The 4 Grounds to Claim General Damages

Since non-pecuniary damages do not compensate a monetary loss, as the term implies, there has been debate as to what they cover and how they are assessed. There are generally 4 grounds upon which non-pecuniary general damages can be claimed: (1) pain and suffering; (2) loss of amenities or enjoyment of life; (3) loss of consortium or companionship; and (4) loss of peace of mind. In Andrews v. Grand Toy Alberta Ltd, [1978] 2 SCR 229 pp 261-262, the unanimous Supreme Court of Canada settled on a ‘functional approach’ for their assessment (see “Pecuniary vs Non-Pecuniary Damages”). This means that courts indemnify an injured party for “physical arrangements which can make [the person’s] life more endurable”, or, as stated in Lindal v. Lindal, [1981] 2 SCR 629 p 634, “to substitute other enjoyments and pleasures for those that have been lost”. However, because it is difficult to find an objective yardstick to actual emotional or psychological loss associated with non-pecuniary damages, the Court has also capped the value at $100,000 in January 1978.

Of course, the value of non-pecuniary general damages will vary depending on the severity of the injuries. In Andrews, supra, dealing with what the Court considered one of the worst types of physical injuries, i.e. quadriplegia, the cap of $100,000 was said to be adequate given proper compensation for other losses like loss income and costs of future care. It was nevertheless acknowledged that the value of the cap would erode with time and inflation. Provision was thus made for a corresponding adjustment: see Lindal, supra pp 640-641 & 643. This practice has been followed in New Brunswick: see Boudreau v. Paquin (1979), 25 NBR (2d) 271 para 20 (QB); Quigg v. Saint John (City) (1980), 30 NBR (2d) 392 para 7 (CA); Godin v. Bourque (1981), 32 NBR (2d) 45 para 39 (CA). In 2021, the cap is about $400,000.

As cost-of-living increases are automatically applied to non-pecuniary general damages, courts have held, namely in Flanagan v. Levesque (1994), 148 NBR (2d) 101 (QB), that interest should not be charged thereon for the period preceding the trial. This has led to s. 265.5 of the Insurance Act, RSNB 1973, c. I-12, which provides that:

265.5 (1) Notwithstanding subsection 45(1) of the Judicature Act, in an action for damages arising out of an accident, interest shall not be awarded, for any period between the date of the accident and the date of the judgment, in respect of any damages for the non-pecuniary loss of the plaintiff.

Although the provision is limited to motor vehicle accidents, courts could foreseeably extend the logic to other personal injury claims.

Finally, regarding motor vehicle accidents, it is worth noting that New Brunswick has a regulation capping the amount of non-pecuniary general damages for minor personal injuries since 2003 (see “Minor Personal Injury”). Although the cap was increased and the definition of minor personal injuries narrowed in 2013, there remains a restriction on the value of the award in those cases. However, contrary to other jurisdictions, in New Brunswick the burden rests on the defendant to show that an injury is minor. Otherwise, non-pecuniary general damages are set according to the ‘functional approach’.

As already explained, the Supreme Court of Canada adopted the ‘functional approach’ to the assessment of non-pecuniary general damages because there is no objective measure for the loss associated with pain and suffering. People react differently to pain, depending on their personal threshold. For that reason, Canadian courts have set a limit to the amount that can be claimed under this head of damages. In order to ensure a level of consistency and objectivity, they favour the use of factually comparable precedents. In McLaughlin v. Levesque, 2009 NBQB 85 paras 163-165, Justice LaVigne, before her appointment to the Court of Appeal, summarized the state of the law:

[163] When comparing cases, we must search for common factors that influence the awards, such as, the age of the plaintiff, the nature of the injury, the relative severity and duration of pain, disability, emotional suffering, and loss or impairment of enjoyment of life. The award must also be adjusted for inflation.

[164] The award does not depend only on the gravity of the injury. Compensation should be awarded for what a particular individual has lost in the way of amenities and enjoyment of life, and for what will function to make up for this loss. It should provide a fund of money to enhance the situation of that plaintiff. It must be remembered that non-pecuniary damages are awarded on a functional basis to the end of providing substitute pleasures for those which have been lost in order to ameliorate the plaintiff’s condition and make his or her life more bearable.

