Gilbert v. South et al.

[Indexed as: Gilbert v. South]

Ontario Reports

Ontario Superior Court of Justice,

Leach J.

June 17, 2014

120 O.R. (3d) 703 | 2014 ONSC 3485

Case Summary

Damages — Deductions — Jury delivering verdict in favour of plaintiff in action for damages arising out of motor vehicle accident — Defendant insurer bringing motion for declaration that plaintiff was obligated to hold in trust for insurer "certain future statutory accident benefits and other collateral benefits" received or to be received by plaintiff — Motion dismissed — Uncertainty existing as to plaintiff's entitlement to statutory accident benefits and as to whether she received compensation for same benefits in tort judgment.

The jury in an action for damages arising out of a motor vehicle accident returned a verdict in favour of the plaintiff. The defendant insurer brought a motion for a declaration that the plaintiff was obligated to hold in trust for the insurer "certain future statutory accident benefits and other collateral benefits" received or to be received by the plaintiff and for related relief.

Held, the motion should be dismissed.

Deductions from a plaintiff's damage award to prevent double recovery will be made only if it is absolutely clear that the plaintiff's entitlement to such collateral benefits is certain, and that the plaintiff has received compensation for the same benefits in the tort judgment. In this case, there were uncertainties as to entitlement and overlap that made it inappropriate to grant the requested relief. There was no evidence to indicate, with anything resembling certainty to the extent required, the total amount of statutory accident benefits the plaintiff definitely would receive. To date, he had received certain statutory accident benefits, but there was no indication as to whether he would receive future benefits, or the nature and extent of such benefits. Moreover, the extent (if any) to which the sums awarded by the jury definitely related to the same losses in respect of which the plaintiff had received or would receive statutory accident benefits could not be determined.

Cases referred to

Bannon v. Hagerman Estate (1998), 1998 4486 (ON CA), 38 O.R. (3d) 659, [1998] O.J. No. 1673, 159 D.L.R. (4th) 223, 109 O.A.C. 339, 34 M.V.R. (3d) 189, 79 A.C.W.S. (3d) 291 (C.A.); Chrappa v. Ohm (1998), 1998 893 (ON CA), 38 O.R. (3d) 651, [1998] O.J. No. 1678, 159 D.L.R. (4th) 215, 109 O.A.C. 102, 33 M.V.R. (3d) 284, 79 A.C.W.S. (3d) 293 (C.A.); Cowles v. Balac (2006), 2006 34916 (ON CA), 83 O.R. (3d) 660, [2006] O.J. No. 4177, 273 D.L.R. (4th) 596, 216 O.A.C. 268, 41 C.C.L.I. (4th) 227, 42 C.C.L.T. (3d) 161, 151 A.C.W.S. (3d) 1044 (C.A.), affg 2005 2038 (ON SC), [2005] O.J. No. 229, [2005] O.T.C. 52, 19 C.C.L.I. (4th) 242, 29 C.C.L.T. (3d) 284, 136 A.C.W.S. (3d) 581 (S.C.J.); Gilbert v. South, [2014] O.J. No. 1874, 2014 ONSC 2413, [2014] I.L.R. I-5604 (S.C.J.); Hoang (Litigation guardian of) v. Vicentini, [2013] O.J. No. 321, 2012 ONSC 6644, 19 C.C.L.I. (5th) 120, 225 A.C.W.S. (3d) 221 (S.C.J.); Mikolic v. Tanguay, [2013] O.J. No. 5352, 2013 ONSC 7177, [2014] I.L.R. I-5530 (S.C.J.); Moore v. Cote, [2008] O.J. No. 3541, 169 A.C.W.S. (3d) 510 (S.C.J.); Moss v. Paul Hutchinson and Associates Leasing Canada Ltd. (2007), 2007 14934 (ON SC), 85 O.R. (3d) 604, [2007] O.J. No. 1734, 48 C.C.L.I. (4th) 265, 157 A.C.W.S. (3d) 204 (S.C.J.) [page704]

Statutes referred to

Insurance Act, R.S.O. 1990, c. I.8, s. 267.8, (9), (10), (12)

Rules and regulations referred to

Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rule 19.06

Statutory Accident Benefits Schedule — Accidents on or after November 1, 1996, O. Reg. 403/96, ss. 14(6) [as am.], 15(12) [as am.]

