Harris.Tort

Some countries, such as the U.S. and Australia, have made headway on reforming tort systems that many perceive to be unfair, costly and inefficient. Joint and several liability, compensatory damages, collateral sources and vicarious liability have specifically been targeted for change in Canada.

Has the time come for amendments to Canada's legal rules?   Forum

Pop Quiz

What are non-pecuniary damages?

BattleTable

Based on past exams, the main things you need to know (in rough order of importance) are:

• definition of joint & several liability
• proposed reform of joint & several liability [Hint: ERF]
• identify reforms to the Canadian tort system [Hint: JCCV]
• ads/disads: of the various proposed reforms

Even though this paper is tested fairly frequently, there are just few facts to memorize. Some of the questions are straightforward memorization, and some require a little more analysis and interpretation. Overall, this is one the best papers for quick & easy points.

Top Questions ← Questions you absolutely need to know!

Questions held out from Fall 2019 exam: #8. (Skip these now to have a fresh exam to practice on later. For links to these questions, see Exam Summaries.)

reference	part (a)	part (b)	part (c)	part (d)
E (2019.Spring #7)	definitions: - tort principles 1	identify reforms: - Canadian tort system
E (2017.Fall #6)	definition: - joint & several liability	ads/disads: - joint & several liability
E (2017.Spring #6)	definition: - joint & several liability	ads/disads: (b) & (c) - joint & several liability	definition: (d) - proportionate liability	J&S miscellaneous (e) & (g) outdated: (f)
E (2016.Fall #7)	SCENARIO: - damages & tort reform	SCENARIO: - damages & tort reform	SCENARIO: - damages & tort reform	SCENARIO: - damages & tort reform
E (2016.Spring #7)	J&S: - impacted group	proposed reform: - joint & several liability	proposed reform: - joint & several liability	proposed reform: - joint & several liability
E (2015.Fall #5)	tort laws: - too plaintiff-friendly	identify reforms: - Canadian tort system
E (2015.Spring #10)	definition: - joint & several liability	J&S: - different points-of-view	proposed reform: - joint & several liability
E (2014.Fall #8)	identify reforms: - to stabilize costs	ads/disads: - of reforms
E (2013.Fall #5)	identify reforms: - Canadian tort system
E (2012.Fall #12)	definition: - joint & several liability	J&S: - increases efficiency	proposed reform: - joint & several liability

¹ The part of this question about pre-judgment interest is from CAS.ATRA. Note that ATRA stands for American Tort Reform Association and that CAS.ATRA is a U.S.-centric reading on tort reforms in the U.S.

In Plain English!

Intro

You can learn this reading in under an hour. Yay! :-)

The overall goal of tort reform is to...

...achieve stability & predictability in the tort system and to balance fairness between plaintiff & defendant

These reforms must be done at the provincial level, rather than the federal level, because the reforms need to be coordinated with the provincial attorneys general. The insurance industry wants reforms because they think it will lower costs. However, trial lawyers do not want reform because they fear it will lower compensation, both for them and for plaintiffs. The Supreme Court has said they will continue to be plaintiff-friendly until reform is enacted. (They Supreme Court wants to stay on our good side!)

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Definitions & Proposed Tort Reforms

We'll need a few basic terms before discussing the proposed reforms:

joint & several liability: plaintiff may recover (ANY or ALL damages) from (ANY or ALL defendants) regardless of share of liability

• If you think about what this means, it seems very unfair. If you were a defendant and were only 5% liable, but the other defendants had gone bankrupt, you may have to pay 100% of the damages yourself. This situation sometimes arises with asbestos claims. Asbestos claims may occur decades after the manufacture of the asbestos-containing product and the manufacturer may no longer exist. It would then fall on the 'peripheral defendants' to settle the claims.

