Injury awards are described by the Supreme Court of Canada as for pain and suffering, loss of amenities, and the loss of enjoyment and expectation of life. These damages cannot be determined through a straightforward calculation and are often called general damages or non-pecuniary damages.
In 1978, a series of three Supreme Court of Canada decisions, commonly referred to as the "Damages Trilogy," established a cap of $100,000 on pain and suffering damages in Canada, save for “exceptional circumstances”. Taking inflation into account since 1978, this amount now translates to approximately $465,280.67 in today's terms. The cases within the Damages Trilogy all revolved around young individuals who experienced life-altering injuries, such as quadriplegia.
These Supreme Court Of Canada Decisions Are Briefly Described Below:
In the case of Andrews v. Grand & Toy Alberta Ltd.  2 SCR, Dorothy Andrews, a 21-year-old individual, was involved in a car accident with a Grand & Toy employee, resulting in him suffering severe injuries that rendered him quadriplegic. One of the issues in this case was whether there can and should be a limit on non-pecuniary damages.
In this case, Justice Brian Dickson established a maximum cap at $100,000 for non-pecuniary damages. He submitted that a cap was necessary due to the consistent escalation of such awards, particularly in the United States.
In Arnold v. Teno,  2 S.C.R. 287, The plaintiff Diane Teno, a 4-year-old girl, sustained brain injuries resulting in significant physical and mental impairment. She was also held to the imposed $100, 000 capped limit.
In the case of Thornton v. School Dist. No. 57,  2 S.C.R. 267, which was also decided around the same time as the Andrews case, the plaintiff, Gary Edmund Thornton was 18 years old at the time of the trial. He was rendered quadriplegic because of an incident that occurred during a physical education class, and his injuries rendered him entirely dependent on orderly assistance for his daily needs. The British Columbia Court of Appeal agreed with the trial judge's assessment of $200,000 as compensation for physical and mental pain and suffering, loss of amenities and enjoyment of life. However, the Supreme Court of Canada later reduced the award to $100,000 as a result of the cap imposed on non-pecuniary losses.
Why was the cap created?
In the case of Andrews v. Grand & Toy, Mr. Justice Dickson found it necessary to put a cap on non-pecuniary damages based upon the following rational:
1. Without setting a cap on damages, the amount that could be rewarded for a non-pecuniary loss is limitless, resulting in a very inconsistent and disproportionate awards.
2. No amount of financial compensation is truly “compensatory” for non-pecuniary damages; therefore, a financial reward only serves the purpose to make life more endurable.
3. At law, it is acceptable that the plaintiff should receive full compensation for loss of income, and care costs.
Presiding Justice Brian Dickson further held in Andrews v. Grand & Toy Alberta Ltd.  2 SCR 229 that:
“There is no medium of exchange for happiness. There is no market for expectation of life. The monetary evaluation of non-pecuniary losses is a philosophical and policy exercise more than a legal or logical one. The award must be fair and reasonable, fairness being gauged by earlier decisions; but the award must also of necessity be arbitrary or conventional. No money can provide true restitution. Money can provide for proper care: this is the reason that I think the paramount concern of the courts when awarding damages for personal injuries should be to assure that there will be adequate future care.”
Principles upon which compensation is based.
In determining damage awards, Canadian courts adhere to two separate compensatory principles. For pecuniary losses, the rationale is to provide the plaintiff with full compensation for both past and future tangible losses. In the case of non-pecuniary losses, the principle is to award damages that are fair and reasonable.
A significant factor in establishing the "fair and reasonable" principle for non-pecuniary damages, as opposed to the principle of full compensation for pecuniary losses, was the increasing number of "million-dollar" damages awards in Canada during the time of the Trilogy cases. Similarly, substantial awards had become increasingly common in the United States. The Court was aware of this trend when making its decision and wanted to limit the increasing amounts of awards.
After the Supreme Court of Canada trilogy decisions were rendered, there was a lot of ambiguity regarding the application of the upper limit due to the Court's usage of the term "exceptional circumstances." This expression implied that the cap may not apply in every case. As a result, there was a period of uncertainty where it was unclear whether the limit was meant to be strictly enforced in all instances or if it served as a guideline for determining non-pecuniary damages. Over the years, this cap faced various legal challenges and there were mixed outcomes.
A series of decisions, designed to resolve this impasse, followed:
Fenn et al. v. Peterborough, City of, Peterborough Utilities Commission and Consumers' Gas Co.,  40 N.R. 425 (SCC)
The Ontario Court of Appeal heard the case of Fenn et al. v City of Peterborough in 1979, about one year after the trilogy cases. In this case, the Court of Appeal emphasized the statement made by Mr. Justice Dickson that the cap should not be exceeded "except in exceptional circumstances." The plaintiff in this case had sustained severe injuries, and the court considered two factors that warranted an award higher than $100,000. Firstly, inflation was taken into account, and secondly, it was evident that the plaintiff had endured more significant pain compared to the individuals in the trilogy cases. Consequently, the Court of Appeal granted an award of $125,000.
Neuzen v Korn,  3 SCR 674
Since, then the cap has faced various legal challenges but the Supreme Court reaffirmed the applicability of the cap established in the trilogy cases in the matter of Neuzen v Korn,  3 SCR 674. The Court emphasized that the cap should be regarded as a binding rule of law for all personal injury claims. In the specific case at hand, the plaintiff had sustained catastrophic injuries and was initially granted $460,000 in non-pecuniary damages by a jury. However, upon appeal, the Supreme Court ultimately reduced the jury's award to align with the prescribed level set by the cap.
Time for Change: A Summary
Forty-five years later, it is now necessary to revaluate and eliminate the existing cap on non-pecuniary damages. There are several compelling reasons to abolish the cap for non-pecuniary losses, apart from the growing societal awareness and empathy towards the total impact of an individual's pain and suffering:
1. Inconsistency in damages awards: Unlike other types of general damages, such as defamation, there is no cap on those. Consequently, one can receive higher compensation for the loss of reputation compared to the loss of a body part.
2. Statutory deductibles: In cases involving motor vehicle collisions, there are additional insurance deductibles imposed on pain and suffering awards. As a result, victims face the double impact of the injuries cap and statutory deductibles. Furthermore, juries are often unaware of the statutory deductibles, preventing them from considering this factor in their decisions.
3. Objective and quantifiable calculations: Pain and suffering awards must be assessed in a more objective and quantifiable manner. In the United States, pain and suffering damages are not subject to a cap, and juries sometimes use logical methods to determine their value, such as calculating hourly pain and suffering over a lifetime or using a multiple of economic damages. These approaches provide a more objective, logical, and fair assessment of pain and suffering compared to the current system in Ontario.
Why Should Canada’s Injury Awards Be So Much Lower Than Other Countries?
Canada has the lowest pain and suffering awards among the G7 countries. Most G7 countries, including Germany, France, Australia, and Ireland, have a cap set at $1 million. The United States is renowned for its significant pain and suffering awards. In many parts of the United States, there are no restrictions or limitations on the amount of these awards. In just one state, New York, there were ten cases in 2011 alone where awards for pain and suffering exceeded $3,500,000. This significant difference in compensation amounts between Canada and other countries raises the question of whether the rationale from the Supreme Court of Canada Trilogy still makes sense today.
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