Date: Wed, 2 Jun 2004 09:02:08 –0400

From: David Cheifetz

Subject: Question

Professor Deslauriers

In the apparent absence of an immediate reply from our professorial colleagues, I'll provide a practitioner's answer to you, for any of them to add to in due course - or correct if I've erred.

Common law practice is the same as the Quebec practice you describe. If there is appropriate evidence of the potential for such a loss, the appropriate award will be made. It will be either a lump sum or periodic payments - the latter where permitted by recent statutory changes. My assumption is that the award you've mentioned is for the possibility of a future loss of income on account of the victim's injuries, notwithstanding he or she is currently able to continue working at pre-accident financial levels.

The common law allows the same result, provided there is appropriate evidence of a real contingency that the victim will sustain future income loss. The required standard of proof isn't balance of probabilities. The test is whether the evidence is cogent enough to establish a reasonable possibility (also called a real possibility) of the future loss. The judge takes into account both positive and negative contingencies. Hence, the award is based on a percentage of what a 100% award would be, if the judge concludes an award is appropriate. If there is appropriate evidence that the victim's future earnings may be reduced, the judge is required to award something to reflect that contingency. It will be a percentage of some amount, the ultimate award being a present value award or, where provincial rules permit and the facts make this appropriate, the award will be for periodic payments of some amount.

In Graham v Rourke (1990) 75 OR (2d) 622, 74 DLR (4th) 1 (CA) at. 41 the Court summarizes Prof. Cooper-Stephenson's statement of the law which is: "A plaintiff who establishes a real and substantial risk of future pecuniary loss is not necessarily entitled to the full measure of that potential loss. Compensation for future loss is not an all-or-nothing proposition. Entitlement to compensation will depend in part on the degree of risk established. The greater the risk of loss, the greater will be the compensation. The measure of compensation for future economic loss will also depend on the possibility, if any, that a plaintiff would have suffered some or all of those projected losses even if the wrong done to her had not occurred. The greater this possibility, the lower the award for future pecuniary loss: Personal Injury Damages in Canada, supra, at pp. 91-92."

What follows is the full text of para 40-42 of Graham v Rourke

"40 A trial judge who is called upon to assess future pecuniary loss is of necessity engaged in a somewhat speculative exercise: J.A. Andrews v. Grand and Toy Alberta Ltd., [1978] 2 S.C.R. 229, 19 N.R. 50, 8 A.R. 182, [1978] 1 W.W.R. 557; 83 D.L.R.(3d) 452; 3 C.C.L.T. 225, at 249-250 S.C.R. The ultimate questions to be determined - will the plaintiff suffer future loss and, if so, how much? - cannot be proved or disproved in the sense that facts relating to events which have occurred can be proved or disproved. A plaintiff who seeks compensation for future pecuniary loss need not prove on a balance of probabilities that her future earning capacity will be lost or diminished or that she will require future care because of the wrong done to her. If the plaintiff establishes a real and substantial risk of future pecuniary loss, she is entitled to compensation: Schrump et al. v. Koot et al. (1977), 18 O.R.(2d) 337, at 340-343 (Ont. C.A.), Giannone et al. v. Weinberg (1989), 33 O.A.C. 11, 68 O.R. (2d) 767, at 774 (Ont. C.A.). Messrs. Cooper-Stephenson and Saunders, the authors of Personal Injury Damages in Canada (1981), aptly describe the task involved in assessing future pecuniary loss claims, at p. 84:

The different standard of proof which governs most of a damage assessment may be termed 'simple probability'. It involves the valuation of possibilities, chances and risks according to the degree of likelihood that events would have occurred, or will occur. This contrasts with 'the balance of probabilities', more familiar in civil actions, which involves an 'all-or-nothing' approach.

41 A plaintiff who establishes a real and substantial risk of future pecuniary loss is not necessarily entitled to the full measure of that potential loss. Compensation for future loss is not an all-or-nothing proposition. Entitlement to compensation will depend in part on the degree of risk established. The greater the risk of loss, the greater will be the compensation. The measure of compensation for future economic loss will also depend on the possibility, if any, that a plaintiff would have suffered some or all of those projected losses even if the wrong done to her had not occurred. The greater this possibility, the lower the award for future pecuniary loss: Personal Injury Damages in Canada, supra, at pp. 91-92.

42 Factors affecting the degree of risk of future economic loss and the possibility that all or part of those losses may have occurred apart from the wrong which is the subject of the litigation are referred to as contingencies. The contemporary Canadian approach to contingencies is described in Andrews v. Grand and Toy Alberta Ltd., supra. Mr. Andrews was 23 years old when he was rendered a quadriplegic as a result of the negligence of the defendants. At trial he was awarded damages for loss of future earning capacity and also for future care costs to be incurred as a result of his medical condition. In the course of assessing the quantum of those damages, the trial judge reduced the total amounts by 20% as an allowance for negative contingencies. The Court of Appeal increased that deduction to 30%. In addressing the contingency deduction for future lost earning capacity, Dickson, J., said, at p. 253 S.C.R.:

It is a general practice to take account of contingencies which might have affected future earnings, such as unemployment, illness, accidents and business depression ... There are, however, a number of qualifications which should be made. First, in many respects, these contingencies implicitly are already contained in an assessment of the projected average level of earnings of the injured persons, for one must assume that this figure is a projection with respect to the real world of work, vicissitudes and all. Second, not all contingencies are adverse, as the above list would appear to indicate. As is said in Bresatz v. Przibilla (1962), 108 C.L.R. 541, at 544 (H.C.) ... 'Why count possible buffets and ignore the rewards of fortune?' Finally, in modern society there are many public and private schemes which cushion the individual against adverse contingencies. Clearly, the percentage deduction which is proper will depend on the facts of the individual case, particularly the nature of the plaintiff's occupation, but generally it will be small ...

43 After noting the absence of more detailed evidence concerning contingencies, the court restored the trial judge's ruling and applied a 20% contingency deduction: Andrews v. Grand and Toy Alberta Ltd., supra, at pp. 249-250."

In many of the common law provinces / territories (I'm uncertain whether it's all) there are now statutory provisions allowing the award to be made, where facts warrant, in periodic payments form rather than a lump sum.

I trust that this helps to answer your question.

David Cheifetz

----------------
David Cheifetz
Bennett Best Burn LLP
Toronto, Canada

----- Original Message -----
From: "Deslauriers Patrice"
Sent: Friday, May 28, 2004 5:14 PM
Subject: ODG: Question

Bonjour chers collègues,

I have a question on Torts.

Quebec Civil Law has problems dealing with the assessment of pecuniary damages when the victim, despite her injuries, is able to continue working at the same salary she had prior to the accident. (We have also problems with non-pecuniary damages but this is another question).

Some judges will allow a lump sum based on the medical incapacity. For example, 1%=7000$ 10%=70000$.

This rule has been criticized but it remains very popular amongst lawyers and judges. My question is the following : how does Canadian common law address this problem?

Thank you for your assistance.

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