Claims for speculative business losses in personal injury claims.

This is an issue that arises somewhat of often in my practice. Can an injured party make a claim for a small business that they have not actually started yet. This issue was dealt with in this recent Supreme Court of British Columbia case:

http://www.courts.gov.bc.ca/jdb-txt/sc/17/06/2017BCSC0644.htm

The plaintiff in this case was a 59 year old woman who had hoped to start her own cosmetics business. She had been injured in a motor  vehicle accident and was claiming that these injuries were preventing her from running a successful multi-million dollar cosmetics business.

The plaintiff in this action had taken a number of steps towards starting their business, including:

  1. Incorporating their business;
  2. Acquiring stock;
  3. Labeling and branding her stock;
  4. Getting approval for sale from Health Canada; and
  5. Applying for trademarks.

Approximately 2 years prior to their injury the plaintiff held a private seminar, where she successfully sold various beauty products. Her stated goal was to hire a team of salespeople to sell her products via future private seminars.  The judge, unfortunately for the plaintiff, found various deficiencies in the plaintiff’s claim, including that:  her goal of having seminars with a sales team was vague; the plaintiff’s evidence about market conditions was inadequate; the plaintiff’s previous lack of success with this business should be taken into consideration;  the plaintiff had not devouted full time hours to her business prior to her injury; and the plaintiff, although partially, was not totally disabled from running her business as a result of her injuries.

As a result, the plaintiff was not given an award for past nor future loss of earnings for her proposed business. She was, however, given an award of $100,000 for loss of her “entrepreneurial spirit”. This amount was considerably less than the several million dollar claim that the plaintiff was advancing for loss of profits from her proposed cosmetics business.

This case illustrates the difficulty that many plaintiffs will face when making a claim for income losses, particularly when there is a high degree of uncertainty concerning their potential earnings.

Construction worker given $430,000 award for soft-tissue injuries sustained in car accident.

http://www.courts.gov.bc.ca/jdb-txt/sc/17/05/2017BCSC0577.htm

The injured party was a construction worker and father of 4 children. His work primarily focused on residential renovations and building and servicing green houses at big box stores. The plaintiff was fifty years old at the time of trial and had been injured in what the courts described as a “violent” rear end type motor vehicle accident. Although the plaintiff continued to work after the accident, he was limited in what roles he could perform and how long he could work for, largely due to ongoing neck and chronic neck pain after the accident.

In this case the lawyers for the defence tried to make the argument that since the plaintiff had been to acupuncture treatments for neck and shoulder issues prior to the accident, he must have been suffering from soft-tissue injuries before the accident that were not caused by the accident. Fortunately, the judge found the plaintiff to be credible and dismissed the defence’s argument, stating:

“Receiving an acupuncture treatment (or a massage) for the relief of soreness or temporary muscle pain arising from long hours of driving or physically demanding activities is qualitatively different from attending an acupuncturist as a result of an injury on the recommendation of one’s general practitioner.”

This was a very astute observation by the judge and was based on medical expert evidence from an expert in occupational medicine who stated “people go for massages all the time when they are working at physical jobs or go to their gardens and they do a bunch of digging”, but it “does not mean they have an ongoing back pain disability”.

Student awarded $150,000 for Future Income Loss.

http://www.courts.gov.bc.ca/jdb-txt/sc/17/05/2017BCSC0550.htm

This case involved a plaintiff who was injured in 3 separate motor vehicle accidents. At the time of their first accident, the plaintiff was a bank teller who was pursuing a Bachelor’s Degree in Financial Services and Administration at Douglas College.

The plaintiff’s award for Future Income Losses was broken down into 2 components:

  1. $50,000.00 for a delay in her education and training; and
  2. $100,000.00 for loss of Future Earning Capacity.

The plaintiff was given these awards despite, at the time of trial, having the ability to work full time. The $50,000.00 was meant to compensate the plaintiff for any delays in her education caused by her inability to pursue career and educational goals with the same vigor had the car accidents not occurred. For example, if the plaintiff was not able to take as many courses or not pursue promotions or new opportunities, this award would compensate her.

The second part of the award, which consisted of $100,000 for Loss of Future Earning Capacity, was meant to compensate the plaintiff for future contingencies, such as time off work, early retirement, and an inability to pursue overtime. This figure of $100,000 was based loosely on her salary at the time, and she was given compensation for approximately 2 years of her current salary.

This case once again illustrates that despite uncertainty as to career paths, a young person or a students may still be entitled to compensation for future losses.