Docket No.: C.A. No. 158103
Date: 20000512
NOVA SCOTIA COURT OF APPEAL
Glube, C.J.N.S.; Roscoe and Bateman, JJ.A.
[Cite as: Fraser v. Hunter Estate, 2000 NSCA 63]
BETWEEN:
ARLINGTON WESLEY FRASER
Appellant
- and -
ESTATE OF GEORGE M. HUNTER
and MARION PEARL HUNTER,
Executrix of the Estate of George M. Hunter
Respondents
REASONS FOR JUDGMENT
Counsel: Anthony J. Morley, Q.C., David A. Miller, Q.C. and M. Chantal Richard for the appellant
S. Raymond Morse, Q.C. and Robert K. Dickson for the respondents
Appeal Heard: April 3, 2000
Judgment Delivered: May 12, 2000
THE COURT: The appeal is allowed and the cross-appeal is dimissed, per reasons for judgment of Glube, C.J.N.S.; and Roscoe and Bateman, JJ.A. concurring.
GLUBE, C.J.N.S.:
[1] On October 10, 1994, the appellant, Arlington Wesley Fraser, was driving a 1986 Mercury Grand Marquis, while towing a utility trailer carrying a lawn tractor, in a westerly direction on Highway #2 near Leamington, Nova Scotia. The respondent, the late George M. Hunter, was driving a 1988 Chevrolet. Mr. Hunter made a left turn onto the highway from his private driveway, moving into the eastbound lane of highway #2. The Fraser vehicle collided with the Hunter vehicle. Mr. Hunter died in the accident and Mr. Fraser was injured.
[2] Mr. Fraser commenced an action against the Estate of Mr. Hunter and the executor of the estate, Marion Pearl Hunter. Following a trial in 1998 and 1999, Justice J.E. Scanlan in a decision dated June 1, 1999, found the collision was a t-bone type “... where the front end of the plaintiff’s vehicle struck near the middle of the driver’s side of the defendant’s vehicle.” The trial judge held Mr. Hunter was negligent and solely responsible for the injuries to Mr. Fraser because Mr. Hunter pulled out in front of Mr. Fraser who was too close to react and avoid the accident. Mr. Fraser reacted by applying his brakes and tried to drive to the left around the Hunter vehicle. There were no eye witnesses to the collision.
[3] Prior to the accident, Mr. Fraser worked for twenty-one years as a correctional services officer at the federal penitentiary in Springhill, Nova Scotia. At the time of the accident, he was 44 years old. As a result of the accident, the appellant took early retirement. He received a medical retirement package consisting of long-term disability (LTD) benefits, Canada Pension Plan disability benefits (CPP) and Superannuation Medical Retirement Benefits from his employer. These benefits provided Mr. Fraser with an income of $2,275 per month.
[4] Justice Scanlan awarded general non-pecuniary damages of $40,000 as well as amounts for past and future loss of income, future pension loss, pre-judgment and post-judgment interest and costs and disbursements. In determining the amount of damages for past and future loss of income, the trial judge deducted the LTD, CPP and Superannuation Medical Retirement Benefits received by the appellant through his employment.
ISSUES
[5] The appellant submits that the trial judge erred in deducting the collateral benefits and asks this Court to adjust the figures accordingly. The respondents agree that the learned trial judge erred in making those deductions, but argue that as a result of other errors, a new trial is required.
[6] The respondents cross-appealed raising four grounds:
1. The learned trial judge erred in making a speculative finding or inference that the appellant was not travelling at an excessive rate of speed prior to braking and that the respondent’s vehicle entered the roadway when the appellant’s vehicle was only a short distance away, which findings were contrary to the evidence;
2. That the learned trial judge misconducted the trial by undue involvement in the case including initially refusing to accept Dr. Smith as an expert witness, the subsequent reversal of that finding and hearing the evidence of Dr. Smith, interfering in examinations and thereafter not accepting the opinion of Dr. Smith in respect to crucial findings of fact on the issue of liability;
3. That the learned trial judge erred in finding the respondent totally liable for the accident, or in the alternative in failing to find the appellant partially liable for the accident, based upon the evidence of speed of travel of the appellant just prior to the accident, evidence of skid marks on the roadway and evidence as to the physical condition of the appellant at the time of the accident;
4. That the learned trial judge erred in assessing the damages to which the appellant was entitled, in that he applied the wrong principle of law by failing to properly take into consideration evidence of prior disability suffered by the appellant, and by awarding amounts for damages which were so inordinately high as to be a wholly erroneous estimate of the damages sustained by the appellant.
