Personal Injury Compensation

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Disclaimer

The following is no substitute for advice provided by a lawyer specifically for you. It is intended only to help you understand that advice. No responsibility is taken for any problems arising except due to paid legal advice.

©1996 Jaques Law Office. All Rights Reserved.

Introduction

Personal Injury claims are a type of civil claim. However, attempting to put a number of what the damage is worth is so difficult and complex, it may be considered an area of the law itself.

As always, to make a claim, somebody must have failed to perform a duty to you. The duty might have arisen by statute, contract, law, or most frequently, by the 'good neighbour principle' that everybody owes a duty to everybody else not to cause them foreseeable harm.

In Saskatchewan, if you are injured in a motor vehicle collision, you must elect whether to receive benefits under the insurance you purchased, or from the person at fault. Under normal law, you would be entitled to both, although your insurance would probably contain a clause requiring you to repay what you collect from the person at fault.

Since 2005, Personal Injury Compensation is no longer one of our core areas. We focus on Real Estate, Wills and Estates, and Small Business. We have left this web page in place as a public service.

Pecuniary Damages

Past Damages

This claim is simple for past expenses. It refers to actual financial damage. This could include medical bills, replacement transportation, renovations to accomodate a disability, lost income, and so forth. You are entitled to all of it, provided the damage was reasonably foreseeable.

Future Damages

For future expenses, it is more difficult. Allowance must be made for the uncertainty (contingencies) and for the likely increase in amount due to inflation and for the likely return you earn on the money you will receive before you actually need it. The trial judge must project your needs for future care. The court must then multiply the expected annual cost with a discount factor determined by your life expectancy. Although you can call evidence on those issues, you may also just rely on the tables set out in the rules of the Court.

Lost Income Earning Capacity

In deciding what would have been, or what will be, the court should consider contingencies, such as the chances of promotion, pay increases, over-time, transfers (both within and without the company), diminished ability to handle rush periods, diminished ability to maintain good relations on the job, dismissals, etc. In the case of a self-employed person, there are possibilities of hiring extra people to handle increased work, tax advantages, etc. Courts have often used percentage allocations to account for such contingencies. Some courts have applied contingencies to reduce claims for lost income, although it is difficult to see how the positive and negative contingencies, of what the income would have been, would not cancel each other out. In fact, for most people, their ability to earn income would normally rise, but for injury. The Saskatchewan Court of Appeal has suggested that for many cases concerning future income, the amount which would have been earned should be reduced by 4% for contingencies while the amount which will be earned should be reduced by about 25% for contingencies, before calculating the difference. The amount used for contingencies is flexible and depends on how certain the court is of its estimates.

When the Plaintiff is beneficially interested in his/his own employer (i.e., somewhat self employed), many things must be considered. Even though profits may be undiminished and salary/draw/dividends may be unaffected, generally, the ability to labour is evaluated using comparable salary levels in the industry, and the award is based on how much of that ability was lost.

Payments by a third party to the Plaintiff in compensation of the loss are not to be considered, unless there is a statutory exception, or there was no loss under the employment contract. For instance, if sick time may be used up, there is a loss. If the employment contract provides contributions to insurance premiums, that insurance is not part of the employment contract. Even if there is no loss under the employment contract, if there is a moral or legal obligation to repay the employer, then the court may still make the award, but in that case, the device of a trust must be considered.

There is some authority that compensation for lost earning capacity must be classified as non-pecuniary damage. If so, then in large claims, the ceiling on compensation will be inappropriately low.

The Saskatchewan Court of Appeal specifically stated, "The evidence need only reveal a reasonable, as distinct from speculative, possibility of a loss being incurred."

Lost Home-Making Capacity

The premise of this claim is that domestic work has a value, and so the ability to do domestic work has a value. If that ability is impaired, then one has lost an asset of value, which should be compensated.

Of course, it must not duplicate a claim for lost income earning capacity. If an individual has the ability to work as a doctor in addition to the ability to do domestic work, the court must conclude how many hours the doctor would have spent at medical work and how much at domestic work, and compensate each at the appropriate rate.

