Family Compensation Act- Damages For Wrongful Death

Valencia-Paiaciao v KCP Heavy Industries Ltd. 2022 BCSC 1171 provided a good review of the law in British Columbia relating to claims under the Family Compensation Act for damages for wrongful death.

In British Columbia the Family Compensation Act creates a statutory basis for the deceased’s surviving dependents, including a spouse, parents, and children, to recover damages against a person who wrongfully caused the death.

At common law there is no action for wrongful death: Panghali v. Panghali, 2014 BCSC 647 at para. 27 [Panghali]

Section 2 of the Act states:

2. If the death of a person is caused by wrongful act, neglect or default, and the act, neglect or default is such as would, if death had not resulted, have entitled the party injured to maintain an action and recover damages for it, any person, partnership or corporation which would have been liable if death had not resulted is liable in an action for damages, despite the death of the person injured, and although the death has been caused under circumstances that amount in law to an indictable offence.

The Act provides that the action may be commenced by the deceased’s personal representative for the benefit of the deceased’s spouse, parent or child (s. 3(1)). The court may award “damages proportioned to the injury resulting from the death to the parties respectively for whose benefit the action has been brought” (s. 3(2)).

Damages may also be awarded for “any medical or hospital expenses which would have been recoverable as damages by the person injured if death had not ensued” and for “reasonable expenses of the funeral and the disposal of the remains of the deceased person” (s. 3(9)).

The purpose of the Act is to place claimants in the economic position they would have occupied but for the wrongful death: Keizer v. Hanna and Buch [1978] 2 S.C.R. 342 at p. 351 [Keizer].

The appellant is entitled to an award of such amount as will assure her the comforts and station in life which she would have enjoyed but for the untimely death of her husband.
[28] Claimants may recover pecuniary benefits they would otherwise have derived from their relationship with deceased but not non-pecuniary losses: Ruiz v. Bouaziz, 2001 BCCA 207 at para. 46. Recoverable losses may include the actual financial benefit of which the claimant has been deprived, and the financial benefit which might reasonably be expected to accrue in the future if death had not occurred: Panghali at para. 29.

 

Loss of Financial Support

Legal Principles

[30] An award for loss of financial support (or loss of dependency) is meant to reflect the portion of the deceased’s earnings that would have continued to provide financial support to the claimant: Panghali, at para. 40. In general, the amount is calculated by assessing what income the deceased would have earned but for the death and then reducing that amount to account for the deceased’s personal consumption: Panghali, para. 40. Values for future losses are to be discounted to reflect present values.

Since, in life, the deceased would have drawn on their after-tax income to support others, the assessment under this head of damages is net of income tax and must therefore be grossed up to account for effects of income tax: Mazloom v. Central Mountain Air Services Ltd., 1992 CanLII 1611 (B.C.C.A.).

Where the claimant is a child, additional considerations apply. First, the award is limited to the period in which the child would have remained dependent on the parent for financial support: Panghali, at para. 43. Second, the analysis must consider two categories of family expenses: those devoted exclusively to the children, and those which “constituted the lifestyle of the children as part of the family”: Ratansi v. Abery, 1994 CanLII 1529 (B.C.S.C.).

The latter are indivisible family expenses from which the child benefits.

While financial support most commonly flows down from parent to child, or horizontally between spouses, it can also flow upwards from child to parent. Where evidence exists to support such a claim, parents may advance claims for lost financial support from their child: Ayeras v. Front Runner Freight Ltd., 1998 CanLII 5455 at para. 18 (B.C.A.C.) [Ayeras].

In Keizer, Justice Dickson discussed the methodology for calculating loss of financial support. He said:

“An assessment must be neither punitive nor influenced by sentimentality. It is largely an exercise of business judgment. The question is whether a stated amount of capital will provide, during the period in question, having regard to contingencies tending to increase or decrease the award, a monthly sum at least equal to that which might reasonably have been expected during the continued life of the deceased.”

In Johnson v. Carter, 2007 BCSC 622, Justice Slade outlined the following “conventional approach” to determining an award for loss of future earning under the Act, based on Coger Estate v. Central Mountain Air Services Ltd., 1992 CanLII 1611 (B.C.C.A.) [Coger Estate]

1. A calculation is made of the income which has been lost up to the date of trial.
2. A calculation is made of the loss of future earnings.
3. A reduction is then made for personal consumption of the deceased.
4. Contingencies are reviewed to determine if a further reduction is required.

Coger Estate adds a fifth step, being to apply the tax gross up to the award. Counsel seek the opportunity to make further submissions on the appropriate tax gross-up after judgment. I give leave to do so.
Assessing loss of earning capacity is always an “inquiry into the unknowable”: Morrison v. Moore, 2009 BCSC 1656 at para. 30 [Morrison]. Courts are required to consider future hypothetical events, assessed on a standard of real and substantial possibilities and weighted “according to the percentage chance they would have happened or will happen.”: Rosvold v. Dunlop, 2001 BCCA 1 at para. 9

The task is even more challenging when the deceased is young and there is little in the way of a work history from which inferences might be drawn as to future events: Cox v. Fleming, 1995 CanLII 3127 (B.C.C.A.).

Loss of Guidance

Legal Principles

A claim for loss of guidance seeks to compensate a claimant, usually a child, for the loss of the pecuniary advantage they would have derived from the continuing guidance of the deceased had the deceased lived. It has been variously referred to as loss of “care, guidance and affection” (McVea v. B.(T.), 2002 BCSC 1407 [McVea]), “care, guidance, training and affection” (Plant v. Chadwick, 1986 CanLII 951 (B.C.C.A.)) “love and guidance” (Collins v. Savovich, 1996 CanLII 1080 (B.C.S.C.)); and “care, guidance, training and encouragement” (Coe Estate v. Tennant, 1988 CanLII 3165 (B.C.S.C.) [Coe Estate]). As counsel point out, “guidance” is the common element in all these. As with all damages under the Act, this must be assessed as, and limited to, a pecuniary loss: Roberts v. Morgan, 2019 BCSC 2313 at para. 34.

Loss of Household Services
Legal Principles

An award for loss of household services compensates claimants for the lost pecuniary benefit of household services provided to them in life by the deceased. The value of the award may be determined by the cost of hiring replacement services: McTavish v. MacGillivray et al., 2000 BCCA 164. There are two case-specific factual considerations: the level of services that the deceased would have provided and the chance that the claimant may replace those lost services with a new spouse: McVea at para. 63.

 

DAMAGES:

By way of summary, I award damages as follows:

Loss of financial support
Ms. Valencia-Palaciao $372,000
Juan Diego Gomez $78,000
Alicia Gomez $78,000
Noridia Obando Arena and Arbey Gomez Soto (Mr. Gomez’s parents) $60,000

Loss of guidance

Juan Diego Gomez $45,000
Alicia Gomez $45,000

Loss of inheritance

Ms. Valencia-Palaciao $20,000
Juan Diego Gomez $20,000
Alicia Gomez $20,000

Loss of household services

Ms. Valencia-Palaciao $50,000
Juan Diego Gomez $25,000
Alicia Gomez $25,000

Special Damages $36,643.45

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