[165] General damages assessments are subjective in nature and are based on the plaintiff’s own experience of pain and suffering. It must manifest the individual plaintiff’s particular situation.

Inflation has been discussed previously. Other objective criteria are thus age, nature and effect of the injury.

In the same line of thought, some injuries are easier to assess than others. A broken bone can be seen on an x-ray; paraplegia or quadriplegia can be ascertained easily. It is not so for invisible injuries, like chronic pain and some emotional or psychological sequelae that typically rely on the subjective reports of the victim. In those cases, the credibility and reliability of the claimant are central to the assessment. In Boucher v. Doiron, 2000 NBCA 18 para 68, Justice Drapeau (as he then was) explained, for the unanimous bench:

[68]  There is no doubt that an injured person is entitled to fair and reasonable compensation for losses attributable to his or her pain, even if there is no objective confirmation of any ongoing injury. Yet, there is much to be said in favour of moderation in the assessment of damages for personal injury when, as here, the reliability of the injured party’s account of effects of her pain is suspect and there is no objective evidence of any continuing injury.

That is where the evidence of a treating physician can become important: Baraly v. Bradley (1991), 117 NBR (2d) 413 para 53 (QB); Boucher v. Doiron (1999), 221 NBR (2d) 1 para 52 (QB); Firth v. Bossé, 2007 NBQB 349 paras 146-147; Webb v. Aviva Insurance Co., 2011 NBQB 98 paras 9-10 & 23-25; Matthews v. McIntyre, 2019 NBQB 127 paras 51-52. The absence of treatments can also play in the equation: Thibault v. Boudreau (1984), 59 NBR (2d) 113 para 23 (QB); Shaw v. Wawanesa Mutual Insurance Co., 2001 NBQB 17 para 16; Noël v. Royal and SunAlliance Insurance Co., 2005 NBQB 453 para 44; Bent v. MacFarlane, 2018 NBCA 17 para 87.

When assessing pain and suffering, courts will typically take a global approach, instead of trying to assess each injury separately. Conceptually, if a person already suffers from disabling pain in relation to one injury, the fact that another is sustained in the same accident would not likely have a corresponding effect on his or her level of pain. For example, a victim who has a daily dose of chronic back pain may only be marginally affected by an additional dose of elbow pain. In Melanson v. LeBlanc (1989), 99 NBR (2d) 177 para 8, the unanimous Court of Appeal explained the approach as follows:

[8]   Each of the injuries and symptoms might, if considered separately, have resulted in a higher total award. There are, however, common features. For example, all have had an effect on her leisure activities and caused her discomfort at work. The court must base its award on the totality of those injuries and their effect upon a claimant rather than add up the sums it might have awarded for each separate injury or symptom.

However, like everything else, each case is assessed on its own facts. Although a person may continue to function despite constant pain, that ability may disappear if an impairment is added through paralysis. Thus, arguably, the assessment should start with the effects of the most severe injury up instead of searching for a common or middle ground between all the injuries.

Another indemnity for non-pecuniary general damages in personal injury cases pertains to the loss of amenities or enjoyment of life. This plays an important role where the plaintiff does not feel pain or suffering but his or her life is negatively affected. It is invoked, namely, when the claimant is rendered unconscious by an accident but remains alive. While s/he may not be aware of pain, suffering or his or her depleted state, there is still a right to compensation: see Jennings (Litigation Guardian) v. Cronsberry, [1966] SCR 532; Mungall v. Costain (1978), 24 NBR (2d) 510 (QB).

