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HEARSAY - December 2015: In This Edition

Case Comments The Defence Wins!
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Case Comments


By Michal Baura
Samis + Company

Bill 15 amending the Repair Storage and Liens Act (RSLA) is an attempt to establish a test for determining fair market value for the services provided by vehicle storage facilities thereby reducing insurance fraud, providing consistency to the industry, and enhancing the value of vehicle towing and storage services.  The most significant amendment to the RSLA to achieve these goals is the provision granting the   Lieutenant Governor in Council the authority to make regulations regarding the “fair market value” of services provided by repairers and storers.  The government released its first draft regulation on the fair market value provisions in the RSLA in September. Unfortunately, the proposed amendments will likely do little to reduce litigation between tow and storage operators and insurance companies.

The Problem: Why “Fair Market Value” Amendments are Needed
It is a scenario that plays out in every corner of the province each day. It may have even happened to you. An individual is involved in an accident and as a result is in a temporary state of shock, and extremely vulnerable. A tow operator appears out of the blue and offers assistance.  The individual involved in the accident likely does not appreciate that they are about to negotiate a contract with the tow operator that goes beyond the simple tow.

The responding tow operator offers to tow the vehicle and store it at their facility until the individual’s insurer sends an appraiser to inspect the damage. At no time does the tow operator mention the cost of services to the individual. He simply says that the insurance company will cover the costs and asks the individual to sign an invoice charging an excessive rate for the proposed storage service. 

The individual usually complies; being unaware of the fair market price of the service. Even if the tow truck driver did disclose the price of the service, why should the individual care about the cost? After all, the insurance company will cover the cost and the individual wants to leave the scene of the accident as soon as possible.  

Once the towing and storage invoice is submitted to the insurance company for payment, the insurer usually recognizes that the fees are excessive and refuses to pay on the grounds that they, or their insured, never agreed to pay the invoiced fee. Section 4(b) of the RSLA, states that where there is no agreement on the amount charged for storage, the storer is entitled to the fair market value of the service.

As a result, insurers typically offer the tower payment at what they believe to be fair market rates. If the storage facility still refuses to release the vehicle, the insurance company must engage the section 24 provisions under the RSLA to secure the release of the vehicle so it can be moved to the individual’s chosen repair shop. Thus begins the lengthy process of dealing with the storage facility’s claim, a process that includes various statutorily mandated notices and responses that extend resolution of the claim to months, and sometimes years.

Section 24 requires the insurance company to pay the amount claimed by the storage facility into court and certify with notification to the storage facility that the payment has been made.

The storage facility may then object to the amount paid into court and demand that the insurer pay an even greater amount into court. The insurer is then required to pay that amount into court to secure the release of the insured’s vehicle. Although the parameters of the dispute have now been identified, litigation is assured and by the time the section 24 process is completed, the vehicle may have sat at the storage facility for many weeks while the daily storage fees accumulate.

After the vehicle is released, the storage facility usually issues a plaintiff’s claim, typically in small claims court, against the insurer for the amount that was paid into court, and there the claim will sit for a couple of years as the ligation process runs its course.   

The primary dispute between the parties in these claims is the value of the storage service. Currently, providers of storage services charge vastly different prices for the same service with storage facilities in the same region charging anywhere from $40 to $100 per day for storage of a vehicle.

The case law that has developed on the issue of fair market value to be charged for vehicle storage provides little guidance. The very few decisions that exist are issued out of the small claims court and employ different methods to arrive at a fair market value for the service.  This has resulted in values for storage services ranging between $25 and $80 per day.  In short, there has been no consistency in this area of law. This is why an amendment providing guidance on the meaning of “fair market value” was needed.

