British Columbia v. Zastowny, 2008 SCC 4, [2008] 1 SCR 27

                                                 SUPREME COURT OF CANADA

Between:

Her Majesty the Queen in Right of the Province of British Columbia

Appellant / Respondent on cross‑appeal

v.

Dean Richard Zastowny

Respondent / Appellant on cross‑appeal

Coram: McLachlin C.J. and Bastarache, Binnie, LeBel, Deschamps, Fish, Abella, Charron and Rothstein JJ.

______________________________

British Columbia v. Zastowny, [2008] 1 S.C.R. 27, 2008 SCC 4

Her Majesty The Queen in Right

of the Province of British Columbia                                     Appellant/Respondent on cross‑appeal

v.

Dean Richard Zastowny                                                       Respondent/Appellant on cross‑appeal

Indexed as:  British Columbia v. Zastowny

Neutral citation:  2008 SCC 4.

File No.:  31552.

2007:  December 14; 2008: February 8.

Present:  McLachlin C.J. and Bastarache, Binnie, LeBel, Deschamps, Fish, Abella, Charron and Rothstein JJ.

on appeal from the court of appeal for british columbia

Damages — Past and future wage loss — Periods of incarceration — Plaintiff seeking damages for injuries suffered as consequence of sexual assaults — Whether plaintiff entitled to compensation for wage loss while he was incarcerated  — Whether plaintiff can be compensated for time spent in prison after he became eligible for parole — Whether recovery for past wage loss while incarcerated barred by application of ex turpi causa non oritur actio doctrine or novus actus interveniens doctrine — Whether Court of Appeal erred in reducing award for loss of future earnings.

In 1988, Z was twice sexually assaulted by a prison official while imprisoned for a break and enter committed to support a crack cocaine addiction.  After his release from prison, Z became addicted to heroin and a repeat offender.  He was in prison for 12 of the next 15 years.  In 2003, Z commenced an action seeking damages for the sexual assaults.  A psychologist testified that the assaults caused Z to start using heroin and exacerbated his substance abuse and criminality.  Z was awarded general and aggravated damages, the cost of future counselling, and compensation for past and future wage losses.  The award for past wage losses included compensation for time spent in prison.  The Court of Appeal reduced the award for past wage loss in order to compensate Z only for the time spent in prison after eligibility for parole and it reduced Z’s future wage loss by 30 percent to reflect his high risk of recidivism.

Held:  The appeal should be allowed and the cross‑appeal should be dismissed.

A person is not entitled to compensation for periods of unemployment due to incarceration for conduct which the criminal law has determined worthy of punishment, except for exceptional circumstances such as a wrongful conviction.  To hold otherwise would create a “clash” between the criminal and civil law which would compromise the integrity of our justice system.  Compensation for wages lost while in prison should only be given where it does not undermine a lawfully imposed criminal sanction. [3] [42]

The doctrine of ex turpi causa non oritur actio is a defence that invalidates an otherwise valid and enforceable tort action in order to preserve the integrity of the legal system.  It precludes damage awards that allow a person to profit from illegal or wrongful conduct or that permit evasion or rebate of a penalty prescribed by the criminal law.  It does not preclude damages for personal injury.  Because it is a defence, it is independent of the duty of care owed by the defendant and the defendant must prove that the plaintiff’s illegal or immoral conduct precludes the action.  In this case, Z should not be compensated for loss of wages while in prison because such compensation would constitute a rebate of the consequences of Z’s criminal acts.  Z is personally responsible for his acts and their consequences. He cannot attribute them to others and evade or seek rebate of those consequences.  No distinction should be made between “core time” of incarceration  and “extra time” because Z’s lawfully imposed sentence consisted of both time before and after parole eligibility. [18] [20] [22] [30] [32]

The novus actus interveniens doctrine should not be conflated with the ex turpi doctrine.  A factual chain of causation is not broken because the civil law is brought into conflict with the criminal law.  Applying the novus actus doctrine in this case would inappropriately suggest that the chain of causation was broken by Z going to prison.  No basis arises to interfere with the trial judge’s finding of causation or the damages awarded for wages lost when Z was not in prison.  The award for past wage loss should be reduced to exclude the periods of time when Z was in prison. [36-39]

