Chisholm v. Lindsay, 2015 ABCA 179

• Judge: Berger, McDonald and Veldhuis, JJ.A.
• Court: Court of Appeal (Alberta)
• Case Date: May 26, 2015
• Citations: 2015 ABCA 179;(2015), 600 A.R. 311

Chisholm v. Lindsay (2015), 600 A.R. 311; 645 W.A.C. 311 (CA)

MLB headnote and full text

Temp. Cite: [2015] A.R. TBEd. MY.115

Catherine Chisholm (plaintiff/appellant in 1301-0011-AC/respondent in 1301-0286-AC) v. Noreen Lindsay (defendant/respondent in 1301-0011-AC/appellant in 1301-0286-AC)

(1301-0011-AC; 1301-0286-AC; 2015 ABCA 179)

Indexed As: Chisholm v. Lindsay

Alberta Court of Appeal

Berger, McDonald and Veldhuis, JJ.A.

May 26, 2015.

Summary:

The plaintiff was injured in a motor vehicle accident for which the defendant admitted liability. At issue was damages.

The Alberta Court of Queen's Bench, in a judgment reported [2012] A.R. Uned. 94, awarded the plaintiff $346,734.91 in damages, including $90,000 general damages for nonpecuniary loss, $125,000 for loss of future income, $45,000 for the cost of future care and $35,000 for the cost of future housekeeping costs. Post-trial issues arose as to whether s. 626.1 of the Insurance Act required deductions for tax on loss of future income and the cost of future care. The plaintiff argued that the loss of future income should be grossed up for tax.

The Alberta Court of Queen's Bench, in a judgment reported [2012] A.R. Uned. 361, held that neither the tax gross up nor the Insurance Act deductions were warranted. The defendant had made two settlement offers ($350,000 and $360,000). The first offer was invalid under the Rules (not served 10 days before trial). The second offer (three days before trial) was made "without prejudice" and did not state an intention to use the offer with respect to the issue of costs if not accepted. Accordingly, the second offer was not a valid Calderbank offer. The plaintiff argued that the court could not consider either offer in determining costs.

The Alberta Court of Queen's Bench, in a judgment reported (2013), 560 A.R. 97, held that the court had a discretion to consider informal settlement offers (invalid offers under the Rules and non-Calderbank offers) in determining costs. At issue was a number of claimed items respecting the plaintiff's Bill of Costs and the defendant's claim to contribution to trial costs resulting from her offers to settle.

The Alberta Court of Queen's Bench, in a judgment reported (2013), 571 A.R. 260, awarded the plaintiff costs. The defendant was denied costs based on her offers to settle. The court determined the allowable amounts under the plaintiff's Bill of Costs. The plaintiff appealed, arguing that the general damage award was too low, that the trial judge applied the wrong legal test in calculating future earning capacity, and that the trial judge erred in refusing to award $3,500 for a special knee brace and a gross up for tax. The defendant appealed, and the plaintiff cross-appealed the costs award.

The Alberta Court of Appeal dismissed the plaintiff's appeal, with the exception of finding that the trial judge should have awarded the plaintiff $3,500 for the knee brace. As for the costs award, both the appeal and cross-appeal were dismissed.

Damages - Topic 1412

Special damages - Loss of wages/income - Deductions (incl. income tax and contingencies) - A plaintiff injured in a motor vehicle accident was awarded a net amount $125,000 for loss of future earning capacity - The plaintiff appealed the trial judge's failure to gross-up that amount for income tax - The Alberta Court of Appeal dismissed the appeal - The trial judge properly applied s. 626.1(2) of the Insurance Act, which required damages for income replacement (past and future) to be calculated on a net basis - See paragraphs 34 to 37.

Damages - Topic 1549

General damages - General damages for personal injury - Impairment of earning capacity - [See Damages - Topic 1550 ].

Damages - Topic 1550

General damages - General damages for personal injury - Prospective loss of wages or earnings - The plaintiff teacher was injured in a motor vehicle accident - The trial judge held that the plaintiff was not entitled to damages for pre-trial loss of income, as she had two children under three years of age (born shortly after the accident) and had expressed an interest in staying home with the children until the youngest child was school age - Accordingly, but for the accident, she would not have lost any income - The trial judge also declined to award damages for lost future income, instead awarding $125,000 for loss of future earning capacity - The trial judge was satisfied that the plaintiff's injuries would preclude her from full-time teaching work, but that the evidence did not establish the loss of a future defined income stream - Accordingly, damages for loss of earning capacity was more appropriate - The Alberta Court of Appeal held that the trial judge did not err in awarding damages for loss of future earning capacity or in assessing the amount - See paragraphs 20 to 29.

Damages - Topic 1550.1

General damages - General damages for personal injury - Pre-trial loss of wages or earnings - [See Damages - Topic 1550 ].

