NEGLIGENCE — damages — economic loss — earning capacity — where plaintiff has reduced working capacity following injury — assessment of residual earning capacity — consideration of buffer to be awarded
NEGLIGENCE — damages — measure of damages — where plaintiff earned salary and received dividends from shareholdings prior to injury — whether any loss suffered by reason of injury
Quick Take
1Where a plaintiff's income derives from both salary and dividends from a company in which she is a shareholder, the Husher v Husher principle that earning capacity is a matter of substance not form does not extend to dividends that represent a return on invested capital or the labour of others rather than the plaintiff's personal exertion; on the facts, post-injury corporate revenue and profit growth negated the claimed past economic loss save for one financial year.
2A forensic accounting methodology that includes a plaintiff's share of business profit in the 'but-for' counterfactual but excludes it from actual post-injury earnings creates an asymmetry that artificially inflates the claimed loss and will be rejected.
3Where a plaintiff's proposed calculation of future loss of earning capacity rests on untested assumptions — here, applying a private-heritage consulting rate to a hypothetical architecture practice never operated, at full billable utilisation, gross of overheads and without vicissitude allowance — the court will reject the calculation but award a substantial buffer where earning capacity has unquestionably been reduced.