With respect to the cross-appeal, the Court of Appeal did not err in reducing the award for future wage loss.  Z represents a high risk of recidivism and the award should be reduced to reflect the likelihood of Z being sent back to prison. [44] 

Cases Cited

Discussed:  Hall v. Hebert, [1993] 2 S.C.R. 159; H.L. v. Canada (Attorney General), [2005] 1 S.C.R. 401, 2005 SCC 25; referred to:  Bazley v. Curry, [1999] 2 S.C.R. 534; Quebec (Commission des droits de la personne et des droits de la jeunesse) v. Maksteel Québec Inc., [2003] 3 S.C.R. 228, 2003 SCC 68; State Rail Authority of New South Wales v. Wiegold (1991), 25 N.S.W.L.R. 500; Clunis v. Camden and Islington Health Authority, [1998] Q.B. 978; Worrall v. British Railways Board, [1999] E.W.J. No. 2025 (QL).

Authors Cited

Banakas, E. K.  “Tort Damages and the Decline of Fault Liability:  Plato Overruled, But Full Marks to Aristotle!”, [1985] Cambridge L.J. 195.

Great Britain.  Law Commission.  Consultation Paper No. 160.  The Illegality Defence in Tort: A Consultation Paper.  London:  Stationery Office, 2001.

APPEAL and CROSS-APPEAL from a judgment of the British Columbia Court of Appeal (Finch C.J.B.C. and Saunders and Smith JJ.A.) (2006), 269 D.L.R. (4th) 510, 225 B.C.A.C. 191, 371 W.A.C. 191, 40 C.C.L.T. (3d) 240, [2006] B.C.J. No. 997 (QL), 2006 BCCA 221, setting aside in part a judgment of Cohen J., [2004] B.C.J. No. 2044 (QL), 2004 BCSC 1273.  Appeal allowed and cross‑appeal dismissed.

Keith L. Johnston and Karen Horsman, for the appellant/respondent on cross‑appeal.

Megan R. Ellis, for the respondent/appellant on cross‑appeal.

The judgment of the Court was delivered by

Rothstein J. —

I.  Introduction

[1]                              This appeal raises the issue of when — if ever — an individual may be awarded damages for past wage loss for time in which he or she was incarcerated.

[2]                              The respondent, Dean Richard Zastowny, was imprisoned when he was 18 years old for a break and enter committed to support his crack cocaine addiction.   While incarcerated, he was twice sexually assaulted by a prison official named Roderic David MacDougall.  After his release, Zastowny became addicted to heroin and a repeat offender.  He spent 12 of the next 15 years in prison for a variety of offences.  In 1996, while in prison, Zastowny became aware of an investigation into MacDougall.  He disclosed to police that MacDougall had abused him.  Consequently, MacDougall was convicted of the sexual assaults.  Zastowny then brought an action for damages, including damages for lost wages.  The trial judge awarded Zastowny  general and aggravated damages due to the assaults, as well as past and future wage loss due to the effect of the assaults. The award for past wage loss included compensation for his time spent in incarceration.  The Court of Appeal reduced the award for past wage loss in order to compensate Zastowny only for the time he spent in prison after he became eligible for parole and reduced his future wage loss by 30 percent to reflect his high risk of recidivism.  

[3]                              In my view, except for exceptional circumstances such as a person having been wrongly convicted, he or she is not entitled to compensation for periods of unemployment due to incarceration for conduct which the criminal law has determined worthy of punishment and the consequences of that punishment.  To hold otherwise would create a “clash” between the criminal and civil law which would compromise the integrity of our justice system.

[4]                              I would therefore allow the appeal and dismiss the cross-appeal. 

II.  Facts

[5]                              Zastowny was suspended from school in grade 9 for using marijuana and dropped out of school in grade 10.  As a teenager, in addition to marijuana, he used acid,  mushrooms and alcohol, and eventually at the age of 17, he started using crack cocaine and developed a serious dependency.  He turned to crime to support his habit and in 1988, at the age of 18, he was convicted of breaking and entering and was sent to Oakalla, a male correctional centre in British Columbia.

