Case: Zajaczkowski v. Grauer, 2016 BCCA 48 (CanLII)

Keywords: Personal Injury; loss of income; income earning capacity; assessment of damages; misapprehension of evidence


Following what the respondent, Mr. Grauer describes as a “very small” motor vehicle accident, the appellant, Mr. Zajaczkowski claims to have suffered an injury to his neck, back and shoulders. The appellant also claims a resulting loss of income and income earning capacity.

This is an appeal from an assessment of damages, in which the trial judge finds the appellant is not credible, dismisses his claim for past wage loss, loss of future earning capacity, and loss of housekeeping capacity.

The appellant raises two grounds of appeal:

  1. The trial judge misapprehended the evidence concerning his education, earnings and work activities and that palpable and overriding errors resulted in an erroneous assessment of his credibility.
  2. The trial judge erred in assessing the claim for loss of earning capacity on the basis that the appellant’s earnings had not actually diminished after the accident.

The Court of Appeal dismisses the appeal; finds the trial judge misapprehended some of the appellant’s testimony, but this does not undermine the overall credibility assessment. Moreover, the Court of Appeal finds no misapprehension with respect to post-accident income/earning capacity. It was open to the trial judge to make his findings.

Saunders J.A. dissents; would allow the appeal on the basis of the flawed credibility assessment (based in part on a misapprehension of evidence relating to the appellant’s education) and order a new trial.


Majority View

For the Court of Appeal, the substantial question was whether the trial judge erred in rejecting the appellant’s evidence; whether the assessment was based upon a misapprehension. Why? At trial an adverse finding with respect to the appellant’s credibility was critical to the outcome. As a consequence, the appellant had to demonstrate an error that is both palpable (evident on the face of the reasons) and overriding.

The appellant relied on principles found in Holsten v. Card, 2002 BCCA 44 (CanLII) and Loveridge v. British Columbia, 2007 BCCA 425 (CanLII). Citing Loveridge, the appellant urged the Court of Appeal to find a misapprehension, and then (based on the principle that the appellant is entitled to have his case assessed on a proper apprehension of the evidence), find that the ultimate result might have been different had the judge not erred; that it cannot be confidently said the same result inevitably follows with or without the error.

A majority of the Court of Appeal confirmed it is not their role to “reweigh the evidence”. Rather, the ultimate question is whether the underlying judgment is sound. In the present case, they determined the trial judge based his finding of credibility upon the following conclusions (see para. 13):

(a) the appellant had a poor memory generally;

(b) demonstrated poor recollection of his earnings and his ability to work since the accident;

(c) gave no reliable evidence as to how far he went in school, and not knowing what formal education he has is “of concern in the assessment of his credibility”; and

(d) the evidence he gave involving a prospective client, Ms. Balano, which was “evidence directly relevant to his claim”, was found to “more directly undermin[e] his credibility” than the other enumerated reasons.

The Court of Appeal found the evidence was not inconsistent enough to serve as a footing upon which the judge could conclude the appellant was not truthful. That being said, the majority also found the trial judge could not be said to have erred in considering the appellant’s poor memory and inability to give a clear account – for the majority, this properly affects confidence in the appellant’s testimony generally.

On the second ground, the majority of the Court of Appeal found the appellant failed to establish the trial judge erred in assessing the claim for loss of future income earning capacity. Citing both Rosvold v. Dunlop, 2001 BCCA 1 (CanLII) and Perren v. Lalari, 2010 BCCA 140 (CanLII), the Court found no error in the finding that, applying the appropriate test, the appellant had not established an impairment of the capital asset (in this case, the ability to perform physically demanding work).

“In the presence of convincing evidence of any measurable reduction in income earning capacity it would be an error in law to dismiss the claim simply because income did not fall after an injury. That would be to confuse loss of earnings or income with loss of capital asset that is income earning capacity” (Emphasis in original at para. 38).

However, at trial, the appellant provided an “insufficient factual underpinning” to ground compensation for loss of earning capacity; the Court of Appeal found this part of the claim failed because the judge found the appellant did not meet the burden described in the Perren decision – the trial judge simply did not accept the appellant’s evidence of his limitations and anecdotal evidence from other witnesses did not shore up his testimony.

Dissenting View

For Saunders J.A., it is impossible to determine whether, absent this adverse finding with respect to the appellant’s truthfulness (which Saunders J.A. suggests was unfounded), there would have been such a lack of credit given to the substance of witness testimony from the appellant’s work colleagues who relayed his complaints (for example, that the appellant “can’t do it any more”; had to focus on lighter finishing tasks rather than heavier framing/drywall duties).

The question should be whether the appellant’s income was diminished or will be diminished from that which he could have earned but for the accident. For Saunders J.A., the evidence of the appellant’s work colleagues, combined with his own, would support the claim for past wage loss and the possibility of a claim for future wage loss on the “capital asset approach” (à la Brown v. Golaiy (1985), 1985 CanLII 149 (BC SC), 26 B.C.L.R. (3d) 353 (S.C.)). Critically, this depends on whether the appellant is believed, and he was not believed by the trial judge.

Saunders J.A. stated the judge misstated or misapprehended the appellant’s evidence and in so doing made the sort of error that fatally undermined the subsequent rejection of his claim for loss of past and future earnings. The reason? For Saunders J.A., there was no inconsistency in the appellant’s description of his education.

Citing Loveridge, Saunders J.A. explained the appellant was entitled to correct consideration of the full substance of his case. However, in the present case, “…the judge made the appellant’s evidence of his education one leg of what was a relatively brief discussion of credibility, and that leg is broken.”

Counsel for the Appellant: Timothy Delaney (Lindsay Kenney LLP, Vancouver)

Counsel for the Respondents: Lyle Harris, Q.C. and Monique Radlein (Harris & Brun, Vancouver)