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More on the "Harsh" Reality of Part 7 Benefits Deductions in ICBC Tort Claims

Written by admin on . Posted in ICBC No-Fault (Part 7) Benefits, Uncategorized. 53 Comments on More on the "Harsh" Reality of Part 7 Benefits Deductions in ICBC Tort Claims


Two Judgements were recently released by the BC Supreme Court discussing the “harsh” reality of Part 7 Benefits Deductions in ICBC Injury Claims.
As previously discussed, if you are entitled to receive Part 7 Benefits under your policy of insurance and don’t pursue these a Defendant who is responsible for injuring you in a BC Motor Vehicle Collision can reduce the amount of damages that they have to pay you by the amount of benefits you should have received from your own insurance coverage.  Often after trial ICBC will argue that some of the awarded damages should be reduced for this reason.  The first of the two recent judgments demonstrates that these deductions could operate in a punishing way for Plaintiffs.
In the first case released this week (Kirk v. Kloosterman) the Plaintiff suffered “catastrophic and tragic” injuries in a motor vehicle collision.  The Plaintiff, who had a learner’s licence to operate a motorcycle, failed to obtain a full licence at the end of his probation period and for this reason was considered uninsured by ICBC.  He was struck by a vehicle operated by the Defendant and suffered serious injuries.  He became paralyzed from near the waistline down.  His spinal cord became infected while in hospital and this “literally chewed up a further portion of the spinal cord so that he has lost a great deal of his thoracic capacity and now his arms and shoulders must bear his weight and provide all his strength“.
A jury found the Plaintiff 15% at fault for the collision and the Defendant 85% at fault.   Damages of nearly $4 million were awarded less 15% to reflect the Plaintiff’s liability.   Following verdict the Defendant (who was insured with ICBC) applied to have some of these damages reduced because the Plaintiff was allegedly in breach of his no-fault plan with ICBC.   Mr. Justice Crawford granted the motion and reduced the damages by approximately $200,000.  In doing so the Court noted that while this was “harsh and even punitive” a Plaintiff who disentitles himself to his own ICBC coverage can be faced with a statutory deduction in their tort claim.  Mr. Justice Crawford provided the following reasons:

[]           Ms. Kloosterman says the law is clear and settled: if the plaintiff acts so as to disentitle himself, then the Court must calculate and apply the deduction. She argues that Mr. Kirk would have been entitled to benefits under Part 7, had he possessed a valid driver’s licence.

[]           It is plain that the legislative intention is to prevent double recovery, that is, to prevent a plaintiff from recovering the same amount of monies both by way of the defendant through a tort action and by way of no-fault insurance coverage. Given the legislative intention, it seems harsh and even punitive to not only deny a plaintiff, who has been found substantially not at fault in a motor vehicle collision and awarded damages for losses sustained, no-fault benefits but also to deduct the amount of his or her potential entitlement to Part 7 from the tort award. However, the case law is binding on me, and can only be construed differently by the Court of Appeal:  see Baart v. Kumar, (1985), 66 B.C.L.R. 1 (C.A.); Si v. Enns, , 2001 BCSC 1120.

[]           Accordingly, I accept the defendant’s submissions on this issue and find that there must be a deduction.

In the second case released this week (Gignac v. Rozylo) the result was not nearly as harsh but the case still demonstrates the reality that applications for statutory deductions can be made following vehicle collision cases.
In Gignac the Plaintiff was injured in a 2004 motor vehicle collision.  Following trial Mr. Justice Wilson awarded damages including $15,000 for ‘special damages‘ and just over $115,000 for ‘costs of future care‘.  (UPDATE August 17, 2012 – the BC Court of Appeal reduced the cost of future care award by about $40,000.  Their reasons can be found here) ICBC then argued that these awards should be reduced by $25,000 to account for the fact that the Plaintiff can obtain money from ICBC for these expenses under their own policy of insurance.
Mr. Justice Wilson largely rejected ICBC’s arguments and made a modest deduction of $2,000 of the awarded damages.  In doing so the Court provided the following useful comments about the “level of abstraction” of ICBC’s permissive benefits scheme:

[23]        As I understand Ms. Lewko, if a benefit is not “specifically listed”, then, an insured’s entitlement to the benefit is dependent upon “ICBC claims handling procedures”, or “ICBC claims handling policies”, or “ICBC policy”.

