13 Apr Future Loss of Earning Capacity
If you have been injured in a car accident and as a result of your injuries you will experience wage loss in the future (post-trial), you are entitled to an award for future loss of earning capacity. Two commonly used methods to calculate future loss of earning capacity are the mathematical approach and the loss of capital asset approach.
Sometimes even though the injured person is able to continue earning the same amount with the same job after the accident, they will likely have to quit their job at some point in the future or will not be able to take advantage of all career opportunities available to them because of their injuries. In those cases, the capital asset approach is more likely to be used. The court must estimate what the financial loss will be to the injured person based on the evidence presented by both their lawyer and ICBC.
In situations where it is relatively simple to calculate the difference in pre- and post-accident earnings, the mathematical approach is more likely to be applied. An example might be when someone earned $20 per hour and worked 40 hours per week before the accident, and after the accident continued to earn $20 per hour but could only work 20 hours per week.
The mathematical approach was recently used in the decision of Guitierrez v. Covvey, 2015 BCSC 369. In that case, the plaintiff was a pedestrian in a marked crosswalk who was hit by a vehicle. Madam Justice Loo found the defendant driver fully at fault for the accident. The plaintiff suffered from chronic musculoskeletal pain in her neck, shoulder and low back, patellofemoral syndrome in her left knee and post-traumatic stress disorder.
The lawyer for ICBC argued that the plaintiff was not entitled to an award for loss of future earning capacity because she would eventually recover from her injuries and she was still capable of working full time. Madam Justice Loo rejected those arguments. She found that although the plaintiff could continue working, she would work 12 hours less per week for the rest of her life as a result of the accident. After adjusting for positive and negative contingencies, Madam Justice Loo added 5% to the award to account for non-wage benefits. In total, the plaintiff was awarded $128,515.00 for her loss of future earning capacity.