The Proposed Solution
The government’s solution to the problem is to establish a test for determining the fair market value of a storage service. The test states that the following factors are to be considered in determining fair market value:
  • the expenses incurred by the storer in relation to the storage or storage and repair or storage and part of the repair of the article, including expenses related to insurance, transportation, labour, weighing and packing 
  • all lawful claims for money advanced and interest on money advanced by the storer in relation to the article 
  • the storer’s fixed costs, variable costs, direct costs and indirect costs 
  • the storer’s profit 
  • any other relevant factors 
Unfortunately, the above test is vague, overly broad and is unlikely to produce any consistency in setting a market rate for storage services. For example, it is unclear what documentation the facility will be required to produce to verify its expenses. Clearly, there will be a variety of fixed costs, variable costs, direct and indirect costs” that will influence the value of the claim; expenses relating to insurance, transportation, labour, weighing, and packing to list a few.  Furthermore, it is unclear whether and how a facility’s profit margin should affect the claim.  Should the insurer bear the cost of a facility’s operating inefficiencies?
It seems, therefore, that these difficult valuation issues will continue to be subject to the vagaries of interpretation of the small claims court, where a storage facility’s business records may not be subjected to the benefits of a rigorous cross-examination by the insurer.

The insurance industry desperately needs some level of predictability in this area of law. The proposed amendments will not provide it.

Legislators should look to the City off Mississauga for a more sensible approach.  There, the city has passed a by-law setting the maximum amount that can be charged and recovered for the storage of vehicles. That amount is periodically reviewed and increased when appropriate. Currently, it is set at $60 per day.

While the towing and storage industry would likely oppose such an Ontario-wide measure that would have the result of capping its profits, the City of Mississauga’s approach could be tailored to apply only to storage-related expense claims resulting from motor vehicle collisions. This exception could reasonably be made on the basis that car collisions involve special circumstances, where injury or upset may prohibit or unduly influence the vehicle owner from negotiating a storage contract that is binding on their insurer.
Most municipalities have towing by-laws setting the maximum that a tow operator can charge for the hook up of a vehicle and mileage related to the tow. Why not the same for storage costs? The government should, therefore, scrap its current draft and work, with the contribution of all stakeholders, on crafting a regulation that would set a maximum amount that can be charged for the storage of a vehicle damaged and towed as a result of a motor vehicle accident. That would seem to be the next logical step and one that would limit the need for expensive and protracted litigation, providing certainty for all parties. 

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By Jennifer Biernaskie, Partner, and Andrea MacLean, Summer Student
McLennan Ross LLP

A recent Alberta Court of Appeal decision reiterated the importance of timely service of a statement of claim.
In McGowan v Lang ("McGowan") the Court found that a plaintiff must formally serve a statement of claim upon the defendant(s) - even in instances where the defendant's insurer had been provided with a copy of the statement of claim. Failure to do so may be fatal to the action.
In McGowan, the plaintiff missed the one-year deadline for service of claims imposed by the Alberta Rules of Court. The statement of claim - relating to a motor vehicle accident - was filed and a copy forwarded to the insurance adjuster who was handling the claim. However, it was not formally served on the defendant until several months after the service deadline.
Prior to the service deadline, there had been ongoing negotiations between the adjuster and the plaintiff's counsel. The adjuster had notified the plaintiff's counsel that he would file a statement of defence if he did not receive medical documents. The plaintiff argued that this conduct created "special or extraordinary circumstances" which should give rise to an extension of the time for service under Rule 3.27(1)(c).
The Court of Appeal found that the actions of the adjuster did not create special or extraordinary circumstances. Further, plaintiff counsel's reliance on the adjuster's statement was found not to be the reason for the failure of service; it was simply a matter that the plaintiff's lawyer had neglected.
The Court expressly stated that an extension of time for service of a statement of claim under Rule 3.27 should not occur where the failure to serve is caused by the plaintiff lawyer's inadvertence, even in situations where there is no demonstrated prejudice to the defendants. 

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By Cara Brown
Brown Economic Consulting Inc.

A personal injury case involving a Correctional Services of Canada (CSC) inmate who was assaulted by another inmate in the medium security facility at Drumheller, Alberta in 2007.  Justice Dario found that the CSC did not breach the applicable standard of care for medium security facilities and was not liable in negligence for the assault on Mr. Adams, nor for failing to find Mr. Adams more quickly after the assault. 