[24]        Legislative support for this approach is s. 88(2)(f), the “other” category, referred to above.

[25]        The statute does not direct me to determine entitlement to benefits pursuant to ICBC policy; the direction is to determine entitlement pursuant to the plan.

[26]        Section 88(2)(f) is subject to the opinion of the corporation’s medical advisor that an expenditure is likely to promote the rehabilitation of an insured.

[27]        The opinion of that medical advisor is a necessary condition before resort may be had to s. 88(2)(f) of the Regulation.  Absent the necessary condition, the corporation is not authorized to pay benefits.

[28]        Rehabilitation means restoration.  This plaintiff’s debilitating condition is chronic pain.  Current medical science has no cure for this condition.  I find it improbable that a medical advisor would opine that any of the goods and services contained in the assessment of future care costs, would promote the rehabilitation of this plaintiff.  Those goods are services were recommended by the occupational therapist as necessary to enable this plaintiff to maintain an optimum level of functioning, now and in the future, and to maximize independence and prevention of further disability.

[29]        Alternatively, if I am wrong in my interpretation of the legislation, and ICBC policy is a relevant factor, then the applicant has not persuaded me that it is more likely than not that this plaintiff is entitled to the benefits in controversy.  The scales are evenly balanced.  Policy may authorize the benefit or it may not.  According to Ms. Lewko:

11.       It is ICBC policy that the exercise of discretion for permissive benefits must be rationally connected to the relevant factors governing an objective assessment of the entitlement to the benefit.

That is a level of abstraction which does not allow for a determination of entitlement on a balance of probability.

[30]        In result, the cost of future care assessment is reduced by $2,000.

ICBC Uninsured Motorist Claims and the Deductibility of WCB Benefits

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If a person is injured by the actions of an uninsured motorist in BC they can seek compensation directly from ICBC under section 20 of the Insurance (Vehicle) Act.
There are certain limitations to section 20 claims and one of these was that ICBC could deduct Workers Compensation Benefits.  This changed by the new section 106 of the Insurance (Vehicle) Regulation which came into force on June 1, 2007.  The new regulation changed the definition of an ‘insured claim‘ that ICBC could deduct as follows:

106 (1)  In this section, “insured claim” means any benefit, compensation similar to benefits, right to indemnity or claim to indemnity accruing to a person entitled to benefits, compensation or indemnity or to the personal representative or guardian of the person, and includes a benefit, compensation, right or claim

(a) under the Workers Compensation Act or a similar law or plan of another jurisdiction, unless

(i)  the insured elects not to claim compensation under section 10 (2) of the Workers Compensation Act and the insured is not entitled to compensation under section 10 (5) of that Act, or

(ii)  the Workers Compensation Board pursues its right of subrogation under section 10 (6) of the Workers Compensation Act

Reasons for judgement were released this week by the BC Supreme Court, Vancouver Registry, addressing whether ICBC could deduct WCB benefits paid when a crash occurred prior to June 1, 2007 but the uninsured claim against ICBC was still on-going after the new Regulation came into force.  In short the Court held that the date of the crash itself does not decide the issue, rather the date that the section 20 claim against ICBC is crystallized does.
In this week’s case (Hicks v. Bieberbach Estate) the Plaintiff was injured in a 2005 collision.  The opposing motorist was operating a stolen vehicle and was killed in the collision.  Motorists in stolen vehicles are deemed to be uninsured motorists by ICBC.  The Plaintiff initially obtained some compensation from WCB.  The Plaintiff then re-elected his route of compensation and brought a tort claim (apparently with WCB’s approval) against the uninsured motorist’s estate.
ICBC took the position that all the funds paid by WCB were non-recoverable as the crash happened prior to June 1, 2007.  Madam Justice Adair disagreed and found that since the CL-42 (the statutory declaration claimiants need to sign to seek section 20 benefits from ICBC) was not signed until after June 1, 2007 the new regulation applied and ICBC could not deduct the WCB payments from their section 20 obligations.  In reaching this decision the Court provided the following reasons:

[44]         A claimant who is injured by an insured driver and who wishes to make an application to ICBC for damages must do so in the prescribed form:  s. 20(2).  The form prescribed is a statutory declaration, where an applicant must verify facts as if under oath or on affirmation.  I do not see anything in s. 20 to suggest that ICBC “may pay” without having fundamental facts relevant to the claimant’s claim verified by solemn declaration,  as prescribed by the legislation.  On the contrary, the clear implication of s. 20(9) is that it is necessary for a claimant to submit a declaration in Form CL-42 before ICBC “may” pay.  The significance of the word “may pay” (rather than “must pay”) is that, even when a claimant has complied with s. 20 and the regulations, ICBC is notobligated to pay:  see Buxton v. Tang, at para. 7.

[45]         In my view, ICBC’s correspondence dated February 7, 2007, indicates that ICBC requires plaintiff’s counsel to comply with the service and default requirements of s. 20 (see in particular ss. 20(5)(b), (6) and (7)), and, more generally, indicates that ICBC expected Roy Hicks to comply with the section and the regulations before any amount would be paid to him.  This is entirely consistent with s. 20(9).  One of the requirements was that Mr. Hicks complete and submit a CL-42.  Unlike s. 24 of the Act, which requires a claimant to give ICBC notice of a claim within 6 months after the accident but does not specify any form in which the notice must be given, s. 20 specifies the form of notice of a claim, but does not fix a deadline…

[52]         In my opinion, in this case and reading s. 20 as a whole, ICBC was not in a position where it at least “may” pay, until Roy Hicks submitted his CL-42 statutory declaration.  That was the final step Mr. Hicks needed to complete (since service of the writ and defence of the claim by ICBC had been addressed in the fall of 2007) as claimant.  Since the CL-42 statutory declaration was submitted in February 2008, s. 106 of the New Regulation applies…

[54]         In summary, the question posed on the special case is:

Does the Insurance Corporation of British Columbia have the legal authority to deduct Workers’ Compensation Board benefits paid to the Plaintiff from any amount to be paid to the Plaintiff for damages, as a result of settlement or judgment in this matter, taking into account Section 20 of the Insurance (Vehicle) Act, R.S.B.C. 1996, c. 231 and regulation 106 of the Insurance (Vehicle) Act Regulations, or the predecessor to these sections which were repealed on June 1, 2007?

My answer is no.  Section 106 of the New Regulation applies in respect of the plaintiff’s claim.

Keep it to Yourself! Solicitor-Client Privilege and Unintended Waiver

Written by admin on . Posted in Civil Procedure, Uncategorized. 58 Comments on Keep it to Yourself! Solicitor-Client Privilege and Unintended Waiver


As previously discussed, the law in Canada permits people to seek confidential legal advice.  Confidential communications between a lawyer and client are a “fundamental civil and legal right“.  This right permits individuals to not only get the advice they need but also to claim ‘privilege‘ over these discussions and to not disclose them in the course of a lawsuit.
This privilege can be waived, however, if the person receiving the advice chooses to discuss the nature of the privileged communications.  This was demonstrated in interesting reasons for judgement released this week by the BC Supreme Court, Vancouver Registry.
In this week’s case (Biehl v. Strang) the Plaintiff apparently advanced the Defendant Mr. Strang $1.6 million.  The lawsuit involved allegations of unjust enrichment and whether there was an enforceable contract as between the parties.  The Plaintiff sued two individual and two corporate defendants.
In the course of the lawsuit one lawyer prepared a statement of defence on behalf of Mr. Strang and the corporate defendants.  Eventually a new lawyer was brought on to represent the corporate defendants.  Mr. Strang, by the time he attended examination for discovery, was self represented.
At his discovery Mr. Strang was asked if he agreed with the contents of the Statement of Defence.   He disagreed with some of the contents.  He was then asked whether he was “giving instrucitons (to his then lawyer) about the drafting of the statement of defence“.   He did not object to this question and replied that he did not give instructions as to the contents of the defence.
The Plaintiff’s lawyer then brought a motion for access to the former lawyer’s records arguing that the Defendant’s lack of objection in discussing this topic constituted a waiver of privilege.   Madam Justice Arnold-Bailey agreed and ordered limited production of otherwise privileged documents.   The court reviewed the law of solicitor-client privilege and waiver at length at paragraphs 31-68 of the reasons for judgement.  In concluding that privilege had been waived the Court provided the following reasons:

[69]    To summarize, in the present case Mr. Strang and the corporate defendants jointly retained Mr. Johnson to represent them.  In the course of doing so, Mr. Johnson prepared and filed a joint statement of defence.  Mr. Strang, by his answers to questions at examination for discovery, denied that he had provided instructions to Mr. Johnson as to the statement of defence and impliedly waived solicitor-client privilege in relation to instructions provided to Mr. Johnson regarding the preparation of the statement of defence.  I have found that Mr. Strang waived his own privilege but not that of the corporate defendants.  However, the corporate defendants will waive privilege as to the preparation of the statement of defence if they call Mr. Johnson.  They seek to do so for the limited purpose of determining whether Mr. Strang approved the statement of defence.

[70]    The position of the plaintiff is that he is entitled to all the material in the possession of Mr. Johnson and his law firm that is relevant and material to the preparation and content of the statement of defence.

[71]    The position taken by the corporate defendants is too narrow; the position taken by the plaintiff is too broad.  The somewhat unusual facts in this case dictate a very cautious and considered approach.  The record is clear that as of the June 2010 discovery of Mr. Strang, he and the corporate defendants no longer jointly retained Mr. Johnson, the lawyer with whom they had privileged communications.  This speaks to a waiver of privilege by Mr. Strang that is very limited in scope.  Mr. Strang ought not to be considered to have waived solicitor-client privilege over anything more than the matters he spoke directly about.

For a more in depth look at this topic you can review the Canadian Bar Associations recently released paper on Solicitor Client Privilege in Canada.

More on the Real Consequences of Insurance Fraud

Written by admin on . Posted in Uncategorized.

Last month I wrote about why I hate insurance fraud.   A quick look at comments following stories of personal injury claims in the news provides insight into the harsh judgments personal injury claimants face by some members of the public.

Although the cynicism and doubt cast on legitimate claims is the most unfortunate consequence of insurance fraud , there are more well recognized effects of fraud and these are the costs to the public at large.  Fortunately the civil consequences for being caught in a fraudulent scheme can be high and this was demonstrated in reasons for judgement released last month by the BC Supreme Court, New Westminster Registry.
In last month’s case (ICBC v. Wiese) the Defendant was insured with ICBC.   Between 1997 and 2005 ICBC alleged that “there were an ongoing series of fraudulent acts and representations by Mr. Wiese to ICBC, both directly asserting certain facts to be true regarding his residence and also providing statements and other updated information though which that pretence was maintained” Over the years the Defendant was apparently involved in “14 separate accidents involving seven different vehicles…resulting in payments out from ICBC of $102,855.48“.
ICBC sued for damages and succeeded.  Mr. Justice Schultes awarded ICBC not only the cost of the claims paid out but a further $70,000 in punitive damages to punish the defendant for his repetitive “fraud on the public“.
If you ask a Plaintiff who has unfairly had their credibility called into question by an insurance defence lawyer they will tell you that insurance fraud causes harm to others beyond insurers.  Cases such as the above serve as a stark and welcome reminder that the cost and consequences of insurance fraud are high.

Case Planning Conferences and Transcripts of Proceedings: Uncontested Applications

Written by admin on . Posted in BCSC Civil Rule 5, Uncategorized. 140 Comments on Case Planning Conferences and Transcripts of Proceedings: Uncontested Applications