Practice - Topic 7247

Costs - Party and party costs - Offers to settle - Costs to unsuccessful defendant - The plaintiff obtained judgment for $347,000 against the defendant - On September 1, 2011, the plaintiff offered to settle for $350,000 plus costs at mediation - That offer was open only to the end of that day - On September 2, 2011, and November 10, 2011, the plaintiff made subsequent offers to settle for $450,000 and $761,000 respectively - On November 15, 2011, the defendant offered to settle for $350,000 plus costs, which offer was open until the start of the trial - On November 18, 2011, the defendant increased the offer to $360,000, but the offer was open for three hours only - The trial commenced on November 21, 2011 - The defendant sought costs notwithstanding her offers were not formal offers under the Rules, nor Calderbank offers - The defendant claimed that the plaintiff should have accepted the offer she made three days before trial, where the plaintiff had offered to settle for that amount 2.5 months earlier - The plaintiff argued that the offers could not be compared, where she spent an additional $40,000 in those 2.5 months in preparing for trial - The Alberta Court of Queen's Bench declined to award the defendant costs based on her offer because "I am not prepared to grant the Defendant costs in the circumstances of this particular matter. An offer to settle before trial is always a factor to consider in costs and may often result in compensation to the party making the offer depending on the circumstances. In this case, I decline to make an award for costs to the Defendant for a number of reasons: a) There was a difference of under $4,000 between the offer made and the ultimate award. Had the award exceeded the offer, even marginally, counsel would not have even made this argument of set-off; b) While the offer was made before trial, it was only a week before trial and all records, expert reports, rebuttal reports and briefing had been completed by then; c) The offer was exactly the same offer the Plaintiff had put forward two and a half months earlier. While the decision of the Plaintiff to continually increase the amount of her offers to settle after the mediation did nothing for the settlement process, the original offer did reflect a range which the Plaintiff felt was reasonable at the time, the Defendant came to accept as reasonable and the court found was appropriate; d) The Defendant could have taken advantage of the formal offer to settle process set forth in Rule 4.24(1) by simply serving their offer a few days earlier. This would have given them all of the advantages set out in the Rules." - The Alberta Court of Appeal dismissed both an appeal and cross-appeal from the costs decision - See paragraphs 38 to 53.

Practice - Topic 8802

Appeals - General principles - Duty of appellate court regarding damage awards by a trial judge - The plaintiff appealed a general damage award of $90,000, arguing that it should have been in the $150,000 to $175,000 range - The defendant had argued for an award of $65,000 to $75,000 - The Alberta Court of Appeal dismissed the appeal - A damage award was reviewable for palpable and overriding error - There must be a fundamental mischaracterization or misapprehension of the evidence - The trial judge properly considered all of the evidence, including expert testimony, and had the benefit of case law cited by both parties - The court stated that "mindful of the standard of review, we see no palpable and overriding error nor any misapprehension of the evidence that would warrant appellate intervention. The amount awarded is neither unreasonable nor wholly erroneous." - See paragraphs 14 to 19.

Cases Noticed:

Sidorsky et al. v. CFCN Communications Ltd. et al. (1997), 206 A.R. 382; 156 W.A.C. 382; 1997 ABCA 280, refd to. [para. 10].

Mahe et al. v. Boulianne, [2010] A.R. Uned. 25; 2010 ABCA 74, refd to. [para. 12].

Housen v. Nikolaisen et al., [2002] 2 S.C.R. 235; 286 N.R. 1; 219 Sask.R. 1; 272 W.A.C. 1; 2002 SCC 33, refd to. [para. 13].

Webb v. Birkett et al. (2011), 499 A.R. 274; 514 W.A.C. 274; 2011 ABCA 13, refd to. [para. 13].

Minhas v. Hayden et al., [2013] A.R. Uned. 272; 2013 ABCA 305, refd to. [para. 13].

Diakow v. Hughes et al., [2009] A.R. Uned. 66; 2009 ABCA 206, refd to. [para. 13].

Tsalamandris v. MacDonald, [2011] B.C.T.C. Uned. 1138; 2011 BCSC 1138, refd to. [para. 17].

Russell v. Turcott, [2009] A.R. Uned. 184; 2009 ABQB 19, additional reasons [2009] A.R. Uned. 153; 2009 ABQB 236, refd to. [para. 17].

Davidson v. Patten et al., [2004] A.R. Uned. 625; 2004 ABQB 681, affd. (2008), 425 A.R. 186; 418 W.A.C. 186; 2008 ABCA 65, refd to. [para. 17].

Dear v. Styre et al. (2002), 318 A.R. 115; 2002 ABQB 522, refd to. [para. 17].

Hill v. Hill Family Trust et al. (2013), 561 A.R. 50; 594 W.A.C. 50; 2013 ABCA 313, refd to. [para. 49].

Statutes Noticed:

Insurance Act, R.S.A. 2000, c. I-3, sect. 626.1 [para. 34].

Counsel:

N.C. Mayer and M.B. Warren, for Catherine Chisholm;

T.C. Burnett and P.J. Stein, for Noreen Lindsay.

This appeal and cross-appeal were heard on November 5, 2015, before Berger, McDonald and Veldhuis, JJ.A., of the Alberta Court of Appeal.

On May 26, 2015, the following memorandum of judgment was filed by the Court.