COURT CASES on INCOME LOSS (PAST)
PAST DIMINISHED EARNING CAPACITY WHEN PLAINTIFF FULLY MITIGATES INCOME LOSS
In Ibbitson v. Cooper et al., the Plaintiff was injured in a motor vehicle accident, and was consequently disabled from his occupation. He was able to secure alternate employment, which paid less than his original job, and as such worked longer hours in order to make up for his loss of income from his original position. As such, he fully mitigated his losses with respect to loss of income, meaning that he was not out any money with respect to employment income. Despite this, the Court still awarded the Plaintiff $95,000.00 for past diminished earning capacity. ICBC’S lawyer appealed, arguing that there should not have been any award whatsoever, as there was no actual income loss. The British Columbia Court of Appeal dismissed the appeal, stating that:
[14] The issue on appeal may be stated in this way – did the trial judge err in giving an award for past loss of earning capacity in circumstances where the plaintiff had fully mitigated his loss of income but where the circumstances of his replacement employment required him to work longer hours?
[19] While in many cases the actual lost income will be the most reliable measure of the value of the loss of capacity to earn income, this is not necessarily so. A hard and fast rule that actual lost income is the only measure would result in the erosion of the distinction made by this Court in Rowe: it is not the actual lost income which is compensable but the lost capacity i.e. the damage to the asset. The measure may vary where the circumstances require; evidence of the value of the loss may take many forms (see Rowe). As was held in Rosvold v. Dunlop, 2001 BCCA 1 at para. 11, 84 B.C.L.R. (3d) 158, the overall fairness and reasonableness of the award must be considered taking into account all the evidence. An award for loss of earning capacity requires the assessment of damages, not calculation according to some mathematical formula.
[20] In this case, the respondent clearly suffered as a result of the accident; he can no longer perform the job he was engaged in prior to the accident. He has suffered a pecuniary disadvantage as he needs to work longer hours to maintain his approximate pre-accident level of income.
[21] The trial judge considered pre-trial earnings both before and after the accident, explaining that calculating a precise value for the extra hours was a difficult task, and chose to assess the damages “at large”. Had Mr. Ibbitson worked the same amount of hours post-injury as he had pre-injury, he surely would have been found to have suffered a compensable loss of earning capacity. His entitlement to such damages does not disappear due to his industrious efforts to maintain his level of income, exceeding his legal requirement to mitigate. I agree with the trial judge’s conclusion and analysis.
In Russell v. Parks, the Plaintiff was injured in a car accident, and brought an ICBC claim for several heads of damages, including pain and suffering, cost of future care, diminished earning capacity, and past diminished earning capacity. The Plaintiff had been injured as a pedestrian in a parking lot. With respect to the issue of past diminished earning capacity, the Court recognized the legal principle that a Plaintiff’s capacity to earn money is an asset which has been taken away when a person suffers injuries. The Court would eventually award $21,000.00 for past diminished earning capacity, before reducing this amount to account for social assistance benefits that the Plaintiff had already received.
[74] Claims for damages for past and future loss of earning capacity are based on the recognition that a plaintiff’s capacity to earn money was an asset which has been taken away: Rowe v. Bobell Express Ltd., 2005 BCCA 141 (CanLII), 2005 BCCA 141 at paras. 23 – 24.
[75] As was stated in Rowe at paras. 30 – 31:
… a claim for what is often described as “past loss of income” is actually a claim for loss of earning capacity; that is, a claim for the loss of the value of the work that the injured plaintiff would have performed but was unable to perform because of the injury.
Evidence of this value may take many forms. As was said by Kenneth D. Cooper-Stephenson in Personal Injury Damages in Canada, 2nd ed. (Scarborough, Ont.: Carswell, 1996) at 205-06,
… The essence of the task under this head of damages is to award compensation for any pecuniary loss which will result from an inability to work. “Loss of the value of work” is the substance of the claim — loss of the value of any work the plaintiff would have done but for the accident but now will be unable to do. The loss framed in this way may be measured in different ways. Sometimes it will be measured by reference to the actual earnings the plaintiff would have received; sometimes by a replacement cost evaluation of tasks which the plaintiff will now be unable to perform; sometimes by an assessment of reduced company profits; and sometimes by the amount of secondary income lost, such as shared family income.
