Citation: Inglis v. Nova Scotia Public Service
Long Term Disability Trust Fund, 2012 NSSC 11
Date: 20120110
Docket: Hfx No. 203247
Registry: Halifax
Between:
Robert D. Inglis
Plaintiff
v.
Trustees of the Nova Scotia Public Service
Long Term Disability Plan Trust Fund
Defendant
DECISION
Judge: The Honourable Justice Glen G. McDougall
Heard: November 25, 2011, in Halifax, Nova Scotia
Counsel: Bruce Evans, Ll.B., for the plaintiff
Colin Bryson, Q.C., for the defendant
By the Court:
[1] The trial of this matter took place over 11 days beginning in June, 2009 and concluding in September of the same year. The Court reserved decision. A written decision was subsequently rendered on February 2, 2011.
[2] Counsel could not agree on the extent of the decision nor the form and substance of the order resulting therefrom. Consequently, the matter had to be brought back to deal with four issues identified by counsel for the plaintiff as follows:
1. (a) Should the Plaintiff be entitled to PJI from September 12, 2002 to date of the judgment order, as you decided in your decision?
(b) how should PJI on LTD (wage-loss) arrears and such arrears be calculated to reflect the offset amount?
2. (a) Did you already decided in your decision of February 2, 2011 that the Defendants are not liable for lost LTD benefits that would have been paid by the Province of Nova Scotia under s. 8 of the LTD Plan, had the Defendants not wrongfully terminated LTD benefits?
(b) Alternatively, if you decided this issue against the Plaintiff, is this a clear and fundamental error of law, that you should correct before issuing an order?
3. Should the Defendants be ordered to:
(a) pay damages to Mr Inglis in an amount to be assessed by the trial judge for lost LTD benefits that would have been paid by the Province of Nova Scotia under s. 8 of the LTD Plan, had the Defendants not wrongfully terminated LTD benefits on September 12, 2002 ? and
(b) pay costs of this damages assessment to the Plaintiff ?
4. What costs should be awarded now relating to the overall proceeding other than costs related to issue 3 ?
[3] Counsel for both parties filed comprehensive written submissions and presented further oral arguments on all four issues. Their oral submissions were heard on Friday, November 25, 2011 over the course of approximately one-half day.
[4] Subsequent to hearing their submissions counsel for the plaintiff sent correspondence dated December 2, 2011 in which he indicated that after further discussions with opposing counsel, the parties had agreed:
... that the defendants will pay Mr. Inglis the sum of $173,318.18 as payment in full of the net LTD (wage-loss) benefits arrears to February 11, 2011 payable by the defendants pursuant to your decision of February 2, 2011 with this amount to be paid to Smith Evans in trust no later than December 6, 2011. This amount is inclusive of pre-judgment interest and is the net amount owed after deduction of the setoff directed by Your Lordship for income which you deemed to be included in the settlement with the Province of Nova Scotia.
The letter went on to state:
Accordingly, it is no longer necessary for you to render a decision regarding the first issue which the parties addressed in argument before you on November 25, 2011.
[5] I commend counsel for their efforts which let to this partial agreement.
[6] I will deal with the three remaining issues identified by counsel. In order to do so I believe it is necessary to provide some background information to provide context for the decision I am about to give.
[7] When this matter began back in 2003, the plaintiff brought an action against his former employer, the Province of Nova Scotia, as well as the Trustees of the Nova Scotia Public Service Long Term Disability Plan Trust Fund (the “LTD Plan”). In his Statement of Claim, the plaintiff sought damages against the Province of Nova Scotia for unjust dismissal and breach of a duty of good faith and fairness. The particulars of the plaintiff’s claim were:
(A) Damages for lost earnings and benefits, including long term disability benefits and pension benefits, which the Plaintiff should have received had his employment been continued until the end of the period of reasonable notice of termination of his employment;
(B) Special damages for mitigation expenses in being rehabilitated and retrained for equivalent alternative employment and in searching for and obtaining equivalent alternative employment or in obtaining a trial period of employment as a plumber;
(C) Aggravated damages for breach of contract to provide security and peace of mind against long term disability by providing long term disability benefits;
(D) Prejudgment interest;
(E) Costs.
[8] As against the Trustees of the LTD Plan, the plaintiff sought:
(A) Special damages for loss of long term disability benefits from September 11, 2002 until date of trial;
(B) A declaration that the Plaintiff is and has been disabled within the meaning of the LTD Plan continuously from August 9, 1996 until date of trial;
(C) Prejudgment interest;
(D) Costs on a solicitor and his own client basis for breach of duty of utmost good faith;
(E) Punitive damages for the breach of the duty of utmost good faith.
[9] The plaintiff settled his claim against the Province of Nova Scotia and a Consent Order to that effect was issued on the 27th day of January, 2005.
