Present: Lamer C.J. and La Forest, L'Heureux‑Dubé, Sopinka, Gonthier, Cory, McLachlin, Iacobucci and Major JJ.
on appeal from the court of appeal for british columbia
Damages ‑‑ Assessment ‑‑ Personal injury -- Loss of future income ‑‑ Life expectancy -- Powers of appellate tribunal ‑‑ Infant suffering from severe disabilities due to oxygen deprivation during birth ‑‑ Court of Appeal substituting its assessment of life expectancy of infant for that of trial judge ‑‑ Whether Court of Appeal justified in interfering with trial judge's conclusion on life expectancy ‑‑ Whether Court of Appeal erred in deducting living expenses for years after infant's projected death from award for loss of future income.
The infant appellant suffered severe disabilities due to oxygen deprivation during her birth. The respondent physician and hospital admitted liability for her injuries and the only issue before the trial judge was the assessment of damages. The appellant's main expert witness testified that, with the continuation of the level of care she currently enjoyed, the appellant could expect to live to 25 or 30 years of age. The respondents' expert witness, relying on an American study on the life expectancy of profoundly handicapped persons, was of the view that her life expectancy was 7.6 years. The trial judge assessed the differing expert opinions and concluded that the best estimate of the appellant's life expectancy was 25 years. He awarded $1,981,879 in damages, including $292,758 for future income loss. The Court of Appeal found that the trial judge had misapprehended the significance of the study as well as attributing greater weight than was warranted to the evidence of the appellant's main expert witness. The court reduced the award, concluding that the trial judge had overestimated the appellant's life expectancy by seven years and had failed to make a deduction for personal living expenses from the portion of the award relating to future income loss for the years after her death. The court also dismissed the appellant's cross‑appeal that the damages awarded for future income loss were too low.
Held: The appeal should be allowed in part.
The Court of Appeal erred in interfering with the trial judge's conclusion on life expectancy. The different conclusions of the trial judge and the Court of Appeal arise mainly from the differing weight they put upon the American study. Although the principle of non‑intervention of a court of appeal in a trial judge's findings of facts does not apply with the same force to inferences drawn from conflicting testimony of expert witnesses where the credibility of these witnesses is not in issue, this does not change the fact that the weight to be assigned to the various pieces of potentially conflicting evidence is essentially the province of the trier of fact. It was far from clear what weight the study should carry and, in the absence of a palpable or overriding error, the Court of Appeal should not have intervened. Further, the trial judge did not fail to consider, or misapprehend, some obvious feature of the evidence. The trial judge carefully considered the evidence of all the experts on the question of life expectancy, as well as the study. His concerns with respect to the applicability of that study, which led him to discount it to a greater degree than the Court of Appeal would have, do not support a conclusion that he ignored the study, in the absence of a demonstration that his concerns were totally without foundation. Finally, it was open to the trial judge to accept the evidence of the appellant's main expert witness, despite the adverse inference drawn from the appellant's counsel's failure to call the treating neurological paediatrician that the latter's evidence as to life expectancy would not favour the appellant. The trier of fact may accept such evidence as he finds convincing, and an appellate tribunal ought not to interfere unless it is persuaded that the result amounts to a palpable or overriding error.
Owing to the manner in which the case was presented at trial, this Court is not in a position to entertain the appellant's new arguments that the future income loss award should be calculated on male earnings tables. Given that the only evidence on the record before the trial judge were the earning tables for women, and given that he was asked by the appellant's counsel to apply only these tables, the trial judge did not err in using a female earnings table in determining the appellant's future income loss. The most the trial judge could do, and has done, was take into account as a positive contingency the expectation that as greater equality is achieved between men and women in our society, women's earnings will increase. The appellant's alternative claim that the trial judge and the Court of Appeal erred in failing to make adequate allowance for loss of marriage benefits raises similar evidentiary problems. On the state of the record, it is not open to this Court to say the courts below were in error and substitute its own view.
The Court of Appeal did not err in deducting 50 per cent for living expenses in the "lost years" from the award for loss of future earning capacity. A deduction for personal living expenses must be made not only for the years the appellant will actually live but also for the years after her projected death. Had the appellant been in a position to earn the monies represented by an award for lost earning capacity, she would have had to spend a portion of them for living expenses. Not to recognize this is to introduce an element of duplication and to put the appellant in a better position than she would have been in had she actually earned the monies in question.