[7] I propose to deal with the cross-appeal first.
STANDARD OF REVIEW
[8] The parties agree that the standard of review on appeals involving findings of fact, apportionment of fault and an assessment of damages is as set out in Morrow v. Barnhill (Ritchie) Contracting Ltd., Pynn and Teed (1988), 86 N.S.R. (2d) 444 at p. 447:
[11] Findings of fact stand unless there was a palpable and overriding error on the part of the trial judge: Stein Estate v. The Ship “Kathy K”, [1976] 2 S.C.R. 802; 6 N.R. 359; 62 D.L.R. (3d) 1.
[12] An apportionment of fault is only to be altered in very strong and exceptional circumstances: Sparks v. Thompson (1974), 1 N.R. 387; 6 N.S.R. (2d) 481 (S.C.C.).
[13] An assessment of damages stands unless the trial judge has applied a wrong principle of law or has arrived at an amount so inordinately high or low as to be a wholly erroneous estimate: Nance v. B.C. Electric Railway Company Ltd., [1951] A.C. 601.
Grounds One and Three of the Cross-Appeal
[9] The first and third issues raised on the cross-appeal relate to findings of fact upon which the trial judge determined liability. It is not the function of a court of appeal to retry the case. I have reviewed the extensive record and heard the able arguments of counsel. There is sufficient evidence accepted by the trial judge to support his findings of fact and credibility and the conclusions he reached. There is no error of law or palpable and overriding error in the trial judge’s determination of liability and no strong and exceptional circumstances to warrant altering the finding of fault against Mr. Hunter.
[10] I would dismiss grounds one and three of this cross-appeal.
Ground Two of the Cross-Appeal
[11] The second ground alleges bias and misconduct of the trial by the trial judge including refusing initially to qualify Dr. Stuart D. Smith, B. Eng., Ph.D., P. Eng., as an expert for the defendants, subsequently reversing that position later on during the trial, then interfering during the examination of Dr. Smith and, finally, not accepting his opinion.
[12] After the appellant’s initial cursory review of Dr. Smith’s qualifications, the respondent interrupted the direct examination with agreement of counsel and the judge to “ask a few questions”. At the conclusion of the cross-examination, appellant’s counsel moved to have Dr. Smith qualified. Justice Scanlan ruled that he did not have sufficient information before him to satisfy him that Dr. Smith should be accepted to give opinion evidence in the field of accident reconstruction. Counsel for the appellant asked to call further evidence of Dr. Smith’s qualifications. Justice Scanlan ruled he was without jurisdiction to reconsider that issue. Justice Scanlan later, having reviewed his notes, concluded that counsel for the appellant may have been under the mistaken impression that an abbreviated examination of Dr. Smith would suffice and prematurely made the motion to have Dr. Smith qualified. He permitted appellant’s counsel to call further evidence on the issue and ultimately accepted Dr. Smith’s qualifications. I would find Justice Scanlan’s conduct at the trial in relation to qualifying Dr. Smith to give opinion evidence does not reveal error or bias.
[13] The appellant by cross-appeal also alleges bias against the trial judge. The test to be applied in deciding whether a trial judge’s conduct gives rise to a reasonable apprehension of bias is an objective one related to the perception of a reasonable and informed observer. (See: R. v. Howell (D.M.) (1995), 146 N.S.R. (2d) 1 (N.S.C.A.).) The interventions made by the trial judge were appropriate to clarify the expert evidence. In my opinion, they do not suggest an apprehension of bias. (See: Brouillard v. The Queen, [1985] 1 S.C.R. 39 or R. v. Taylor (J.W.) (1995), 142 N.S.R. (2d) 382 (N.S.C.A.).)
[14] I would dismiss the second ground of the cross-appeal.