As recently discussed, one of the changes in the new BC Supreme Court Civil Rules is the introduction of Case Planning Conferences (CPC’s).   Rule 5-2(7) states that “proceedings at a case planning conference must be recorded, but no part of that recording may be made available to or used by any person without court order“.  The first reasons for judgement  that I’m aware of addressing the issue of a court’s discretion to order a transcript of proceedings following a CPC were released last week by the BC Supreme Court, Vancouver Registry.
In last week’s case (Shen v. Klassen) the plaintiff was involved in a motor vehicle collision and sued for damages.  In the course of the lawsuit a CPC was held.  The Defendant wrote the Court requesting a copy of a transcript following the CPC.  The plaintiff took no position with this request.  Despite this the Master refused to make a transcript available stating that “I see no basis upon which to accede to the request“.
The Defendant appealed.  The Plaintiff again took no position.  Madam Justice Beames allowed the appeal and permitted the Defendant to obtain a copy of the CPC transcript stating that “there is no compelling reason, in my view, for the court to refuse to order a transcript of a CPC where one party seeks the transcript and the other party does not object“.
The Court was invited by the Defendant to set out guidelines to be applied in future cases addressing the circumstances when CPC transcripts should be released.  Madam Justice Beames refused to do so noting that it would be inappropriate to do so when the Court only heard one party’s submissions on this issue.
I will continue to follow the Judicial development of this rule and write about relevant cases as they come to my attention.  If anyone is familiar with other cases addressing the Court’s discretion to order the release of CPC transcripts I invite you to bring them to my attention.

$55,000 Non-Pecuniary Damages Assessment for Bimalleolar Ankle Fracture

Written by admin on . Posted in ICBC Ankle Injury Cases, Occupier's liability claims, Uncategorized.


Reasons for judgement were released today by the BC Supreme Court, Vancouver Registry, addressing the issues of fault and value of injuries sustained in a 2005 slip and fall accident in Vancouver, BC.
In today’s case (Druet v. Sandman Hotels, Inns & Suites Ltd.,) the Plaintiff was visiting Vancouver, BC and was staying at a hotel operated by the Defendant company.  As she entered the hotel she slipped on the floor and fractured her ankle.  The injury requires surgical correction.
The Court found that both parties were equally at fault for the incident.  The Defendants were found at fault for having unreasonably slippery tiles in their lobby knowing how often patrons tracked water into the lobby.  The Plaintiff was found partly at fault for failing to take reasonable care for her own safety.  Paragraphs 14-62 are worth reviewing for the Court’s discussion of fault.
In valuing the Plaintiff’s non-pecuniary damages (money for pain and suffering and loss of enjoyment of life) at $55,000 Mr. Justice Savage made the following findings with respect to the severity of the Plaintiff’s injury:

[11]        Druet suffered a bimalleolar ankle fracture.  She had open reduction surgery.  The break was fixed with metal screws.  The metal screws were removed by a further operation.  She had ongoing complaints of stiffness and lack of range of motion.  She had a lack of dorsiflexion and could not invert or evert her right hindfoot very well.  In June 2008 she had scar tissue surgically debrided and a gastrocnemius recession was performed.

[12]        By 2009 Druet’s condition was stabilized, but she had stiffness and arthrofibrosis of her right ankle, related to her bimalleolar ankle fracture.  She is not considered at high risk for future injuries, provided she stays within reasonable restrictions.

[13]        She walks with a slight limp and can no longer run as she once did, but can walk significant distances, which she does with walking partners.  She has some concerns about the work she does as a nurse, but is still able to perform the work required to the satisfaction of her current employer…

[66]        I have described the injuries above.  As a result of those injuries the plaintiff had three surgeries, although two were in succession.  She had implantation of a plate, a rod and surgical screws in March 2005 which were removed in September 2005.  Her ankle was debrided in June 2008.

[67]        Druet missed a total of three months of work as a licenced practical nurse arising from the injuries and surgeries.  She walked with crutches for a short time after the Accident while recuperating.  She had limited physiotherapy in 2005 but not since.  She wears orthotics.

[68]        Druet has substantially resumed her previous activities, except running.  She now walks two miles a day, five days a week.  She did substantial walking during a vacation to Europe in 2006 and a holiday in New York in 2008.  She can walk five kilometres.  She participates in 5K walks and completes them 10 to 15 minutes slower than when she ran. ..

In my opinion non-pecuniary damages fall between the two parties’ positions.  I award $55,000 under this head.