[6]                              MacDougall was a classification officer at the centre responsible for placing prisoners in the system.  MacDougall sexually assaulted Zastowny twice by performing forced fellatio on him.  He overcame Zastowny’s resistance by threatening him with inmate violence and also induced Zastowny to cooperate by promising a transfer to a less threatening correctional centre.  Zastowny did not tell anyone what had happened. 

[7]                              Shortly after the second assault, Zastowny was moved to a forestry work camp.  He fled the camp, was caught and was returned to Oakalla to serve the rest of his sentence. After his release in 1989, he became dependent on heroin.   Zastowny was incarcerated for various offences over 12 of the following 15 years. While in prison for a robbery committed in 1996, he became aware of an investigation into MacDougall and he called the police.  MacDougall was charged with the offences against Zastowny and others and convicted after two trials.

[8]                              A psychologist, Dr. Robert Ley, with an expertise in assessing and counselling cocaine and heroin addicts testified at trial.  He opined that Zastowny’s anti-social behaviour and criminality resulted from the assaults.  His report stated that Zastowny’s self‑concept and self‑esteem were reasonably stable before the assaults but that after the assaults, he had low self-esteem, anti-social behaviour and suffered sexual anxiety.  Dr. Ley linked Zastowny’s resentment and rebelliousness towards correctional officers to the assaults.  He attributed Zastowny’s alcohol use, subsequent choice of heroin as his preferred drug, and greater need to obliterate himself to the assaults.  He opined that Zastowny had a good work ethic and record up until he was 18 years old, when he became addicted to crack cocaine, whereafter he had, for the most part, not sustained employment.  He concluded that Zastowny’s substance abuse and criminality directly interfered with his employment and his substance abuse was significantly exacerbated by the sexual assaults.

III.  Decisions Below

A. British Columbia Supreme Court, [2004] B.C.J. No. 2044 (QL), 2004 BCSC 1273

[9]                              Zastowny brought a successful action for damages against the Province of British Columbia.  The Province conceded at trial that the vicarious liability test articulated in Bazley v. Curry, [1999] 2 S.C.R. 534, was met, and thus the Province — as MacDougall’s employer — was vicariously liable for the injuries suffered by Zastowny as a consequence of the assaults.  Cohen J. relied heavily on the evidence of psychologist Dr. Ley.  He ordered the Province to pay general and aggravated damages of $60,000, as well as $15,000 for future counselling, $150,000 for past wage loss and $50,000 for future income loss. 

[10]                          Cohen J. awarded damages for wage loss for time spent in incarceration due to the effect of MacDougall’s assaults.  He held that MacDougall’s contribution to Zastowny’s mistrust of the criminal justice system and his alienation from justice authorities led Zastowny to conceal his abuse and led to greater sentences than he would have received had he disclosed the abuse.  Further, Zastowny’s stance in prison in regards to prison authorities meant that he served most of his sentences to his mandatory release date.  He held it was unlikely that Zastowny would have been sentenced as he was or served his sentences to their maximums had the courts and prison officials known that he had been sexually assaulted by a prison officer. 

[11]                          Cohen J. conducted an extensive review and analysis of cases dealing with the doctrine of ex turpi causa non oritur actio — no right of action arises from a base cause.  He concluded that the ex turpi doctrine did not apply in the present case to deny Zastowny damages for loss of wages while incarcerated because the wages claimed could not be considered profits from Zastowny’s illegal activity or an evasion or rebate of his criminal punishment.

[12]                          Cohen J. also awarded compensation for future income loss, noting that the assaults would likely contribute to Zastowny experiencing difficulty with employers or any individual in a position of authority.

B. British Columbia Court of Appeal (2006), 269 D.L.R. (4th) 510, 2006 BCCA 221

[13]                          The Court of Appeal divided three ways on the issue of compensation for wage loss due to incarceration.  Finch C.J.B.C. held that the trial judge’s order should be upheld.

[14]                          Smith J.A. found that Zastowny was precluded from compensation for loss of earnings while imprisoned.  He would have reduced the award for past loss of earning capacity by 80 percent to exclude the period of Zastowny’s incarceration (12 out of 15 years).