[Underlining added in Rowe.]
[81] When I consider this evidence within the context of the legal principles to which I have referred, I conclude the plaintiff has established a loss of earning capacity to the date of the trial which is causally related to the injuries sustained in the Accident. But I am unable to accept that in the timeframe of approximately a year or so leading up to the Accident the plaintiff was earning $1,000 per month. That would be approximately $250 per week. If one assumes an hourly wage of $10 and that the average length of the grass mowing or snow shovelling jobs was two to three hours then that would amount to two jobs per day, five days a week. The evidence led by the plaintiff, in my view, could not form the basis for such a conclusion.
WHEN YOU ARE PAID “UNDER THE TABLE”
In certain ICBC claims, the Plaintiff will be seeking past loss of income, including where the Plaintiff has not declared his or her full income, such as in the example of tips. When this occurs, it is still possible to claim for these amounts, even if they do not appear on your income tax return. The problem, however, is that you will need to testify in open court. This could later put you at risk with respect to Revenue Canada finding out.
In Wong v. Hemmings, the Plaintiff’s occupation was as a server. She was involved in two motor vehicle accidents, and brought an ICBC claim for damages for her injuries. The Plaintiff provided evidence as to actual earnings, however such amounts differed from what she actually declared on her income tax returns. The Plaintiff was quite candid with the Court, in admitting that she did not declare her full amounts, but acknowledging that she knew that she was under an obligation to do so. ICBC’S lawyer argued that the Plaintiff should not be entitled to any amount for loss of income with respect to tips, however the Court would rule otherwise.
[125] The defendants assert that the plaintiff should not be granted a past wage loss award that includes undeclared tips. They assert this position to preserve an ability to argue the issue in another forum as counsel for the defendants otherwise concedes that this Court is bound by Iannone v. Hoogenraad (1992), 66 B.C.L.R. (2d) 106 (C.A.), leave to appeal dismissed [1992] S.C.C.A. No. 185, which holds that failure to declare tip income is no bar to the recovery of undeclared tips as past wage loss.
[126] The defendants also submit that the plaintiff has failed to establish what she would have earned in gratuities on her cash sales. As noted above, the Fairmont’s records reflect only the total amount of the plaintiff’s cash sales as a server. Any tip received by a server on a cash sale would be known only to them. The defendants point out that in 2006, for example, and assuming an average 12% tip on cash sales, the tips received by the plaintiff on cash sales represented 8.6% of her total tip earnings. Using this as a baseline, the defendants argue that the plaintiff’s past tip loss should be discounted by 8.6% to reflect the amount of cash tips allegedly lost but not proven.
[127] The defendants are, at least in theory, on firmer ground on this issue. Iannone stands for the proposition that the plaintiff has the burden of leading evidence of past wage loss and that it will be a difficult burden to discharge where there is no confirmatory evidence, such as income tax returns, to establish that the amount claimed would, in fact, have been earned. In this case, however, I am satisfied that the plaintiff has met her burden of proof on this issue. The records of the Fairmont Hotel clearly establish the total of the plaintiff’s cash sales as a server. The plaintiff testified that she would receive, on average, a 12% tip on her cash sales. I accept her evidence on this point.
[128] In the result, I award the plaintiff $20,250.00 for past income loss.
TAX DEDUCTIONS FROM INCOME LOSS AWARDS
In British Columbia, the Plaintiff is only entitled to a “net” income loss, not a “gross” one. In other words, tax deductions must be factored into a final damages award for income loss.
In the British Columbia Court of Appeal decision in Laxdal v Robbins, the Court clarified how net past wage loss is to be determined. If it can be shown that the income loss can be attributed to a certain year, then the income loss should be calculated on a yearly basis, and not a lump sum basis, for all years as though the income was earned in one year. This would be beneficial to Plaintiffs. However, the amount of the lost income should be added to the actual income for a particular year when attempting to determine the marginal tax rate. This would not be so beneficial to Plaintiffs, as this leads to a higher marginal tax rate if the claimant earns an income in the years leading up to trial.