Cases Cited
Referred to: P. (D.) v. S. (C.), [1993] 4 S.C.R. 141; Geffen v. Goodman Estate, [1991] 2 S.C.R. 353; Stein v. The Ship "Kathy K", [1976] 2 S.C.R. 802; Croke (a minor) v. Wiseman, [1981] 3 All E.R. 852; Semenoff v. Kokan (1991), 59 B.C.L.R. (2d) 195; Pickett v. British Rail Engineering Ltd., [1979] 1 All E.R. 774; Skelton v. Collins (1966), 115 C.L.R. 94.
Authors Cited
Cooper‑Stephenson, Kenneth D., and Iwan B. Saunders. Personal Injury Damages in Canada. Toronto: Carswell, 1981.
APPEAL from a judgment of the British Columbia Court of Appeal (1992), 73 B.C.L.R. (2d) 116, 16 B.C.A.C. 46 and 22 B.C.A.C. 173, 28 W.A.C. 46 and 38 W.A.C. 173, allowing the respondents' appeal and dismissing the appellant's cross‑appeal from a judgment of Hogarth J. (1991), 27 A.C.W.S. (3d) 1171, [1991] B.C.W.L.D. 1887, [1991] B.C.D. Civ. 3389‑42, [1991] B.C.J. No. 2206, assessing damages to be awarded to child appellant. Appeal allowed in part.
Darrell W. Roberts, Q.C., Susan A. Griffin and W. A. Baker, for the appellant.
C. E. Hinkson, Q.C., and Cheryl L. Talbot, for the respondent Savein.
John G. Dives and P. A. Washington, for the respondent Burnaby Hospital.
The judgment of the Court was delivered by
McLachlin J. -- This is a claim for injuries suffered by a child due to oxygen deprivation during her birth. The oxygen deprivation resulted in severe disabilities, including mental retardation, blindness and a seizure disorder. The trial judge summarized her situation as follows: ". . . the child for all intents and purposes is, and will continue to exist until her death, totally incapacitated and incapable of displaying any cognition beyond that of a reflexive nature". Unrelated to these impairments, Jessica also suffered from a hip abnormality, which was surgically corrected. The attending physician, Nelson Savein, and the Burnaby Hospital admitted liability for her injuries. The only issue before the trial judge was the assessment of damages.
The trial judge awarded the followings:
Non-Pecuniary Damages $ 20,000
Past Care $ 50,000
Future Income Loss $ 292,758
Future Care $ 1,524,746
Management Fees $ 94,375
Total $ 1,981,879
The Court of Appeal reduced this award on grounds that the trial judge had overestimated Jessica's life expectancy by seven years and had failed to make a deduction for personal living expenses from the portion of the award relating to lost earning capacity for the years after Jessica's death (i.e., the "lost years"). The Court of Appeal dismissed a cross-appeal which alleged the damages awarded by the trial judge were too low: (1992), 73 B.C.L.R. (2d) 116. Jessica and her mother now appeal to this Court.
This appeal raises the following issues:
(1) The validity of the assessment of life expectancy;
(2) The use of female earning tables and the treatment of loss of marriage benefits in fixing the award for lost earning capacity;
(3) The deduction of 50 per cent for personal living expenses from the award for lost earning capacity during the "lost years".
I will deal with each issue in turn.
1. The Validity of the Assessment of Life Expectancy
The trial judge heard evidence from three experts on Jessica's life expectancy. Dr. MacLean, a paediatrician with 35 years experience, testified that, with the continuation of the care currently enjoyed by Jessica, she could expect to live to 25 or 30 years of age. Dr. Van Rijn, an expert in the assessment of clinically impaired disabled persons, was of the view that survival to 10 years of age was critical, and that once that age passed, the child could live into her forties. The third expert was a paediatric neurologist, Dr. Crichton, who was of the view that the appellant's life expectancy was 7.6 years, although he testified it could be longer with excellent care. Dr. Crichton relied on a study published in the New England Journal of Medicine on the life expectancy of profoundly handicapped persons (the "Eyman Study"). Dr. MacLean had been referred to the Eyman Study, but had not read it.
In addition to the expert evidence, the trial judge heard evidence attesting to the devotion of Jessica's mother to Jessica and the very high level of care which Jessica was receiving as a result of that devotion.
