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Damages - Loss of Competitive Advantage ('LOCA'). Cairns v. Ellis
In Cairns v. Ellis (Ont Divisional Ct, 2025) the Divisional Court considered the damages category of 'loss of competitive advantage' ('LOCA'), and when issues of economic loss may be submitted to a civil jury:i) LOCA
[20] The court in Rezai elaborated on the threshold for issues of economic loss going to the jury: a trial judge should not propose a method for quantifying such damages that is not supported by the evidence at trial; and a trial judge should not use an approach that the parties did not advance and had no opportunity to test or challenge. The court went on to state at para. 37:There must be admissible evidence upon which a properly instructed jury can make the requisite findings of fact to support their calculation of the compensation awarded. Juries should not be invited to “speculate and pull a dollar figure out of thin air.” [Citations omitted]. [21] In TMS Lighting Ltd. v. KJS Transport Inc, 2014 ONCA 1, 314 O.A.C. 133, at para. 65, the Court of Appeal provided the following direction:... it is not open to a trial judge to postulate a method for quantification of damages that is not supported by the evidence at trial. Nor is it open to a trial judge to employ an approach to the quantification of damages that the parties did not advance and had no opportunity to test or challenge at trial … To hold otherwise would sanction trial unfairness. [22] In Mundinger v. Ashton, 2019 ONSC 7161, 41 C.P.C. (8th) 1, at para. 35, Charney J determined that the question of LOCA could not be put to the jury. He reasoned as follows:Loss of competitive advantage is a pecuniary loss and must have some basis in empirical evidence, such as the Statistics Canada Survey relied on by Mr. Wollach. In the absence of such empirical evidence, the jury is being asked, once again, to speculate and pull a dollar figure out of thin air. [23] In the case at bar, the issue of LOCA was extensively canvassed during the pre-charge discussions. The trial judge determined that there was no evidence that “a jury can work with to come up with a number.” Specifically, she cited the absence of evidence about job options and opportunities, range of salaries, and general marketplace evidence. The trial judge was rightly concerned about taking the jury down “rabbit holes”.
[24] The trial judge agreed to put the question of future loss of income to the jury. She found there to be insufficient evidence to put the question of LOCA to the jury. She was justified in making that determination. There was no palpable or overriding error on the part of the trial judge.
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