[17] The respondent argued that a plain reading of the reference in s. 95 of the Insurance (Vehicle) Act to only “the gross income that the person lost in that period less the amount that would have been payable on that gross income” compels one to the conclusion that the past income loss award is to be taxed without reference to taxes otherwise payable during the same taxation year. In my view, such a reading of s. 95 is not harmonious with s. 98 of the Act, as amended, which seeks to award “damages for the income loss suffered after the accident and before the first day of trial of any action brought in relation to it, [of] not more than the net income loss that the person suffered in that period as a result of the accident”.
[18] I have concluded that the trial judge was incorrect in interpreting ss. 95 and 98 of the Insurance (Vehicle) Act as not requiring a reduction in her award for past loss of income to reflect the tax consequences when that loss is combined with earned income during the same period. The words of those sections must be read in their grammatical and ordinary sense.
[19] Having found that the losses all occurred in 2006, the trial judge ought to have combined the respondent’s 2006 income with the past income loss award for the purpose of determining the income she would have earned for income tax purposes “as if she had continued working” (as per Tysoe J.A. at para. 185 of Lines). To achieve this result, the appellant proposed the use of what has been referred to as the “stacking approach”.
[20] I am satisfied that, where an income loss can be attributed to a particular tax year or years, the language of ss. 95 and 98 of the Insurance (Vehicle) Act requires a resort to the stacking approach. Although Tysoe J.A. explained in the examples he referred to in Lines that “it was the intention of the Legislature to give a discretion to the judge to determine what period or periods are appropriate for the determination of net income loss in all of the circumstances”, once that determination is made, the legislation requires a deduction from the gross income loss to take into account the provisions of the Income Tax Act of British Columbia, the Income Tax Act of Canada and the Employment Insurance Act of Canada for the relevant year or years.
[23] The application of the stacking approach in accordance with the legislation will result in the combination of the award for past income loss with the other income earned for the same year, but the application of the enumerated legislation from the preceding year to only that portion of the total income for that year represented by the award. While the result is a cumbersome calculation, I see no need to resort to any exceptional construction of the legislation, as discussed by Lamer J., as he then was, in R. v. Paul, [1982] 1 S.C.R. 621 at 662, in order to achieve the legislative intent of ss. 95 and 98 of the Insurance (Vehicle) Act. Section 95(a) of the Insurance (Vehicle) Act refers in each of its subsections to taxes or premiums as the enumerated Acts “read on December 31 of the calendar year before the calendar year in respect of which the net income loss is to be determined”. In my view, this wording accommodates awards for either single or multiple years of income loss by permitting a judge to allocate the loss as discussed at para. 184 of Lines, and to then subject the award for that year or years to the effect of the specified legislation based on their provisions for the preceding year.
[24] A feature of the present legislation that does not arise in this case is the inability of a person injured in a motor vehicle collision to take advantage of any tax planning, such as a contribution to a Registered Retirement Savings Plan. In Lines Tysoe J.A. concluded at paras. 190-194 that such a notional contribution could not be allowed when calculating net income loss under ss. 95 and 98. While the inability to take advantage of such tax planning will not place the injured person in the same position that he or she would have been in, but for the accident, the application of the stacking approach will come as close to so doing as possible, while at the same time giving effect to the intent of the Legislature.
[25] In this case, the respondent’s total reported income for the year 2006 was $40,175.00. The respondent paid $6,024.05 for federal and provincial income tax that year, which represented an overpayment of $202.26.
[26] I conclude that the appropriate means by which to arrive at the respondent’s net past income loss is:
a) to determine her income from other sources during 2006 ($40,175.00);
b) add that figure to her income loss after taking into account the sick benefits she received ($3,306.24);
c) determine the tax that would be payable on $43,481.24, based upon the 2005 income tax rules and regulations by computing the amount in accordance with the provisions of theIncome Tax Act of British Columbia, the Income Tax Act of Canada and the Employment Insurance Act of Canada applicable to the calendar year ending December 31, 2005 and on $40,175.00 based upon the 2006 income tax rules and regulations by computing the amount in accordance with the provisions of the Income Tax Act of British Columbia, the Income Tax Act of Canada and the Employment Insurance Act of Canada;
d) subtract the difference between the two tax figures determined in c, above;
e) then deduct d from the income loss award, net of sick benefits that she received.
EMPLOYER WAGE LOSS PAYMENTS are NON-DEDUCTIBLE in HIT and RUN CLAIMS
When you have been injured in a motor vehicle accident, and through your contractual agreement with your employer you have received some wage loss benefits, the lawyer for ICBC will likely argue that such payments are to be deducted from your overall damages award.
