The Supreme Court of Canada has ruled that courts can award damages for psychological or emotional damage without expert evidence. The Insurance Bureau of Canada had argued such awards shouldn’t be given unless the plaintiff could demonstrate the tort caused a “recognizable psychiatric illness.”
Canada’s highest court finds that expert evidence is not essential for deciding whether a claimant “has proven a mental injury,” although such evidence can be helpful. The decision comes after a recent unanimous ruling found in favour of a former truck driver.
Moshen Saadati was involved in a July 5, 2005 incident in New Westminster, British Columbia. He made a claim against Grant Moorhead, who was driving a Hummer that collided with a Freightliner tractor-truck operated by Saadati. IBC was an intervener in the claim, and while Moorhead admitted liability, he argued that Saadati was not damaged in the collision.
Saadati claimed psychological damage and was awarded $100,000 in 2014 by Justice Gordon Funt of the Supreme Court of B.C. This payment was for psychological damages caused. Saadati was involved in a subsequent collision later in 2005, which led to more mental injury. However, he says the psychological damage was caused by the original hit.
Justice Funt’s ruling was overturned on appeal in 2015, before the Supreme Court of Canada restored Funt’s ruling on June 2, 2017. Saadati’s lawyer successfully argued that a trial judge should have “discretion to award compensation for a psychological injury in the absence of a medical diagnosis of one, if the trial judge accepts on the evidence that the negligence of the defendant has caused a plaintiff psychological harm that rises above mere grief or upset.”
IBC disagrees and says that psychological effect damages should not be awarded without a “recognizable psychiatric illness.”
Such a decision would “expand the scope of liability in tort law to an indeterminable extend, triggering a reallocation of risk in the insurance industry and higher premiums passed on to insureds across Canada,” IBC reasoned.