Court Uses Capital Asset Approach To Make Award For Past Diminished Earning Capacity

In Russell v. Parks, the Plaintiff was injured in a car accident, and brought an ICBC claim for several heads of damages, including pain and suffering, cost of future care, diminished earning capacity, and past diminished earning capacity. The Plaintiff had been injured as a pedestrian in a parking lot. With respect to the issue of past diminished earning capacity, the Court recognized the legal principle that a Plaintiff’s capacity to earn money is an asset which has been taken away when a person suffers injuries. The Court would eventually award $21,000.00 for past diminished earning capacity, before reducing this amount to account for social assistance benefits that the Plaintiff had already received.


[74]        Claims for damages for past and future loss of earning capacity are based on the recognition that a plaintiff’s capacity to earn money was an asset which has been taken away: Rowe v. Bobell Express Ltd., 2005 BCCA 141 (CanLII), 2005 BCCA 141 at paras. 23 – 24.


[75]        As was stated in Rowe at paras. 30 – 31:


… a claim for what is often described as “past loss of income” is actually a claim for loss of earning capacity; that is, a claim for the loss of the value of the work that the injured plaintiff would have performed but was unable to perform because of the injury.


Evidence of this value may take many forms. As was said by Kenneth D. Cooper-Stephenson in Personal Injury Damages in Canada, 2nd ed. (Scarborough, Ont.: Carswell, 1996) at 205-06,


… The essence of the task under this head of damages is to award compensation for any pecuniary loss which will result from an inability to work. “Loss of the value of work” is the substance of the claim — loss of the value of any work the plaintiff would have done but for the accident but now will be unable to do. The loss framed in this way may be measured in different ways. Sometimes it will be measured by reference to the actual earnings the plaintiff would have received; sometimes by a replacement cost evaluation of tasks which the plaintiff will now be unable to perform; sometimes by an assessment of reduced company profits; and sometimes by the amount of secondary income lost, such as shared family income.


[Underlining added in Rowe.]


[81]        When I consider this evidence within the context of the legal principles to which I have referred, I conclude the plaintiff has established a loss of earning capacity to the date of the trial which is causally related to the injuries sustained in the Accident. But I am unable to accept that in the timeframe of approximately a year or so leading up to the Accident the plaintiff was earning $1,000 per month. That would be approximately $250 per week. If one assumes an hourly wage of $10 and that the average length of the grass mowing or snow shovelling jobs was two to three hours then that would amount to two jobs per day, five days a week. The evidence led by the plaintiff, in my view, could not form the basis for such a conclusion.


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