Justice Dario determined that the plaintiff had not “established a future income loss as a ‘real and substantial possibility’ (Athey at para 44), given his pre-incident work history and his previous income that was so markedly below the average for his peers” (para [152], emphasis added).  She continued to provide what her findings would have been in the event that a loss of future income had been established:

[150]  Based on Mr. Adams’ sporadic pre-incident work history and his criminal record, I find he has not established a loss of past income. After release from the Drumheller Institution, he received social assistance payments between $6,469 and $11,411 in each year from 2008-2011, then worked part-time in 2012-2013 in some training/entry-level jobs. On October 7, 2013, he commenced working 32 hours per week as a light duty cleaner at a rate of $12/hr. His income for these years is above his historical earning pattern and he has provided no evidence that it is out of line with re-entry into the workforce…(emphasis added)
[154] Of the two economic experts, I prefer both the assumptions relied upon and the methodology used by the Defendant’s expert [Brown], for various reasons. Regarding methodology for example, Mr. Adams’ expert made allowances for real growth for “without incident” income, but held the “with incident” income at a no growth constant dollar amount. Mr. Adams contests the method by which the Defendant’s expert arrived at the level of disability to apply in her calculations. Nevertheless, I find that the Defendant’s expert evidence is preferable even taking into account this concern. In coming to this conclusion, I must balance Mr. Adams’ objection against the Defendant’s argument, supported by Dr. King, that some of Mr. Adams’ residual issues – such as memory problems and other mental and cognitive functional difficulties – may be attributable to his crack cocaine and marijuana addictions rather than to the attack.  I accept that a mild disability rating is acceptable in light of the Plaintiff’s evidentiary issue (emphasis added).
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By Garett Harper, Associate
McCague Borlack LLP    

The Ontario Superior Court of Justice recently released a decision that provided additional comments on the efficacy of waivers and the development of waiver defences in Ontario. 
In Trimmeliti v. Blue Mountain Resorts Limited,[1] decided by the Honourable Mr. Justice Dunphy, the plaintiff, a season pass holder, was night skiing with friends on the defendant’s premises when he collided with a fluorescent orange mesh ribbon that was used to close a run.  As a result of this collision, the plaintiff suffered a fractured clavicle.
Evidence was advanced at trial by the defendant that prior to the plaintiff’s receipt of the season pass he executed a “Release of Liability, Waiver of Claims, Assumption of Risks and Indemnity Agreement.”  Justice Dunphy noted that the title, “…cannot have failed to put the plaintiff or anyone on inquiry as to the nature of the contractual terms that followed.”[2]  Justice Dunphy also noted that the title was presented in large, bold type and highlighted in yellow.
Contained within the title box was a statement which indicated the following:
The plaintiff was required to initial a box that was placed next to this statement.  Furthermore, the plaintiff provided his signature at the bottom of the waiver, beneath an additional bold typed statement which indicated:
Although the plaintiff stated that he did not read the agreement in full, Justice Dunphy held that the plaintiff could not have failed to understand what the agreement was about in a general way.  When the plaintiff provided his signature, Justice Dunphy determined that the plaintiff understood and agreed with the purpose of the document and made a choice to not inform himself further.
The existence of “fine print”, which in the words of Justice Dunphy was not so much “fine print” as a loud proclamation displayed prominently on the waiver found in a bold type text box, contained a very explicit assumption of risk clause. 
In addition, the defendant had recreated the language contained within the release on the back of all lift tickets.  They had also displayed the terms of the release prominently around the premises, including at the entry to each chair lift.  In short, there was nothing more the defendant could have done to ensure that the plaintiff and other users of the defendant’s premises had knowledge of the conditions required to access the ski hill.
Beyond the existence of the waiver agreement, evidence was advanced regarding plaintiff’s familiarity with the defendant’s ski hill.  Therefore, the court held that the plaintiff knew or ought to have known about the defendant’s requirement to complete a waiver prior to using the ski hill. 
Justice Dunphy also considered the case of Goodspeed v. Tyax Mountain Lake Resorts Ltd.[5] in order to determine if, on the facts of this case, the waiver should not be enforced.  The case of Goodspeed provided that waivers should only not be enforced in one of three situations: 
  1. Where there has been non est factum;
  2. Where there has been a misrepresentation
  3. Where the defendant knows that the plaintiff does not intend to be bound by the form, and therefore there is a duty to bring its terms to the plaintiff’s attention. 
In applying the test as set out in Goodspeed and with knowledge of the decision in Karroll v. Silver Star Mountain Resorts Ltd.[6] which held that there was no presumed duty to bring these types of clauses to the attention of a party, the court determined the waiver was to be enforced.  As a result, the plaintiff’s case was dismissed.
The decision reached in Trimmeliti indicates that the efficacy of waivers is increased where the purpose of the waiver is clearly communicated to all parties.  This can be accomplished through the use of vibrant text on the release itself as well as reproduction of the terms of the release in locations that can be readily observed by users of the premises. 
Furthermore, in determining whether the terms of a waiver should be enforced; the courts will look to the parties’ familiarity with conditions for entry onto the premises.  Evidence of this familiarity can therefore be crucial in the successful advancement of a waiver defence argument.
As demonstrated by the decision in Trimmeliti, when waivers are used appropriately they may operate as a complete defence to a tort claim.

