Who says you have to retire at age 65?
If your plan was to work to age 75 and a car accident stopped your ability to do that then justice requires that you be compensated for that lost earning capacity.
In a recent case, Banic-Govc v. Timm, 2018 BCSC 1073, the Supreme Court of British Columbia dealt with just such a situation.
The plaintiff, had been a youth services counsellor prior to the car accident. Even though she was 65 years of age at the time of the car accident her plan was, had the car accident not occurred, to continue working until age 75.
The accident occurred while the plaintiff was exiting a parking lot to turn onto the main roadway. Another vehicle, turning left into the parking lot entrance collided with the plaintiff’s vehicle. The impact between the two vehicles was in the left front corner of each vehicle.
Liability was at issue at the trial. The judge found both the plaintiff and the defendant to be sincerely telling the truth but had different versions of what happened. The plaintiff says she was fully to the right side of the exit of the parking lot but the defendant says that the plaintiff was more towards the middle of the exit.
The judge found for the plaintiff primarily based on the admission by the defendant that she had “cut the corner” upon entering the parking lot entrance and failed to see the plaintiff until just prior to impact. The injuries the plaintiff sustained included headaches, including migraine type headaches, pain in her back and right knee, tingling in both hands, and anxiety. She hit her knee on the console at the time of the accident. An orthopedic surgeon who she saw opined that at some point she may need a total knee replacement. Treatments included medication, massage, physiotherapy, and Pilates. Despite her efforts to get better the plaintiff continued, at the time of trial, to suffer from migraine type headaches and considerable pain in her neck and upper back.
Prior to the accident the plaintiff was extremely active able to walk and hike for many hours and ride her bike regularly. After the accident her walking tolerance was limited to approximately one hour with pain.
The court stated:
“ The plaintiff has been transformed from a physically active woman into an inactive woman with constant, debilitating pain. Her physical condition is not likely to improve. The plaintiff’s ability to engage in hiking or biking as she did before May 2014 is severely limited. Her social life has been greatly restricted. Her physical relationship with her husband has, at best, become a source of pain and of emotional distress. She was formerly a meticulous housekeeper but now finds herself distressed to realize that her house is “messy” and there is little she can do about it. Much of the housework is now impossible for her. She has enjoyed gardening when capable of doing so but much of that activity causes such pain that she cannot continue. Importantly, I accept that the plaintiff would have continued in her employment with the Boys and Girls Club to at least the age of 70 but the accident has brought that ambition to an end. It was one of the greatest sources of pleasure in her life.”
The court assessed nonpecuniary general damages [that is compensation for pain and suffering] at $130,000.
The plaintiff did attempt to try to go back to work and succeeded to some extent. The court awarded her income loss from the date of the accident to date of trial at $19,500.
In terms of future income loss [that is, lost income after trial and into the future] the court stated:
“ The medical evidence leaves me in no doubt that the plaintiff’s capacity to earn an income has been severely constrained by her injuries. Her decision to retire from the Boys and Girls Club was based on medical advice. If the accident had not happened, I conclude that, absent the various contingencies in life, she would have continued in her employment to age 70 on a full-time basis. Thereafter, she would have reduced her work week to four days. From the date of the accident until the age of 70, it is likely that she would have earned an annual salary of $64,000. From the age of 70 to age 75, she likely would have earned a salary of $51,000. I have no basis on the evidence to conclude the plaintiff would have retired before 75 if she had not suffered the accident of May 2014.”
“ I have no evidence of specific negative contingencies that ought to be applied to the plaintiff’s circumstances to conclude that she would not have worked to age 75 but for the accident injuries. Nevertheless, it is unusual in our society to be employed past the age of 70 and particularly unusual to be a salaried employee to age 75 or beyond. The negative contingencies in those years are unavoidable for most people and the plaintiff is no exception.”
“ The plaintiff submits she now has a residual annual earning capacity of $20,000 though No Fear to the age of 70. I accept that as correct. After age 70, I conclude her residual earning capacity will be reduced to $10,000 per annum. If the plaintiff had continued her employment with the Boys and Girls Club and her salary was unchanged as I believe would have occurred, she would have earned $64,000 for each of the five years between ages 65 and 70 for a total of $320,000. From that sum must be deducted $100,000 to account for a residual earning capacity over those five years, leaving a total of $220,000. Reduced to a present value that sum is $208,000. For the additional six working years between age 70 through age 75, the plaintiff would have earned $51,000 annually with the Boys and Girls Club. Her residual annual earning capacity with No Fear I assess at $10,000 for each of those years. Her loss is then about $240,000 before a reduction to its present value which I have factored into my calculations.”
“ My calculation based on the foregoing approach is that the plaintiff’s loss of future earning capacity exceeds $400,000. That does not take into account the contingencies. There are no positive contingencies that could be expected to increase the plaintiff’s future earnings. I conclude, however, as I have already suggested, that the negative contingencies begin to increase in importance with advancing age. Those contingencies lead me to conclude that the $400,000 earning capacity loss that I have referred to is greater than is appropriate as a damage award under this head. I assess the plaintiff’s loss of future earning capacity at $350,000.”
The court also awarded past loss of housekeeping at $22,000, out-of-pocket expenses that $7218.18, and cost to future care at $190,000 for a grand total of $720,000. In an era when by choice or necessity more and more people are delaying their retirement it is good to see the court recognizing that economic reality.