Introduction
In Ferreira v Hopper (2024 ONSC 5385), the Ontario Superior Court of Justice found that Canada Emergency Response Benefit (“CERB”) and Canada Recovery Benefit (“CRB”) payments were deductible from a damages award in tort for past loss of income.
In this case the plaintiff sustained soft tissue injuries in a motor vehicle collision which prevented him from returning to work for an extended period. At trial, the jury awarded the plaintiff $100,000 in damages for past loss of income. However, while he was off work, Mr. Ferreira received $14,000 for CERB and $5,000 for CRB. To determine whether these pandemic-related benefits were “in respect of an incident,” and therefore deductible, the Court turned to section 267.8(1) of the Insurance Act. That section governs the deductibility of collateral benefits from awards for income loss or loss of earning capacity. While the Court ultimately held that these pandemic-related payments were deductible, this decision demonstrates the mutability of collateral benefits in tort law and the importance of the plaintiff’s evidence.
The facts
On October 24, 2017, Mr. Ferreira was involved in a motor vehicle collision and sustained soft tissue injuries to his neck, back, and lower back. As a result of these injuries, Mr. Ferreira testified that he was unable to work from the date of the accident, October 24, 2017, until September 2019, and again from November 2019 until May 2022. During this period, Mr. Ferreira also collected a total of $19,000 in CERB and CRB payments. The Court considered whether these payments, intended to address pandemic-related income loss, should be deducted from Mr. Ferreira’s award for income loss due to his collision-related injuries.
Plaintiff’s counsel argued that Mr. Ferreira’s CERB and CRB payments should not be deducted because they were not made “in respect of an accident.” The defendant argued that the purpose of CERB and CRB was paramount: because these programs shared the same purpose as the income loss award, they should be deducted.
The legal framework
Section 267.8(1)2 of the Insurance Act governs whether collateral benefits that were received or may in future be received should be deducted from tort damages for income loss or loss of earning capacity. To establish that a collateral benefit is deductible, the defendant must establish that Mr. Ferreira received CERB and CRB “(1) ‘for income loss or loss of earning capacity’; and (2) that they were ‘in respect of an incident’” (para 10).
The role of the plaintiff’s evidence
Mr. Ferreira’s evidence regarding the nature of his income loss was central to the Court’s decision. Mr. Ferreira maintained that his absence from work was due to the injuries he sustained during the motor vehicle collision. The issue of deductibility turned on whether the CERB and CRB payments could be understood to be “in respect of an incident.”
The Court’s decision
Ultimately, the Court found that the CERB and CRB payments were “in respect of an incident” and, therefore, deductible. Although the plaintiff’s evidence supported a finding that his absence from work was due to his collision-related injuries, he nonetheless received CERB and CRB payments. As stated by the Court (paras 28 – 29): “To be eligible for the CERB the Plaintiff must have experienced a reduction in hours or stopped working due to COVID-19 as opposed to any other reason, including disability caused by the motor vehicle accident. To continue to receive the CRB, he must represent that he did not quit his job or reduce his hours voluntarily on or after September 27, 2020, unless it was reasonable to do so, again due to COVID-19. In other words, to qualify and maintain eligibility for these benefits, the Plaintiff must have been otherwise able to work during the period for which benefits were available. At no point during trial did Mr. Ferreira concede that any portion of his absence from work was due to any reason other than his inability to work because of the car accident. Given his evidence at trial, he cannot now reframe his theory of income loss post-verdict to avoid deductions.”
Conclusion
Ferreira raises important questions about the relationship between tort law, statutory deductions, and the evolving nature of collateral benefits that replace income. The Court’s reliance on the plaintiff’s consistent evidence about the nature of his work absence framed the legal issue as one of the deductibility of government benefits, rather than a factual dispute about the cause of his income loss. While the Court found that the CERB and CRB payments were sufficiently tied to the plaintiff’s income loss, the Court acknowledged that these payments were not directly related to the motor vehicle collision. Accordingly, the Court expanded the scope of what constitutes a payment “in respect of the incident” within the meaning of section 267.8(1)2 of the Insurance Act.
Isabel Cox is an articling student at the firm and author of this blog. If you have a question about this decision or a similar file, please contact Isabel at [email protected].
