Case involves a bus passenger who was in an accident
The BC Court of Appeal has ruled against the deduction of benefits from the damages awarded to the plaintiff who was injured in a motor vehicle accident.
In Blackburn v. Lattimore 2023 BCCA 224, Hailey Blackburn was a passenger on a bus when her head hit a metal railing, resulting in an injury. She sued the bus operators for damages, and the court issued a judgment in her favour, ordering the defendants to pay damages. The Insurance Corporation of British Columbia (ICBC) is the insurer liable to pay no-fault benefits to Blackburn under part 7 of the Insurance (Vehicle) Regulation. The judge decided to reduce the damages awarded by the amount of the part 7 benefits to which Blackburn would be entitled.
Blackburn appealed the judge’s decision to the BC Court of Appeal. The court explained that under s. 83 of the Insurance (Vehicle) Act, a defendant may apply to deduct from the amount of the judgment certain mandatory part 7 benefits corresponding to sums compensated in the tort damages award. The rule aims to determine the amounts that would be paid to the plaintiff immediately and to prevent double compensation.
The appeal court further explained that the requirement for deduction under s. 83 is a correspondence or a correlation between the damages sought to be reduced and the mandatory part 7 benefit. This requirement ensures that the deduction addresses the risk of overcompensation.
The court noted that part 7 of the regulation mandates the no-fault benefits referred to in s. 83 of the act, including disability benefits for employed persons. The court also noted that s. 84 of the regulation provides disability benefits for homemakers.
The judge deducted $40,000 in damages awarded to Blackburn for loss of past and future housekeeping capacity because ICBC had committed to pay part 7 homemaking benefits until the entire award was utilized. Blackburn argued that the judge committed an error because the required correspondence between the award and the benefit available under s. 84 is absent.
The appeal court agreed with Blackburn’s contention. The court explained that, unlike costs of future care items, damages for loss of housekeeping capacity are not inherently damages that compensate for the expenditure of money. Instead, they are a specific award to pay for the loss of the ability to do housework.
The court further said that a tort damages award for housekeeping capacity loss does not necessarily correspond with the disability housekeeping benefits described in s. 84. Section 84 reimburses only expenses incurred from hiring others and is not intended to compensate for the economic losses occasioned by the plaintiff in housekeeping. On the other hand, the damages award is not limited to reimbursement for specific services provided by hired persons, as it also compensates for the value of the housekeeping work that would have been done by the plaintiff, even if no person was or will be hired for the task and is expressly for loss of the ability to work.
The court stressed that the issue of deductibility of an amount for housekeeping benefits under part 7 requires consideration of the correspondence between the damages award and the benefit under the regulation. The court concluded that the defendants failed to establish the necessary correspondence to deduct such benefits from the damages award.