MOTION for relief relating to future statutory accident benefits and other collateral benefits.

Richard J.T. Shaheen, for plaintiff.

Bruce R. Mitchell, for defendant York Fire & Casualty Insurance Company.

[1] Endorsement of LEACH J.: — Following trial of the action herein (which concluded with a jury verdict delivered in Woodstock on April 4, 2014), and prior to judgment being formally entered, the defendant York Fire & Casualty Insurance Company ("York Fire") brought a motion seeking various forms of relief relating to "certain future statutory accident benefits and other collateral benefits" received or to be received by the plaintiff (emphasis added).

[2] In that regard, pursuant to s. 267.8(9), (10) and (12) of the Insurance Act, R.S.O. 1990, c. I.8, the moving defendant requested, inter alia, the following:

an order declaring that the plaintiff is obligated to hold such moneys in trust for York Fire;

an order that the plaintiff is obligated to pay such moneys held in trust to York Fire, as requested;

in the alternative, an order assigning to York Fire the plaintiff's rights to certain future statutory accident benefits from Unica Insurance; and

an order compelling the plaintiff to co-operate with York Fire in any claim or proceeding in respect of any payment or entitlement to payment assigned by the plaintiff to York Fire.

[3] Pursuant to leave granted in the immediate wake of the jury's verdict (which took into account the probable difficulties the parties would encounter in securing a further viva voce hearing before me in Woodstock at any time in the near future), the motion was argued by way of teleconference on May 15, 2014, following the delivery of motion materials. [page705]

[4] To facilitate finalization of an appropriate judgment, I indicated at the completion of the aforesaid teleconference hearing that the defendant's motion relating to collateral benefits was being denied, for written reasons to follow. These are those reasons.

Background to Motion and Ruling

[5] The nature of the underlying litigation, and the circumstances leading to this motion, effectively are set forth in my earlier ruling dealing with York Fire's "threshold" motion, which has since been reported. See Gilbert v. South, 2014 ONSC 2413 (S.C.J.).

[6] I therefore will not repeat all of that information in detail here. For present purposes, relevant earlier information, and further evidence filed by the parties in relation to this motion, may be summarized as follows:

This litigation stemmed from a motor vehicle accident on April 27, 2010, in which the plaintiff was said to have been injured.

-- Trial began with selection of a jury on March 17, 2014.

On April 4, 2014, the jury returned a verdict strongly suggesting its acceptance of the proposition that the motor vehicle accident had caused the plaintiff to experience at least some significant and lasting injuries. In particular, the jury awarded the following:

-- general damages in the amount of $70,000 (reduced to $40,000 after application of the statutorily mandated deductible);

-- "future care cost" damages (specifically, for the plaintiff's "future treatment, medication, rehabilitation, intervention and aids" from the date of trial onwards), in the amount of $57,250;

-- damages for "loss of housekeeping and handyman capacity" (specifically, for the plaintiff's "home maintenance costs, including seasonal costs and handyman allowance" from the date of trial onwards), in the amount of $85,000;

-- pre-trial income loss damages (modest in any event because the plaintiff has managed to keep working since the motor vehicle accident, albeit with modified job responsibilities and inability to earn certain additional income), in the amount of $5,800; and

-- damages for loss of future income (including benefits and pension), earning capacity and competitive advantage in the amount of $250,000.

Because the plaintiff was injured in a motor vehicle accident, and his injuries were non-catastrophic, he notionally was entitled to certain statutory accident benefits that included the following:

-- up to $100,000 for medical and rehabilitation needs that might be required, subject to a ten-year time period for which such coverage was available;

-- up to $72,000 for attendant care needs that might be required during the first two years following the accident;

-- up to $100 per week, to help defray the cost of external housekeeping and home maintenance services, for two years following the accident; and

-- income replacement benefits equal to 80 per cent of net pre-accident income up to $400 per week.