[15]                          He found that the ex turpi doctrine had no relevance because Zastowny’s “cause of action does not arise out of his own illegal or immoral conduct”.  Rather, he would have denied an award for past wage loss while incarcerated on the doctrine of novus actus interveniens — a new act intervenes.  In his view, Zastowny’s criminal conduct after the sexual assaults broke the causal chain between the sexual assaults and his imprisonment.

[16]                          Saunders J.A. concluded that Zastowny should recover some of his wage loss while incarcerated.  She divided Zastowny’s incarceration into non-compensable “core time” (time before eligibility for parole) which she found was his responsibility to bear as the consequence of his criminal behaviour and compensable “extra time” (time after eligibility for parole) which she held was more directly related to Zastowny’s response to the assaults.  She thus reduced the award for past wage loss by only 40 percent.

[17]                          In order to break the deadlock and make an effective order, Smith J.A.  acceded to the disposition proposed by Saunders J.A. but was clear that in doing so, he was not resiling from anything that he said in his reasons.

IV.  Analysis

A.  Appeal: Damages for Wage Loss During Periods of Incarceration

[18]                          The issue in the appeal is whether a plaintiff is barred from compensation for loss of wages during a period of time that he is unable to work because he is incarcerated.

(1) The Ex Turpi Causa Non Oritur Actio Doctrine

[19]                          The ex turpi doctrine, as applied in tort, has not historically been well understood.  In Hall v. Hebert, [1993] 2 S.C.R. 159, McLachlin J. (as she then was) says that its application in tort, “in both Canada and elsewhere, has had a chequered history” (p. 171).  The seminal case explaining the judicial policy underlying the ex turpi doctrine and its application in the context of tort law is the majority judgment of McLachlin J. in Hall v. Hebert. 

[20]                          The question is, “under what circumstances should the immoral or criminal conduct of a plaintiff bar the plaintiff from recovering damages to which he or she would otherwise be entitled” (p. 169).  The following principles and approach are established in Hall v. Hebert and are applicable in the present case.

1.                   Application of the ex turpi doctrine in the tort context invalidates otherwise valid and enforceable actions in tort (p. 169).

2.                   Therefore, its application must be based on a firm doctrinal foundation and be made subject to clear limits and should occur “in very limited circumstances” (p. 169).

3.                   The only justification for its application is the preservation of the integrity of the legal system.  This concern is only in issue where a damage award in a civil suit would allow a person to profit from illegal or wrongful conduct or would permit evasion or rebate of a penalty prescribed by the criminal law (p. 169).

It would, in short, introduce an inconsistency in the law. It is particularly important in this context that we bear in mind that the law must aspire to be a unified institution, the parts of which — contract, tort, the criminal law — must be in essential harmony.  For the courts to punish conduct with the one hand while rewarding it with the other, would be to “create an intolerable fissure in the law’s conceptually seamless web”: Weinrib, supra, at p. 42.  We thus see that the concern, put at its most fundamental, is with the integrity of the legal system. [p. 176]

4.                   The ex turpi doctrine generally does not preclude an award of damages in tort because such awards tend to compensate the plaintiff rather than amount to “profit”: 

Such damages accomplish nothing more than to put the plaintiff in the position he or she would have been in had the tort not occurred. . . . [A plaintiff should get] only the value of, or a substitute for, the injuries he or she has suffered by the fault of another.  He or she gets nothing for or by reason of the fact he or she was engaged in illegal conduct. [pp. 176-77]

5.                   The ex turpi doctrine is a defence in a tort action.  The plaintiff’s illegal conduct does not give rise to a judicial discretion to negate or refuse to consider the duty of care which goes to the relationship between a plaintiff and a defendant.  It is independent of that relationship.  The defendant may have caused harm by acting wrongly or negligently, but the “responsibility for this wrong is suspended only because concern for the integrity of the legal system trumps the concern that the defendant be responsible” (pp. 181-82).

6.                   Treating the ex turpi doctrine as a defence places the onus on the defendant to prove the illegal or immoral conduct that precludes the plaintiff’s action.  And as a defence, it allows for segregation between claims for personal injury and claims that would constitute profit from illegal or immoral conduct or the evasion of or a rebate of a penalty provided by the criminal law.

