Judge rules that Wrongdoer Defendant rather than Victim should be Entitled to Benefits of Insurance that she paid for

Calculating damages is one of the most significant and complex aspects of civil cases, including personal injury claims.

Damages in cases of negligence fall into two main categories - special and general. Special damages include financial losses such as loss of income, medical expenses, cost of attendant care, home maintenance expenses and so on, while general damages refer to non-monetary losses such as pain and suffering, and the loss of enjoyment in life that results from a person's injuries.

There are many issues a jury and/or judge must consider when deciding how much to award a claimant and some factors can significantly affect that decision.

Case example

The case, Mazzucco et al. v. Herer et al., exemplifies some of the complexities in determining fair compensation for an injured person, particularly with respect to double recovery for the same losses.

The plaintiff, Rita Mazzucco, suffered a stroke after being discharged from Women's College Hospital, where she had been admitted after complaining of a severe headache and hypertension. Ms. Mazzucco spent two months in the hospital and her family doctor later filed medical reports so she could receive Canada Pension Plan (CPP) and Long Term Disability (LTD) benefits. Ms. Mazzucco never returned to work and was receiving CPP and LTD benefits for the better part of 10 years, the latter of which was paid in full by her employer Dufferin-Peel Catholic School Board.

Ms. Mazzucco's doctor testified that she was unlikely to ever work again. As a result, Ms. Mazzucco proceeded to file a malpractice suit against Women's College Hospital for not recognizing that she was too sick to be discharged. The action included claims for both past and future income loss, which is a key contributing factor to the main issue in this case.

That is, whether or not the CPP and LTD benefits Ms. Mazzucco already received should be deducted from a settlement awarded by the jury for past and future income loss. Both parties agreed that the CPP benefits should not be deducted. Therefore, the question Justice Skarica had to answer was whether or not the LTD benefits should be deducted.

Justice Skarica began his analysis by acknowledging that the issue was really one of double recovery, as the general principle with regards to negligence damages is that it is measured by actual loss, with some exceptions. Therefore, for Ms. Mazzucco to have already received LTD benefits for all the time she could not work and then later receive financial reward for this same past and future income loss, would be the equivalent of receiving double recovery.

In civil cases, the general rule is that claimants should not receive compensation for the same loss more than once, thus constituting 'double recovery'.

One of the exceptions regarding double recovery is in the case of private insurance, for example, if the benefits were paid as part of the individual's wage package from their employer. However, Justice Skarica referenced the recent Supreme Court decision in IBM Canada Limited v. Waterman, which reviewed and reevaluated this particular exception.

In considering the decisions in that case, Justice Skarica concluded that there is really no single marker to decide what benefits fall into the private insurance exception and also, that there is room in the analysis of the deduction issue for broader policy considerations.

Prior to the IBM Canada Limited v. Waterman ruling, Justice Skarica noted that the LTD benefits paid to Ms. Mazzucco by her employer would have qualified as private insurance. However, that was no longer the case. Ms. Mazzucco's counsel argued that the IBM Canada Limited v. Waterman case was a contract case and therefore not applicable to a tort case.

Justice Skarica disagreed, noting that the ruling began a new era regarding the private insurance exception. Ultimately, Justice Skarica applied the broader policy considerations factor to the issue and ruled that Ms. Mazzucco should have the LTD payments that had been previously provided deducted from the amount to be awarded to her.

His reasoning was that Ms. Mazzucco continues to receive LTD payments paid for by her employer and thus is already being compensated for her actual losses. Justice Skarica determined that for Ms. Mazzucco to get full compensation from the defendant Women's College Hospital, would be the equivalent of double recovery from agencies, both of which are funded by the Ontario taxpayers.

Justice Skarica noted that was particularly unfair to the province and public, which he stated is already overburdened financially. The judge's decision is problematic in that it does not appear to consider that the ruling actually creates a windfall for the wrongdoers in this case.

After all, the defendants in this case were found liable - that is, they were found to have done something wrong. They did not pay for the collateral insurance, but the ruling gives them the benefit of it.

Query whether the fact that the state is overburdened is a proper aspect in the calculation of damages. When you or someone you love has incurred serious injuries due to the negligence of another party, it can be a particularly stressful and painful time, both physically and emotionally.

Trying to navigate the complicated and multifaceted legal system to receive the benefits and rewards you are owed and deserved, without the help of an experienced and skillful personal injury lawyer places you at a distinct disadvantage.

At Gluckstein Lawyers, our experienced team of personal injury lawyers specialize in tort law and well understand the complexities inherent in, and relevant case laws applied to the injury compensation process. We know how difficult the recovery process following a serious injury can be for an accident victim and their loved ones, and our goal is to help you obtain a just outcome in as quickly and stress-free a manner as possible. 

If you or someone you love has been seriously injured in an accident, please do not hesitate to call Gluckstein Lawyers. We provide a free initial consultation to review all the facts of your unique case and provide you with your best legal options.