23 Sep Assessment of Electrician’s Future Financial Loss
In the case of Stare v. Whitehouse, 2019 BCSC 1445, the 20-year old Plaintiff sustained injuries in a motor vehicle accident. Although the injuries to his neck and shoulder resolved, the injury to his back did not.
Due to the trauma of the accident and his ongoing back pain, the Plaintiff began to suffer from anxiety. Over time this developed into depression, adjustment disorder, and somatic symptom disorder.
The most contentious issue at trial was whether the Plaintiff suffered significant financial loss due to his inability to continue working as an apprentice electrician. The Plaintiff feared that he would not be able to sustain this type of physical work into the future. He sought $421,105 under this head of damages.
ICBC agreed that the Plaintiff was injured but not to the extent that he claimed. ICBC argued that even if his symptoms were permanent, the reduction in his capacity to work would not be significant and an award of $0 – $37,345 was appropriate.
The court had to determine whether the Plaintiff’s earning capacity was impaired by his injuries. If it was, then the court had to determine what compensation should be awarded for the resulting financial harm.
There are two ways to assess loss of future earning capacity: the “earnings approach” and the “capital asset approach”. The earnings approach is useful when the loss is easily measurable and the capital asset approach is more appropriate when it is not. In this case, the court decided that the capital asset approach was preferable because the Plaintiff’s loss of earning capacity could not be determined with any mathematical precision.
Using the capital asset approach, the court took into account:
1. whether the Plaintiff was rendered less capable overall from earning income from all types of employment: The court did not think he had been. However, the court found that he would likely be restricted from taking on more onerous physical jobs than that of an electrician;
2. whether the Plaintiff was less marketable or attractive as an employee to potential employers: The court noted that it was possible that the Plaintiff would be restricted in seeking advancements in the future and it was likely the Plaintiff would not be able to sustain physical work as he got older;
3. whether the Plaintiff had lost the ability to take advantage of all job opportunities which might otherwise have been open to him, had he not been injured: The court noted that given his work ethic and his ability to work well with teams, it was likely that the Plaintiff would move into a supervisory or management role as he got more experience; and
4. whether the Plaintiff was less valuable to himself as a person capable of earning income in a competitive labour market: The Plaintiff was very sensitive about his mental health issues. Those psychological issues made him less valuable to himself although with continued treatment the court did not find that they would make him less valuable as an employee.
The court held that there was a real and substantial possibility that the Plaintiff would suffer a loss in his future earning capacity and awarded $250,000 him for this loss.