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Foreseeability and Mitigation of Pecuniary Losses

It is alleged that I failed mitigate my business losses and that they were not foreseeable. What does this mean?

The recent case of Singh v. Soper (2016 BCSC 1748), involved a plaintiff who sought damages for lost business income arising not from his physical injuries, but rather as a result of losing an essential piece of equipment in a motor vehicle collision.  In this case the plaintiff was rear-ended by a fellow truck driver who admitted full liability for the collision. At the time of the collision the plaintiff was leasing the truck from a third party, who required the plaintiff to pay a $40,000 non-refundable deposit at the outset of the lease. Immediately following the collision, the truck was towed to a storage yard where it accumulated over $1,300 in storage charges as it awaited ICBC’s assessment for over two months. With storage charges accruing, the plaintiff decided to cancel the insurance on the truck in order to save costs, however, as per the terms of the truck’s lease, cancelling the insurance required the plaintiff to return the truck to the facilities of the third party leasor. Upon the return of the truck, the third party agreed to terminate the remainder of the lease, leaving the plaintiff without the means to continue his trucking business and no reimbursement of his $40,000 deposit.  As a result, the plaintiff sued the defendant for the $40,000 deposit, the storage charges, and damages in respect of business losses until age 70. In opposition, the defence argued that the lost deposit was too remote and unforeseeable. Further, the defence argued that the plaintiff was precluded from making a claim for lost business income due to his failure to mitigate. Upon hearing the case, Maisonville J., decided that the plaintiff’s claims concerning the non-refundable deposit were reasonably foreseeable, awarding the plaintiff compensation for the lost $40,000 deposit. However, the judge was not as readily prepared to award damages for business losses due to the plaintiff’s failure to establish that the losses could not have been mitigated and that they stemmed from his inability to drive a truck. Below are the judge’s comments regarding the foreseeability of the plaintiff damages, and his failure to mitigate his business losses:

Basic principles of foreseeability

[54]         The issue of business losses engages the core principles regarding reasonable foreseeability and remoteness in the recovery of damages. In order for a plaintiff to recover damages in tort, the damage suffered must be reasonably foreseeable. The Supreme Court of Canada in Mustapha v. Culligan of Canada, 2008 SCC 27, described the inquiry as follows:

[12]      The remoteness inquiry asks whether “the harm [is] too unrelated to the wrongful conduct to hold the defendant fairly liable” (Linden and Feldthusen, at p. 360). Since The Wagon Mound (No. 1), the principle has been that “it is the foresight of the reasonable man which alone can determine responsibility” (Overseas Tankship (U.K.) Ltd. v. Morts Dock& Engineering Co., [1961] A.C. 388 (P.C.), at p. 424).

 [55]         The standard for determining whether the harm was foreseeable asks not whether the harm was “possible”, as clearly, if it has occurred, it is possible.  Rather, the degree of probability required is that of a “real risk”, which would not be brushed aside as far-fetched by a reasonable person: Mustapha, para. 13.

[56]         The plaintiff is not required to establish that the precise injury or even the full extent of the injury was reasonably foreseeable, “only that the type or kind of injury was reasonably foreseeable”: Borgfjord v. Boizard, 2016 BCCA 317 at para. 57, citing Hussack v. Chilliwack School District No. 33, 2011 BCCA 258 at para. 71.

Discussion and Analysis

[65]         I find that the fact that an individual would be driving a leased vehicle and that an accident could result in the termination of the lease and thereby the loss of the deposit paid on that lease is entirely within the realm of possibility and foreseeability.  

[66]         However, I do not find that the plaintiff has proven that his loss is an ongoing loss due to his failure to drive a truck.  In his evidence, he testified that he was available and willing to do so and yet, there is no evidence that he has applied for any such work at all in the past time since the accident.  Nor was any evidence tendered to show that the plaintiff could not have made a further deposit to lease another vehicle, in fact, the plaintiff testified he is having his house renovated at present.  He testified that he would have kept driving.  Further in that regard, while individuals were called as witnesses at trial in an effort to support his claim, none of them testified they were in a position to hire the plaintiff or even to have someone drive the Truck for him.  I do not find the plaintiff efforts to mitigate this business to be at all reasonable.  Nor was anyone called from his key clients say they would have continued to hire him.  Further steps by the plaintiff’s own evidence can and could have occurred to mitigate his loss.  I find the steps he took insufficient to establish that, on a balance of probabilities, he has suffered a business loss.

Summary

[69]         In those circumstances, I find that the plaintiff is entitled to the damages in the amount of $40,000 equaling the return of his $40,000 deposit.  I also find that he is entitled to the costs of the towing of the Truck and to the storage at the Unitow towing lot for $1,340.64.  He is also entitled to pre-judgment interest on those amounts.

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