[21]                          In the case at bar, there is no challenge to the awards made for the personal injury suffered by Zastowny from the sexual assaults, namely the awards of general and aggravated damages and for future counselling.  Nor is there a challenge to the award of past wage loss for the period when Zastowny was not incarcerated.  The sole issue on the appeal is whether Zastowny is entitled to compensation for wage loss while he was incarcerated.

[22]                          Zastowny’s wage loss while incarcerated is occasioned by the illegal acts for which he was convicted and sentenced to serve time.  In my view, therefore, the ex turpi doctrine bars Zastowny from recovering damages for time spent in prison because such an award would introduce an inconsistency in the fabric of law.  This is because such an award would be, as McLachlin J. described in Hall v. Hebert, at p. 178, “giving with one hand what it takes away with the other”.  When a person receives a criminal sanction, he or she is subject to a criminal penalty as well as the civil consequences that are the natural result of the criminal sanction.  The consequences of imprisonment include wage loss.  As Deschamps J. found in Quebec (Commission des droits de la personne et des droits de la jeunesse) v. Maksteel Québec Inc., [2003] 3 S.C.R. 228, 2003 SCC 68, at para. 33, “[e]very incarcerated offender must suffer the consequences that result from being imprisoned, namely loss of employment for unavailability.”  An award of damages for wages lost while incarcerated would constitute a rebate of the natural consequence of the penalty provided by the criminal law.

[23]                          Preserving the integrity of the justice system by preventing inconsistency in the law is a matter of judicial policy that underlies the ex turpi doctrine.  “Judicial policy” was this Court’s justification for barring a similar claim for past wage loss due to incarceration in H.L. v. Canada (Attorney General), [2005] 1 S.C.R. 401, 2005 SCC 25.  In that case, the plaintiff was a resident of a First Nations reserve.   When he was 14 years old he joined a boxing club on the reserve that was operated by the Department of Indian and Northern Affairs and administered by William Starr.  Starr sexually assaulted the appellant by subjecting him to two acts of masturbation. H.L. became addicted to alcohol, had emotional difficulties, and engaged in criminal conduct.  He claimed damages from the Government of Canada, including loss of income both past and future, as a consequence of the sexual assaults.  The claim included loss during periods of time for which he was incarcerated.  His claim succeeded at trial, but was overturned by the Saskatchewan Court of Appeal on the awards for loss of income.

[24]                          This Court allowed the appeal to the extent of restoring the award for past wage loss while H.L. was at liberty, but excluding recovery for the periods of time he was incarcerated.  Fish J. for the majority concluded that an award for wage loss due to incarceration was not only unsupported by the evidence, but was, in any event, contrary to judicial policy:

In calculating H.L.’s loss of past earnings, the trial judge did not reduce the damages awarded to reflect the time H.L. spent in prison. The Court of Appeal intervened in this respect — quite properly, in my view. As Cameron J.A. noted, to compensate an individual for loss of earnings arising from criminal conduct undermines the very purpose of our criminal justice system . . .; an award of this type, if available in any circumstances, must be justified by exceptional considerations of a compelling nature and supported by clear and cogent evidence of causation.

. . .

Thus, on any view of the matter, the trial judge’s finding that Mr. Starr’s sexual abuse of H.L. caused his loss of income due to imprisonment is both contrary to judicial policy and unsupported by the evidence. [Emphasis added; paras. 137 and 143.]

[25]                          Bastarache J. dissented in H.L. but his views on the specific issue of awarding damages for wage loss for periods of incarceration were similar to those of

Fish J.  In writing for himself and two other judges, he found that to compensate a plaintiff for lost wages due to incarceration would “undermine the principles of our criminal justice system” (para. 344).   In concluding as much, Bastarache J. pointed to Samuels J.A.’s reasons in the Australian case State Rail Authority of New South Wales v. Wiegold (1991), 25 N.S.W.L.R. 500 (C.A.), at p. 514:

If the plaintiff has been convicted and sentenced for a crime, it means that the criminal law has taken him to be responsible for his actions, and has imposed an appropriate penalty. He or she should therefore bear the consequences of the punishment, both direct and indirect. If the law of negligence were to say, in effect, that the offender was not responsible for his actions and should be compensated by the tortfeasor, it would set the determination of the criminal court at nought. It would generate the sort of clash between civil and criminal law that is apt to bring the law into disrepute. [Emphasis added.]