Justice Harris Discourages Deposition Evidence Absent "Pressing Reasons"

Written by admin on . Posted in BCSC Civil Rule 12, BCSC Civil Rule 7, Uncategorized. 118 Comments on Justice Harris Discourages Deposition Evidence Absent "Pressing Reasons"


Rule 7-8(1) of the BC Supreme Court Rules allows parties to a lawsuit to, by consent, record evidence of witnesses prior to trial by way of Deposition.  Deposition evidence can then be admitted at trial as authorized by Rule 12-5(40).
When evidence is taken prior to trial it is accompanied by certain shortcomings as compared to live courtroom testimony.  Mr. Justice Harris discussed these at length in an Appendix to reasons for judgement released earlier this month.
In this recent case (Byer v. Mills) the Plaintiff was seriously injured in a motor vehicle collision.  In the course of the lawsuit the parties agreed to record much of the evidence by way of pre-trial deposition.  Ultimately the Plaintiff’s lawsuit was dismissed.  Mr. Justice Harris shared some concerns about the shortcomings that can be created by deposition evidence at trial and suggested that counsel only agree to pre-trial depositions when there are ‘pressing reasons to do so‘.  The Court provided the following feedback to BC litigants:

a)    The majority of the defence evidence of fact was taken by deposition before trial began. This was done by consent as the Civil Rules permit. I presume it was done to convenience the witnesses, most of whom live in or near Quesnel and to save the expense of bringing witnesses to testify “live” before the court in Vancouver.

b)    During the course of one deposition, I expressed some reservations about using depositions in this way. What follows are some reflections triggered by the use of this practice, and are not comments directly arising from the way counsel in the case before me conducted the depositions. They are also not complete, but merely illustrative of the kind of problems that arise by taking evidence by deposition.

c)     It is well settled in our trial practice that the basic rule is that witnesses should testify live before the court. This proposition is reflected in Civil Rule12-5 (27) and in the many cases in which our courts have considered the basis on which to exercise their discretion to make an order that evidence be taken by deposition.

d)    In this case, the defence evidence was taken before trial and therefore before the plaintiff had led any evidence at all. In my view, there are good reasons why in a conventional trial a plaintiff is required to lead evidence first on matters on which he or she bears the burden of proof. The defence is then required to respond to the plaintiff’s case, including leading evidence on any matters on which it carries the burden. This provides an orderly framework for the receipt of evidence by the court. It helps keep the relevance of evidence in focus.

e)    Taking defence evidence first carries with it risks and potential inefficiencies. First, there is the risk that a defendant may not correctly anticipate what the plaintiff’s evidence turns out to be at trial. The defence evidence may not be properly responsive to the plaintiff’s case. Evidence may be taken that is unnecessary. Issues may not be adequately addressed in the defence case, creating the risk that a party may need to apply to have a witness who has been deposed supplement his or her evidence. It seems to me to be generally undesirable to take trial evidence out of the normal order.

f)      There are further difficulties inherent in taking evidence by deposition. The evidence is not taken live and its receipt as trial evidence is not controlled by the trial judge as the evidence is being given. Objections may be made, as occurred in this case. Inevitably, the objection is made and left on the record. The witness then provides the evidence to which there is an objection, subject to a later ruling.

g)    This seems to me to be unsatisfactory. It is preferable that objections be ruled on before the evidence is given for a number of reasons. First, if the objection is upheld, a witness does not spend time answering improper questions. Where several witnesses are testifying about the same matter, a ruling at the outset will limit the scope of the evidence of all the subsequent witnesses. Secondly, it is not uncommon for counsel to frame questions in an objectionable manner, even though there are ways properly to elicit the evidence counsel is seeking. It is far better for the court to have the opportunity to ensure that questions are properly framed and evidence properly received than to try to “unscramble an omelette” after the fact. This is not just a practical issue. Often the way in which evidence is elicited can affect the weight it is entitled to receive. There is a risk of substantive prejudice to the parties if the trial judge is denied the opportunity at the time it is given to ensure that evidence is properly received.

h)    Finally, the trial judge has an important additional role to play in controlling the trial process. It is not uncommon for a trial judge to be called on during cross-examination, either at the request of counsel or on his or her own initiative, to control the conduct of the cross-examination. For example, it may be necessary to decide how much of a prior allegedly inconsistent statement ought properly to be put to a witness. That is a decision that should be made at the time the witness is confronted with the statement. Taking evidence by deposition necessarily deprives the trial judge of an essential judicial function. Doing so is fraught with risks to the trial process and risks substantive prejudice to the parties.

i)       I appreciate the Civil Rules permit depositions to be taken by consent. In my view, the purpose of allowing this to occur by consent is to obviate the need for an order where it is clear that the circumstances exist that would lead a court to make an order. Generally, the party applying to take evidence by deposition has a burden to meet to justify departing from the general rule that evidence be given live. I will not rehearse the law on this point. But I do not think the drafters of the Civil Rules intended to encourage a practice that is inconsistent with conventional trial practice.

j)      It follows from my comments above that I would discourage counsel from electing to resort to taking depositions by consent unless there are pressing reasons to do so. If there are legitimate concerns about cost and convenience, there are provisions permitting taking evidence by video conference. At least then the evidence is taken live.

