Law Times

Page 19 Law TiMes • March 24, 2014 Court shows willingness to order structure Investment option 'best protects' injured man's interests: judge t's not every day that a court orders a structured settle- ment despite a guardian's wish for a lump sum. But such situations do happen as the courts and legislation recognize some forms of long-term pay- ments, such as annuities, as a guarantee that the injured party will always have some income. "It raises all kinds of interest- ing issues, on money manage- ment particularly," says Craig Brown, who acted for Glenda Ann Melvin, guardian for her son omas, in Melvin v. Ontar- io (Correctional Services). "e whole settlement of the case was empowering his mother to take care of him. e idea is to help your client live a life of dig- nity and value and not run out of money." In 1997, Melvin was serving time at the district jail in un- der Bay, Ont., when two fellow inmates assaulted him. He suf- fered serious injuries, including a closed head injury. e parties settled the action against the province at mediation in 2012. Glenda initially agreed to a structured settlement but then changed her mind. For Brown, the concept of a lump sum presented a conflict. His duty, he adds, was to both the guardian and her injured son. Brown is a litigator and partner at omson Rogers, a firm that has a policy to pres- ent structured settlements in any case in which the client is incompetent. e approach is to negotiate the amount of the award and then determine how it will meet the client's needs. With the support of the pub- lic guardian and trustee, Brown presented the situation to the judge who, aer "a very thor- ough canvassing," ultimately decided a structured settlement was the way to go. e differ- ence in this case, adds Brown, is that the judge presented his de- cision for approval of the mo- tion in writing while most are resolved in chambers. e advantages of structures include the fact they require no maintenance and are tax-free with guaranteed payments for life. "I have an obligation to pro- tect Mr. Melvin's interests be- cause of his disability. I am satis- fied that a structured settlement best protects those interests," wrote Justice Douglas Shaw of the Ontario Superior Court of Justice in under Bay. He pointed out that a struc- tured settlement would enable the injured man to request that he retain his Ontario Disability Support Program benefits while still receiving the structured payments since his future-care costs would likely exceed the income from the structure. By retaining the disability benefits, he also retains health coverage in addition to OHIP. "e courts have been very much in favour of structured settlements generally," says Ralph Fenik, president of McK- ellar Structured Settlements Inc., a company that dates back more than 30 years and helped to encourage the widespread acceptance of structures as tax- free, guaranteed payments in personal injury cases. "Structures are recognized as a viable alternative to a lump sum and in catastrophic cases are preferred to the lump sum," especially in situations involv- ing children, he adds. "You cannot out invest a tax- free investment without taking a risk. You cannot support guar- anteed tax flow with equity." Fenik and Rita Levato of McKellar's legal depart- ment say Melvin is an ex- ample of a case where a structured settlement was clearly in the best interest of the injured party. And they point to other cases involving catastrophic injuries that resulted in structured settlements. e common elements leading to structures in- clude the competency and age of the plaintiffs as well as the fact that they suf- fered catastrophic injuries, aren't employable, require community support to live, and could suffer an adverse impact if a lump sum runs out, according to Levato. In 2000, the Ontario Court of Appeal adopted the trial judge's reasons in Rob- erts v. Morana. In that case, the trial judge ordered the bulk of the settlement, more than what was requested, into a structure for future care with a por- tion paid out in a lump sum. But there are also situ- ations in which the courts support and prefer lump- sum payments. In Wilson v. Martinello, the Court of Appeal upheld a de- cision to award a lump sum. It found in favour of a lump sum because the plaintiff had proven he was still employable and had no responsibilities to his family as his wife and daughter had died. "ere was a risk to him but he could afford to take the risk," says Fenik. Even so, the lack of volatility in a structure has attracted wide ap- peal, particularly when the injured party is a child. Kyla www.lawtimesnews.com No matter where you are, the McKellar Slide Rule is never out of reach. In addition to the printed version, it is always available for BlackBerry®, iPhone® and Android™. Free from McKellar, all you have to do is visit www.mckellarmobile.com and download the McKellar Slide Rule App today. McKellar. Leaders in innovation and efficiency. Scan this QR-Code with your smartphone to visit our mobile site. iPhone® is a trademark of and owned by Apple Inc. BlackBerry® is a trademark of and owned by BlackBerry Limited. Android™ is a trademark of Google Inc. McKellar Structured Settlements Inc. is not endorsed, sponsored, affiliated with or otherwise authorized by Apple Inc., BlackBerry Limited or Google Inc. McKellar's Slide Rule App... easy access with just one touch. GUELPH 1.800.265.8381 | HALIFAX 1.800.565.0695 | EDMONTON 1.780.420.0897 | USA 1.800.265.2789 | www.mckellar.com Untitled-1 1 14-01-02 11:11 AM BRIEF: STRUCTURED SETTLEMENTS BY MARG. BRUINEMAN For Law Times I Melvin 'raises all kinds of interesting issues, on money man- agement particularly,' says Craig Brown. See Structures, page 20

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