Ground Four of the Cross-Appeal
[15] The appellant by cross-appeal claims that the trial judge erred in assessing the damages by applying a wrong principle of law relating to prior disabilities of Mr. Fraser and awarding amounts so inordinately high as to amount to a wholly erroneous assessment of damages.
[16] After reviewing the evidence and the decision of the trial judge, it is clear that he did take into account Mr. Fraser’s pre-existing health issues. He determined, however, that the accident was a major contributing factor to his current psychological difficulties. I would find there was sufficient evidence to support his findings. I am not persuaded the trial judge applied a wrong principle of law or arrived at an award of damages so inordinately high as to be a wholly erroneous estimate of the damages suffered by Mr. Fraser (see Nance, supra).
[17] I would dismiss the fourth ground of the cross-appeal.
APPEAL - DEDUCTIONS
[18] Only one ground of appeal was raised by the appellant.
That the learned Trial Judge erred by deducting the Appellant’s collateral benefits arising from his employment (including disability insurance benefits, Canada Pension Plan disability benefits and medical retirements benefits) in determining the quantum of the Appellant’s awards for past and future loss of income.
[19] The trial judge found that Mr. Fraser’s average annual income was $46,000.00 or $3,833.33 per month. In determining an award for past lost income, he concluded that Mr. Fraser was completely disabled from working for a period of 56 months. From his monthly income the trial judge deducted amounts earned for CPP, LTD and Superannuation Medical Retirement Benefits totalling $2,275.00 per month. He awarded past lost income of $1,558.35 (rounded up) times 56 months for a total of $87,267.60 or $18,700.20 per year.
[20] Justice Scanlan determined that Mr. Fraser would never be able to return to work as a correctional services officer because the work was too physically and mentally demanding. However, he went on to find Mr. Fraser should retrain in order to obtain other employment. He concluded Mr. Fraser would have to recondition himself and find a low stress position. He gave Mr. Fraser two years to accomplish his retraining and awarded him $37,400.40 for that period, or $18,700.20 as an ongoing annual loss, taking the same deductions as he did in determining the past lost income.
[21] Following retraining, the trial judge determined Mr. Fraser’s earning capacity would be reduced by 50%. He concluded that Mr. Fraser planned to retire at age 55 in any event. He therefore awarded an amount equal to his annual income of $46,000, reduced by 50%, less Medical Retirement Benefits of $17,390.16 per annum for 5 years.
[22] The appellant seeks a variation of the judgment of the trial judge as follows:
1. The damage awards for loss of past income and future loss of income be varied so that no deduction or adjustment be made for collateral benefits received by the appellant (including disability insurance benefits, Canada Pension Plan disability benefits and medical retirement benefits) and making such other adjustments as may be necessary consequent thereupon;
2. By providing for payment of pre-judgment interest on the increase in the award for past loss of income.
[23] The parties agree that collateral benefits which are similar to indemnity insurance are not to be deducted, provided the plaintiff offers some evidence of direct or indirect contributions towards those collateral benefits whether made through a collective agreement or contract of employment. (See: Cunningham v. Wheeler, [1994] 1 S.C.R. 359.)
[24] There was evidence that Mr. Fraser made a direct contribution to an LTD plan with Sun Life of Canada through his employment. The evidence of payments to the LTD plan meets the requirements of Cunningham, therefore, no amount should have been deducted for LTD.
[25] Canada Pension Plan benefits have, for many years, been found to be a form of insurance and therefore non-deductible from an award for loss of income. (See: Canadian Pacific Ltd., et al. v. Gill et al. (1973), 37 D.L.R. (3d) 229 (S.C.C.); K. Cooper-Stephenson, Personal Injury Damages in Canada, 2nd Ed. (Toronto: Carswell, 1996) at pp. 592-594; Kirk v. Singh (1995), 137 N.S.R. (2d) 218 (C.A.).)
[26] Guy v. Trizec Equities Ltd. (1979), 32 N.S.R. (2d) 345 (S.C.C.) established that medical retirement benefits are derived from the employee’s contract with his employer. The payments made are similar to payments under an insurance policy (p. 351). Mr. Fraser’s Superannuation Medical Retirement Benefits amounted to $1,449.18 per month which he will continue to receive whether or not he returns to work. This benefit should not have been deducted.
