Cox v Carter Orders provide a mechanism for Defendants to receive the benefit of future payments to the Plaintiff for collateral insurance benefits. These Orders are usually given around or at the time of trial. The law in New Brunswick on Cox v Carter Orders for Section B wage-loss benefits is well-established. If you are approved for Section B wage-loss benefits for the foreseeable future, your lawyer should discuss the impact this could have on your Section A claim and the possibility of a Cox v Carter Order.
The 1976 Ontario Case of Cox v Carter
Cox v Carter Orders originate from a 1976 Ontario case called Cox v Carter. This case involved a motor vehicle accident claim for damages. At the time of trial, the Plaintiff was receiving wage loss benefits in the amount of $70 per week from the insurer of the vehicle he was driving at the time of the accident. In assessing damages for loss of income, the trial judge found that the Plaintiff’s loss of income was less than $70 per week. One of the issues to be decided was how the past and future wage loss benefits should be deducted from the Plaintiff’s damages.
The Court held that it was appropriate to deduct the wage loss benefits from all heads of damages. Having determined that the Defendant was entitled to the benefit of the deduction of past and future wage loss benefits from all damages, the Court then turned to the best approach to the deduction of future wage loss benefits. The Court ordered that the Plaintiff hold in trust for, and pay over to the Defendant any future wage loss payments. The Court also held that the Plaintiff could stop paying the Defendant the benefits once the amount reached the total amount awarded for the claim.
Cox v Carter Orders in New Brunswick
The first New Brunswick case to consider the application of a Cox v Carter Order was the 2002 case of Brown v Smith. In this case, the Court held that the Plaintiff must hold future Section B loss of income payments in trust for the benefit of the Defendant’s insurer. Since this case, there have been many cases in New Brunswick where Cox and Carter Orders have been granted for future Section B wage loss benefits (including Wilson v Campbell Estate; Gould v Atkinson; Chiasson v Theriault, and McIntyre v Matthews).
It is therefore likely that if a Plaintiff will receive future Section B wage loss benefits as the result of a motor vehicle accident, the Defendant(s) will likely be entitled to a Cox v Carter Order at the time the issue of damages is resolved. A Cox v Carter Order requires that the Plaintiff hold all future Section B wage loss benefits in trust and pay them to the Defendant, until the amount of future benefits received totals the entire amount of the Plaintiff’s damages. The Plaintiff is then entitled to keep the Section B wage loss benefits after that time, if applicable.
After two years of Section B wage loss benefits, if the Plaintiff meets the criteria that they are unable to work in any employment for which they are reasonably suited, the Plaintiff is entitled to these benefits for life. This can create an unfortunate situation for Plaintiffs where damages for loss of income are less than the amount expected for Section B wage loss benefits. In these cases, Plaintiffs may completely lose the benefit of any future Section B wage loss benefits.
Factors that increase the possibility of this scenario are: When a Plaintiff’s age of retirement is much less than the lifespan of the Plaintiff; where the Plaintiff was making a lower income at the time of the accident; and also where the Plaintiff is near the age of retirement and has little expectation of increasing their earning potential.
An Example of How a Cox v Carter Order Works
Lisa is injured as a result of a motor vehicle accident. Lisa was making $20,000 annually at the time of the accident. Lisa was 62 years old at the time of the accident and would have retired at the age of 65. Lisa is approved for Section B benefits in the amount of $250/week ($13,000 annually). According to Statistics Canada, Lisa has an average life expectancy of another 24 years. Lisa has an expected loss of income of $60,000. However, Lisa may be entitled to Section B wage loss benefits in the amount of $312,000. If Lisa is entitled to damages over the amount of $312,000, it is likely that a Cox v Carter Order would result in Lisa not receiving any future Section B wage loss benefits.
How Your Lawyer Can Help
If you are involved in a motor vehicle accident claim, your lawyer will explain if a Cox v Carter Order might be applicable to your claim and will discuss with you, in detail, the risks of a Cox v Carter Order and some strategies to deal with a potential Cox v Carter Order.
At Melanson Law, we have extensive experience dealing with Cox v Carter Orders and their impact on our clients’ claims. We have strategies and approaches for addressing Cox v Carter Orders that we use to help our clients involved in car accident claims. We work hard to help our clients understand any risks created by Cox v Carter Orders, and how we can help our clients manage and address these risks.