The Judgment of the Saskatchewan Court of Appeal in Fobel v. Dean & MacDonald, (Sask. C.A.), File 371, #109/91, delivered August 27, 1991 (87 pages) sets out the proper approach for compensation for this loss. For loss prior to trial, those actual payments for assistance will be compensated as pecuniary damages. Otherwise, the pre-trial loss of capacity is compensated as a head under non-pecuniary damages, for which the cost that replacement services would have been is a major factor in determining the appropriate award. The court awarded $15,000.00, relying on a 30% remaining capacity and a $7.54/hour cost of replacement labour. The majority in Fobel, supra, stated: “One must assess that loss as a loss of amenity, but in so doing, the replacement cost is a relevant component or element in arriving at the dollar value of the loss of amenity. It is, in my opinion, only one elementŠbut an important one.”

For loss subsequent to trial, the court must rely on the evidence presented to determine the worth of the lost capacity, and award it as pecuniary damages. In the Fobel case, the court relied on the evidence of a home economist that replacement house-keeping labour wage rates were $7.50 per hour, and assumed they would be 30% less if paid on a monthly basis. The court determined that if the Plaintiff had 30% remaining capacity, he would need 15 hours per week of replacement capacity. The court regretted that there was no evidence to permit it to award a higher amount for the management aspects of the Plaintiff’s home-making (p.33), and gave the following award after performing the following calculations

annual cost = 15 hours/wk * 52 weeks/yr. * 5.50/hour = $4,290.00

Discount rate = 3% & life expectancy is 27 yrs., so the discount factor is 18.57768

The Award is the annual cost times the discount factor = $79,698.24

First the court must determine the annual loss. Then the court should determine a percentage of lost capacity, according to the evidence. Then the court must determine the Plaintiff’s original capacity. The percentage should be applied to the capacity to determine the loss. Once the annual loss is determined, it must be multiplied by the discount factor determined by the Plaintiff’s life expectancy.

Tax Gross-Up

In other words, a further amount must be awarded to account for the fact that interest earned on the amount for compensation will be taxed, even though the interest is intended, via the ‘factor’, to be part of the compensation. Without the ‘gross up’, the Plaintiff would be under compensated.

Non-Pecuniary Damages

This is much harder. How do you put a value on pain? In the end, the courts just try to be consistent. So the lawyer must do a lot of research to find comparable cases. But, in comparing other cases, one must adjust for inflation back to date of the injury.

Sometimes the courts will put a 'cap' on awards for certain types of injuries. The Supreme Court of Canada set an overall cap on awards for non-pecuniary damages, which was equivalent to $216,000.00 as of October of 1990. The Saskatchewan Court of Appeal put a cap on 'normal' 'whiplash' cases of $45,000.00 as of October of 1990.

Of course a type of injury may have additional types of syndromes. For instance, a significant number of whiplash injuries will acquire 'Chronic Pain Syndrome', or 'Temporal Mandibular Joint Dysfunction'. If so, then the cap does not apply.

Interestingly, when the case is heard by a jury, neither other awards nor caps may be mentioned, though the jury can be reversed for those reasons. Further, the one question that does offer an answer to the issue may not be asked, namely, "What would you accept in order to voluntarily suffer this injury?" Centuries of experience have found that this question results in awards which are much 'too high'. In the writer's opinion, that suggests that cases decided without asking that question are much too low.

Court Costs

As usual in a civil claim, the winning party should expect to receive some compensation for legal costs. This is only intended to be a partial compensation, since the winner did, after all, fail to settle the matter. The Rules of Court set out a tariff for various items, which must be calculated.

However, if the winner proves that the award meets or exceeds a formal offer which they made, they get double costs after the time of that offer.

Ultimately, Court Costs are in the discretion of the trial judge. The judge may lower or raise them. Sometimes the award will be for the entire legal cost, if the loser's conduct in the proceeding was particularly bad. These are then called 'solicitor client costs'.

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