The trial judge concluded that the best estimate of Jessica's life expectancy was 25 years from birth, or 22 1/2 years from the date of trial. He concluded that home care was a major factor in the child's continued well-being. In considering the evidence presented by the experts, the trial judge noted that the plaintiff had not called Dr. Hill, the neurological paediatrician who had cared for Jessica since birth. He stated that he was prepared to draw the adverse inference from the failure to call Dr. Hill that his evidence as to life expectancy would not favour the plaintiff. He assessed the differing expert opinions as follows:
I have sifted and weighed the evidence on the issue of life expectancy and I have come to the conclusion that it is the evidence of Dr. MacLean that impresses me the most. Notwithstanding the able observations of Dr. Crichton and his reference to the Eyman Article, there are too many variables involved to apply its informative contents to the case at bar, or to give it the weight required to take it from the general to the particular, that is to say, from the statistical sphere into the realm of specific application. Had Dr. Crichton expressed the view that from his personal experience, the life expectancy of the child was 7.6 years and later referred to the Eyman Study as corroborative of this opinion, I would have given his evidence more weight, but as it stands, it appeared to me he more or less reflected largely, but not entirely, what was indicated by the Article. The matter is too grave to be resolved by statistics when such evidence as that of Dr. MacLean, supported to some extent by Dr. Van Rijn, is available.
Nevertheless, I feel I must give some effect to the Study and, as a result, cannot accept the evidence of Dr. MacLean to its fullest extent. . . .
It will be seen from the above passage that the trial judge was reluctant to put too much weight on the statistical evidence, found in the Eyman Study, an American article which suggested much lower survival rates than the life expectancy which Dr. MacLean forecast for Jessica.
The Court of Appeal saw the matter differently. It faulted the trial judge for failing to place proper weight on the statistical evidence and in particular, on the Eyman Study. Goldie J.A., speaking for the court, began by pointing out that the failure to call Dr. Hill led to the inference that his evidence on life expectancy would not have supported that of Dr. MacLean. He then proceeded to examine the expert evidence in depth. He noted that Dr. MacLean's estimate was based on experience with children unaffected by seizure disorder and that similar children that he had dealt with in the two years prior to his testimony had died between three and ten years of age. He further noted that Dr. MacLean's experience with children with similar conditions was limited to 20 children. Goldie J.A. found it significant that Dr. MacLean had not read the Eyman Study, although he had been referred to it. As a direct result, Goldie J.A. found that the trial judge "misapprehended the significance of the Eyman study as well as attributing greater weight to Dr. MacLean's evidence than was warranted" (p. 127).
In conclusion, Goldie J.A. held that the trial judge did not make full or correct use of the evidence before him, and that there was "virtually no basis for his conclusion that Jessica would survive another 22 1/2 years" (p. 127). Goldie J.A. reduced the life expectancy by seven years. He noted that this was higher than warranted by the Eyman Study for immobile persons but gave effect to the optimal care enjoyed by the appellant.
The question is whether the Court of Appeal was justified in substituting its assessment of life expectancy for that of the trial judge.
It is by now well established that a Court of Appeal must not interfere with a trial judge's conclusions on matters of fact unless there is palpable or overriding error. In principle, a Court of Appeal will only intervene if the judge has made a manifest error, has ignored conclusive or relevant evidence, has misunderstood the evidence, or has drawn erroneous conclusions from it: see P. (D.) v. S. (C.), [1993] 4 S.C.R. 141, at pp. 188-89 (per L'Heureux-Dubé J.), and all cases cited therein, as well as Geffen v. Goodman Estate, [1991] 2 S.C.R. 353, at pp. 388-89 (per Wilson J.), and Stein v. The Ship "Kathy K", [1976] 2 S.C.R. 802, at pp. 806-8 (per Ritchie J.). A Court of Appeal is clearly not entitled to interfere merely because it takes a different view of the evidence. The finding of facts and the drawing of evidentiary conclusions from facts is the province of the trial judge, not the Court of Appeal.
The Court of Appeal justified its intervention on the ground that it was in as good a position to draw inferences from the evidence as was the trial judge (at pp. 121-22):
There is no issue with respect to the veracity of these expert witnesses. As the trier of fact the trial judge was free to reject or adopt in whole or in part the evidence of experts he found qualified but in the absence of findings of credibility this court is in as good a position as the trial judge to review the expert evidence and to draw inferences of fact therefrom: New Brunswick (Workmen's Compensation Board) v. Greer (1973), [1975] 1 S.C.R. 347, 7 N.B.R. (2d) 171, 42 D.L.R. (3d) 595, 1 N.R. 99. It should undertake this task if the trial judge has failed to take into account some obvious feature of the evidence or has misapprehended its significance: Croke (A Minor) v. Wiseman, [1982] 1 W.L.R. 71, [1981] 3 All E.R. 852 (C.A.), per Griffiths L.J. at p. 859 (All E.R.).