[26]                          H.L. is authority for the proposition that the judicial policy that underlies the ex turpi doctrine precludes evasion or a rebate of the consequences of the criminal penalty, both direct and indirect.

[27]                          The ex turpi doctrine has been applied by the courts of the United Kingdom on a basis similar to that found appropriate in Hall v. Hebert and H.L.  In Clunis v. Camden and Islington Health Authority, [1998] Q.B. 978 (C.A.), the plaintiff had been discharged from a hospital where he had been detained under the U.K.’s Mental Health Act 1983. His mental condition deteriorated and two months later he stabbed a stranger to death. He pleaded guilty to manslaughter.  He subsequently brought an action against his local health authority for negligence.  He claimed that in consequence of the health authority’s breach of duty he would be detained for longer than he otherwise would have been and was unlikely to regain his liberty for many years.  The Court of Appeal found that he had no cause of action because his claim was “essentially based” on an illegal act. Lord Justice Beldam stated, at p. 990:

[T]he plaintiff’s claim is essentially based on his illegal act of manslaughter; he must be taken to have known what he was doing and that it was wrong, notwithstanding that the degree of his culpability was reduced by reason of mental disorder. The court ought not to allow itself to be made an instrument to enforce obligations alleged to arise out of the plaintiff’s own criminal act and we would therefore allow the appeal on this ground.

As pointed out by the United Kingdom Law Commission, Consultation Paper No. 160, The Illegality Defence in Tort (2001), at _4.100:

Clunis v. Camden and Islington Health Authority . . . seems entirely justifiable if the rationale of consistency is accepted: it would be quite inconsistent to imprison or detain someone on the grounds that he was responsible for a serious offence and then to compensate him for the detention.

[28]                          A similar conclusion was reached in Worrall v. British Railways Board, [1999] E.W.J. No. 2025 (QL) (C.A.), in which Lord Justice Mummery stated, at para. 34:

Having been convicted of those offences the plaintiff must be treated in this action as fully and personally responsible in law for his deliberate criminal acts and for the consequences of them, including financial loss resulting from the criminal conviction.  It would be inconsistent with his criminal conviction to attribute to the negligent defendant in this action any legal responsibility for the financial consequences of crimes which he has been found guilty of having deliberately committed. 

[29]                          Cohen J. rejected the application of the ex turpi doctrine because he found that “compensation for lost wages [was not] an evasion or ‘rebate’ of the plaintiff’s criminal punishment” (para. 245); that the criminal penalty was a term of confinement and he was not making an award to compensate for confinement.  Although he had the benefit of the United Kingdom and Australian precedents that denied compensation for the civil consequence of incarceration, he did not have the decision of this Court in H.L.

[30]                          The judicial policy that underlies the ex turpi doctrine precludes damages for wage loss due to time spent in incarceration because it introduces an inconsistency in the fabric of the law that compromises the integrity of the justice system.  In asking for damages for wage loss for time spent in prison, Zastowny is asking to be indemnified for the consequences of the commission of illegal acts for which he was found criminally responsible.  Zastowny was punished for his illegal acts on the basis that he possessed sufficient mens rea to be held criminally responsible for them.  He is personally responsible for his criminal acts and the consequences that flow from them. He cannot attribute them to others and evade or seek rebate of those consequences.  As noted by Samuels J.A. in State Rail, to grant a civil remedy for any time spent in prison suggests that criminally sanctioned conduct of an individual can be attributed elsewhere. E. K. Banakas discussed this issue in “Tort Damages and the Decline of Fault Liability: Plato Overruled, But Full Marks to Aristotle!”, [1985] Cambridge L.J. 195, at p. 197:

Although it is morally irrational to punish a person unable to account for his actions, it is even less rational to compensate such a person for his punishment following his unchallenged conviction for a mens rea offence; if the conviction stands, punishment is a lawful injury, if not, there should be no punishment at all and no injury of the kind compensated in this case. Tort law has enough on its plate without having to play criminal law’s conscience; besides, if lawful injury, inflicted by the courts themselves, starts being compensated in negligence, where will it all end? [Underlining added.]