[10] The plaintiff’s claim against the LTD Plan continued and culminated in the decision referred to earlier. During the course of the trial, the Court was asked to rule on a motion brought on behalf of the defendant to permit the introduction of certain letters and documents related to the negotiations and ultimate settlement reached between the plaintiff and the Province of Nova Scotia. Disclosure of these various documents had earlier been ordered by the Honourable Justice M. Heather Robertson following an application under Rule 20 of the Civil Procedure Rules (1972). The defendant was successful in its motion before me allowing these documents to be tendered at trial for the purpose of deciding whether a portion of the settlement paid by the Province should be construed as earnings. Sub-section 9(8) of the LTD Plan would permit the Trustees of the Plan to offset “earnings recovered through a legally enforceable cause of action against some other person or corporation.”
[11] Although my decision after trial might not have been as clear as it could have been, I ordered that a portion of the plaintiff’s settlement with the Province based on wrongful dismissal should be attributed to earnings. The figure I used equated to 13.66 months of wage loss. As such the defendant was entitled to offset the equivalent amount of LTD benefits from the amount owed to the plaintiff for the period of his loss.
[12] As for the plaintiff’s claim for loss of so-called Section 8 benefits under the LTD Plan, namely employer superannuation contributions, employer payment of health plan premiums and employer payment of life insurance premiums, these clearly were the responsibility of the employer. The LTD Plan was never contractually bound to pay these. The LTD Plan document is clear on this point. This should have been known to the plaintiff at the time he settled his claim against his former employer.
[13] A portion of the amount paid to the plaintiff by the Province would have included reimbursement for his loss of Section 8 benefits. To now order the LTD Plan to reimburse the plaintiff for premiums and benefits that were never their responsibility in the first place is not warranted and cannot be supported in law. The LTD Plan is only liable for the payment of LTD wage-loss benefits less the offset for the equivalent period of income and benefits paid to the plaintiff by the Province under their settlement agreement. The plaintiff cannot seek to recover Section 8 benefits from the LTD Plan when he should have known that this would have been included in the settlement reached with the Province. Certainly, the defendant had no control over these negotiations as it was not a party to them. Indeed, the plaintiff tried to prevent the defendant from gaining any knowledge of the settlement terms by resisting their disclosure. Had the Court not ordered their disclosure and permitted their introduction at trial, the plaintiff would have received payment for damages for lost wages from his former employer while still receiving long term wage loss disability benefits. This would have been unfair to the defendant and would have amounted to a windfall for the plaintiff. As such it is not necessary for the Court to order a further assessment to determine damages for any alleged loss of Section 8 benefits. That issue is for the plaintiff and his former employer to thrash out, if it has not already been dealt with. I will leave that to the plaintiff and his counsel to contemplate. This then disposes of issues two and three. I will proceed to decide the fourth issue related to costs at trial.
Costs
[14] The issue of costs arising from the trial also could not be agreed upon by the parties. As this action was commenced in 2003, the 1972 Rules apply.
[15] The plaintiff submits that the amount involved should not only include the amount of wage-loss benefits owing but also the amount he stands to collect after judgment to age 65. One would have to conclude that the plaintiff would not only live to age 65 but that he would also remain totally disabled throughout that period. To his credit, the plaintiff suggests that the Court would have to use a present value method to determine the current day value of future benefits. He also suggests that the value of Section 8 benefits (which I have already decided to deny) should be factored in. The figure of $45,566.85 for past loss benefits without valuing the future losses of superannuation benefits (which would require actuarial evidence to assess) should be added according to counsel.
[16] Counsel for the plaintiff further argued that due to the complexity of the matter, the importance of the issues to the parties, and the actual legal expenses incurred by the plaintiff (which to the date of the last court appearance exceeded $268,400.00 in fees (excluding taxes) and $26,990.33 in disbursements), the court should order the following:
1. Contribution to legal fees:................................................. $ 178,995.00
2. Disbursements:............................................................... $ 26,990.33
3. Costs of Stay Application:................................................ $ 2,000.00
(previously ordered by Murphy, J.)
Total:............................................................................. $ 207,985.33
[17] Counsel for the defendant disagrees with the plaintiff’s suggestion that the present day value of potential future disability benefits should be included in the calculation of the “amount involved” for the purpose of determining the appropriate cost award under the old Tariff structure. He also challenges the plaintiff counsel’s assertion that this was a particularly complex case. He does acknowledge that the plaintiff is entitled to $2,000.00 awarded by Justice John D. Murphy over and above any amount the Court decides to order. He suggests that an appropriate amount would be $25,000.00 with disbursements to be taxed.
[18] After considering the submissions of counsel, both written and oral, I have decided that this is an appropriate case in which to order a lump sum award of $60,000.00 plus $2,000.00 (Murphy, J.’s order) with disbursements to be taxed. If the parties can agree on an amount for disbursements then the requirement for taxation might be avoided. If not, I am prepared to perform this function myself and I would ask for proof of disbursements by the plaintiff within 14 days of the date of release of this decision after which defendant’s counsel will have 14 days to challenge them.
[19] I will leave it to counsel to prepare an order reflecting my decision.
McDougall, J.