Two decisions of importance to the personal injury bar and the insurance industry were released by the Court of Appeal this afternoon. They are Vollick v. Sheard and Walker v. Ritchie. Both cases involved the issue of whether an owner of a car, who happens also to be the employer of the driver, is a “protected defendant” within the meaning of s. 267.5 of the Insurance Act. In Vollick, that was the only issue. The Walker case involved a number of other issues as well. Vollick v. Sheard In the Vollick decision, the Court ruled that “a defendant otherwise enjoying protected defendant status as owner of a motor vehicle is nevertheless liable to an injured party for the negligence of its employee”. (It reached the same conclusion in Walker .) In so ruling, the Court of Appeal overruled the decision of Justice Nordheimer in Hechavarria v. Reale. So, where the owner of the vehicle is also the employer of the driver, he, she or does not gain the protection of the threshold, the deductibles, the collateral benefits deductions, etc. under the Insurance Act. The court also looked at the new Insurance Act provision that came into force on October 1, 2003, which reads as follows:Despite any provision of this Part, a person vicariously liable for the fault or negligence of a protected defendant is not, in respect of the person’s vicarious liability, liable for any amount greater than the amount of damages for which the protected defendant is liable.Each of the parties claimed that this legislative change favoured it. After some discussion, the Court declined to decide who was correct (presumably, leaving this issue for another day).
Walker v. Ritchie
The second case arose out of severe injuries suffered by a young woman whose car struck a tractor-trailer. Non-pecuniary general damages were assessed by the trial judge (Justice Brockenshire) at $250,000, which would have been close to the maximum.
The appeal related to various damages and costs issues. The most important aspects of the decision are summarized below.
This has been a recurring issue in personal injury cases in which the plaintiff is a woman. In presenting the plaintiff’s future income loss, her solicitor will often use statistics for the population as a whole, even though there are statistics that are specific to the female members of that population. The reason for doing so is that overall, the earnings of women are lower than the earnings of men, so using statistics for both men and women produces a bigger future loss than would be yielded by using statistics for women only.
Defendants argue that it is misleading to project earnings for a woman as if she were a man because doing so fails to take into account the fact that, rightly or wrongly, women tend to earn less than men.
Here, the trial judge used what were referred to as “gender-neutral statistics”, namely, statistics for both males and females. (We would prefer to see “gender” used to refer to parts of speech, not to people.)
The defence appealed on this ground. The Court of Appeal noted that the discrepancy between the earnings of the two sexes was diminishing over time, so that projecting future income on the basis of an equal level of earnings was not necessarily incorrect.
Also, in this particular case, two of the possible career options for this plaintiff were fields in which the sexes have already achieved income parity.
So, while the Court did not endorse “gender-neutral” statistics in all cases, it did not interfere with the trial judge’s ruling in this one.
Loss of interdependent relationship
This is a head of damages that is seen with increasing frequency. It stems from “the proven and well known fact that two people can live together less expensively than they can live apart”. So, someone who is less likely, because of her injury, to be able to form such a relationship, is more likely to have a higher cost of living.
In relation to this head, the defendants argued that loss of interdependent relationship should simply form part of the future earning capacity claim.
Again, the Court of Appeal did not disturb this award.
Deductibility of non-earner benefits
The Court ruled definitively on this issue: non-earner benefits (paid under s. 12 of the SABS), are not deductible from any tort damages, pecuniary or non-pecuniary.
There has been some uncertainty in earlier caselaw as to whether a successful party can recover more than one counsel fee at trial. The Court of Appeal has now ruled that more than one counsel fee (for a senior and junior lawyer, for example) can be awarded, but that the aggregate cannot exceed the daily and weekly maximums set out in the Tariff. So, for example, the Tariff provides that the maximum partial indemnity counsel fee per day is $1,500. According to today’s ruling, a court could award $1,000 for senior counsel and $500 for junior counsel, but not more.
Some good news for defendants: the Court held that a costs premium is not recoverable from an opposing party in an award of costs on a partial indemnity basis. (It confirmed that premiums are recoverable, where the award of costs is on a substantial indemnity basis.)
Criticizing the practice of including premiums in awards of costs on a partial indemnity basis, the Court said:
116] To award a premium in addition to partial indemnity costs would infringe upon the principles enunciated in both Mortimer and Vanek. The premium would amount to a supplement to a damage award in situations that did not attract costs on a substantial indemnity basis and its award would amount to the creation of a third type of cost award.The practice of tacking on a premium to an award of partial indemnity costs has been occurring with more frequency over the last couple of years, so defendants will welcome at least this part of today’s ruling.