In the wake of the accident, the plaintiff has indeed received at least some payments from his accident benefits insurer. In particular, as of April 22, 2014 (the date of what appears to be the most recent "Benefits Paid to Date" summary available to York Fire from the accident benefits insurer, prior to delivery of York Fire's motion material), the plaintiff had received "medical benefits" totalling $14,822.50 and "housekeeping benefits" totalling $14,822.50.

By the time of this motion's argument, it appeared to be common ground that the plaintiff had neither applied for nor received income replacement benefits or attendant care benefits, and that the plaintiff would not receive such benefits. Although its motion material suggested that York Fire might be seeking relief in relation to Mr. Gilbert's possible receipt of income replacement and/or attendant care benefits, the submissions of counsel made it clear this was not the case. [page707]

Similarly, by the time of this motion's argument, it appeared to be common ground that the plaintiff could and would not receive any future statutory accident benefits related to housekeeping or home maintenance expense, as the situation had progressed well beyond the two-year post-accident period during which such benefits were a possibility. (It bears repeating that the relief requested by York Fire in its motion record was restricted to claims for relief in relation to "certain future statutory accident benefits".)

Counsel for York Fire instead restricted his submissions to arguments that the jury's award of damages for "future care costs", coupled with the plaintiff's entitlement to statutory accident benefits for medical and rehabilitation expenses, gave rise to concerns of "double recovery" and corresponding obligations of trust, payment and assignment.

Analysis

[7] As noted above, York Fire relies upon s. 267.8(9), (10) and (12) of the Insurance Act, supra. For the sake of brevity, I will not reproduce those statutory provisions in their entirety here (although I have reviewed and considered their complete legislative text).

[8] For present purposes, suffice it to say that the provisions are capable, in certain prescribed circumstances, of imposing trust, payment and assignment obligations on plaintiffs who, because of automobile-related accidents, obtain certain types of litigated recovery for losses which also may be addressed by certain collateral benefits (e.g., statutory accident benefits, income continuation benefit plans, sick leave plans and various forms of other plans relating to medical treatment, rehabilitation and care).

[9] Not surprisingly, the provisions of s. 267.8 have been the subject of judicial consideration on a number of occasions. In that regard, general principles relating to their application now would seem to include the following:

The provisions operate as an exception to the otherwise applicable general common law rule relating to a litigant's recovery of overlapping compensation from "collateral" sources. Their object is to prevent, in the particular circumstances indicated therein, a "double recovery" by a plaintiff. The provisions assume that the plaintiff has obtained, through the litigation, damages covering the same loss otherwise covered by the collateral benefits, e.g., through recovery of funds necessary to purchase services required in the future. See Moss v. Paul Hutchinson and Associates Leasing Canada Ltd. (2007), 2007 14934 (ON SC), 85 O.R. (3d) 604, [2007] O.J. No. 1734 (S.C.J.), at paras. 21-22; Mikolic v. Tanguay, 2013 ONSC 7177 (S.C.J.), at para. 13; and Hoang (Litigation guardian of) v. Vicentini, 2012 ONSC 6644, [2013] O.J. No. 321, 19 C.C.L.I. (5th) 120 (S.C.J.), at paras. 18 and 29.

However, concern to ensure mandated prevention of such double recovery is balanced by concern that a plaintiff should receive full compensation and not recover less than that to which he or she is entitled, i.e., by being subjected unfairly to deductions based on collateral benefit entitlements that are in doubt and/or which may not truly overlap with sums recovered in a tort judgment. Statutory provisions of this nature therefore are strictly interpreted and applied. In particular, deductions from a plaintiff's damage award to prevent double recovery will be made only if it is absolutely clear that the plaintiff's entitlement to such collateral benefits is certain, and that the plaintiff received compensation for the same benefits in the tort judgment (as "apples should be deducted from apples, and oranges from oranges"). Evidence of "likelihood" and "probability" in that regard is not enough to warrant a deduction. Rather, a "very strict onus of proof" applies in relation to such matters, and it must be "patently clear" that the preconditions for an appropriate deduction have been established. If there is uncertainty as to a plaintiff's receipt of such benefits, the value of the benefits entitlement, and/or the extent (if any) to which recovered tort damages relate to the same type of expense covered by the benefits received, matters are not "beyond dispute" in the sense required for a deduction, and no deduction should be made. See Chrappa v. Ohm (1998), 1998 893 (ON CA), 38 O.R. (3d) 651, [1998] O.J. No. 1678 (C.A.), at p. 657 O.R.; Bannon v. Hagerman Estate (1998), 1998 4486 (ON CA), 38 O.R. (3d) 659, [1998] O.J. No. 1673 (C.A.), at p. 679 O.R.; Cowles v. Balac, 2005 2038 (ON SC), [2005] O.J. No. 229, [2005] O.T.C. 52 (S.C.J.), at para. 205, affd (2006), 2006 34916 (ON CA), 83 O.R. (3d) 660, [2006] O.J. No. 4177 (C.A.); Moore v. Cote, [2008] O.J. No. 3541, 169 A.C.W.S. (3d) 510 (S.C.J.), at para. 9; and Hoang v. Vicentini, supra, at paras. 27-28, 36 and 45.