[1] 2015 ONSC 2301 (Ont. S.C.J.).
[2] Ibid at para 66.
[3] Ibid at para 67.
[4] Ibid.
[5] [2005] BCJ No 2515 (B.C. S.C.).
[6] (1988) BCLR (2d) 160 (B.C. S.C.). 

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By C. Nicole Mangan
Richards Buell Sutton LLP
Conflicts often arise between strata corporations, unit owners and their respective insurers regarding payment of insurance deductibles in cases of damage to strata common property.  While the Strata Property Act, S.B.C. 1998 c. 43 (the "Act") governs strata corporation insuring obligations there has been virtually no jurisprudence on the operation of insuring provisions.  In Louie v. The Owners of Strata Plan VR-1323, 2015 BCSC 1832, the B.C. Supreme Court provides guidance on responsibility for payment of a strata corporation's insurance deductible in circumstances where damage occurs primarily within a single strata unit.

The plaintiff owned a strata unit that was rented to a tenant.  Without the plaintiff's knowledge, the tenant operated a methamphetamine laboratory in the unit.  Unsurprisingly, a fire occurred.

Coverage for the fire loss and damage was denied under the plaintiff unit owner's insurance policy.  An exclusion applied to property used to process or manufacture illegal substances.  This coverage denial was not part of the litigation.

The strata corporation had "all risks" insurance that applied to its common property and individual strata units.  Coverage for "losses arising out of . . . manufacturing, processing, storing or distribution of any drug . . ." was subject to a $50,000 deductible.  The strata's policy also had two relevant exclusions: an owner or tenant's personal property or contents and remediation costs for release or escape of "pollutants".

Testing confirmed parts of the unit were contaminated.  One remediation recommendation was to replace the stove exhaust ducting and, if that ducting connected with another unit, to replace the connecting ducting.  Mechanical plans indicated the ducting did not connect to another unit.

The strata's insurer agreed to cover certain losses subject to the unit contents being removed and payment of the deductible.  The unit owner and the strata disagreed over who was obligated to commence the repairs and pay the deductible.  By the trial date, the plaintiff had not commenced any repairs or removed or disposed of the contents or paid the deductible.  The strata corporation also had not taken these steps.  The strata's insurance did not cover the duct remediation, therefore, responsibility for its replacement was another issue between the strata and the plaintiff.

The Ruling
The court noted section 155 of the Act which includes strata lot owners, tenants and persons who normally occupy a strata lot as a "named insured" if a strata corporation is the named insured.  The fact that the strata's insurance policy did not have these people included as "insureds" was irrelevant to the analysis.

Deductible payment is addressed in section 158 of the Act which states that payment of an insurance deductible is a common expense, however, this "does not limit the capacity of the strata corporation to sue an owner in order to recover the deductible . . . if the owner is responsible for the loss or damage that gave rise to the claim".  The plaintiff argued this section obligated the strata to pay the deductible as a common expense while the strata argued it only provided an option for it to pay the deductible, which it could then recover from a "responsible" owner.

The court concluded section 158 does not require a strata corporation to pay the deductible every time damage occurs that could be the subject of an insurance claim.  After reviewing other sections of the Act related to strata insurance and repair obligations, the court noted the permissive language those sections used.  The Act was not breached by the strata's refusal to commence the unit repair work or its refusal to pay the insurance deductible.  Further, the strata had a right to insist the plaintiff pay the deductible.  From the factual findings, the conclusions seem based on the damage being primarily to the unit and the plaintiff's status as a named insured as opposed to the plaintiff being "responsible" for the damage under section 158.