As a general rule, the person injured in an accident is the one entitled to compensation. At one point, a loss of valuable services was awarded to the parent, spouse or friend providing assistance, but that practice is now discontinued (see “Claiming a Loss of Valuable Services”). However, very often, the victim is not the only one impacted by the injury; a spouse or child can suffer through changes to his or her lifestyle because of someone else’s injuries. In Guimont v. Williston (1980), 30 NBR (2d) 178 para 35, Justice Limerick, for the unanimous Court of Appeal, acknowledged that the “right of a husband at common law to claim damages for the loss of consortium due to injuries suffered by his wife is the subject of conflicting decisions”. After reviewing a few cases, he concluded that “a partial loss of consortium, if substantial, affords a ground for an award of damages to a husband whose wife is injured by the negligence of a third party” (para 43). He then confirmed an award of $5,000 by the trial judge for this reason, because (para 44):

Mr. Guimont’s whole life style is affected. He and his wife enjoyed skiing, skating, bowling, tennis and other active sports together; she can no longer participate with her husband in any of those sports and he must either forgo them or participate in them unaccompanied by his wife. His wife’s sexual activity is reduced by 70 to 75 percent. His whole manner of living has been permanently disrupted.

It was held, back in November 1982, by Justice Deschênes, in Lepage v. Hickey (1982), 43 NBR (2d) 328 (QB), that such a claim did not extend to a wife. The husband was the one injured in that case. Although he was awarded some loss of consortium as part of his non-pecuniary general damages, the wife’s claim was dealt with as follows (paras 11-12):

Now, as far as the claim for Stella LePage is concerned, I want to deal first with her claim for loss of consortium. It would seem to me that historically, at least, the wife never had a right of action for loss of comfort and society of her husband as a result of the negligence of a 3rd party and such right of action or remedy belongs solely to the husband and the reference here is the case of Best v. Samuel Fox Co. Ltd., […] which case was referred to in the Supreme Court of Canada case of Woelk v. Halvorson […], and it seems that the Canadian Courts have, on balance, tended to follow the “Best” case.

It woud [sic] seem therefore that if a wife is to be given a right of action and a remedy for loss of comfort and society of her husband or loss of consortium, that the common law should be changed by statutory enactment as was done in Alberta in the Domestic Relations Act. In the absence of that type of legislation, in this province I have no alternative but to maintain the common law position which I certainly look upon as being antiquated and discriminatory.

Indeed, that rule was discussed before the coming into force of the equality provision (s. 15) of the Canadian Charter of Rights and Freedoms, in 1985, and it is now obsolete: Hill v. Church of Scientology of Toronto, [1995] 2 SCR 1130. Spouses of both sexes are likely entitled to claim loss of consortium.

That being said, only partial loss of consortium is allowed. Where a spouse dies, the Fatal Accidents Act, SNB 2012, c. 104, s. 8, limits the recovery to “pecuniary loss resulting from the death”. A complete loss of consortium is therefore not indemnified: Coy’s Estate v. Lewis (1980), 31 NBR (2d) 1 (CA). Although that conclusion may be questionable in light of s. 7 of the Canadian Charter, supra, and Augustus v. Gosset, [1996] 3 SCR 268 para 63 (see “Entitlements in Cases of Death”), the law allows such a claim in the case of children. Section 10 of the Fatal Accidents Act, supra, expressly provides for a parent’s grief and loss of companionship of a child: see Nightingale v. Mazerall (1991), 121 NBR (2d) 319 (CA).

Courts have recognized that certain types of contracts provide for peace of mind. Namely, it is the case for disability insurance contracts as found in the case of Fidler v. Sun Life Assurance Company of Canada, 2006 SCC 30. The insurer had refused to pay benefits owed to the plaintiff. The trial judge awarded $20,000 in non-pecuniary general damages for the mental distress caused to the client. This amount was disputed on appeal to both levels of courts. The unanimous bench of the Supreme Court of Canada explained (paras 44-47):

We conclude that damages for mental distress for breach of contract may, in appropriate cases, be awarded as an application of the principle in Hadley v. Baxendale: see Vorvis. The court should ask “what did the contract promise?” and provide compensation for those promises. The aim of compensatory damages is to restore the wronged party to the position he or she would have been in had the contract not been broken. As the Privy Council stated in Wertheim v. Chicoutimi Pulp Co., [1911] A.C. 301, at p. 307: “the party complaining should, so far as it can be done by money, be placed in the same position as he would have been in if the contract had been performed”. The measure of these damages is, of course, subject to remoteness principles. There is no reason why this should not include damages for mental distress, where such damages were in the reasonable contemplation of the parties at the time the contract was made. This conclusion follows from the basic principle of compensatory contractual damages: that the parties are to be restored to the position they contracted for, whether tangible or intangible. The law’s task is simply to provide the benefits contracted for, whatever their nature, if they were in the reasonable contemplation of the parties.

