NOTICE
PROPOSED ALLOCATION OF 2019 SURPLUS FOR THE BENEFIT OF CLASS MEMBERS
Every three years the financial sufficiency of the Hepatitis C 1986-1990 Trust
Fund is reviewed to ensure that it is adequate to meet the expected needs of
class members and family members.
On the most recent financial sufficiency review, the actuaries retained by the
Joint Committee and by the federal government expressed the opinion that the
Trust Fund is financially sufficient and that there is a
surplus. They estimated the surplus was between $195,037,000 and $201,019,000 as at
December 31, 2019. After that date, the financial markets declined
substantially, which decreased the value of the Trust Fund. The surplus is now
estimated to be about $174 million as at June 30, 2022.
The settlement approval orders allow the Joint Committee and the governments
to apply to the Courts where there is a surplus. The Courts have discretion to
decide what to do with the surplus, including whether all or a portion of the
surplus should be allocated or kept in the Trust Fund.
THE JOINT COMMITTEE’S RECOMMENDATIONS
In May 2022, the Joint Committee filed applications requesting the Courts to allocate the surplus for the benefit of class members and family members with a small balance kept in the Trust Fund. The Joint Committee’s applications were recently amended to reflect the lower amount of surplus available for allocation, which required the Joint Committee’s initial recommendations to be revised.1 The federal, provincial and territorial governments have confirmed that they will not oppose the Joint Committee’s amended applications. The federal government has also confirmed that it will not apply for any portion of the surplus.
A summary of the Joint Committee’s revised recommendations is attached
along with details about how you can access the full application records for
more information. If the Courts accept the Joint Committee’s revised
recommendations, all of the surplus will be allocated for the benefit of class
members and family members except about $2 million (the “Retained Amount”), which will be retained in the Trust Fund.
WHY ARE YOU RECEIVING THIS NOTICE?
This notice is to allow you to express your views
in advance of the hearings
about the Joint Committee’s recommendations or to make a request or
recommendation regarding the Retained Amount. It also provides the details
of when and how the hearings will be held.
HEARING DETAILS
The Joint Committee’s applications to allocate the surplus will be heard at a
joint hearing of the three Courts, to be held by judicial videoconference on
Tuesday, May 30, 2023 at 11:00 am EDT.
Information on how you may attend the hearing by video-link will be provided
on the home page of the settlement website
https://www.hepc8690.ca/home-e.shtml
once it becomes available.
HOW YOU CAN PROVIDE YOUR INPUT TO THE COURTS
If you wish to comment on the Joint Committee’s recommendations or to make a
request or recommendation regarding the Retained Amount, you may do so
no later than May 15, 2023 by email at
info@hepc8690.ca or by regular mail at
the following address:
PO Box 2370
Station D
Ottawa, Ontario
K1P 5W5
All written communications received by this date will be provided to the
Courts for their consideration.
SUMMARY OF THE JOINT COMMITTEE’S FOUR RECOMMENDATIONS2
Recommendation 1 - 6.8% of Fixed Payments
The Joint Committee recommends the creation of a special distribution benefit
equal to 6.8% of the value of the fixed payments listed
below, indexed to the dollar value of the year in which the benefit is paid
out.
If the recommended allocation for fixed payments is granted:
-
infected class members who received or become entitled to receive disease
level benefits would be entitled to a special distribution benefit based
on their current cumulative disease level and/or any progression in
disease level that may thereafter occur in the following approximate
amount(s) (shown in 2020 dollars):
|
Disease Level
|
6.8% Allocation per disease level
|
Cumulative Total
(in 2020 dollars)
|
|
Disease level 1
|
$1,097
|
$1,097
|
|
Disease level 2
|
$2,195
|
$3,292
|
|
Disease level 3
|
$3,292
|
$6,584
|
|
Disease level 5
|
$7,133
|
$13,717
|
|
Disease level 6
|
$10,974
|
$24,691
|
-
class members who received or become entitled to receive one of the
following fixed payment benefits would be entitled to a special
distribution benefit in the following approximate amount (shown in 2020
dollars):
|
Fixed Payment Type
|
6.8%
(in 2020 dollars)
|
|
$50,000 non-pecuniary general damages option for approved living
co-infected hemophiliac class members
|
$5,487
|
|
$50,000 death benefit option for approved class members whose
death prior to January 1, 1999 was caused by HCV
|
$5,487
|
|
$120,000 death benefit option for approved class members whose
death before January 1, 1999 was caused by HCV
|
$13,169
|
|
$72,000 death benefit option for approved co-infected hemophiliac
class members whose death before January 1, 1999 is not proven to
be caused by HCV
|
$7,901
|
Approximately $54,684,000 of the 2019 surplus is required to fund this
benefit.