The Court, however, rejected this line of argument in Loeppky v ICBC, where the Court commented that:
[83] In my view, Mr. Loeppky’s wage replacement benefits do not constitute an “insured claim” under s. 106 of the Regulation, and therefore may not be deducted from Mr. Loeppky’s award.
[84] In Arklie v. Haskell (1986), 33 D.L.R. (4th) 458, 25 C.C.L.I. 277 (B.C.C.A.), McLachlin J.A., writing for the court at para. 26, held that a sum of money advanced by an employer to an employee that had to be repaid in the event of any recovery did not qualify as a benefit under the predecessor of s. 106.
[85] More generally, in Lopez v. Insurance Corporation of British Columbia (1993), 26 B.C.A.C. 142, 78 B.C.L.R. (2d) 157, Hollinrake J.A., writing for the court at para. 21, held that an “insured claim” for the purposes of the Regulations must still import at least some element of insurance. He went on conclude that payments made by reason of a contract of employment, without some evidence that they originate from an insurer, do not possess such an element of insurance.
[86] The sum of $6,804.77 was paid to Mr. Loeppky under the collective agreement between the Vancouver Police Union and the Vancouver Police Board. Under the terms of that agreement Mr. Loeppky must repay that amount if he recovers it in this action. There is no evidence that the payments originated from an insurer. Thus, it is not an insured claim under s. 106 and the defendant is not entitled to deduct it from any award.
BANKED SICK TIME is RECOVERABLE
In Chingcuangco v. Herback, the Plaintiff was injured in a motor vehicle collision as a passenger when the vehicle she was traveling in collided with a vehicle that had turned left in front of their path. Consequently, she brought an ICBC claim for damages due to the injuries sustained therein. Liability was disputed by ICBC’S lawyer, however the Court would rule that the Defendant was negligent. The Plaintiff was required to use some of her sick leave hours to compensate her for some of her wage loss. The Plaintiff sought reimbursement for banked sick time hours, however ICBC’S lawyer argued that she should not be entitled to this. The Court, in keeping in line with previous cases, ruled that such banked sick time was in fact recoverable.
[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.
In Kilian v. Valentin, the Plaintiff was injured in a rear-end collision, and brought an ICBC claim for damages. The Plaintiff claimed nearly $10,000.00 in loss of banked sick time, which the Court awarded.
[126] The cost to Ms. Kilian to buy back those 29.6 days is $307, for a total of $9,087. Ms. Kilian testified that she intended to buy back those days, as she has very few days left in her sick back and is concerned about future exacerbations of her neck symptoms.
[127] I conclude that Ms. Kilian is entitled to an amount of $9,087 to replenish her sick bank. Given the purpose of this award, there will be no deduction for income taxes on this amount (Bjarnson v. Parks, 2009 BCSC 48 (CanLII), 2009 BCSC 48).
In Chalmers v Russell, the Court held that payments for banked sick time are tax exempt in a damages award for loss of income.
[85] I accept Ms. Chalmers’ evidence that following the first accident, she was so sore and painful that she felt it necessary to take time off work prior to the birth of her child in order to expedite her recovery. I am mindful that she did not obtain any medical evidence in support of her decision to take time from work. Regardless, given her advanced state of pregnancy, the trauma of the accident and the pain she was in after the first accident, I consider her decision not to return to work to be reasonable and due to her injuries. The cost to reimburse the sick bank during this time period is $342.45 per day, totalling $3,766.95.
[86] As noted in Bjarnason v. Parks, 2009 BCSC 48, depletion of a sick bank is a compensable loss: at para. 56. However, it is not an income loss so there should be no deduction for income tax in accordance with ss. 95 and 98 of the Insurance (Vehicle) Act, R.S.B.C. 1996, c. 231: Bjarnason at para. 66.
In Burton v Bouwman, the Plaintiff was forced to use up a good portion of “banked sick time” due to injuries sustained in a motor vehicle accident. The lawyer for ICBC argued that the Plaintiff was not entitled to such damages, however the Court ruled differently.
[157] Mr. Burton is not entitled to receive cash from CSC for unused banked sick leave. The banked sick leave will only be of value to him if he becomes sick and has insufficient banked sick leave, with the result that he takes an unpaid leave.
