To Dictate Timelines for a Plaintiff's Retirement

Interesting reasons for judgement were released this week by the BC Supreme Court, Vancouver Registry, addressing mitigation of damages in a personal injury claim seeking compensation for reduced pension benefits.
In this week’s case (Wangert v. Saur) the Defendant died when his vehicle collided with a train operated by the Plaintiff.  The Plaintiff suffered from Post Traumatic Stress Disorder and missed some time from work.  The Plaintiff retired in 2012 and sought damages for a reduced pension arguing that had he not been psychologically injured by the collision he would have worked more hours thereby having greater pensionable earnings.
The Defendant argued that since, at the time of the Plaintiff’s retirement at age 55, he was able to work full time and had no residual difficulty from the Accident he failed to mitigate his damages by not working past his otherwise planned retirement in order to earn a greater pension.  Mr. Justice Abrioux rejected this argument providing the following reasons:
[34]         In this case, I accept the plaintiff’s evidence that he had always planned to retire at the age of 55. He had spent many years working for CP Rail.
[35]         The defendant did not cite any legal authority supporting his position that a plaintiff could have mitigated losses by working past his or her planned retirement age. I was also unable to find any.
[36]         In my view, planning for retirement is a very important stage in a person’s life. When one has the opportunity to retire at a certain age, even though continuing to work remains available, the decision to retire is not entered into lightly. It is not for the tortfeasor to take the position that the plaintiff‘s failure to change his life plan due to an accident which occurred through no fault of his own, amounts to unreasonable conduct.

Plaintiff Compensated Two Years Salary for "Delayed Graduation" Claim

Just as loss of wages are compensable in personal injury claims, if an injury delays a person’s entry into the workforce the law in BC recognizes that the financial repercussions that flow from this are recoverable.  Reasons for judgement were released last week by the BC Supreme Court, Vancouver Registry, addressing this principle.
In last week’s case (Rezaei v. Piedale) the Plaintiff was injured in a 2009 collision.  Fault was admitted.  Due to the Plaintiff’s injuries she scaled back from intended full time courses to a part time course load at University.  As a result her graduation, and expected entry into the workforce was delayed by two years.  The Court addressed this by awarding damages equivalent to two years income.  In doing so Mr. Justice Voith provided the following comments regarding delayed graduation claims:
[87]         The plaintiff’s former high school principal, Mr. Li, testified that he recalled Ms. Rezaei and that she was a good student who was engaged in her high school. She was a likely scholarship candidate. He said that there was no reason she would not have been able to take a full course load at university and that most students with her academic background did. In her first and second terms of Grade 12, she had an 85% and 83.75% overall average, respectively. In her third term, after the Accident, her average was 53.25%. She ultimately graduated with a 78.1% average for her Grade 12 year. Both the plaintiff and Ms. Toghiani-Risi said that the plaintiff had expected to take a full course load when she went to university. I accept the foregoing evidence and consider that this was an entirely realistic expectation on the part of the plaintiff.
[88]         In the ensuing years at Simon Fraser University, the plaintiff has generally taken a part-time course load. She has often taken additional courses at the outset of an academic term only to later drop them. She has had to repeat certain courses to improve her grades. The details of what has happened from term to term are of no moment. The fact is that, at this point, her graduation has been delayed by at least one year and seven months, from May 2013 to December 2014. She requires 120 credits to graduate; she currently has 67 credits.
[89]         The plaintiff’s anticipated graduation date is premised on her taking and carrying a full-time course load henceforth, something she has not yet done. It is further premised on her studying in the summers, or at least part of them, and on being able to take the courses that she requires in the summer. If she is unable to graduate by April 2015, her plans to go to graduate school and obtain a Master’s Degree would be further delayed.
[90]         Ms. Rezaei presently plans to work in public health or health administration. The expert report of Mr. Peever, an economist, establishes that $35,000 per annum represents an average salary for the jobs that the plaintiff might be suited for when she graduates. No objection was taken to that figure.
[91]         The defendants sought to argue that the plaintiff could have made up some time by taking more courses in the summer. The plaintiff did say that she has, at times, chosen to work during the summer rather than study. She also said that she felt she needed a break. Dr. Frank has opined that “her persistence in schooling even though she was significantly disabled has been impressive”. Dr. Robinson stated that “[h]er accident related symptoms have been an impediment in pursuing her postsecondary education.”
[92]         Counsel for the defendants, in his submissions, said that he did not question the plaintiff’s efforts to reasonably mitigate her losses. Yet, the foregoing submission directly engages the issue of mitigation. The onus of establishing that a plaintiff has not acted reasonably to mitigate his or her losses falls on the defendant. In this case, the defendants have not satisfied that onus. I would also observe that this issue is somewhat artificial. Had the plaintiff gone to school during the summers, her summer wage loss claim would have increased. The amount that she originally anticipated earning while working at her mother’s daycare approximates the amount that she hopes to earn on graduation.
[93]         The plaintiff’s present claim, in conceptual terms, is supported by each of Pelkinen v. Unrau, 2008 BCSC 375 at para. 98; and Williams v. Nekrasoff, 2008 BCSC 1520 at para. 36.
[94]         The plaintiff’s graduation has already been delayed. I find this delay was caused by the Accident. I also consider that there is a real and substantial possibility that her graduation may be further delayed. I consider that a total delay of two years is likely for the plaintiff’s graduation. Accordingly, I award the sum of $70,000 for this head of loss.