The court also confirmed a strata corporation could be required to repair common property that was for the benefit of all, or a number of, owners.  In those circumstances, the strata corporation should proceed with repairs.  The court did not address who would pay the deductible in this scenario, however, given section 158, it is likely the strata must pay and then pursue any "responsible" owner for the cost of the deductible.

The court also concluded the covered portion of the loss was ultimately below the deductible amount and thus the plaintiff had no claim under the policy or against the insurer for damages.

Ducting, if it was "common property", would have to be repaired by the strata corporation  pursuant to section 72(1) of the Act which requires a strata to repair and maintain common property.  If, however, the ducting was part of the "strata lot", then the bylaws required the unit owner to replace it.  The court concluded the ducting was "limited common property" designated for the unit's exclusive use and the plaintiff was required to replace it.

For insurance lawyers, navigating who is responsible for damage and repairs can be complex in a strata environment.  Both the Act and the strata's bylaws are relevant to the analysis.  This case confirms the scope of damage and who is making the claim under a strata's insurance policy are important facts when assessing who is obligated to pay the deductible.

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By Chris McKibbin and Stuart Woody
Blaney McMurtry LLP
The recent decision of the Eleventh Circuit Court of Appeals in Scottsdale Indemnity Company v. Martinez, Inc. addresses the difficult issue of what happens where the application for fidelity coverage has been completed by the same employee who is perpetrating a fraud against the insured.  In deciding in favour of the insurer, the Eleventh Circuit relied on the wording of the crime coverage’s misrepresentation warranty, and did not expressly address the “adverse interest” principle or the “sole representative” exception to that principle. 
The Facts
The insured, Martinez, Inc. (“MBS”), carried on business as a building maintenance company servicing commercial properties.  The principal of MBS, Greg Martinez, spent most of his time performing building maintenance services for MBS’s clients.  In 2004, MBS hired Brenda Walters as its accountant.  Walters later became the Chief Financial Officer and Chief Executive Officer.  Walters’ duties included handling the company’s financial accounting, in which capacity she had authority to make withdrawals from MBS’s bank accounts. 
In August 2011, Martinez discovered that Walters had been embezzling funds since at least 2006.  Walters’ activities included writing cheques to herself and others, as well as misuse of company credit cards.  The total loss was in excess of $2 million.  
MBS had obtained a Business and Management Indemnity Insurance policy from Scottsdale.  This policy included crime coverage.  MBS’s application was completed by Walters herself.  In the course of completing that application, Walters answered “yes” to the following questions: 
  • “Is there an annual audit or review performance by an independent CPA on the books and accounts, including a complete verification of all securities and bank balances?”; and,
  • “Are bank accounts reconciled by someone not authorized to deposit or withdraw from those accounts?” 
Both of Walters’ answers were false. 
The Crime Coverage
MBS submitted a claim under its crime coverage with Scottsdale.  The policy included a warranty, which provided that:  
In the event the Application … contains any misrepresentation or omission made with the intent to deceive, or contains any misrepresentation or omission which materially affects either the acceptance of the risk or the hazard assumed by Insurer under this Policy, this Policy … shall not afford coverage to the following Insureds for any Claim alleging, based upon, arising out of, attributable to, directly or indirectly resulting from, in consequence of, or in any way involving, any untruthful or inaccurate statements, representations or information: … 
any … Insured, if any past or present chief executive officer [or] chief financial officer … knew the facts misrepresented or the omissions, whether or not such individual knew of the Application, such materials, or this Policy. 
The insurance policy also provided that the application was incorporated into, and constituted a part of, the policy.  Scottsdale concluded that, as a result of Walters’ misrepresentations, these provisions were engaged and no coverage was available to MBS. 
Scottsdale commenced a declaratory action, relying on Walters’ misrepresentations in the application.  MBS relied on the adverse interest exception in arguing that Walters’ misrepresentations should not be imputed to MBS. 
The Decision
The District Court characterized MBS’s attempt to take the benefit of the policy application, without the burden of Walters’ misrepresentations therein, as an “I want to have my cake and to eat it, too” argument.  Applying the plain language of the misrepresentation warranty, and with the benefit of evidence from Scottsdale’s underwriter, the District Court concluded that Walters’ misrepresentations were material to Scottsdale’s terms of acceptance of the risk. 
Turning to the issue of whether general agency principles prevented Scottsdale from relying on the misrepresentation warranty, the District Court rejected MBS’s “adverse interest” argument, relying on the “sole representative” exception.  Generally speaking, where the agent is the sole representative of the principal in a transaction with a third party, her acts and knowledge are imputed to the principal in relation to that transaction, even if she is acting adversely to the principal.  (This exception has also been recognized in Ontario law, in decisions such as jjBarnicke Ltd. v. Commercial Union Assurance Co. of Canada.)
The Eleventh Circuit Court of Appeals affirmed the District Court’s analysis with respect to the misrepresentation warranty.  The evidence demonstrated that Walters’ answers to the two questions were false.  Further, the underwriting evidence demonstrated that the misrepresentations were material to Scottsdale’s terms of acceptance of the risk.  The Court also observed:  
Finally, that Walters' criminal conduct itself was allowed to continue over a lengthy period of five to seven years, when it likely would have been found had the controls inquired about in Questions 3 and 4 been in place, indirectly exemplifies the materiality of the misrepresentations.
In affirming the District Court’s conclusion, the Eleventh Circuit did not expressly address the applicability of the “adverse interest” principle or the “sole representative” exclusion, confining its analysis solely to the relevant policy provisions themselves. 
The injection of agency principles into the misrepresentation analysis makes coverage analysis more difficult and, on a broader level, raises numerous competing considerations, such as underwriting accuracy, the reasonable expectations of both insureds and insurers, the principle that only fortuitous losses should be covered, and general notions of fairness.  Martinez, Inc. provides an example of an appellate court applying a well-worded misrepresentation warranty to find no coverage, without express resort to the application of agency law principles. 
Scottsdale Indemnity Company v. Martinez, Inc., 2015 WL 3823728 (11th Cir.)

