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Case Summary: Sunner v. Rana
Defence + Indemnity

In assessing the quantum for loss of future income earning capacity, negative contingencies must be supported by evidence.   

Sunner v. Rana, 2015 BCCA 406, per Chaisson, J.A. [4178]   


This is an appeal by the defendants from damages of $350,000 for future loss of income and $20,000 for cost of future care awarded to the respondent for injuries suffered in a 2008 motor vehicle accident. Due to his injuries, the respondent, then 32, was unable to continue working as a taxi driver or janitor. In 2011, the respondent and his brothers purchased a gas station in the US. The trial judge found the gas station was selling gas at a loss due to competition from a nearby First Nation. In assessing the respondent's loss of future income, the trial judge awarded him $100,000 for the negative contingency that the gas station business was at risk of failing. Neither the respondent nor his brother testified that they feared the business would fail. There was no expert evidence on the likelihood of the business succeeding or failing. In 2013, revenue to November 30 from fuel sales exceeded the cost of fuel by approximately $110,000. In the four years prior to the accident, the respondent's average income was $32,236. The average for the five years after the accident was $11,009.

II. HELD: Appeal allowed. The award of $100,000 for a negative contingency was set aside. The award for future loss of income was reduced to $200,000. The issue of the costs of future care was remitted to the trial court. 

1. Future loss of income and negative contingencies:

a. The cornerstone of the judge's concern was his understanding that the gas station was selling gas at a loss. This observation was based on the testimony of the respondent and his brother.

b. Although they recognized that any business has risk, neither the respondent nor his brother testified that they feared the business would fail.

c. The financial records of the business do not support either selling gas at below cost or the business failing because of the sale price of gas:

25   The judge's concern with the competition with the First Nations gas station may be understandable, but, in my view, on the available evidence, it cannot translate into a conclusion that there was a serious risk the respondent's business would fail and an award for a negative contingency…

d. Though the trial judge did not fully explain his reasoning for awarding $250,000 for future loss of income, the Court of Appeal explained:

30 … this Court must examine not only the reasons, but the record to determine whether the award is supported by the evidence: Shannon v. Shannon, 2011 BCCA 397 at paras. 9, 28. It also is important to note that the assessment of damages is not a mathematical exercise and that it should take into account negative and positive contingencies when it is appropriate to do so: Harlow v. Thompson, 1999 BCCA 271Íž Westbroek v. Brizuela, 2014 BCCA 48. 

e. The respondent testified that he worked three or four days per week in the gas station business. Subsequently, he could work full-­time managing a family business, although this likely would require him to upgrade his language and other skills. This might be considered to be a positive contingency. The trial judge did consider the potential for the respondent to continue full-time employment in the gas station business or in a management position.

39   The judge was entitled to reject the appellants' position that the respondent was entitled to only a modest amount for loss of earning capacity and to award a significant sum for that loss. In my view, the judge erred in not considering the evidence that the respondent could work full time and in not considering that the gas station business would succeed and provide the respondent with an income at least comparable with his pre-­accident income.
. . .

41   The judge was influenced by the negative contingency in awarding the appellant $250,000 for loss of earning capacity and did not consider the positive potential for the respondent to work full-time in the gas station business or in a management capacity despite his inability to work as a janitor or taxi driver. In my view, he erred on both counts.

42   While respecting the judge's award of significant damages for loss of future income, in my view, it must be reduced. I would reduce the award to $200,000.
. . .
56   There is no evidence to support the $100,000 awarded by the judge for the negative contingency that there is a high risk the business would fail. The basic $250,000 assessed by the judge as the present loss of future income, is infected with his concern that the business would fail and with his failure to consider the positive contingencies of full-­time employment, consistent with the expert evidence, and possible success of the business based on its financial records…

III. COMMENTARY: This case illustrates that negative contingencies must be supported by evidence. Further, it also illustrates that award for future loss of income must also consider positive contingencies.