Research & Publications

Damages: Estimating Pecuniary Loss

By Cara L. Brown

This publication is distributed by Canada Law Book. Orders will be accepted directly through the publisher, Canada Law Book, or at 1-800-565-6967.

"This looks like a marvelous piece of work. I haven't seen anything comparable to your book, and I always had to search around for examples and isolated references for this kind of material."

Dr. Ken Cooper-Stephenson, University of Saskatchewan

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Table Of Contents

• Chapter 1: Establishing Earning Capacity in Civil Litigation Cases
• Chapter 2: Augmenting the Base Salary for Fringe Benefits
• Chapter 3: How to forecast growth of earnings
• Chapter 4: Projecting working life expectancy
• Chapter 5: Estimating the impact of disability
• Chapter 6: Treatment of the self-employed from an economic perspective
• Chapter 7: Wrongful death cases
• Chapter 8: Discounting lump sum awards
• Chapter 9: Valuation of housekeeping capacity
• Chapter 10: Valuation of costs of care
• Chapter 11: Calculating Damages in Wrongful Dismissal, Wrongful Confinement, Wrongful Imprisonment, Sexual Assault and Sexual Harassment Cases
• Chapter 12: Costs of Raising Children and the Federal Child Support Guidelines
• Chapter 13: Economic Advantage and Disadvantage Assessments in Martial Breakdown
• Chapter 14: Use of Economic Experts in No-Fault and Fault Jurisdictions
• Chapter 15: Expert witnesses

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December 2011 Release

The 2011 update concentrates on:

• Updated case law (5 new cases) on including EI benefits as part of without-incident potential employment income [chapter 1]
• Prevalence of benefits and updated pension contributions are updated in Table 2-10, plus compensable contingency updates [chapter 2]
• Historical analysis of productivity rates from Canadian Institute of Actuaries’ Report on Economic Statistics, 1924 – 2010 and forecasts of the productivity rate from the 2009 actuarial report of the Canada Pension Plan [chapter 3]
• Update of data for the disability contingency using 2009 Canada Pension Plan actuarial report [chapter 4]
• Updates on rates for participation; unemployment; part-time work; and hours of work [chapter 4]
• Updates on duration of unemployment, by gender and province [chapter 4]
• New data from the 2006 Participation and Activity Limitation Survey (“PALS”) and estimated wage gaps based on mild, moderate, severe or very severe disabilities [chapter 5]
• 2006 PALS wage gaps by gender, compared to 2001 PALS wage gaps, along with comparisons of 2006 & 2001 PALS surveys [chapter 5]
• Comment on award for lost income due to delay in education: Brodie v. Canada (Attorney General), 2010 [chapter 5]
• Percentage of self-employed updated by class of worker & gender [chapter 6]
• Various comments on how to construct PCRs, including the use of before-tax income; why family budgets are not used; how economies of scale are incorporated; how PCRs vary by family size & income level [chapter 7]
• PCRs calculated from 2007 & 2008 Surveys of Household Spending – update of 2000 PCRs [chapter 7]
• Revised mandated discount rates across Canada [Table 8-2]
• Comment on a different interpretation of rule 53.09(1) for Ontario’s real discount rate, along with Slaght & Greenlagh cases [chapter 8]
• Analysis of historical rates from Canadian Institute of Actuaries’ Report on Economic Statistics, 1924 – 2010 [chapter 8]
• New forecasts of real rates of return from the major chartered banks in Canada and the Department of Finance [chapter 8]
• New forecasts of interest rates from Towers Watson’s 30th Annual Canadian Survey of Economic Expectations & Policy and Economic Analysis Program (“PEAP”)’s Long-term National Outlook to 2040 [chapter 8]
• New data on time use for housekeeping loss assessments from Statistics Canada’s 2010 General Social Survey [chapter 9]
• New time use data for American residents, from “Dollar Value of a Day” 2009 [chapter 9]
• Estimates of unpaid work spent on housework and childcare from Statistics Canada’s 2001 and 2006 Censuses [chapter 9]
• Participation rates for seniors on heavy tasks; and the percentage of seniors who need help with housework [chapter 9]
• Composition of household tasks for Canadian households [Figure 9-6]
• New hourly rates for housekeeping losses, by province [Table 9-8]
• New hourly rates for housekeeping losses, Canada-wide average, from 1991 to 2011 [Table 9-9]
• New case law on cost of care awards, by type of injury (brain injury, paraplegic, quadriplegic) [chapter 10]

December 2010 Release

The 2010 update concentrates on:

• updating sources of salary surveys and government sources (chapter 1 appendices);
• decision from Palmquist v. Ziegler about not deducting CPP survivorship benefits in fatality cases (chapter 1);
• update on the distribution of educational attainment in Canada, males & females, 1981 to 2006 (Table 1-4, chapter 1);
• comment on valuing replacement costs for provincial health care premiums as fringe benefits (chapter 2);
• case law on accepting the productivity increase by industry sector (chapter 3);
• discussion on including "promotional" increases as per Waddams' The Law of Damages (chapter 3);
• updates on rates for participation; unemployment; part-time work; and hours of work (chapter 4);
• updates on duration of unemployment (chapter 4);
• preliminary findings from the 2006 PALS, on type and severity of disability, and labour force activity and median employment income, by gender and province (chapter 5);
• new divorce rates from Statistics Canada 2005 data - contingency in fatality cases (chapter 7);
• tax gross-up: case law discussion on management fees and legal fees; subrogation; and assumption as to form of investment income (exclude equities) (chapter 7);
• statistics about RRSP contributions when calculating net income and tax gross-up (chapter 7);
• new discount rate & inflation rate forecasts (chapter 8);
• time use data comparing trends by gender, 1986 to 2005;
• update of housekeeping rates for each province and territory to 2010, and historically back to 1991 (Tables 9-8, 9-9);
• new case law on cost of care awards, by type of injury (brain injury, paraplegic, quadriplegic) (chapter 10);
• update on outcome of Morrow v. Zhang (Alberta minor injury definition) (chapter 14).

December 2009 Release

The 2009 update concentrates on:

• wealth of sources to research wages from government internet sites and unions (appendices 1-1 and 1-2);
• discussion on taxability of income, and taxability of lump sum awards as per CRA Income Tax Bulletin IT-365R2 (chapter 1);
• more information on the source of wage inflation used from date of loss to date of trial (chapter 1);
• new data on fringe benefits, by industry sector, obtained from Watson Wyatt (chapter 2);
• comments on the undervaluation of fringe benefits (chapter 2);
• research on historical 'productivity' rates from the Canadian Institute of Actuaries (chapter 3);
• new productivity forecasts, by industry sector, from Informetrica (chapter 3, Table 3-8);
• updates on working life expectancy, related to life expectancy; participation; unemployment; part-time work, and hours of work (chapter 4);
• updates on case law related to the HALS/PALS approach (chapter 5);
• new data on self-employment trends (chapter 6);
• case law review on housekeeping, summarizing awards from recent cases, including the landmark decision from Ontario, McIntyre v. Docherty (chapter 9);
• update of housekeeping rates for each province and territory to 2009, and historically back to 1991 (Tables 9-8, 9-9 and appendix 9-2);
• new demonstrations of the online Housekeeping Damages Calculator (chapter 9);
• new case law on cost of care awards, by type of injury (chapter 10);
• case law on fringe benefits, retirement age and use of wage inflation data (chapters 1, 2 and 4);
• summary of personal injury litigation by province, comparing injury caps, gross v. net wage loss, subrogation (chapter 14).

November 2008 Release

The 2008 update concentrates on:

• new data on unemployment, non-participation & part-time rates (chapter 4);
• new case law on brain injured plaintiffs (chapter 5); self-employed plaintiffs (chapter 6); housekeeping awards (chapter 9); and cost of care awards, by type of injury (chapter 10)
• update of housekeeping rates for each province and territory to 2008, and historically back to 1991 (Tables 9-8, 9-9 and appendix 9-2);
• evidence of rising health care costs in relation to the application of a productivity rate in cost of care calculations (chapter 10)
• economic impact of sexual assault (using Canadian GSS cycle 18 data from 2004) - review of all 3 GSS cycles from 1993, 1999 and 2004 and summary of economic impact (chapter 11)

November 2007 Release

The 2007 update concentrates on:

• comparison of wage changes for various sectors, including unionized ones (chapter 3);
• new "disability contingencies" using 2006 CPP actuarial data to affect working life expectancy (chapter 4);
• new interest rate & inflation rate forecasts (chapters 3 & 8);
• new data on unemployment, non-participation & part-time rates (chapter 4);
• retirement by sector and for self-employed, by gender (chapter 4);
• new case law on brain injured plaintiffs (chapter 5);
• update of housekeeping rates for each province and territory to 2007 (Table 9-8 and appendix 9-2);
• new case law for cost of care awards, by type of injury (chapter 10)

December 2006 Release

The 2006 update concentrates on:

• new data from Statistics Canada's 2002 General Social Survey (cycle 16) on retirement ages
• new data on retirement & the baby boomer generation, and fringe benefits from Statistics Canada's The Canadian Labour Market at a Glance 2005
• new rates for participation, part-time work, hours worked per week, weeks worked per year, duration of unemployment - by age, gender, education level, province, occupation group
• new unionization rates & comparison of wage changes to major wage settlements
• new forecasts for productivity factors
• new forecasts for unemployment rates
• historical interest rates revised, new forecasts of real discount rates & real return bonds (RRBs)
• revised inflation rate forecasts (Consumer Price index)
• new case law on brain injury plaintiffs, self-employed, cost of care awards
• new housekeeping hourly rates by province & territory - updated to 2006

November 2005 Release

The 2005 update concentrates on:

• New results on wage gaps from the 2001 PALS (Participation & activity limitation survey) - published nowhere else! Revolutionary yet simple method for deriving wage loss estimates (chapter 5)
• PCR (dependency) rates by family size and income level - first time in Canada! Endorsed by Lutz, J. in Fullowka et al v. Royal Oak Ventures et al - Giant Mine explosion case (chapter 7)
• Data and contingencies ideal for using in the income damages calculator at www.browneconomic.com > economic calculators > income damages calculator
• New results on wage gaps due to sexual assault from the 1999 Statistics Canada data - update from 1993 results! (chapter 11)
• Chart of cases on awards for loss of care, guidance and companionship for the past 20 years (chapter 7)
• New housekeeping hourly rates by province & territory - updated to 2005 (chapter 9)
• Revised chapter on economic loss methodologies across Canada - including no-fault regimes and after-tax regimes (chapter 14)
• New productivity & interest rate & inflation rate forecasts (chapters 3 & 8)
• New data on unemployment, non-participation & part-time rates - negative labour market contingencies (chapter 4)
• New! research underlying Canadian spousal support guidelines (chapter 13)

December 2004 release

The 2004 update concentrates on:

• Alberta's Bill 53 changes: "net" income loss calculations & deduction of collateral benefits as of Jan. 26, 2004; implications for self-employed & tax gross-ups (chapter 15)
• comparison of fault & no-fault jurisdictional economic loss calculations (Alberta, BC, Ontario, New Brunswick)- chapter 15
• Mohan economic expert report guidelines - to comply with Daubert-type voir dire hearings evaluating expert testimony in Canada (chapter 15)
• impact of disfigurement on earnings (chapter 5)
• new "disability contingencies" using CPP actuarial data to affect working life expectancy (chapter 4)
• new productivity & interest rate & inflation rate forecasts (chapters 3 & 8)
• new data on unemployment, non-participation & part-time rates (chapter 4)
• new housekeeping replacement rates across Canada (chapter 9)
• new case law on loss of fringe benefits (sick leave pay), mitigation, self-employed persons, "joint" dependency rate, spousal support, wrongful dismissal and sexual assault

Novmeber 2003 release

The 2003 update concentrates on:

• new data on fringe benefits in chapter 2
• revolutionary working life expectancy tables in chapter 4
• demonstration of on-line internet working life/ life expectancy calculator
• new cases in chapter 5 for "loss of marriage benefit"
 
• a revamp of chapter 7 for personal consumption rates (PCRs) using Canadian data, varying by income level- significant ramifications for dependency losses
• distinction of income sources required in personal injury vis-à-vis fatality cases in chapter 7
• housekeeping awards in fatality cases across Canada, 1990-2003 (appendix in chapter 7)
• updates on interest rate forecasts and discount rate to use in provinces without mandated rates in chapter 8
• new housekeeping rates, by province in chapter 9
• additional cases on sexual abuse damages in chapter 11

Click here to see a detailed list of updates.

October 2002 Release

Case law updated in 14 of 15 chapters

• MacCabe Court of Appeal decision - impact on projecting earnings for females (chapter 1)
• New case law affecting minors & young adults (chapter 1)
• New productivity forecasts, industry-specific productivity forecasts, & explanation of productivity factors, inter-provincial differences in wages and industry-sector productivity forecasts as of 2002 (chapter 3)
• New heads of damage: "loss of insurability"; loss of income for survivor after fatality of spouse ("Maccartney & Ruiz damages")
• Advances in computation of remarriage and divorce contingencies (chapter 7)
• Revised real discount rate assumption (3.50%) & long-term economic forecasts for the Canadian economy (chapter 8)
• New section on "investment" or "management" fees in cost of care and fatality claims (chapters 7 & 8)
• New life expectancy estimates as of 1997 and 1999 for Canada, provinces, and other countries (chapter 4)
• Discussion on the CPI as a measure of inflation, and the concept of "core inflation" (chapter 8)
• Valuable services award trends in Canada, 1990-2001, from 1300+ cases (chapter 9)
• Housekeeping internet tool section (chapter 9)
• New case citations on courts' evaluation of expert quantum evidence (chapter 15)
• Cost of raising children- 2 new Alberta decisions (chapter 12)
• New approaches to economic disadvantage in marital breakdown (chapter 13)
• New approaches in Family Relief Act claims (chapter 13)
• New data on 'special and extraordinary expenses' under sec. 7 of the federal child support guidelines (chaper 12)
• Additional findings on pension plan coverage in Canada (chapter 2)
• New data on amount & duration of spousal support awards (chapter 13)
• Section on economists & actuaries as expert witnesses (chapter 15)
• Particularities of Saskatchewan's Automobile Accident Insurance Act for no-fault claims (chapter 15)

July 2001 release

This text merges Canadian case law principles and guidance with forensic economic data available to understand the impact of an interruption on an earnings stream, both for individuals and for families, and for wage earners and the self-employed, in the context of civil litigation. Other heads of damage are explored (loss of valuable services/housekeeping, future cost of care, tax gross-up) and damages arising from unique circumstances are addressed (wrongful death, sexual harassment, sexual assault, wrongful imprisonment, wrongful confinement, marriage breakdown). The role of expert evidence in Canada's civil litigation field is discussed, drawing on the author's 100+ testimonies in courts across Canada and the US. The text is updated annually for changes and advances in case law and economic data and methodologies.