(2)   Distinguishing Between “Core Time” and “Extra Time”

[31]                          Saunders J.A. divided Zastowny’s periods of incarceration into non-compensable “core time” (time before eligibility for parole) and compensable “extra time” (time after eligibility for parole), and awarded damages for the latter.  Aside from evidentiary concerns respecting this division, I am unable to agree in principle with this approach.

[32]                          Zastowny was serving a lawfully imposed criminal sentence.  There should be no distinction between “core time” and “extra time” because Zastowny’s lawfully imposed sentence consisted of both.  To award damages for any period of incarceration pursuant to a lawfully imposed sentence would create that conflict between the criminal and civil law which the judicial policy underlying the ex turpi doctrine requires be precluded.  In the words of McLachlin J. in Hall v. Hebert, “concern for the integrity of the legal system trumps the concern that the defendant be responsible” (p. 182).  It would be inconsistent to incarcerate a person for a criminal offence and then compensate him for the incarceration.  Zastowny was serving the sentence imposed for his criminal conduct.  He cannot attribute part of his lawfully imposed sentence to someone else in order to obtain a partial rebate of the consequences of his criminal conduct.

[33]                          As explained by counsel for the Province, there are other difficulties with the notion of compensating for “extra time”.  Parole boards are assigned exclusive jurisdiction to make parole decisions.  Such discretionary decisions are contextual, involving a balancing of factors including public safety, the interests of victims and rehabilitation and reintegration interests of the offender.  A trial court hearing an action for negligence would not be in possession of all the material before the parole board.  It would be in the position of “second guessing” what the decision of the parole board would have been had the board attributed some or all of the offender’s conduct while incarcerated before parole eligibility to someone else and on that basis granted parole.  It is not for a trial court in a negligence action to review the merits of a discretionary decision of a parole board.  It would be doing just that if it was to find that a person would not be incarcerated for extra time but for the negligent action of another.  For these reasons, the “core time” versus “extra time” approach must be rejected.

(3)   The Novus Actus Interveniens Doctrine

[34]                           In the view of Smith J.A., the bar to recovery for past wage loss while incarcerated was due to the application of the novus actus interveniens doctrine.  His conclusion was based on his interpretation of Fish J.’s words in H.L.:

[S]ince the basis of the decision in H.L. v. Canada (Attorney General) is that H.L.’s intervening conduct broke the causal chain between the sexual assault and his imprisonment, the relevant doctrine is novus actus interveniens — “A new act intervenes”: The Dictionary of Canadian Law, (Carswell: Scarborough, 1995) 2nd ed., p. 813.

In H.L. v. Canada (Attorney General), Fish J. said, in a passage I have already quoted but will reproduce for convenience,

142  In any event, the chain of causation linking H.L.’s sexual abuse to his loss of income while incarcerated was interrupted by his intervening criminal conduct. During these periods, his lack of gainful employment was caused by his imprisonment, not by his alcoholism; and his imprisonment resulted from his criminal conduct, not from his abuse by Mr. Starr nor from the alcoholism which it was found to have induced. [Emphasis added by Smith J.A.; paras. 105-6.]

[35]                          I cannot agree with Smith J.A.’s conclusion that Fish J. applied the novus actus doctrine in H.L.  Nowhere did Fish J. use the term novus actus interveniens or conduct an analysis of why that doctrine might apply.  In my view, Fish J. was only pointing to the lack of evidence that might have connected H.L.’s criminality with the abuse he suffered.  Unlike in H.L., in the case at bar, there is evidence linking Zastowny’s criminality to the sexual assaults he suffered.

[36]                          With respect, I think that Smith J.A. conflated the novus actus and ex turpi doctrines when he found at para. 111:

The question was not whether it would bring the administration of justice into disrepute to award the respondent damages for injuries arising out of his own criminal acts: rather, the question was whether the criminal acts of the respondent should serve to break the chain of causation because to award him compensation for the losses he suffered by reason of his punishment for those criminal acts would undermine the purpose of the criminal justice system by bringing the civil law into conflict with the criminal law, to the disrepute of both.

