If someone dies in an auto accident due to the actions of another driver or the failure of the municipality to maintain the road, dependants can make a claim under the Family Law Act for loss of care, guidance, and companionship. But in the right cases, compensation should not be limited to those heads of damages, says personal injury lawyer Steve Rastin.
“There is a principle of law called a dependency claim which results in awards that could be significantly larger,” says Rastin, managing partner of Rastin Trial Lawyers.
“If you are staying home to raise the kids, and your partner is killed in an accident, you have suffered a huge financial loss as a result of that death,” he says. “So under the legislation, you can also advance a dependency claim for the past and future dependency losses of your partner.”
Rastin says he has been involved in cases where the dependency loss is $1 million or more.
“These cases are very complex to build,” he says. “Basically, what you need to do is you hire a forensic accountant to examine the family’s entire history, not only what they were earning but what they were likely to be earning in the future.”
Rastin gives the example of a medical school student killed in an accident.
“It’s probably not fair to look at the income that person was earning as a student, but instead the fair thing to do is to look at what a medical professional would have contributed to the family,” he says.
The court takes into account factors such as whether it was a one- or two-income family and the likelihood of the surviving spouse to remarry, Rastin says.
“There is a recognition that a portion of the money earned by the person who died was going to be spent on themselves, so it would be unfair to say that 100 per cent of that person’s income should now go to the spouse,” he says.
Rastin says the court considers a range of factors to determine what percentage of the income could be awarded in a dependency claim, with awards ranging from 30 to 60 per cent of the deceased’s income.
“Specialized accountants do those dependency claim calculations,” he says, adding these cases will be structured in order to relate to the loss of household services.
“If the person killed was cutting the lawn and doing all the maintenance around the house, the fact that these household services aren’t being done anymore can result in huge out-of-pocket expenses to surviving family members,” Rastin says.
The court will look at the tasks that the person was doing and how much it would cost to hire someone else to do the same work, he says.
“I’ve seen cases where these claims can be for hundreds of thousands of dollars,” Rastin says.
If family members are given a lump sum payment as an award for a dependency or household services claim, he says they will have to pay tax on that, so accountants will factor that into their calculations and increase the amount sought.
“Proving a dependency claim is a very labour-intensive process for a forensic accountant, as it’s a very technical process,” Rastin says. “I’ve argued these cases in front of juries, and sometimes it is difficult for jurors to follow the very complicated math that’s involved in these cases.”
If the deceased was raising children, an experienced accountant will factor in the net benefit that they are now missing, using complex accounting formulas.