[27] The courts of Nova Scotia have consistently held that the collateral benefits described above should not be deducted from a loss of income award. (See: Skeffington v. McDonough and Varamburg (1992), 112 N.S.R. (2d) 52 (T.D.); Pottie v. Pottie et al (1994), 129 N.S.R. (2d) 389 (C.A.); Kennedy v. Lewis (1993), 122 N.S.R. (2d) 65 (S.C.); and Hines v. Englund (1991), 108 N.S.R. (2d) 401 (T.D.).)
[28] Deducting the collateral benefits of LTD, CPP and Superannuation Medical Retirement Benefits resulted in erroneous amounts being awarded for past lost income, retraining loss, future loss of income to retirement, prejudgment interest on the past loss, the pension award, costs and disbursements and post judgment interest. The general non-pecuniary damages are not affected.
[29] The respondents submit that the appellant, in asking this Court to recalculate the above amounts, is relying upon actuarial evidence when such evidence was not introduced at the trial. They say, as well, that Mr. Fraser has failed to mitigate his damages and that the trial judge erred and failed to apply any contingencies to reduce the overall award.
[30] At the appeal hearing, the appellant presented proposed figures which would correct these several erroneous deductions. The appellant did not calculate the present value of the loss of future income. He submits his figures were neither actuarial evidence nor an attempt to introduce fresh evidence. The figures he used are based upon the figures determined by the trial judge.
[31] Justice Scanlan properly concluded the burden was on Mr. Fraser to prove his damages. He commented in his decision that the lack of actuarial evidence resulted in a difficult situation for him to calculate “... the total loss of future income based on normal life expectancies and proper contingencies that might be factored in by an actuary.” As a result, he did not award an amount for future loss of income after Mr. Fraser reaches age 65, in spite of his being satisfied that Mr. Fraser is receiving a reduced pension (by $570.00 a month) as a result of retiring early. In addition, he noted Mr. Fraser’s difficulty with high blood pressure, sedentary lifestyle and problems with alcohol abuse.
[32] In determining the appropriate time period and amount to award for retraining, Justice Scanlan referred to the appellant’s obligation to mitigate his damages. I would find Justice Scanlan considered both mitigation and contingencies in deciding upon amounts under the several heads of damages.
[33] The deductions taken in error by the trial judge from the awards for past and future losses of income should be restored to Mr. Fraser as follows:
1. $2,275 per month for 56 months (past loss) $127,400
2. $2,275 per month for 24 months (retraining) $54,600
3. $1,449.18 per month for 60 months
(future loss at 50% to retirement) $86,950.80
plus prejudgment interest on the past loss
at 6% for 1/2 of 56 months.
[34] The trial judge determined the amount for loss of future income had to be capitalized. Because he did not have any actuarial figures, he referred to the discount rate of 2.5% per annum (Civil Procedure Rule 31.10(2)) and left the calculation of the present value for future pension loss to counsel if they could agree. In the order following the trial, the parties agreed to the amount of $46,020.12.
[35] Mr. Fraser is currently in receipt of his pension. It is conceded by him that once the improper deductions for Superannuation Medical Retirement Benefits are restored, the corrected amount will exceed the future loss of pension benefits awarded and, therefore, the amount of $46,020.12 should be deducted from the amounts to be added back in for LTD, CPP and Superannuation Medical Retirements Benefits.
[36] The awards made by the trial judge should be adjusted to:
(1) add the collateral benefits wrongly deducted,
(2) deduct $46,020.12 for loss of future pension,
(3) reflect the increase in pre-judgment interest and post judgment interest, resulting from the increased awards, and
(4) reflect the present value of the future losses.
If the parties are able to agree on the exact adjustments necessitated by this judgment, they should submit the appropriate order to this court within 15 days of the date of this decision. Otherwise, the matter is remitted to the trial judge to hear further submissions as he may direct for final determination.
[37] New trial costs should also be determined according to Tariff A, scale 3 (basic). Costs on the appeal are awarded to the appellant at 40% of the trial costs when determined, plus disbursements.
[38] I would allow the appeal and dismiss the cross-appeal.
Glube, C.J.N.S.
Concurred in:
Roscoe, J.A.
Bateman, J.A.