Davidson - Cap on Non Pecuniary General Damages

Question 1

What is the trilogy?

Answer 1

1978 trilogy of Supreme Court of Canada decisions:
• Andrews. v. Grand
• Toy Alberta Ltd., Teno v. Arnold
• Thornton v. Prince George School District #57

Question 2

What was the outcome of The Trilogy of 1978?

Answer 2

Court decides to stabilize and make consistent awards for non-pecuniary or general damages ($100K)

Question 3

What are the reasons for capping awards for non-pecuniary damages?

Answer 3

• Claim on severely injured person for non-pecuniary damages is limitless
• Non-pecuniary damage is not to indemnify (no money can provide for true restitution) but to make life more endurable
• Extremely high awards can lead to excessive social burden and lead to unaffordable premium
• Plaintiffs are already fully indemnified for future loss or income and care costs, which are more important

Question 4

Important observations that can be drawn from the reasons of Justice Dickson in Andrews

Answer 4

1 - A fundamental justification for imposing an upper limit on non-pecuniary losses is the underlying assumption that pecuniary losses will be fully compensated
2 - Assumption that if left unregulated, non-pecuniary claims in the most serious cases would lead to extravagant awards and a subsequent burden on society

Question 5

Briefly discuss Teno v. Arnold

Answer 5

Justice Spence reiterates social burden produced by extravagant awards in the US. We have a right to fear a situation where none but the wealthy could own or drive automobiles because none but the wealthy could afford to pay the enormous premiums which would be required by insurers to meet such exorbitant awards

Question 6

Briefly discuss Fenn v. City of Peterborough (1979)

Answer 6

Plaintiff was grievously injured, Court relied on 2 factors which justified an award that was somewhat higher than $100K ($125K):
1 - Trial occurs 1.5 years after last of trilogy cases over which there had been an appreciable erosion in the value of money
2 - Plaintiff had suffered more substantial pain than any of the plaintiffs in the trilogy

***Never went to Supreme Court

Question 7

Briefly discuss Lindal v. Lindal (1981)

Answer 7

• Plaintiff was awarded $135K at the trial level, reduced to $100K by the appeal
• Limit was to be viewed as the upper limit for all such similar cases
• Provide a measure of uniformity and predictability in this difficult area
• From this decision, the Courts have subsequently viewed the cap as $100K indexed for inflation

Question 8

Briefly discuss Ter Neuzen v. Korn (1995)

Answer 8

• Infected with AIDS as a result of artificial insemination
• At trial, the jury awarded $460K for general damages
• Court of Appeal ordered a new trial on the basis that the award for general damages could not exceed the Trilogy limit
• Rough upper limit evolved from a judicial directive to a “rule of law”

Question 9

Briefly discuss Lee v. Dawson (1995)

Answer 9

• Extremely serious brain injury and serious facial injuries
• Jury awarded general damages of $2M, but the judge felt he was bound by the cap of the Trilogy ($294K)
• On appeal, plaintiff stated that the cap was discriminating against seriously injured victims of negligence, using the Charter
• Court rejected the argument, as general damages were never meant to compensate the plaintiff
• General damages should not depend on seriousness of injury
• Supreme court dismissed the appeal w/o reason

Question 10

Briefly discuss additional argument presented in the case of Lee v. Dawson that support the removal of the cap

Answer 10

• Supreme court sees cap as a rough upper limit, not a strict rule of law
• Contemplated skyrocketing awards and premiums did not occurred
• Cap precludes juries from keeping up with rapid pace of social, economic and technological change in society
• Cap is arbitrary and lacks foundation
• Cap produce unjust results for plaintiffs who differ from those in the trilogy

Question 11

Provide 3 examples of cases to which the cap on non-pecuniary damages does not apply

Answer 11

1 - Court of Appeal: Sexual assault claims
2 -Supreme Court: Defamation
3 - Accident and medical malpractice to cases of negligence causing catastrophic personal injuries

**Rationale is that it has no impact on public purse

Question 12

Conclusion regarding the cap, it’s relevance since being instituted

Answer 12

• Cap works because it creates an economic climate where insurers continue to UW P&C insurance
• Innocent victims receive full compensation of economic losses where resources are finite
• Supports a stable and predictable system of law