In the recent Ontario Superior Court decision of D.S. v. Quesnelle, Justice Smith made it abundantly clear that in Ontario, general damages caps do not apply in civil sexual abuse claims. This decision should be commended as the policy rationale for general damages caps in most other areas of personal injury are drastically different than in the context of sexual abuse cases.
To understand the history, we will very briefly meander down memory lane starting with the 1978 Supreme Court “Damages Trilogy” and ending with the laudable decision in D.S. v. Quesnelle. Our courts have come a long way in finally recognizing that intentional torts involving criminal behaviour including sexual abuse may require and deserve more than the general damages cap allows.
The Supreme Court Damages Trilogy of 1978:
In Canada, General Damages Caps all started in 1978, when the Supreme Court of Canada heard what is now referred to as “The Damages Trilogy” of cases comprising the decisions in Andrews v. Grand and Toy Alberta Limited, Thornton v. District No. 57 and Arnold v. Teno.
This landmark Trilogy dealt with 3 catastrophically injured claimants rendered quadriplegics after being injured through the negligence of others in motor vehicle accidents. The Supreme Court of Canada established an upper limit of $100,000 for general damages/pain and suffering for the most serious types of personal injury cases and held that “save in exceptional cir-cumstances, this should be regarded as an upper limit of non-pecuniary loss in cases of this nature”. This amount has grown with inflation and is approximately $367,000 today.
The exception to the Damages Cap for Defamation made in the Supreme Court of Canada’s Decision in Hill v. Church of Scientology:
In 1995, an exception was made for the general damages cap, as notably held in Hill v. Church of Scientology of Toronto. In that case, the appellants unsuccessfully argued that there should be a cap placed on general damages/pain and suffering in defamation cases just like in the personal injury context as established in the Trilogy. However, the Supreme Court cited policy reasons justifying the cap in personal injury cases while rejecting a cap in defamation cases. The Supreme Court of Canada was of the view that in the personal injury context, the “size and disparity of assessments was affecting insurance rates and, thus, the cost of operating motor vehicles and, indeed, businesses of all kinds throughout the land”.
The court further distinguished the policy reasons for upholding a general damages cap for personal injury negligence actions but not in defamation cases. The court commented at paragraphs 169 and 170 the following:
A very different situation is presented with respect to libel actions. In these cases, special damages for pecuniary loss are rarely claimed and often exceedingly difficult to prove. Rather, the whole basis for recovery for loss of reputation usually lies in the general damages award. Further, a review of the damage awards over the past nine years reveals no pressing social concern similar to that which confronted the courts at the time the trilogy was decided.
Personal injury, on the other hand, results from negligence which does not usually arise from any desire to injure the plaintiff. Thus, if it were known in advance what amount the defamer would be required to pay in damages (as in the personal injury context), a defendant might look upon that sum as the maximum cost of a licence to defame. A cap would operate in a manner that would change the whole character and function of the law of defamation. It would amount to a radical change in policy and direction for the courts.
Carving Out Exceptions for General Damages Cap in Sexual Abuse Claims:
Hill v. Church of Scientology was the judicial motivation needed to ignite a fire bright enough to finally shine a light on further exceptions to the general damages cap in the area of intentional torts such as sexual abuse.
This came one year later in the 1996 British Columbia Court of Appeal decision in S.Y. v. F.G.C. where the applicability of the cap was considered in the context of sexual abuse.
In S.Y. v. F.G.C., the court dealt with a Plaintiff who was victim to repeated sexual abuse by her stepfather when she was a minor. On the issue of whether there should be a cap on awards on general damages for sexual abuse, the court relied on Hill v. Church of Scientology to expand the cap exceptions further for cases involving sexual abuse. It held the following at paragraphs 30 and 31:
I am not persuaded that the policy reasons which gave rise to the imposition of a cap in “the trilogy” have any application in a case of the type at bar. In my opinion the differences described [in Hill v. Church of Scientology]…exist in this case as well. The policy considerations which arise from negligence causing catastrophic personal injuries, in the contexts of accident and medical malpractice, do not arise from intentional torts involving criminal behaviour. There is no evidence before us that this type of case has any impact on the public purse, or that there is any crisis arising from the size and disparity of assessments. A cap is not needed to protect the general public from a serious social burden, such as enormous insurance premiums…
In contrast, sexual abuse claims do not usually result in awards guaranteeing lifetime economic security. In the catastrophic personal injury cases, awards under other heads of damages are so high that there may be a lesser need for general damages to provide solace and to substitute for lost amenities. In some cases, sexual abuse victims may require and deserve more than the “cap” allows, due to the unpredictable impact of the tort on their lives. Judges, juries and appellate courts are in a position to decide what is fair and reasonable to both parties according to the circumstances of the case.
This decision recognized a cap exception in British Columbia for sexual abuse at the highest provincial level. However, the momentum eventually made its way to Ontario but it took several years.
By 2003, the Ontario Court of Appeal Decision of Padfield v. Martin finally opened up the possibility of cap exceptions to sexual abuse claims “in theory” and recognized the S.Y. v. F.G.C decision in British Columbia. The Ontario Court of Appeal held at paragraph 29 that:
It is in theory open to this court to create an exception to the cap and to decide that it does not apply in certain circumstances on policy grounds. For example, the Supreme Court of Canada concluded in Hill v. Church of Scientology of Toronto, that the cap does not apply in defamation cases, because the function of general damages is different in such cases than in personal injury cases. In British Columbia, the Court of Appeal has concluded that the policy reasons for the cap are not present, and therefore the cap does not apply, where the cause of action is an intentional tort involving criminal behaviour, such as sexual assault.
Ontario Finally Carves Out an Exception to Caps on Sexual Abuse General Damages in D.S. v. Quesnelle:
Taking into account the judicial history of general damages caps as described above, this takes us back full circle to the 2019 decision of Justice Smith in D.S. v. Quesnelle awarding $400,000 for general damages, well in excess of the cap (approximately $367,000). Justice Smith explicitly concluded, “I am of the view that the cap should not apply in this case.” Cap exceptions for sexual abuse claims are no longer theoretical in Ontario.
While this is encouraging, it is also important to understand that the decision in D.S. v. Quesnelle was made as part of an undefended motion for default judgment, as the defendant had chosen not to defend the lawsuit. There were no arguments put forward in support of the cap, which might have been the case had it been defended. This decision will in all likelihood never be appealed. Nonetheless, the decision was well reasoned and fits in with the previous case law and judicial trends across the country which have opened the door to carve out exceptions for sexual abuse general damages caps in Ontario with the right case. This happened to be that case.
I would expect that as sexual assault civil litigation progresses, we will see more decisions being made in excess of the general damages cap. I would also predict that we may see further exceptions made to general damages caps in other types of quasi-criminal intentional torts beyond just sexual abuse claims. This may be seen in certain cases of battery, bullying, or nursing home abuse, where egregious harm is done, particularly where there is a level of trust, authority, and dependence on the perpetrator. Time will tell.