New Brunswick Court of Appeal Finds Interest on Disbursements Recoverable in Injury Litigation
I have previously discussed the uncertainty about whether interest on disbursements is a recoverable item in the prosecution of BC personal injury claims. I understand the BC Court of Appeal will have the opportunity to canvass this issue in the upcoming months in an appeal of the competing Chandi and McKenzie decisions.
In New Brunswick, fortunately, the law has just been clarified with the Court of Appeal of New Brunswick addressing the issue head on in reasons for judgement released last week. In short the Court held that interest on disbursements could in fact be recovered.
In last week’s case (LeBlanc v. Doucet) the Plaintiff was injured in a motorcycle collision. He could not finance his lawsuit for damages and approached a lender who provided over $26,000 in disbursement financing. By the time of resolution the interest on the loans topped $14,000. The New Brunswick Court of Appeal held that interest could be a recoverable item. In reaching this conclusion the Court provided the following reasons:
The appellant, Francis LeBlanc, lacked the means to finance his action in damages against the respondents. His impecuniosity compelled him to take out loans from an independent third party to cover litigation expenses, all for the purpose of securing access to justice. While no provision of the Rules of Court expressly allows interest on such loans as a “disbursement”, sub-para. 2(14) of Tariff “D” of Rule 59 fills the gap. It suffices that those loans were “necessarily incurred” to secure the just determination of the proceeding and that the interest rates were “reasonable”. The evidence shows that these conditions were met in the present case. Accordingly, the clerk was duty bound to allow, as a disbursement, the interest ($12,665.41) on the loans required to cover the other disbursements he had approved. In short, these are the reasons that caused me to join my colleagues in reversing the decision of the judge of the Court of Queen’s Bench, sitting on appeal, which upheld the clerk’s rejection of Mr. LeBlanc’s interest reimbursement claim.
While this judgement is not binding in BC it certainly may be influential when the BC Court of Appeal addresses the issue.