Written by: Iain Walker and Januel C. Ibasco Insights from the Case: Jackson v Cooper, 2024 ABCA 272 and, section 585.2(2) of the Insurance Act, RSA 2000, c I-3 (ABCA upheld Trial Decision) Background & Trial Decision The Insurance (Enhancing Driver Affordability and Care) Amendment Act, 2020, SA 2020, c 36 [Insurance Amendment Act] came into force on December 9, 2020 and had the effect of, among other things, reducing the rate of interest a plaintiff was entitled to in respect of general (or non-pecuniary) damages for pain and suffering resulting from injuries suffered in a motor vehicle accident. Prior to this legislation coming into force pre-judgment interest for general damages was calculated at a higher rate than for pecuniary damages which are intended to reimburse a plaintiff for monetary losses for things like lost wages or out of pocket expenses. Trial in the Jackson v Cooper case, which revolved around damages associated with personal injuries suffered in a car accident, was held in June of 2021 with the Court’s Reasons for Judgment issued September of 2022. In its decision, the Court held that: While the right to pre-judgment interest is not a vested right, it is a substantive one; Because the right is substantive there is a presumption against the retroactive application of legislation; and The presumption against retroactive application of legislation was not displaced. Accordingly, the Trial Court found that pre-judgment interest was to be calculated at 4% from the date of the subject motor vehicle accident in 2015 to December 9, 2020 when the Insurance Amendment Act came into force and at the lower rate prescribed by the Insurance Amendment Act from December 9, 2020 forward. The Defendant appealed this aspect of the Trial Court’s decision. The Parties’ Arguments The Plaintiff argued, among other things, that pre-judgment interest is a “substantive” right rather than a “procedural” one. While the difference is legally quite technical, the important factor in this case is that a substantive right attracts a presumption against the retroactive application of legislation whereas a procedural right does not. The Defendant argued, among other things, that it did not matter whether the right to pre-judgment interest was procedural or substantive and that the right to pre-judgment interest arises at the time of judgment and the Court is directed to the legislative framework for calculating pre-judgment interest as it exists at the time of judgment. The Defendant argued alternatively that the Legislature clearly intended for the Insurance Amendment Act should apply retroactively given its stated purpose was, at least in part, to control rising costs of automobile insurance. The Defendant pointed to transcriptions of legislative sessions discussing the legislation in support of this argument. The Court of Appeal Decision In a split, 2 to 1 decision, the Alberta Court of Appeal (“ABCA”) in Jackson v Cooper, 2024 ABCA 272, ultimately affirmed the Trial Court’s decision on the question of pre-judgment interest. The Majority of the Court of Appeal agreed with the Trial Court that there was a presumption against retroactivity that had not been rebutted. While a right to prejudgment interest may not vest or crystallize until the time of a judgment, any interpretation of the Insurance Amending Act that resulted in a lower rate being applied prior to December of 2020 would have had a retroactive effect and there is a presumptive rule that legislation must not be interpreted retroactively. That presumption can be rebutted, but the Majority was not convinced by the Appellant’s arguments relating to the legislative intent of the Insurance Amending Act. Therefore, the presumption was not rebutted. The Dissent, from Justice Grosse, would have held in favour of the Appellants. Justice Grosse outlined that in her view a judgment was a pre-requisite to the right to pre-judgment interest and that therefore the presumption against retroactivity is not engaged. Justice Grosse was also convinced of the Legislature’s intent for the Insurance Amendment Act to have retroactive effect if that presumption did need to be rebutted. Takeaways In general, absent express language in a piece of legislation evidencing an intent to have retroactive effect it is unlikely that the presumption against retroactivity will be rebutted, even with relatively clear evidence of the Legislature’s intent. More specifically it would appear that the question of pre-judgment interest rates can be put to bed. The applicable rate for general damages resulting from a motor vehicle accident is 4% prior to December 9, 2020 and in accordance with the Insurance Amendment Act from that date forward. Disclaimer: This article is to be used for educational and non-commercial purposes only. Parlee McLaws LLP does not intend for this article to be a source of legal advice. Please seek the advice of a lawyer before choosing to act on any of the information contained in this article. If you are interested in learning more or discussing your rights and obligations in insurance law, you can contact our team at Parlee McLaws LLP.