The recent decision of the British Columbia Court of Appeal in Villing v. Husseni 2016 BCCA 422, dealt with the difficult question of how to assess damages for the impact injuries may have on a young person’s future earnings.
The plaintiff in Villing was only 17 years old and still in high school when she was injured in a motor vehicle accident. She developed chronic back pain. Since she did not have an established career the assessment of her loss of future earning capacity was difficult.
In cases like Villing v. Husseni the trial judge, to use the oft-quoted words of Dickson J. in Andrews v. Grand & Toy  2 S.C.R. 229, has to “gaze deeply into the crystal ball”, in order to assess damages. The Court of Appeal in Villing v. Husseni offers some guidance on how “crystal ball gazing” ought to be performed by a trial judge.
The Court of Appeal noted there are two ways to assess damages for the loss of future earning capacity. There is the “earnings approach” and there is the “capital asset approach”. The earnings approach is most appropriate where the plaintiff has an established career, and there is no prospect they will change their occupation, making the loss more easily quantifiable. The capital asset approach is the appropriate method of assessing damages when the loss is not easily quantifiable.
An obvious example of a situation where the capital asset approach will be used is when the plaintiff is a young person who has not yet established a career.
Once the court has chosen to apply the capital asset approach the assessment is then described as being at large.
In Villing the Court of Appeal noted, however, that even when an assessment is at large the trial judge must still explain the factual basis for the award.
This means the trial judge should at a minimum address the four questions set out in the leading case of Brown v. Golaiy (1985), 26 B.C.L.R. (3d) 353. Specifically the judge should consider whether:
- The plaintiff has been rendered less capable overall from earning income from all types of employment;
- The plaintiff is less marketable or attractive as an employee to potential employers;
- The plaintiff has lost the ability to take advantage of all job opportunities which might otherwise have been open to him, had he not been injured; and
- The plaintiff is less valuable to himself as a person capable of earning income in a competitive labour market.
This list is not exhaustive.
ICBC argued in Villing that, on the evidence, Ms. Villing would likely only miss a modest amount of work in the future when she underwent some treatments for her injuries. ICBC pointed to expert evidence which suggested the plaintiff would still be able to do her job in the future.
The trial judge, however, noted that even though Ms. Villing may be able to do her job that did not mean there was no loss of capacity. He found there was a real and substantial possibility she would not have the capacity to assume some employment positions or some employment responsibilities due to her chronic back pain. For example, she may not be able to work at a job where long overtime hours were expected. The trial judge awarded Ms. Villing $100,000 for the impact her injuries would have on her future capacity to earn income.
ICBC filed an appeal from that decision. The Court of Appeal, however, dismissed ICBC’s appeal and upheld the trial judge’s decision.
In doing so, the Court of Appeal noted setting the amount of the award for loss of future earning capacity for a young person was still a difficult exercise. Nevertheless, the Court of Appeal in Villing has affirmed that when gazing into the crystal ball, a trial judge ought to at least address and consider one or more of the questions set out in Brown v. Golaiy. If the answer to those questions is that the injuries will impact the young person in the future then an award should be made to compensate for this loss.
This article is intended to be an overview of the law and is for informational purposes only. Readers are cautioned that this article does not constitute legal or professional advice and should not be relied on as such. Rather, readers should obtain specific legal advice in relation to the issues they are facing.