Recommendation 2 - 50% of Loss of Guidance, Care and Companionship Payments
The Joint Committee recommends the creation of a special distribution benefit
equal to 50% of the value of the loss of guidance, care and
companionship payments payable to family members3 following the
death of the HCV infected person.
If the recommended allocation for loss of guidance, care and companionship is
granted, family members who have received or become entitled to receive a loss
of guidance, care and companionship benefit would be entitled to a special
distribution benefit in the following approximate amount, indexed to the
dollar value of the year in which the benefit is paid out:
|
Family Member
|
50% allocation
(in 2020 dollars)
|
|
Spouse
|
$18,593
|
|
Child < 21
|
$11,155
|
|
Child 21 and >
|
$7,139
|
|
Parent
|
$7,139
|
|
Sibling
|
$3,718
|
|
Grandparent/Grandchild
|
$372
|
Approximately $71,812,000 of the 2019 surplus is required to fund this
benefit.
Recommendation 3 - Increase Lost or Diminished Pension Benefits by 4% of
Loss of Income
The Joint Committee recommends the creation of a special distribution benefit
that increases lost or diminished pension benefits for those who have received
or become entitled to receive loss of income benefits by an additional
4% of the annual loss of income payment capped at $200,000
per annum before 2014 and $200,000 per annum indexed thereafter, payable
retroactively and prospectively.
If the recommended allocation to increase lost or diminished pension benefits
is granted, based on this formula, for example:
-
an infected class member receiving an annual income loss benefit of $50,000
would be entitled to a 2019 special distribution benefit of $2,000 for each
year of their income loss entitlement; while
-
an infected class member with an annual income loss benefit of $200,000 or
more before 2014 would be entitled to a special distribution benefit of
$8,000 per year of income loss entitlement; and
-
an infected class member with an annual income loss benefit of $200,000 or
more in 2014 or after would be entitled to a special distribution benefit of
4% on the indexed value of $200,000 per year of income loss entitlement.
Approximately $6,653,000 of the 2019 surplus is required to fund this benefit.
Recommendation 4 - Pay an additional $1.49/hr for Loss of Services incurred
from and after January 1, 2019
The Joint Committee recommends the creation of a special distribution benefit
of $1.49/hour for each compensable hour of loss of services
benefits received or entitled to be received, for the years 2019 and
following, indexed to the dollar value of the year in which it is paid out.
If the recommended allocation to pay an additional $1.49/hour for loss of
services incurred from and after January 1, 2019 is granted, for example, a
class member who received the maximum 22 hours of loss of services/week for
2020 would be entitled to a special distribution benefit in the approximate
amount of $1,700 for that year and any subsequent years of entitlement,
indexed to the year of payment.
Approximately $25,365,000 of the 2019 surplus is required to fund this
benefit.
Costs of Administration
Approximately $1,400,000 of the 2019 surplus is required to administer the
requested special distribution benefits described above.
FURTHER INFORMATION
Please note that the above is only a summary. The materials that the Joint
Committee has filed with the Courts must be referred to for full and accurate
details. The material filed with each Court is identical in substance.
The applications can be reviewed at the following links:
Ontario, British Columbia and Quebec.
1 Note: The Joint Committee’s applications are based on 2019
dollars. The estimated cost of the Joint Committee’s revised recommendations
is about $160 million in 2019 dollars, which is about $172 million in 2022
dollars.
2 Although separate applications have been filed with each of the
three courts (Ontario, Québec and British Columbia), the Joint Committee’s
recommendations to each court are identical and meant to be applicable in a
similar fashion in each jurisdiction.
3 Family members must have been alive when the infected class
member passed away to be eligible for benefits. References to Child under age
21 and Child 21 years of age or older refers to the Child’s age at the time
the infected class member passed away.
