Loss of future earning capacity – Arguments for and against

This is a case referenced as Singh v Chand, 2019 BCSC 932 (CanLII) that will allow us to review some of the defence arguments put forward in a claim for loss of future earning capacity and pay attention to the details of this case.

The Plaintiff in this case, a lawyer, was seeking $4,000,000 in compensation.  She was not successful in proving her claim and was awarded only $137,000 in total damages.

I wanted to focus on the loss of future earning capacity for a few reasons.  First, I really like the Judge’s explanation of the two types of approaches to take when dealing with loss of future earning capacity.  Yes – we are all aware of the approaches – but a review is always a good exercise for everyone.

Further, the Plaintiff was seeking $2,787,970 under the heading of loss of future earning capacity and unfortunately, the evidence was not sufficient to prove this category of loss.  An award was not made under this head of damage.  I will be outlining the defence arguments as it is helpful to review them.

Let’s begin with the Judge’s comments on the two different approaches when dealing with this head of damage and I am simply going to quote from this decision because its well worded:

 [450]     In assessing the loss of earning capacity, the standard of proof is probability, with hypothetical events being given weight according to their relative likelihood where there is a real and substantial possibility of loss.  The court is to consider these possibilities and make allowance for contingencies that assumptions upon which the award is based may prove to be wrong in assessing loss of future earning capacity: Reilly v. Lynn, 2003 BCCA 49 at para. 101; Hay v. Hofmann 1999 BCCA 26 at para. 67.

[451]     There are two approaches to assessing loss of future earning capacity: the “earnings approach” and the “capital asset approach.”  Both are correct and will be more or less appropriate depending on whether the loss in question can be quantified in a measurable way:  Perren v. Lalari, 2010 BCCA 140 at para. 12.

[452]     The earnings approach involves a math-oriented methodology, for example by postulating a minimum annual income loss for the plaintiff’s remaining years of work, multiplying the annual projected loss by the number of remaining years and calculating a present value.  Alternatively, the court may make an award in the amount the plaintiff’s entire annual income for a year or two:  Pallos v. Insurance Corp. of British Columbia (1995), 100 B.C.L.R. (2d) 260 (C.A.) at 271.

[453]     The capital asset approach involves considering a variety of factors.  In Brown v. Golaiy (1985), 26 B.C.L.R. (3d) 353 (S.C.) at 356, the court set out a number of these factors, including whether:

(a)            the plaintiff has been rendered less capable overall from earning income from all types of employment;

(b)            the plaintiff is less marketable or attractive as an employee to potential employers;

(c)             the plaintiff has lost the ability to take advantage of all job opportunities which might otherwise have been open to them had they not been injured; and

(d)            the plaintiff is less valuable to themselves as a person capable of earning income in a competitive labour market.

[454]     The assessment of damages must be based on what is reasonable in all the circumstances.  Projections, calculations and formulas are useful only to the extent that they assist in determining what is fair and reasonable:  Schenker v. Scott, 2014 BCCA 203 at paras. 50-53.

The legal framework has been identified.  Let’s now turn to the arguments of each party and of course, pay attention to the defence arguments because they were successful in persuading the court that no award should be made.  They were successful.

I have often said that one way to build your skills in personal injury litigation is to study the arguments put forth by both sides.  This review process also assists with identifying the defence theory in current claims you may be managing but also provides insight into legal strategy and tactics in managing existing claims.

The Plaintiff’s arguments:

  • she is entitled to $2,787,970 in loss of future earning capacity
  • the evidence demonstrates that she continues to have psychiatric and physiological symptoms as a result of the Accidents
  • her tolerance level is much lower than her pre-Accident capacity
  • although it is possible her symptoms will improve, her prognosis is that she will continue to have pain indefinitely
  • duration of her mental health illness is a negative prognostic factor
  • her condition may worsen
  • She is more vulnerable to stressors
  • Has an increased risk of recurrence of depressive or anxiety disorders
  • Theory: 67 is the age of retirement for assessment purposes (average retirement age in women)
  • Plaintiff will not be having children (increases work life)
  • Plaintiff’s theory is that she would have earned 190K but for the accident.
  • Claim is for 2.7 MM
  • Plaintiff could have been made a partner but for the accidents
  • Agree to a negative contingency of pre-existing anxiety and stress around relationships also her post-accidents condition could improve resulting in increased work hours.

The Defendant’s arguments:

  • Not liable for any damages under loss of future earning capacity
  • Plaintiff’s injuries are divisible
  • Plaintiff only suffered de minimis range injuries or minor soft tissue injuries
  • No mood issues were suffered in the 1st accident
  • Plaintiff has significant residual capacity
  • Plaintiff has been capable of full-time work since Jan. 2012
  • Claim for ongoing disability is not supported by the medical evidence
  • Any wage loss the Plaintiff may suffer is as a result of her own lifestyle choices
  • Plaintiff is not truly functionally disabled from working
  • Plaintiff has multiple examples of work she has done since the accidents
  • Present work at law firm is one of those examples
  • Working on a litigation file
  • Building her own case for trial is another example
  • There is no basis to conclude the Plaintiff cannot work more hours than what she is doing at present
  • Evidence supports that the Plaintiff chose to pursue other interests to the prejudice of the Defendants
  • Plaintiff pursued interests outside of law before attempting to return to practice with a serious attempt to return to work
  • The Plaintiff did not take adequate steps to find work elsewhere (in-house counsel)
  • Such employment would have been readily available
  • Plaintiff left the country repeatedly
  • Plaintiff has spent more than 50% of her time outside of Canada since the collisions
  • Plaintiff was not permitted to practice law outside of Canada
  • Defendants say either approach to calculate any loss under this heading should result in no award
  • Their position is that any contribution of the accidents to a loss of future capacity is de minimis and non-compensable
  • Plaintiff only has limited pre-accident earnings history
  • The suggestion is that Plaintiff would have gone through lengthy periods of unemployment regardless of the accidents.
  • No strong evidence of an ongoing loss
  • Voluntary choices to restrict her work led to such a loss
  • Plaintiff did not follow recommendations
  • The Plaintiff has not acted reasonably to mitigate her damages


[465]     I find that the plaintiff has not made out a claim for loss of future earning capacity.

[466]     As noted above, I have found that the plaintiff regained her former earning capacity by February 2012.  By September 2013, her injuries had all but resolved.  Her subsequent psychological deterioration is not causally related to the accident.  Though she continued to suffer occasional flare-ups, I do not find that those diminished her earning capacity in any significant way.  Any reduction in her actual earnings after 2012 is attributable either to her personal lifestyle decisions, or her psychological deterioration as a result of the various non-tortious pressures in her life in the context of her pre-existing mental health issues.  As such, I do not find there is a real and substantial possibility of future loss of earning capacity as a result of the Accidents.

[467]     Therefore, I make no award of damages under this heading.  

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