An Insurance Law Update
On Thursday, June 21st, 2007 the Supreme Court of Canada issued a one line decision refusing leave to appeal the decisions of the Northwest Territories and Nunavut Courts of Appeal in the cases of Blake Estate v. Waechter et al; Tilson Estate v. Summit Air Charters; and Daniska Estate v. Caron. All of these cases involved claims by the estates of deceased persons for damages equivalent to the net present value of future earnings of the deceased, pursuant to s. 31 of the N.W.T. and Nunavut Trustee Acts.
Readers may recall the Duncan Estate v. Baddeley debate that raged in Alberta in the mid-1990's, where the Alberta Court of Appeal ultimately found that s. 5 of the Alberta Survival of Actions Act allowed for an estate claim for the present value of future lost earnings of a deceased under the heading of "actual financial loss" suffered by the deceased. This became known as a "lost years" claim. This decision flew in the face of the traditional common law view that a claim for lost earnings "died" with the victim. Eventually in November of 2000 the Alberta legislature stepped in to amend the Survival of Actions Act to expressly disallow such a claim. Legislatures and provincial Courts of Appeal followed suit across Canada to a point where an estate claim for "lost years" was simply not available.
Except in the Northwest Territories and Nunavut, where the decades-old Trustee Act continued to allow claims by an estate for "... all torts or injuries to the person... in the same manner and with the same rights and remedies as the deceased would if living have been entitled to do." The NWT Chambers Judge hearing the matter on a Stated Case found that the lost years claim was purely an estate claim, and not one the deceased was entitled to while living. Accordingly, while the estate could maintain a claim on behalf of dependents of the deceased (pursuant to the NWT Fatal Accidents Act) there was no claim for the "lost years". The NWT Court of Appeal disagreed, essentially finding that had the deceased lived, she could have maintained a claim for future lost earnings and it was this claim that "vested" in the estate. As stated earlier, this position was contrary to virtually all other jurisdictions in Canada, other than Nunavut, where the Nunavut Court of Appeal upheld a similar claim under the identical legislation in that territory. (It is likely not a coincidence that both courts draw membership from the Alberta Court of Appeal.)
In refusing leave to appeal these decisions, the Supreme Court has sent two clear messages: first, this is not an issue of sufficient importance to attract the attention of our highest court; and second, if there is going to be a change, it will have to be through the legislatures, not the courts.
This alert is a general overview of the subject matter and cannot be regarded as legal advice. Please contact Don Dear or Dave Risling, or any other member of our Insurance Practice Group for further advice on this or any other insurance law topic.