Firing Your ICBC Claims Lawyer: The Costs/Benefits Analysis

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As discussed last year in the below video, if you hire a lawyer to represent you for a personal injury claim and are not satisfied with their performance you can fire them.  However, there usually is a cost associated with this.
When people are seeking a new lawyer my typical advice is to first have them review their contract and determine how much it will cost them to change counsel.  From there an informed decision can be made whether the shortcomings in their current lawyer relationship outweigh the costs of moving on.  Reasons for judgement were released this week by the BC Supreme Court, Vancouver Registry, demonstrating the costs that come with switching lawyers.
In this week’s case (Alafriz v. Mathivanan) the Plaintiff was injured in a motor vehicle collision and hired a lawyer to represent him.  The Plaintiff eventually changed lawyers.  A dispute arose over how much was owed to the first lawyer for services rendered.  The lawyer sent a bill seeking $5,825.  The client refused to pay this and the Court was asked to settle the issue.  Ultimately Registrar Sainty held that the first lawyer’s bill was “far too pricey in these circumstances“.
Despite this the Court held that the first lawyer was entitled to a fee for the services rendered and ordered the client to pay $3,000.  This case is worth reviewing in full to see the types of factors the Court considers in addressing the appropriateness of a fee for a personal injury claim where a client changes lawyers prior to settlement or trial.

More on the Limits of "Nervous Shock" Claims

Written by admin on . Posted in ICBC Psychological Injury Cases, ICBC PTSD Cases, Uncategorized. 47 Comments on More on the Limits of "Nervous Shock" Claims

As recently discussed, in appropriate circumstances witnesses to the consequences of a BC collision can sue for damages for “nervous shock“.  There are some limits on these claims and one of these relates to whether the shocking event is “sudden and unexpected“.  If not, a claim for damages for nervous shock will fail.  This topic was addressed in reasons for judgement released today by the BC Court of Appeal.
In today’s case (Toukaev v. ICBC) the Plaintiff’s spouse was seriously injured in a motor vehicle collision.  He was notified of the crash and saw his wife shortly afterwards in the hospital.  He claimed he suffered damages after seeing his wife “in a very bad state at hospital” and sued for compensation.  His claim was dismissed and he appealed.  The Appeal was dismissed.  In doing so the BC Court of Appeal provided the following reasons addressing the need for nervous shock claims to develop as a result of ‘sudden and unexpected‘ events:

[21]         Chief Justice McEachern went on to state that while the Court was in part bound by Rhodes, he did not consider Rhodes as standing for the proposition that for a claim for nervous shock to be found, psychological injury must have occurred at the scene of the accident.  He stated that in certain cases it could be extended to the events at the hospital immediately after the accident.  At paras. 75 – 77, the Chief Justice concluded:

[75]      The law in this province, as formulated by Rhodes, requires that the plaintiffs, in order to succeed, must experience something more than the surprise and other emotional responses that naturally follow from learning of the death of a friend or relative. Instead, there must be something more that separates actionable responses from the understandable grief, sorrow and loss that ordinarily follow the receipt of such information. In Rhodes, Taylor and Wood JJ.A. described the requisite experience as alarming and startling (and therefore sudden and unexpected), horrifying, shocking and frightening, and Southin J.A. referred to a “fright, terror or horror”.