[158] There is a real and substantial possibility that Mr. Burton will become sick while still employed by CSC and have insufficient banked sick leave. Mr. Burton is entitled to compensation to reflect that…
[190] As discussed above, Mr. Burton is entitled to be compensated for the loss of his banked sick time. CSC paid Mr. Burton about $12,000 for his banked sick leave after the First Accident, about $250 after the Second Accident, and about $18,700 after the Third Accident. That is a total of about $30,950.
[191] The method of compensating a continuing employee for loss of sick bank credits was discussed in Bjarnson v. Parks, 2009 BCSC 48, and the cases cited in it. In that case, and in Roberts v. Earthy, [1995] B.C.J. No. 1034 and Choromanski v. Malaspina University College, 2002 BCSC 771, the court awarded the full amount of salary corresponding to the banked sick leave, without making any deduction for contingencies. Other cases cited in Bjarnson made such a deduction.
[192] I would assess the likelihood that Mr. Burton will become sick while working at CSC and have insufficient banked sick leave at 75 percent. As a result, Mr. Burton is entitled to damages of $22,500 in respect of his lost banked sick leave.
“PRIVATE INSURANCE” EXCEPTION to RULE AGAINST DOUBLE RECOVERY
If you have been injured in a motor vehicle accident, and you have received wage loss replacement benefits through, for example, your employer, ICBC cannot then deduct any such amounts from your overall damages award, provided there is evidence that you paid for such insurance benefits in the first place. A main reason for no deduction being allowed is that your employer or insurance carrier will almost invariably ask you to sign a subrogation agreement, requiring you to repay the amount of the wage loss benefits.
In Napoleone v Sharma, the Court discussed the “private insurance” exception to the rule against double recovery.
[5] Ms. Napoleone argues that the insurance exception to the general rule against doubt recovery is applicable to this case. In support of this proposition, Ms. Napoleone relies upon Cunningham v. Wheeler, 1994 CanLII 120 (SCC), [1994] 1 S.C.R. 359, Brennan v. Singh (1999), 86 A.C.W.S. (3d) 537 (S.C.), and Kean v. Porter, 2008 BCSC 1594 (CanLII), 2008 BCSC 1594.
[6] The defendant argues the insurance exception is not available to Ms. Napoleone because there is no evidence that she or her husband paid for the insurance benefits by any means. In support of this proposition, the defendant relies upon Cunningham and Ratych v. Bloomer, 1990 CanLII 97 (SCC), [1990] 1 S.C.R. 940.
[7] The general rule in an action for damages arising out of negligence is that the plaintiff is only entitled to be restored to the position she would have been in had the accident not occurred. The plaintiff is awarded damages for her actual loss and no more: Cunningham at para. 5 per McLachlin J. (dissenting in part)
[8] The law has recognized a limited exception to the rule against double recovery which is referred to as the “private insurance” exception. In Cunningham at para. 75 Mr. Justice Cory, speaking for the majority, adopts the following passage from Bradburn v. Great Western Rail Co., [1874-80] All E.R. 195 as accurately describing the underlying rationale for the exception:
… I think that there would be no justice or principle in setting off an amount which the plaintiff has entitled himself to under a contract of insurance, such as any prudent man would make on the principle of, as the expression is, “laying away for a rainy day”. He pays the premiums upon a contract which, if he meets with an accident, entitles him to receive a sum of money. It is not because he meets with the accident, but because he made a contract with, and paid premiums to, the insurance company, for that express purpose, that he gets the money from them. …and I think that it ought not, upon any principle of justice, to be deducted from the amount of damages proved to have been sustained by him through the negligence of the defendant.
[9] Whether the plaintiff has paid for private insurance or has obtained these benefits through an employment contract, the exception will apply. It is also irrelevant that it is the plaintiff’s husband who secured these benefits. See, Brennan at para. 182-3. However, the onus rests with the plaintiff to prove he or she has paid for the provision of insurance benefits in some fashion. As Cory J. says in Cunningham at para. 94:
In my view, Ratych v. Bloomer, supra, simply placed an evidentiary burden upon plaintiffs to establish that they had paid for the provision of disability benefits. I think the manner of payment may be found, for example, in evidence pertaining to the provisions of a collective bargaining agreement just as clearly as in a direct payroll deduction.