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By David J. Olevson and Leona Kung (Student-at-Law)
McCague Borlack LLP
The Ontario Superior Court of Justice recently examined the effectiveness of a signed waiver as a full defence in the context of injuries sustained during recreational sports play in Levita v. Alan Crew et al.[1]
In that case, the plaintiff, Robbie Levita, was a player on a recreational hockey team in a league operated by the defendant, True North Hockey Canada (“True North”). Of note, this was a “no-contact” recreation league, which means body checking was prohibited. During the course of a game, the plaintiff suffered a fractured tibula and fibula as a result of being checked from behind into the boards by the defendant, Alan Crew. In his Statement of Claim, Levita claimed that Crew intentionally or recklessly injured him. Levita also named True North as a defendant, alleging that it was negligent in failing to take adequate steps to protect the safety of the players in the league and also that it knew or ought to have known that Crew was a dangerous player.
Before allowing players to join the league, True North demands that a waiver of liability be executed. This was no different for the plaintiff, who signed the waiver before the start of the season. True North relied on this waiver to escape liability at trial.
The Court found that Crew was neither negligent nor did he attempt to injure the plaintiff. True North therefore could not be found liable, as it did not breach the requisite standard of care that it owed to the plaintiff to provide a safe playing environment. The Court nonetheless discussed whether the waiver executed by the plaintiff was enforceable. In his decision, Justice Firestone accepted that the waiver signed by Levita at the start of the season was a complete defence to any finding of negligence on the part of True North. In essence, Justice Firestone found that “even if True North had been found to be negligent in not providing a safe environment for the play of hockey, the waiver is a complete defence to the claims against it.”[2]
Justice Firestone’s decision implied that the waiver was properly executed by Levita and constituted a valid agreement between Levita and True North, a factor crucial to its enforceability. While the onus of proving the validity of the document rested on the party relying on it, this was met by True North. Although the subject waiver was passed around the team dressing room before the first game of the season without the presence of a league representative to explain its terms, the Court found that it was open to the plaintiff to take the necessary steps to ensure he understood its contents if he did not have sufficient time to read the waiver before signing it.
The Court held that the waiver’s effect could not be retroactively voided by arguing that he did not understand or read the waiver even though he voluntarily signed it.
Furthermore, the Court found the wording of the waiver was unambiguous and it specifically listed the risks and dangers to which it intended to apply. Even though True North was a “non-contact” league, the inherent nature of hockey includes bodily contact. This is the precise reason why the waiver was provided and it was specific to the risks inherent in the sport of hockey. Specifically, the waiver stated:
“[…] In consideration of my participation…I hereby acknowledge that I am aware of the risks and hazards associated with or related to ice hockey. The risks and hazards of ice hockey include, but are not limited to, injuries from:
  • Collisions with the rink boards, hockey nets, and ice;
  • Being struck by hockey sticks and pucks;
  • Physical contact with other participants, resulting in injuries to the eyes, face, teeth, head, and other parts of the body, bruises, sprains, cuts, scrapes, breaks, dislocations and spinal cord injuries which may render me permanently paralyzed.”[3] 
Given the precise wording of the waiver, the plaintiff’s claim is appropriately covered by it and does not fall outside of its scope.[4]

