Statutory Deductibles can affect a Claimant's Awarded Damages

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Case example

On December 5, 2009, Sara Corbett was struck head-on by another vehicle while she was preparing to turn into a driveway. As a result of the accident, the plaintiff developed whiplash symptoms that later evolved into chronic pain syndrome.

At the end of a six-week 2016 trial, Corbett v Odorico, the jury ruled in the plaintiff's favor and awarded her $141,500 in damages including: $33,000 for general damages, $22,000 for past housekeeping and home maintenance, $32,000 for past caregiving, $21,000 for future housekeeping and home maintenance and $12,000 for future caregiving.

Per the Family Law Act, her husband, and two sons were also awarded $7,500, $7,000 and $7,000 respectively.

However, before the trial was concluded, the Court was required to rule on three key issues, which could further impact the amount of eligible damages:

  1. a threshold motion, which was brought by the defendant prior to the start of the trial;
  2. whether or not the August 1st, 2015 statutory deductibles were applicable to this case; and
  3. issues concerning the pre-judgement interest calculations.

On the first matter, the defendant argued that the plaintiff failed to meet the threshold set out in the Insurance Act. That is, she failed to prove on a balance of probabilities that her injuries resulted in the permanent serious impairment of an important physical, mental or psychological function.

The judge disagreed and accepted the plaintiff's evidence, as well as that of her expert witnesses - a psychiatrist, a specialist in physical medicine and rehabilitation, and a psychologist and occupational therapist -- as credible. 

A psychiatrist, Dr. Swayze, diagnosed the plaintiff with a chronic pain disorder called somatic symptom disorder. This is a condition that often accompanies chronic pain and is characterized by a preoccupation with anxiety about one's pain symptoms. According to Dr. Swayze, the condition negatively impacts the plaintiff's ability to cope with her parenting and housekeeping responsibilities and engenders feelings of shame and guilt about her shortcomings.

The plaintiff was further diagnosed with an adjustment disorder involving depressed mood which, combined with her other psychological issues, constitutes a "serious and permanent psychiatric impairment as a result of this accident", according to Dr. Swayze.

Dr. Kleinman, who specializes in physical medicine and rehabilitation, assessed Ms. Corbett's complaint of neck and back pain and headaches, and diagnosed the plaintiff with chronic pain syndrome with associated depressive symptomatology. He stated that he believed the plaintiff to be credible and not exaggerating her symptoms, which were both physical and psycho-emotional. Further, he presented the opinion that the combination of her symptoms made physical and functional improvement unlikely.

The trial judge rejected the defendant's implication that the plaintiff's medical records showed that many of her symptoms preceded, and were not caused by the accident. The records disclosed that she had some previous episodes of depression and depressed mood, as well as periodic back pain, prior to the motor vehicle accident.

The judge believed that these conditions were evidence of a thin-skull scenario. That is, the plaintiff's pre-existing psychological vulnerabilities and occasional back complaints predisposed her to a poor recovery from her whiplash injuries.

The judge ultimately ruled that the plaintiff did, in fact, prove on a balance of probabilities that her accident-related injury created a permanent and serious impairment of her physical and psychological functions. In particular, her ongoing pain causes depression and substantially restricts her physical capabilities. Accordingly, he dismissed the defendant's threshold motion.

With regard to the statutory deductibles, effective August 1st, 2015, the regulations under Ontario's Insurance Act were amended to increase the deductible to $36,540 (an amount which applies until December 31st, 2015 but will be amended every year following).

The defendant argued that the wording and policy behind this amendment indicates its intended immediate application. In other words, the changes were procedural in nature and therefore should be applied with immediate effect. The plaintiff argued that the deductible was not to be applied retrospectively, because it is a substantive change and thus, should only apply to accidents that occurred after August 1st, 2015.

The judge ruled in favor of the defendant on the matter, noting that a regulation that varied the amount of the deductibles for general damages and the Family Law Act, was indeed procedural in nature and should therefore be applied retrospectively. Further, the new regulations were designed to fix the deductible amounts in current dollars, similar to jury verdicts and other court judgements.

Referencing the decisions in Vickers v. Palacious, Justice Hackland concluded that the legislative intention was clear, and the revised deductible was to apply to all pending actions. By applying the $36,540 deductible to the $33,000 jury award for general damages, the plaintiff's recovery was rendered nil.

Similarly, applying the new deductible for damages under the Family Law Act, the award for the plaintiff's husband and two sons were also rendered nil. The trial judge's ruling that the increased deductible (from" $30,000 to the new amount) is retroactive, continues to be hotly debated.

There have been conflicting decisions on this point and the matter will surely be brought to the Ontario Court of Appeal. On the matter of pre-judgement jury calculations, the judge ruled in the plaintiff's favour, agreeing that interest on the damages began from the date the defendant was served with a notice letter stating the plaintiff's intention to make a claim.

In conclusion, the Court awarded the plaintiff $56,294.98 in damages, inclusive of interest. This sum included damages for past housekeeping, past caregiving, future housekeeping and future caregiving.

Ontario insurance law is ever-evolving, in terms of new amendments and changing legislation that potentially impact a claimant's benefits and compensation.

Understanding these changes and how any one change may affect a specific injury claim is challenging to someone not well versed in insurance law.

Because a personal injury attorney specializes in insurance and negligence law, they have the requisite understanding and expertise to determine how current statutes may affect your access to owed benefits and what's required in building a strong case for compensation.

At Gluckstein Lawyers, our knowledgeable team offers years of experience in helping individuals successfully navigate their personal injury claims.

If you or someone you love was seriously injured in a motor vehicle accident, slip and fall, or another accident, please do not hesitate to call or visit us today. We provide a free initial consultation to review the specifics of your case and provide you with an expert and honest opinion regarding your most viable options for obtaining owed compensation.


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