Safety & Training
You’re Liable, but for What?
March 12, 2010 By Neil J. MacDonald
When we hear about aircraft accidents causing personal injury or death, it is common to think in terms of the U.S. legal system. We see how their system works by watching TV, and we are amazed at how much money a person receives when their loved one is killed.
When we hear about aircraft accidents causing personal injury or death, it is common to think in terms of the U.S. legal system. We see how their system works by watching TV, and we are amazed at how much money a person receives when their loved one is killed. We routinely hear of damage awards in the “tens of millions” of dollars. Scary stuff, but what is the reality here in Canada?
Million-dollar awards are certainly possible in Canada when people are injured or killed in accidents – aviation related or otherwise. For the most part, however, damage awards in B.C. are more likely to be somewhat less.
Damage awards in B.C. for “wrongful death” claims are governed by the Family Compensation Act (the “Act”). The Act outlines how compensation may be determined by a court if another party is found to be legally liable for the death. The Act defines who is entitled to recover, and under which heads of damages recovery may be found. In general, the Act seeks to restore the plaintiffs to the same financial position that they would have enjoyed “but for” the death of the loved one.
A spouse, parent, or child of the deceased may recover damages under the Act. The Act defines “parent” to include grandparent and step-parent. Also, the deceased need only to have stood in the “role of a parent” in order for that child to claim damages under the Act.
The heads of damages under which a party can claim under the Act include loss of financial support, loss of household assistance, loss of guidance, and loss or acceleration of inheritance. These are all claims that are generally advanced by the spouse and/or children of the deceased. No damages are payable, however, for grief or emotional upset arising from the death. While it may appear somewhat cold-hearted, parents are generally not entitled to damages for the loss of a child unless evidence is adduced which indicates the child would have contributed financially to the parents, absent the accident. Since parents usually spend more on a child than they might reasonably expect to receive in the future, parental claims for loss of financial support from a child can be difficult to advance.
As damages under the Act are often assessed in lump-sum payments, tax gross-up (to cover the tax implications on invested awards) and management fees (to assist in investing funds) are often included in awards. Simply stated, the Act is intended to compensate survivors and return them to where they would have been financially but for the death, so tax implications and the cost of professional advice are included.
As a result, punitive or aggravated damages are not awarded under the Act. Similarly, the surviving family members are not allowed to recover any “non-pecuniary” damages under the Act, i.e., those damages that compensate a plaintiff for what is generally known as pain and suffering. These limitations on damages under the Act are probably where we see the greatest difference between the American system and ours, and where the general notion arises that someone will be awarded millions of dollars on the death of their family member.
When calculating or, perhaps better yet, estimating damage awards for loss of financial support under the Act, B.C. courts will look at lost earnings up to the date of the trial, and then estimate the deceased’s future earnings. Courts estimate these unknowable future earnings by looking at probabilities, and opportunities that would have been reasonably available to the deceased, not on mere speculation. A discount is applied that accounts for expenditures the deceased would have incurred on their own behalf in their lifetime, and the award may even be reduced further for other contingencies that might reasonably have arisen.
The result of every case is of course dependent upon its specific facts. While it is not unusual for damage awards in B.C. wrongful death claims to be assessed at $1 million or more, for the reasons I outlined above, this is not generally the norm.
While the U.S. legal system appears to be more dramatic and perhaps garners more eye-catching headlines in the media, our system in B.C. is intended to restore family members – to the extent money can – to where they were before the accident. It is not like a lottery – you are not supposed to be worth more dead than alive!
Neil MacDonald is a lawyer with Harper Grey LLP, practising in Aviation Law. He holds an ATPL-H, and flies as an Air Ambulance Captain on helicopters in B.C. firstname.lastname@example.org. This is not a legal opinion. Readers should not act on the basis of this article without first consulting a lawyer for analysis and advice on a specific matter.