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Are You Forgetting Something?

Four Common Oversights in Personal Injury Cases

Have you considered making a claim for loss of capacity to do household work, both for work done now or later in life? Have you considered the possiblity of work beyond age 65?
A good number, if not the majority, of future care assessments we see in our practice include a provision for assistance with regular and/or seasonal household work. In many personal injury cases, a claim is made for loss of earning capacity but a future care assessment is not requested. In those cases, the injured person's inability to do household work, or to do the same amount of household work as before becoming injured, often falls by the wayside. The question of age at retirement remains a hot topic of discussion, driven in large part by two factors: (a) the recognition that an entire generation of baby boomers is about to leave the work force, and (b) the recognition that many people may not have sufficient financial resources to retire. In many cases, work beyond age 65 should be considered as a distinct possibility.
The present value of unindexed payments should not be determined using a wage loss multiplier.
It is much more accurate to calculate past losses of incomes, net of income taxes and Employment Insurance premiums using a year–by–year approach than the approach applied in Rintoul v. Gabriele.
This is relevant in situation where wage replacement payments will continue to the injured person's age 65 and are to be deducted from an award or negotiated settlement for lost earning capacity. We have recently become aware that it is common practice to use wage loss multipliers which are based on an annual discount rate of 2.5% per annum. Strictly speaking, this discount rate applies to amounts that change with wage inflation. If ongoing wage replacement payments are not indexed to wage inflation — and we understand that they may not be indexed at all — a much higher discount rate should be applied. The effect of this is to decrease the amount that is to be deducted from the award. In many instances, the latter approach either significantly overstates or understates the total past loss of income following these two payroll deductions.