Increased Earnings Are Not A Barrier to Diminished Earning Capacity Damages

As the BC Court of Appeal recently confirmed, it is not ‘wage loss‘ that is compensible in a personal injury lawsuit but rather ‘diminished earning capacity‘.  With this in mind it is important to remember that damages for diminished capacity can be available in circumstances where there is no past wage loss and even in cases where a Plaintiff’s earnings increase following a collision.  Reasons for judgement were released this week by the BC Supreme Court, Nelson Registry, with such a result.
In this week’s case (Brechin v. Pickering) the Plaintiff was injured in a 2007 collision.  Liability was admitted focusing the trial on an assessment of damages.  The Plaintiff suffered various soft tissue injuries to his neck, knee and shoulder.  He worked as an electrician and took ‘very little time off‘.  In addition to this the Plaintiff’s earnings increased in the years following the collision as follows:
[52]  Mr. Bredin’s work history since 2002, shows the following pattern:
2002  $49,991
2003  $29,917
2004  $23,866
2005  $64,256
2006  $40,059
2007  $68,986
2008  $84,142
2009  $80,255
2010  $99,802
The Plaintiff’s injuries were expected to linger and although he could continue to work in his own occupation he was limited in tasks ‘at the heavier end of the scale‘.  As a result the Court awarded damages for diminished earning capacity.  In doing so Mr. Justice McEwan provided the following reasons:
[78]  What emerges from Ms. Mihalynuk’s evidence is a portrait of a person who is rather self-contained, proud of his work and inclined to do very little on his time off..
[80]  Mr. Brechin is now 42 years old in a setting in which he may retire in 15 to 20 years.  There are significant physical demands in the work some of the time, although as he continues to take leadership roles, he is likely to work more often at a reduced physical level of strain.  The primary concern for his future is whether he will be able to continue to retirement without interference from the effects of the accident…
[83]  I accept that work at the heavier end of the scale ought to be avoided, and that he could probably not stay in an occupation that demanded continuous heavy labour.  In the field in which he is employed, however, this does not appear to be expected.
[99]  The possibility of a future event is not specifically that Mr. Brechin will be laid off because of his condition, which is relatively unlikely, given that the medical evidence suggests that his condition is not disabling, but the more general vagaries of business that have made employment “for life”, once a common expectation, highly uncertain.  Should Mr. Brechin lose his position for such a reason he would be put back into a competitive environment where a fraction of the heaviest work would be lost to him…
[100] In this case, that involves a consideration of the medical evidence; Mr. Brechin’s age and likely working life; the relative stability of his employment at Fortis; the possibility that either Mr. Brechin’s condition, or larger workplace and market forces will change his situation, and the prospects he could have were that to happen.  It seems clear that Mr. Brechin could work but that to some extent this range of opportunities would be limited at the heavier end of the work.  The degree to which this is attributable to the accident diminishes over time as age and other factors come into play.  I think it would be an error to assume the same capacity for heavy work in a 50 year old, that one would find in someone significantly younger.  Doing the best I can to assess these factors, I fix $60,000 for future loss of income due to the diminishment of his capacity viewed as a capital asset.  I have done so, bearing in mind his present income earning capacity, which is an improvement over the years before the accident, but that the injuries suffered in the accident may reduce, somewhat, his broader opportunities to work as an electrician.

$80,000 Non-Pecuniary Assessment For Chronic Hip Soft Tissue Injury

Reasons for judgement were released last week by the BC Supreme Court, Vancouver Registry, assessing damages for a chronic hip soft tissue injury.
In last week’s case (Pisani v. Pearce) the Plaintiff was involved in a ‘significant‘ head on collision.  Fault was admitted by the Defendant.   The crash resulted in a non-specific soft tissue injury to the Plaintiff’s hip.  The symptoms interfered with the Plaintiff’s physical lifestyle and were expected to linger indefinitely.  In assessing non-pecuniary damages at $80,000 Madam Justice Loo provided the following reasons:

[73] Ms. Pisani was injured in a significant head on collision. Her 2009 Mercedes C300 4Matic was written off. She sustained soft tissue injuries to her shoulder, neck, and back. She will likely suffer flare ups from time to time for the rest of her life. She now has problems with her hip that prevent her from enjoying activities she used to enjoy. There is no diagnosis for the problem with her hip, and there is little or no evidence that it will improve. Her relationship with her boyfriend and her friends has been adversely affected.

[74] Her social life and her extracurricular activities have been adversely affected. She has difficulty attending the mosque because sitting on the floor causes her pain. She cannot dance, play soccer, hike, ride her bicycle, or ski. Dancing has always played a big and important part of her life. Hopefully by carrying out Dr. Anton’s recommendations, she will improve her postural muscles and core stabilizers and may be able to resume most of her activities…

[87] In this case, Dr. Anton suggests that Ms. Pisani’s neck, shoulder, and lower back symptoms should hopefully improve with one on one training with a qualified kinesiologist. Dr. Anton also suggests that if Ms. Pisani fails to have a good response to the training, she may not be able to resume dancing. She will probably suffer flare ups of her injuries for the rest of her life. She is still only 23 years old. There is also no evidence that her hip problem will resolve.

[88] I conclude that a fair and reasonable award of non-pecuniary damages is $80,000.

In addition to the above, paragraphs 96-104 are worth reviewing for the Court’s discussion of damages for the Plaintiff’s delayed entry into the workforce as a result of her injuries.


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Personal Injury Lawyer

When not writing the BC Injury Law Blog, Erik is the managing partner at MacIsaac & Company, based in Victoria, B.C. He is also involved with combative sports regulatory issues and authors the Combat Sports Law Blog.

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