[10] In my view, the case before me clearly presents various uncertainties as to entitlement and overlap that make it inappropriate to grant the relief requested by York Fire.

[11] Those uncertainties are reflected, I think, in the somewhat vague and unspecified nature of that very request for relief, which repeatedly employs only nebulous references, e.g., to "certain" future statutory accident benefits, "other" collateral benefits", "such moneys", and "any payment or entitlement".

[12] Apart from indicating the maximum notional entitlements permitted to someone in the plaintiff's situation, and the amount of benefits received to date by the plaintiff, there is no attempt made to quantify, with any sort of precision, the scope of the relief effectively requested by York Fire.

[13] There simply is no evidence before me to indicate, with anything resembling certainty to the extent required, the total amount of statutory accident benefits the plaintiff Mr. Gilbert definitely will receive. In other words, Mr. Gilbert's entitlement to such benefits is not "patently clear". To date, he has received certain statutory accident benefits -- but there is no indication as to whether he will receive further benefits, or the nature and extent of such benefits.

[14] However, the uncertainties in this case, as far as collateral benefits are concerned, extend beyond entitlement.

[15] In particular, there is a separate and independent obstacle to York Fire's request for relief in this particular case, in that the circumstances effectively prevent any determination of the extent (if any) to which the sums awarded by the jury definitely relate to the same losses in respect of which Mr. Gilbert has received or will receive statutory accident benefits.

[16] For example, York Fire points to the $57,250 in damages the jury awarded to Mr. Gilbert for "future care costs", and says this inherently overlaps completely with the "medical benefits" Mr. Gilbert has received or will receive from his accident benefits insurer.

[17] However, as noted by the plaintiff, that is not necessarily so for a number of reasons.

[18] First, there are significant temporal considerations which prevent assumption or conclusion of overlapping recovery, or quantification of the extent (if any) to which that may occur in relation to medical and rehabilitation benefits. In particular:

As noted above, any possible entitlement of Mr. Gilbert to medical and rehabilitation benefits is subject not only to a $100,000 maximum, but will terminate in any event ten years from the date of the accident. In other words, Mr. Gilbert will have no entitlement to any such medical benefits after April 26, 2020, i.e., approximately six years after the time of trial, at which point Mr. Gilbert will be only 47 years old. [page710]

However, as reflected in the wording of the relevant question put to the jury for determination, the $57,250 the jury awarded was to be for all future care costs, "from this date forward", without any differentiation as to whether the damages awarded corresponded to the plaintiff's future care needs before April 26, 2020, his needs after that date, or his future needs before and after that date. In other words, the jury simply was not asked to indicate, and did not indicate, the extent to which any of the $57,250 in future care cost damages was allocated to the time period during which Mr. Gilbert may be entitled to medical and rehabilitation benefits.

In the result, while it is certainly possible that there may be an overlap between the future care cost damages awarded by the jury and any medical and rehabilitation benefits received by Mr. Gilbert after trial (during the ten-year period following the accident), thereby entailing an extent of "double recovery", that also may very well not be the case. Some or all of the future care cost damages awarded by the jury to Mr. Gilbert may have been intended to cover what the jury perceived to be Mr. Gilbert's likely future care needs for the period after April 26, 2020. At this point in the litigation process, there is simply no way of making such determinations -- and therefore no corresponding way to ensure that any effective deduction from the plaintiff's award of damages would not leave him with less than the full compensation to which he is entitled.