It does not follow, however, that all mental distress associated with a breach of contract is compensable. In normal commercial contracts, the likelihood of a breach of contract causing mental distress is not ordinarily within the reasonable contemplation of the parties. It is not unusual that a breach of contract will leave the wronged party feeling frustrated or angry. The law does not award damages for such incidental frustration. The matter is otherwise, however, when the parties enter into a contract, an object of which is to secure a particular psychological benefit. In such a case, damages arising from such mental distress should in principle be recoverable where they are established on the evidence and shown to have been within the reasonable contemplation of the parties at the time the contract was made. The basic principles of contract damages do not cease to operate merely because what is promised is an intangible, like mental security.

This conclusion is supported by the policy considerations that have led the law to eschew damages for mental suffering in commercial contracts. As discussed above, this reluctance rests on two policy considerations — the minimal nature of the mental suffering and the fact that in commercial matters, mental suffering on breach is “not in the contemplation of the parties as part of the business risk of the transaction”: McGregor on Damages, at p. 63. Neither applies to contracts where promised mental security or satisfaction is part of the risk for which the parties contracted.

This does not obviate the requirement that a plaintiff prove his or her loss. The court must be satisfied: (1) that an object of the contract was to secure a psychological benefit that brings mental distress upon breach within the reasonable contemplation of the parties; and (2) that the degree of mental suffering caused by the breach was of a degree sufficient to warrant compensation. These questions require sensitivity to the particular facts of each case.

When confirming the award of the trial judge, the court explained that it is not necessary that peace of mind “be the dominant aspect or the ‘very essence’ of the bargain” (para 48).

The case of Belliveau v. Royal Bank of Canada (2000), 224 NBR (2d) 354 (CA), is of interest. The plaintiff had contracted a RRSP with the defendant financial institution. She had managed to accumulate over $144,000 in anticipation of retirement. However, she had also given to the same institution a personal guarantee for the debt of a family business. As default was registered on the debt, the bank obtained a court order against the client. To cover part of the outstanding balance, it, without notice, unilaterally appropriated her RRSP when it came to terms, even though the statute and contract expressly prevented such action. At trial, the presiding justice held the bank to a fiduciary duty towards its client. In addition to the value of the RRSP garnished and the income tax charged, he awarded $100,000 in compensation. The decision was upheld on appeal even though the unanimous bench discarded the fiduciary duty. In many respects, a RRSP contract shares the characteristics of a disability insurance contract: it also provides for peace of mind. The following comment from Fidler, supra para 56, is apposite. Suffice to trade ‘disability’ for ‘retirement’:

The bargain was that in return for the payment of premiums, the insurer would pay the plaintiff benefits in the case of disability. This is not a mere commercial contract. It is rather a contract for benefits that are both tangible, such as payments, and intangible, such as knowledge of income security in the event of disability. If disability occurs and the insurer does not pay when it ought to have done so in accordance with the terms of the policy, the insurer has breached this reasonable expectation of security.

It is not clear on what ground the additional compensation was awarded in Belliveau, but the judge referred to a perfectly legitimate tax shelter destroyed by the bank; the plaintiff would now have to pay income tax on all interests accrued on the money from the judgment. In that sense, the $100,000 might be considered a provision for future income tax premised on the peace of mind that an RRSP provides to the tax payer. Given the age of the plaintiff at the time of the breach (55 years) and the yearly interests accrued in the previous five years (about $12,500), it seems unlikely that she would pay income taxes of $100,000 by the time of retirement. It is possible that the language of the decision would have been different had Belliveau not been rendered 6 years before Fidler, supra.

This aspect of non-pecuniary general damages is relevant to cases of personal injuries mostly where the victim contracted for disability benefits and the insurer denies coverage. An additional layer of stress may aggravate the situation of an already impecunious person and justify compensation. Of course, “the particular facts of each case” would determine the issue.