I agree that the principle of non-intervention of a Court of Appeal in a trial judge's findings of facts does not apply with the same force to inferences drawn from conflicting testimony of expert witnesses where the credibility of these witnesses is not in issue. This does not however change the fact that the weight to be assigned to the various pieces of evidence is under our trial system essentially the province of the trier of fact, in this case the trial judge.
The different conclusions of the trial judge and the Court of Appeal in this case arise mainly from the differing weight they put upon the Eyman Study. It was far from clear what weight this study should carry. The study was based on figures from a different country with a different health care system from that which Jessica enjoyed. Nor did it disclose the level of care which the children who made up the statistics received. These are factors which, if Dr. MacLean was believed, were of great importance. Moreover, there was no unanimity on the importance of the extraordinarily high quality of care Jessica would receive on her life expectancy. In short, the issue was what weight should be put on disparate pieces of potentially conflicting evidence. This, as I have indicated, is the province of the trier of fact.
Nor am I persuaded that the trial judge, in the case at bar, failed to consider or misapprehended some obvious feature of the evidence, the error discussed in Croke (a minor) v. Wiseman, [1981] 3 All E.R. 852, at pp. 859-60. The trial judge carefully considered the evidence of all the experts on the question of life expectancy, as well as the Eyman study. Concerns with respect to the applicability of the Eyman study led him to discount it to a greater degree than the Court of Appeal would have. But this does not support the conclusion that the trial judge ignored the Eyman study, in the absence of a demonstration that his concerns about its applicability were totally without foundation.
The matter of the adverse inference from the failure to call Dr. Hill remains to be considered. The trial judge drew the inference from the failure to call Dr. Hill that his evidence would not have favoured the plaintiff. Despite drawing this inference, the trial judge concluded that he should accept Dr. MacLean's evidence. As trier of fact, it was open to him to do so. It is trite law that the trier of fact may accept such evidence as he or she finds convincing, and that an appellate tribunal ought not to interfere unless it is persuaded that the result amounts to a "palpable or overriding error".
I conclude that the Court of Appeal erred in interfering with the trial judge's conclusion on life expectancy.
2.The Use of Female Earning Tables and the Treatment of Loss of Marriage Benefits in Fixing the Award for Lost Earning Capacity
In order to determine the award for Jessica's lost earning capacity, the trial judge was required to consider what Jessica would have earned had she not been injured at birth. Counsel for Jessica at trial asked the judge to base the award for lost earning capacity on earning tables for women with post-secondary non-university training. Counsel, through the expert witness Carson, introduced male earning tables, but advised the judge that this was done "simply for comparative purposes" and further assured the judge "we're not going to rely upon [them]". The judge accordingly drew a line through them, striking them from the record.
The trial judge, noting that assessing loss of future earning capacity involves many hypotheticals, based his analysis in the main on the assumptions proposed by Jessica's counsel: that Jessica, had she not been injured, would have received non-university post-secondary education; and that she would have entered the workforce at the age of 19 and remained in it until the age of 65. This resulted in an award, when discounted for present value, of $292,758.
But the trial judge went further. Jessica's counsel had not asked him to increase the award to compensate for the fact that the earning tables for women reflect past inequities which have historically resulted in women on average earning less than men, inequities which arguably should not be imposed on Jessica. Nevertheless, the trial judge took this matter into consideration. Given the conduct of the case, he had no evidence before him of what people would earn in the future, assuming income parity between females and males. Indeed, he did not have the male earnings tables in evidence before him. This absence of evidence precluded a detailed calculation on a "gender neutral" basis. But the trial judge did consider this factor as one of the positive contingencies which justified a higher award than might otherwise be the case, stating that he was weighing "other contingencies such as the possibility of family income, early retirement packages and the trend to increase and equalize the salaries of women with those of men" (emphasis added). The Court of Appeal generally affirmed the trial judge's conclusions on this point.
Before us, counsel for Jessica argued that both the trial judge and the Court of Appeal had erred. She urged this Court to set aside their award for lost future earning capacity and to substitute an award based on male earning tables.