[76]      The nature of the experience by which an injury is alleged to have been suffered is one of the “controlling mechanisms” that serve to limit the reach of liability for nervous shock in this province. It seems to me that the principle shock suffered by the plaintiffs was in learning of Yasmin’s death; after that, grief, sorrow and regret would follow immediately, and would continue for an unlimited period. The experience of viewing the body, however, cannot be equated to the shock and horror that would be experienced, for example, at the scene of an accident witnessed by the plaintiffs because the features of surprise, shock, horror and even fear are absent in a hospital setting. As already mentioned, it might have been different if Yasmin’s body had been horribly mutilated or if she had died in the presence of her family. That was the case in Cox v. Fleming (1993), 13 C.C.L.T. (2d) 305 (B.C.S.C.) where the plaintiff succeeded. That would be a different case and one that I need not attempt to decide.

[77]      While I consider myself free to agree with many eminent judges who have extended the immediate aftermath of a casualty to the hospital in circumstances such as these, I am constrained by authorities binding upon me to decide that the experience the plaintiffs endured, grievous as it must have been for them, was not one that falls within the requirements of the law relating to the circumstances in which persons who are not physically injured are entitled to damages for nervous shock.

[22]         Here, Mr. Toukaev learned of Ms. Toukaeva’s injuries before he saw her, and while her condition must have been upsetting to him when he saw her, it could not be said to have been unexpected.  As was the case for Yasmin Devji’s family, the Chambers Judge here concluded that a claim by Mr. Toukaev would not fall within the requirements of the law relating to the circumstances in which persons who are not physically injured are entitled to damages for nervous shock, and I conclude that that aspect of his appeal lacks the degree of merit necessary to justify a finding of indigent status.

Cost of Future Care Awards and Tax Gross Ups: Can Tax Planning Strategies Be Considered?

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When Personal Injury Plaintiffs are awarded damages for costs associated with future medical care they are expected to invest the money and draw from this fund to pay for their future care needs over their lifetime.  The difficulty is that while personal injury damage awards are not taxable, investment income is.  To account for this Trial Judges have the ability to award further damages to set off these tax consequences.  This is called a “tax gross up” award.  Reasons for judgement were released this week by the BC Supreme Court, Victoria Registry, addressing this area of law.
In today’s case (Sartori v. Gates) the Plaintiff was awarded damages by a Jury which included $41,000 for cost of future care.  The Plaintiff applied for a tax gross up and presented an actuarial report which concluded that approximately $10,000 would be necessary to offset the investment tax consequences from the cost of care award.  ICBC presented contrary evidence arguing that an award of $3,000 would be appropriate.
The main reason for the difference in the economists opinions was whether the Court could consider tax minimizing strategies in quantifying a tax gross up award.  Ultimately the Court held that these can be considered, however, the whole of these strategies are not to be applied solely to the damage award for cost of future care.   Mr. Justice Wilson provided the following practical reasons:

[20]         In result, I find the tax free savings account benefits to be a lawful consideration in defining the tax gross up amount.  That said, however, Townsend is also authority (among many, many others) for the principle that, “compensation aims at restoring the victim to the position that person would have been in had no loss been incurred”.

[21]         A cost of future care award is founded on the theory that the tortfeasor must provide a fund from which the victim may draw to meet future expenses as they occur.  It is a presumption of law that the fund will be invested and will earn income.  According to the theory, as I understand it, the fund and its income, is a separate stand-alone phenomenon.  It appears to me that Mr. Szekely has treated it as such in his analysis.  Therefore, the tax benefits available to the plaintiff, by virtue of a tax free savings account, are exhausted in this separate stand-alone account.

[22]         Commencing 1 January 2009, the plaintiff has been entitled to the tax benefits of a tax free savings account.  It seems to me that if I assign all of the tax benefits, from a tax free savings account, to this stand-alone account, then I will not be restoring the plaintiff to the position he would have been in had no loss been incurred.  To put it in Mr. Wickson’s terms, adopting Mr. Szekely’s approach, fails to recognize the plaintiff’s right to use the tax free savings account for his “first slice” income.

[23]         I have considered the tax benefits of a tax free savings account as a legitimate factor in determining the tax gross up and having done so, I conclude that in this particular case, Mr. Szekely’s calculations are not applicable in the determination of the tax gross up amount…

[31]         Finally, the fund available to meet the plaintiff’s costs of future care is $41,333.33.  I find it is more probable than not that the income to be earned from the investment of this fund will be interest income.  Therefore, I make no allocation for capital gain or dividend income and assess the tax gross up at $10,025.