Written By: Michael Warfe and Brock Turville, Student-at-Law
Those injured in motor vehicle collisions and other types of incidents are left with endless uncertainties. You may suddenly find yourself unable to work, facing mounting financial pressures of unpaid household expenses and medical bills. After you’ve retained a lawyer, one of the first things you will likely want to know is: how much is my claim worth?
While you might hope to receive a straightforward answer, the reality is that there are a multitude of factors that affect the value of your claim. To name a few:
- Who was at fault (or partially at fault)
- The kind and severity of the injuries you suffered
- The care you will require in the future
- How much you earned prior to the incident and how much you were projected to earn throughout your working life
- The lifestyle you previously lived, including hobbies and activities of daily living
Taking all of these contingencies into account and applying them to your unique case, valuing a claim can be extremely challenging.
First, liability must be assessed. If you are found to be partially at fault for the incident, the amount you receive at trial will be reduced by the percentage you are determined to be at fault. Liability is also taken into account during settlement discussions.
The next step is to assess the losses you suffered. One important principle to keep in mind is that the law was designed to compensate you for the losses you suffered as a result of the incident, no more and no less.
Another difficulty in accurately assessing your claim is time. Your injuries may take years to fully develop, and personal injury lawyers and insurance companies are often reluctant to settle before you have reached “maximum medical recovery”. This is because both sides are uncertain of the true value of your claim. Personal injury lawyers typically do not settle without first obtaining medical opinions and prognoses of your injuries and how you will fair in the future.
Once you have reached maximum medical recovery, which may be years after the incident, you will likely have a better idea of the value of your claim. Rather than provide you with a single number, your lawyer will likely talk in terms of the “reasonable range” you can expect to receive based on the particular circumstances of your case.
Your claim will be assessed and valued based on different “heads” or categories of damages. Distinguishing between these categories is important, as you will undoubtedly become familiar with them throughout your case.
General and Special Damages
General and special damages can be thought of on a timeline – i.e. the losses you incurred from the date of the incident to the date of trial and your losses after trial.
General damages cover pecuniary (monetary) losses after trial and non-pecuniary losses (such as pain and suffering), both before and after trial. In order to determine non-pecuniary damages, your lawyers will need to know what you did before and how your life changed after the incident. General damages include future loss of working capacity, such as loss of earnings and loss of shared family income, future cost of care and non-pecuniary losses, such as your pain and suffering and loss of expectation of life.
In Canada, the maximum you can receive for non-pecuniary losses is currently around $390,000. This cap was imposed by the Supreme Court of Canada in 1978, which determined that these damages were to be capped at $100,000. This cap has been adjusted with inflation.
Another issue to be aware of is something called the “statutory deductible”. This deductible only applies to non-pecuniary losses in motor-vehicle collision claims. If you are awarded less than $131,854.01 in non-pecuniary damages at trial, that award will be reduced by $39,556.53. For example, if you received an award of $100,000, you would only receive $60,443.47 for non-pecuniary damages. However, if you are awarded $135,000 for non-pecuniary losses, you have surpassed the $131,854.01 “threshold” and receive the entire amount.
Special damages, on the other hand, provide compensation for pecuniary losses before trial (such as loss of income and cost of care). Special damages include pre-trial loss of working capacity and pre-trial cost of care.
Compared to general damages, which involve more uncertainty and subjectivity, special damages can usually be calculated and particularized. For example, pre-trial loss of income can be calculated by looking at how much you earned at the time of the incident. Pre-trial care costs and be calculated by adding up all of your medical bills and out-of-pocket expenses. While amounts claimed under special damages need to have some air of reality, you are only expected to prove your losses as fully as possible given the circumstances of your case.
Punitive damages are exceptional and are only available in very limited circumstances where the defendant’s conduct is particularly shocking. Punitive damages are awarded to punish the defendant’s “egregious” or “high handed” conduct and are not intended to provide compensation to the plaintiff.