Law Times

Law Times • November 24, 2014 Page 15 www.lawtimesnews.com been a real focus on exceeding client expectations and a firm- wide commitment to keeping rates affordable so that regula- tors could continue to have ac- cess to a high level of expertise," says Durcan. Rapid growth isn't on the agenda, although the firm has nearly doubled in size in the last few years. "Our clients know us all," says Durcan. "Getting bigger could change the dynamic." Another consideration is the limited number of regulators, especially for the professions. Even the health-care arena has just 23 regulators while engi- neers and architects have just one. And the firm no longer de- fends professionals in disciplin- ary proceedings, particularly those in the health professions. "There is more room to grow but there would be a point where we could get a little cau- tious about how to grow," says LeBlanc. Because corporate contract law is becoming more sophis- ticated, however, the firm has recently interviewed dedicated corporate lawyers. They would differ from current firm mem- bers, almost all of whom would categorize themselves as barris- ters and solicitors. "Procurement issues, for example, are now huge in the health-care profession and else- where and it seems that bylaws need to be amended more often than ever," says Durcan. Above all, the firm is intent on preserving its culture. "Most of us came from large firms," says Durcan. "I have three kids and if I hadn't moved here five years ago, I wouldn't be practising law." LT CANADA & USA 1.800.265.8381 | EMAIL info@mckellar.com | www.mckellar.com The reason why we are Canada's largest and most comprehensive structured settlement firm has everything to do with our passion for service and performance— without exaggeration, we make life easier for you. Almost as accurate as McKellar. The world's most precise clock loses less than a second every five billion years... Untitled-2 1 2014-09-26 12:54 PM BRIEF: STRUCTURED SETTLEMENTS 'In one way or another, we work for most regulators in the province,' says Marc Spector. Continued from page 13 Law firm cautious about growth expertise and, I'd proffer, any structured settlement broker's expertise." Fenik says it's "obviously unpredictable" what will happen to in- f lation in the long term. But since 1991, when the Bank of Canada set an inf lation target of one to three per cent, "either by good luck or good management, that's where inf lation has been," he notes. To Baxter, the high cost of inf lation-indexed structures isn't the only downside. With these structures comes a loss of predictability as well, she says. "Many of our clients also prefer to see the outline of future pay- ments. With a CPI-indexed annuity, we cannot provide them with the future projections since we unfortunately do not have that crystal ball. When a fixed index rate is used, the clients are able to see their future monthly payments and are able to plan accordingly." Structured settlements, of course, are a tax-free vehicle. But recently, the Supreme Court of British Columbia considered the treatment of that income for the purpose of the child support guidelines in the case of a father who receives structured payments from Veterans Affairs Canada. L.F. v. C.G.C. considered whether structured settlements are per- sonal in nature or are a family asset. "In my opinion, a personal award for injuries, such as pain and disability, loss of the amenities of life, and cost of future care, whether used by the recipient to purchase a structured annuity or simply de- posited in an interest-bearing savings account, should not be treated as guidelines income for child support purposes. Such awards were never intended to replace income lost by the recipients of those awards. This conclusion is congruent with Manuge, M.K., and, for that matter, the principles developed in Storey," wrote Justice Neill Brown in a ruling referencing Manuge v. Canada, M.K. v. R.A.S., and Storey v. Simmons. Added Brown: "For the basic portion of a veteran's disability pen- sion, I have decided that none of the basic pension amounts the De- partment of Veterans Affairs has paid the father should have been treated as guidelines 'income' for child support purposes. Child sup- port the father has already paid based on a guidelines amount that takes in the basic amount of his disability pension are overpayments." The decision was a reaffirmation of what structured settlement brokers say they already knew. In the end, whether structured pay- ments count as income depends on whether they replace lost earn- ings, says Chobotar. "When a person settles their case and a certain portion is consid- ered to compensate them for income loss and they get a structured settlement, that percentage or portion has been looked at for child and family support," Chobotar adds. "If somebody got a million-dollar settlement, put a million dol- lars into a structured settlement, and $200,000 of that was consid- ered loss of income, then 20 per cent of their structure payment could possibly be garnished for child support or spousal support," he notes. When the structured settlement compensates for something such as future-care costs, it's irrevocable, says Baxter. "If their family members also suffered injuries, they, too, would be compensated per- sonally. The structured settlement payments are not an asset of the claimant; they are the irrevocable recipient of the benefit. It should not be seen as a family asset. These payments are put into place in order to ensure the injured claimant is taken care of, not necessarily the family. We protect the injured claimant." LT Inflation indexing can mean less predictability Continued from page 14

• Cover