[10] There is no evidence before the court as to what, if any, consideration passed between Mr. Napoleone and his employer in respect of the extended health benefits. There is no evidence of whether Mr. Napoleone pays all or a portion of the insurance cost or whether it was negotiated as a part of a collective bargaining scheme. The only evidence before the court is that the plan was secured through Mr. Napoleone’s employer and it covers 80% of Mrs. Napoleone’s health related expenses.
[11] Without an evidentiary foundation to support the claim, I am unable to apply the private insurance exception to the case at hand. As Cory J. says at para. 93 of Cunningham, it is only when this evidentiary requirement is met that the court may be satisfied the plaintiff has shown the prudence and corresponding deprivation that underlies the exception and permits double recovery.
CPP PAYMENTS NOT to be DEDUCTED
When an award for past wage loss has been made, the lawyer for ICBC will often argue that any CPP benefits already made to the claimant should be deducted from the amount awarded.
In Kean v Porter, Seniuk, and ICBC, the Court dismissed the argument of ICBC’S lawyer in this regard.
[102] Counsel for the defendant and the third party argued that CPP disability benefits received by Mr. Kean should be deducted from his award for past wage loss, and the present value of future CPP disability benefits should be deducted from his future income award. The thrust of their argument is that this is necessary to prevent double recovery. The defendant argues that CPP disability benefits are a form of mandatory social insurance that workers cannot negotiate out of, and the scheme is a form of income replacement.
[103] The defendant’s argument is essentially the same argument that these same counsel made unsuccessfully in the case of Maillet v. Rosenau 2006 BCSC 10. In Maillet, the plaintiff had received social assistance payments which were deducted from the past wage loss, but Powers J. did not accede to the defendant’s argument that future CPP disability benefits should be deducted from the award for losses of future earnings.
[104] In Maillet, Powers J. followed a line of authority which had held that the CPP disability pension scheme was essentially an insurance scheme and covered by the insurance exception to the rule against double recovery.
[105] Like Powers J, I do not see the reasoning in M.B. as effecting a change in the law as it applies to CPP disability payments. The analysis undertaken in that case was outlined in ¶24 of the decision:
The first question is whether social assistance is a form of income replacement. If it is not, no duplication arises. If it is, the further question arises of whether social assistance can be excluded from the non-duplication rule under an existing or new exception.
[106] The court determined that social assistance was a form of income replacement and then stated in ¶28:
It follows that the only way in which they can be non-deductible at common law is if they fit within the charitable benefits exception, or if this court carves out a new exception. Otherwise, retention of them would amount to double recovery.
[107] After holding that social assistance payments did not fit the charitable benefits exception (because the rationale for that exception did not concern the purpose of charitable donations, but its effect on the owners and the difficulties of valuation), the court discussed whether it should carve out a new policy- based exception. The court decided that it should not do so. Clearly there was no viable argument that the insurance exception might be applicable to social assistance and that was not considered.
[108] The defendant wishes to characterize the CPP disability payments as a form of social security because it is a legislative creature and contributions are mandatory. But, unlike social assistance, it is funded by contributions and only those who have contributed can benefit. There is an overlap of recovery, but that is inherent in the insurance exception to the rule against double recovery. The other side of the coin is that to deduct the CPP benefits from a tort award is to force the injured contributor to share the benefits of his contributions, (which represent deductions from his former earnings), with the tortfeasor.
[111] I conclude, as did the court in Maillet, that the law in this jurisdiction is settled to the effect that CPP disability benefits fall within the insurance exception to the rule against double recovery and should not be deducted from tort awards for past or future wage loss.
In Combs v. Bergen, the Plaintiff was injured in a motor vehicle collision, and brought an ICBC claim against the Defendant for damages for pain and suffering, wage loss, diminished earning capacity, and cost of future. Liability was admitted by ICBC’S lawyer. The Plaintiff endured neck pain, back pain, and headaches, and was awarded $70,000.00 for non-pecuniary (pain and suffering) damages. As part of the Plaintiff’s past wage loss, the Court awarded damages for the loss of the Plaintiff’s employer’s contribution to her Canada Pension Plan (CPP), as well as her pension. ICBC’S lawyer argued that such amounts should be deducted, however the Court rejected this submission.
[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 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.