Any attempt to implement this submission on this appeal runs squarely up against the impediment that, on the record and submissions of counsel before the trial judge, it is impossible to say that the trial judge erred, much less that his conclusion on the award for lost future earning capacity was wholly erroneous. The trial judge in fact went further than counsel for Jessica urged him to do in considering the potential inequity of applying earning tables based on past earnings of women. Given that the only evidence on the record before the trial judge was the earning table for women, and given that he was asked to apply only this table, the most the trial judge could do was take into account as a positive contingency the expectation that as greater equality is achieved between men and women in our society, women's earnings will increase. This Court is in no better position. Due to the manner in which this case was presented at trial, we are not in a position to entertain the arguments advanced for the first time in this Court that female earning tables should be replaced by other alternatives. Consideration of these arguments must await another case, where the proper evidentiary foundation has been laid.
Counsel for the appellant submits in the alternative that the trial judge and the Court of Appeal erred in failing to make adequate allowance for loss of marriage benefits. This claim raises similar evidentiary problems. On the state of the record before us, it is not open to us to say the courts below were in error and substitute our own view.
3.The Deduction of 50 Per Cent for Personal Living Expenses from the Award for Lost Earning Capacity during the "Lost Years"
Jessica is entitled to an award for the loss of earning capacity, not only for the years she will actually live, but for the years she would have lived had she not been injured at birth. It is established that a deduction for personal living expenses must be made from the award for lost earning capacity for the years she will actually live. This is necessary to avoid duplication with the award for cost of future care. The question is whether a similar deduction should be made from the award for lost earning capacity for the years after the plaintiff's projected death. In this case, the bulk of the earnings fall into the latter category.
The trial judge made no deduction for personal expenses. The Court of Appeal deducted 50 per cent on this account. In so ruling, the Court of Appeal followed its earlier decision in Semenoff v. Kokan (1991), 59 B.C.L.R. (2d) 195. This approach reflects the view taken in England (Pickett v. British Rail Engineering Ltd., [1979] 1 All E.R. 774 (H.L.)) and in Australia (Skelton v. Collins (1966), 115 C.L.R. 94 (H.C.)).
A number of considerations suggest that a deduction for personal living expenses should be made from the award for lost earning capacity during the "lost years". The first is the fact that the projected earnings could not have been earned except on the supposition that the plaintiff would have been alive to earn them. There can be no capacity to earn without a life. The maintenance of that life requires expenditure for personal living expenses. Hence the earnings which the award represents are conditional on personal living expenses having been incurred. It follows that such expenses may appropriately be deducted from the award. Against this, it is argued that if Jessica had been born a millionaire, her personal living expenses during the "lost years" would have been met from other sources. But this does not negate the fact that in order to earn income one must live and incur the attendant expenses.
It can be argued that not to make a deduction for personal living expenses is to introduce into the award for lost earning capacity for the "lost years" a measure of overcompensation akin to the duplication which the law avoids in the case of an award for lost earnings during the plaintiff's actual lifespan. This deduction has been justified for the years before the plaintiff's actual projected death, on the ground that it avoids duplication between the award for cost of care and the award for lost earning capacity. But in fact, the "lived years" and the "lost years" cannot be so easily distinguished. The same reasoning applies to both: had the plaintiff been in a position to earn the monies represented by the award for lost earning capacity, she would have had to spend a portion of them for living expenses. Not to recognize this is to introduce an element of duplication and to put the plaintiff in a better position than she would have been in had she actually earned the monies in question.
The logic of the making of a deduction for personal living expenses on the lost years in the case of a child is also supported by the argument that since Jessica's care is fully provided for under another head of the award, the award for lost earning capacity will serve but one purpose: to enrich her heirs. It will do little to improve her life. As Cooper-Stephenson and Saunders persuasively argue in Personal Injury Damages in Canada (1981), at p. 244, the amount by which heirs can ordinarily expect to be enriched by a victim's putative earnings is small indeed:
. . . the award of damages to a very young child for prospective loss of earnings during the lost years should reflect only that portion of the entire lifetime earnings which the court estimates would have been saved by the child for his estate, at the end of his pre-accident life expectancy. It may result in a very small award. . . .
I conclude that logical and functional considerations combine to suggest that it is appropriate to make a deduction for personal living expenses from the award for lost earning capacity during the "lost years".
4. Conclusion
I would allow the appeal in part. I would restore the decision of the trial judge that the appellant's life expectancy is 22 1/2 years from the date of trial. I would maintain the Court of Appeal's deduction of 50 per cent from the award for lost earning capacity.
Costs here and below should be assessed in accordance with the disposition of the respective issues.
Appeal allowed in part.
Solicitors for the appellant: Roberts, Muir & Griffin, Vancouver.
Solicitors for the respondent Savein: Harper Grey Easton, Vancouver.
Solicitors for the respondent Burnaby Hospital: Bull, Housser & Tupper, Vancouver.
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