[37]                          The determination of a chain of causation and whether that chain was broken is a factual one.  A factual chain of causation is not broken because the civil law is brought into conflict with the criminal law.

[38]                          Indeed in this case, Cohen J., based on the evidence of Dr. Ley, was of the view that Mr. Zastowny’s incarcerations and their lengths were attributable to the sexual assaults he suffered.  Unlike H.L., on the evidence in this case, there is a chain of causation between the sexual assaults and Zastowny’s criminal activity and incarceration.  There is no basis to interfere with the factual findings of Cohen J.  It is notwithstanding the chain of causation that Zastowny cannot recover damages for wages lost due to incarceration.  The reason is the judicial policy underlying the ex turpi doctrine that the criminal and civil law should not be in conflict.

[39]                          In addition, application of the novus actus doctrine here would be inappropriate because it might suggest that a chain of causation can be irreparably broken by a plaintiff going to prison, and that is not necessarily the case.  Depending on the facts, the chain of causation may still apply to attribute loss of wages for the period a person is not incarcerated.  In other words, a trial judge may see fit to award a plaintiff damages for wage loss after a period spent in incarceration.  That is what this Court will do by only reducing Zastowny’s damages for wage loss to exclude the periods of time when he was in prison between 1988 and 2003. 

(4)   Exceptional Circumstances

[40]                          Fish J. left open a window in H.L. when he found, at para. 137, that an award for past wage loss due to incarceration would have to be justified by “exceptional considerations of a compelling nature”.

[41]                          No exception exists in the present case.  There is no principled distinction between the wage loss award at issue in H.L., and that at issue in the case at bar. While I agree with Finch C.J.B.C. that the circumstances of the sexual assaults were egregious and involved a breach of trust by MacDougall in his capacity as an employee of the Province, this will be true of any case in which an institutional employer is found vicariously liable for the sexual torts of an employee.  In H.L., for example, the victim was a young teenager and his abuser was a government official on reserve.   Moreover, as noted by Smith J.A., the egregious circumstances of Zastowny’s abuse were taken into account in the trial judge’s award of aggravated damages. 

[42]                          Because awarding damages for wage loss for time spent in incarceration would create an inconsistency between the principles governing criminal responsibility in the criminal law and tort law, the only “exceptional circumstance” is where an award for wage loss while in prison would not undermine a lawfully imposed criminal sanction, such as where an individual was wrongly convicted.   No valid exceptional circumstance can result in a “clash” between the criminal and civil law. 

B. Cross-Appeal: Damages for Future Wage Loss

[43]                          At trial, Cohen J. awarded $50,000 for future wage loss.  Cohen J. did not specifically state that he was awarding future income loss for periods in which Zastowny might be incarcerated in the future, though he did say that Dr. Ley’s opinion was that the plaintiff “represents a very high risk of drug relapse and future criminal offending”.  On appeal, both Smith and Saunders JJ.A. agreed that this award should be reduced by 30 percent to reflect the “high risk of recidivism” identified by the psychologist.  Zastowny by cross-appeal submits that the Court of Appeal erred in reducing the award for loss of future earnings. 

[44]                          The trial judge did not exclude time Zastowny had spent in prison from his damage award for past wage loss.  Although he noted that Zastowny represented a high risk of recidivism, there is no indication that in awarding damages for future wage loss, he excluded time for future imprisonment based on the high risk of that occurring.  It was therefore not unreasonable for Saunders and Smith JJ.A. to conclude that the award for future wage loss had to be reduced in order to reflect the likelihood of Zastowny being sent back to prison — a “very high risk” according to Dr. Ley.  

V.       Disposition

[45]                          I would allow the appeal and dismiss the cross-appeal both with costs.

Appeal allowed with costs. Cross‑appeal dismissed with costs.

Solicitor for the appellant/respondent on cross‑appeal:  Attorney General of British Columbia, Vancouver.

Solicitors for the respondent/appellant on cross‑appeal:  Megan Ellis & Company, Vancouver.