[19] Second, there are qualitative considerations which also prevent reliable assumptions or conclusions concerning the extent of overlapping recovery in relation to medical and rehabilitation benefits. In particular:

In relation to future care costs, the jury was asked to determine an appropriate "lump sum" award for "future treatment, medication, rehabilitation, intervention and aids".

The jury responded accordingly, awarding a global sum of damages for "future care costs" that made absolutely no allocation whatsoever towards any one or more particular category or categories of future care expenditures the jury may have had in mind when arriving at what it considered to be an appropriate total award for such damages.

As noted by the plaintiff, there nevertheless are various aspects of future care expenditures (such as certain elements of transportation of an insured person to and from medical, counselling and/or training sessions) that are not recoverable under the Statutory Accident Benefits Schedule -- Accidents on or after November 1, 1996, O. Reg. 403/96, ss. 14(6) and 15(12).

In the result, it is certainly possible (and I think likely) that most of the future care cost damages were intended by the jury to cover the type of expenditures in respect of which Mr. Gilbert might receive medical and rehabilitation benefits (leaving aside temporal considerations). However, at this point in the litigation process, there is simply no way of making an accurate determination of the extent to which the award of damages was intended to cover aspects of future treatment in respect of which Mr. Gilbert would not be entitled to medical and rehabilitation benefits. A deduction from his damages of all such benefits, without any such qualitative distinctions, therefore once again would run the risk of Mr. Gilbert receiving less than the full compensation to which he is entitled.

[20] Of course, such uncertainties might have been avoided and/or resolved by the posing of more specific questions to the jury.

[21] However, in the course of formulating the questions for the jury, with input from counsel, York Fire gave no indication, either directly or indirectly, that the plaintiff's possible entitlement to statutory accident benefits raised any concerns or issues that needed to be addressed. To the contrary, York Fire indicated its satisfaction with the finalized questions put to the jury.

[22] In the result, there is no effective mechanism or ability, at this point, to achieve the level of certainty required by the authorities to make the effective deductions requested by York Fire in relation to the plaintiff's future care cost damage award. Any such deductions inherently would entail the impermissible risk of reducing Mr. Gilbert's recovery to something less than full compensation.

[23] As noted above, the suggestion of other relief pursuant to s. 267.8 of the Insurance Act, supra, relating to income replacement benefits, attendant care benefits, or future housekeeping and home maintenance benefits, was not pursued by York Fire during the course of submissions. To the extent it has not formally been conceded, I find that York Fire similarly has not established, with the requisite certainty, the preconditions for such other relief. [page712]

Conclusion

[24] For the reasons outlined above, I decided, as indicated following counsel submissions, to dismiss the defendant's motion for the requested declarations, orders and assignment relating to the plaintiff's collateral benefits.

Additional Matters

[25] At the conclusion of submissions regarding the motion herein, counsel took the opportunity to raise two additional matters about which there effectively was no disagreement, but in respect of which formal judicial direction and determination was requested, prior to any formal and final judgment being entered.

[26] First, York Fire requested that judgment in this matter should include formal confirmation that it succeeded in relation to its undefended cross-claim for contribution and indemnity vis-à-vis the uninsured driver, i.e., the defendant Michael South (who was noted in default and did not participate at trial). In my view, the circumstances and facts established at trial entitled York Fire to judgment on its cross-claim, pursuant to rule 19.06 [of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194], and there was no apparent reason why York Fire's unopposed request in that regard should not be granted. As I indicated to counsel when the request was made, the final judgment accordingly should include provisions to that effect.

[27] Second, the plaintiff requested formal confirmation that it was entitled to prejudgment interest from September 15, 2010 (the date on which he served formal notice of his claim). The plaintiff's request in that regard was not disputed and in my view was appropriate. As I indicated to counsel when the request was made, the final judgment accordingly should include that corresponding indication as well.

Motion dismissed.

End of Document