→ this rule is plaintiff-friendly (it favours compensation of the plaintiff over fairness to the defendant)

• proposed reform: [Hint: ERF] Eliminate joint & several liability (for non-pecuniary damages), Replace with a system of proportionate liability, create a Fund to be used for guilty parties who can't pay

collateral source rule: evidence of plaintiff's collateral source of compensation need not be entered at trial

• An example of a collateral source may be disability compensation. With the collateral source rule, the plaintiff could be compensated twice: once from their disability pay, then again from court-awarded damages. This is because the court would not be aware of the existing compensation. That isn't fair. Plus, it violates the principle of indemnity). Recall that the principle of indemnity states that after a covered event, the insured should be returned to their former financial position, with neither penalty nor reward.

→ this rule is plaintiff-friendly (there is potential for over-compensation of the plaintiff)

• proposed reform: eliminate the collateral source rule (and allow collateral sources to be taken into account when determining award)

compensation basis: refers to the base value for income replacement (can be gross income or net after-tax income)

• The level of income replacement is usually based on a percentage of the claimant's income prior to injury. Obviously, the amount would be higher if based on a percentage of gross income versus net income. Often a person's expenses are lower if they aren't working, due to savings on transportation and work clothing, for example.

→ this rule is plaintiff-friendly if the compensation basis is gross income (because compensation is potentially higher)

• proposed reform: change the basis of compensation from gross income to net income

vicarious liability: where one person is held responsible for the actions of another

• Vicarious liability may occur between and an employer and an employee. For example, if one employee engages in sexual harassment of another employee, the employer may be held responsible for some portion of the ensuing liability. For this example, the concept of vicarious liability seems reasonable because the employer likely has a degree of control over the workplace environment. Another example of vicarious liability is a car rental agreement, where the rental company would be liable for actions for the person who rented the car. In this case, vicarious liability doesn't seem fair because the rental company wouldn't normally have control over the actions of the renter.

→ this rule is plaintiff-friendly (because the employer, or car rental agency, likely has deeper pockets than the employee, or the person who rents the car)

• proposed reform: eliminate vicarious liability (makes sense for the car rental example, but not for the employer/employee example?)

Summary of Proposed Reforms

Let's summarize the proposed reforms using the memory trick: JCCV:

Joint & several liability (eliminate & replace with proportional liability)

Collateral source rule (eliminate)

Compensation basis (change from gross to net)

Vicarious liability (eliminate)

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Advantages & Disadvantages of Reforms

Each reform has both good and bad points:

J Reform of joint & several liability:

advantage: discourages search for deep pockets

disadvantage: increased cost of determining proportionate liability

C Reform of collateral source rule:

advantage: reduces likelihood of over-compensation

disadvantage: the guilty party shouldn't be relieved (by any collateral sources) of providing full compensation

C Reform of compensation basis:

advantage: reduces likelihood of over-compensation

disadvantage: interferes with an intentional government tax break for plaintiff (using gross or pre-tax income as the basis for income replacement amounts to a tax break, and this tax break is sometimes intentional)

V Reform of vicarious liability:

advantage: discourages search for deep pockets

disadvantage: all involved parties should be held responsible regardless of level of liability

Note that J & V have the same advantage, discourages search for deep pockets. This means that the plaintiff can't simply go on a fishing expedition for a defendant they know has lots of money. (This is called Deep Pocket Syndrome. Also note that C & C have the same advantage, reduces likelihood of over-compensation. This type of over-compensation may potentially violate the principle of indemnity as discussed above and in Baer.Intro.

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Miscellaneous Exam Problems

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BattleCodes

Memorize:

• JCCV
• For each of the 4 reforms: defn / proposal / advantages & disadvantages
• a few miscellaneous facts from the BattleCards

Conceptual:

• How does this reading (by Harris) relate to Davidson's reading on non-pecuniary damages Dav.NonPec?
• How are tort reforms viewed by different stakeholders? (defendants, plaintiffs, insurers, lawyers)

Calculational:

• None

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  Forum

POP QUIZ ANSWERS

• Non-pecuniary damages are damages that are not readily quantified or valued in money, such as proposed compensation for pain and suffering. (NOT the same as punitive damages.)
• This reading is closely related to Davidson reading on non-pecuniary damages. That's the reading that discusses the famous Trilogy decision and cap on non-pecuniary damages.