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Morrow v. Zhang - The Cap is Back

On June 12, 2009, the Alberta Court of Appeal overturned the February 2008 decision of Justice N.C. Wittmann, which struck down the Minor Injury Regulation (A.R. 123/2004) on the basis that it breached s. 15 of the Canadian Charter of Rights and Freedoms, and could not be saved under s. 1. In doing so, the Court of Appeal has reinstated the $4,000 cap on general damages as it applies to “minor injuries” as that term is defined in the regulation. 

The essence of the decision of the Court of Appeal was that the insurance reform scheme which included the Minor Injury Regulation (MIR), the Diagnostic and Treatment Protocols Regulation (DTPR) and the Automobile Accident Insurance Benefit Regulation (AAIBR)(collectively the “Reforms”) did make a distinction on the basis of an enumerated ground (ie. disability), it was not discriminatory. The error that the trial judge made, according to the Court of Appeal, was in assessing the MIR alone, rather than in its context as part of a reform package. While the MIR taken alone may seem to perpetuate a negative stereotype that strains, sprains and WAD injuries are not real or not deserving of consideration, the DTPR specifically demonstrated an acknowledgement of the reality of such injuries, and their need for individualized assessment and treatment. As a result, when the reforms were considered as a whole, as the Court found they must be, there was no discriminatory effect.

The Court of Appeal did agree with Justice Wittmann in his reasoning on the first two steps of any s. 15 analysis:

  • The appropriate comparator groups were soft tissue injuries sustained in motor vehicle accidents as compared to other types of motor vehicle injuries; 
  • The distinction was drawn based upon a ground specifically enumerated in s. 15 of the Charter: disability.

The Court of Appeal’s criticism of the trial judge’s analysis arose when it considered the final step, the determination of whether the differential treatment discriminates in a substantive sense, bringing into play the ills of prejudice, stereotyping and historical disadvantage. This step requires the consideration of five contextual factors:

  • the existence of a pre-existing disadvantage or stereotype; 
  • whether the legislation perpetuated the stereotype; 
  • the correspondence between the ground claimed and the needs, capacities and the circumstances of the claimants; 
  • the ameliorative purposes and effects of the legislation; and 
  • the nature of the interest affected.

The Court deferred to Justice Wittmann’s finding that minor injury victims were subjected to stereotyping and prejudice, and that the legislation had no valid ameliorative effect because young drivers and seniors were not more disadvantaged than minor injury claimants. However, they found that when one considered the whole of the Reforms (as opposed to just the MIR), the balance of the factors suggested that there had been no discriminatory effect:

  • The DTPR promoted and assisted treatment of minor injured, which recognized the reality of the injuries, and provided for an individualized assessment, which is the antithesis of the stereotype. 
  • The Reforms had a number of purposed borne from legitimate concern with the affordability of insurance, the potential increase in uninsured drivers, and the failure of those with soft tissue injuries to access treatment. The Reforms met these goals; 
  • While the interest is important in an economic sense to minor injury sufferers, it is not fundamental in the broader sense. It is not a societal or constitutional fundamental interest.

The Court of Appeal agreed with the trial judge that there had been no s.7 (life, liberty and security of the person) violation. The Reforms imposed a potential financial penalty for failure to follow the treatment protocol laid out in the DTPR. However, it left the claimants the ability to choose to pursue their own treatments outside the DTPR. It neither coerced a certain treatment, nor did it restrict a health care provider’s discretion.