As demonstrated by this decision, a waiver can be a useful tool as long as it is carefully drafted and unambiguous. Furthermore, this case demonstrates that waivers in some circumstances may operate as a complete defence to claims found to fall within their scope. 

[1] Levita v. Alan Crew et al, 2015 ONSC 5316.
[2] Ibid at para 102.
[3] Ibid at para 14 and 104.
[4] For an analysis of the legal requirements for a waiver to be enforceable, please see an article by McCague Borlack LLP, Waiver of Liability vs Public Policy – Which Takes Precedence?, found  at
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The Defence Wins!


Bryan Carroll and Dalton McGuinty Jr. were successful in the case of 1483677 Ontario Inc. v. Howard et al. in obtaining a dismissal of an action against a solicitor. The claim was for $2,083,152.00. Justice Darla Wilson dismissed the action after a thorough review of the law of solicitor negligence.  This may in fact be one of the last “big wins” of Mr. Carroll’s esteemed career as he prepares to retire as a litigator and transition into a mediation practice. (link to decision in PDF format)

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Featured Articles


Ted Chadderton, Carroll Heyd Chown LLP

The issue of plaintiff’s counsel serving their statement of claim directly upon a defendant’s insurer, by way of an order for substituted service, has been around for some time.
The leading case on the issue is Laframboise v. Woodward (2002), 59 O.R. (3d) 338, 2002 CarswellOnt 1448 (Ont. S.C.J.)
It has no history. It does not have negative treatment. It has not been distinguished or overruled.
In the decision Justice Quinn decides to summarize the state of the law on the issue and make very pointed comments on the proper procedure to be followed in obtaining such an order.
The key components of this decision are:

  • Has the defendant satisfied the test for substituted service,
  • Met the requirement to take all reasonable steps to effect service personally, and
  • That such an order should not be made lightly. 
The decision sets the bar high, requiring plaintiff counsel to go as far as demonstrating the use of a skip tracer to locate the defendant, before having moved on to seeking an order allowing service of the claim upon the defendant’s insurer.

It is also the decision which captures and sets in to the common law what is known as the “undertaking”. 
The undertaking is given by plaintiff’s counsel.  In doing so he or she undertakes – originally done in a letter – that the plaintiff will not move to strike out the defence of the defendant if the insurer is unable to produce the defendant for examinations for discovery.
Justice Quinn ruled that it was not sufficient to merely provide the undertaking in a letter, but rather

“it must be contained in the supporting affidavit. And, it should be part of the order.”
I have long held that the principle would be the same for the inability to provide a sworn affidavit of documents, and that the undertaking should extend to include this.
The issue was later commented on by Master Dash in the decision Chambers v. Muslim (2007), 2007 CarswellOnt 6438, 87 O.R. (3d) 784 (Ont. Master) where at para. 25 he says that it has been his experience that insurers may agree not to oppose the motion for substituted service but with conditions such as those above, that the order include a term that the defence filed not be struck if the insurer is unable to produce their insured for discovery.
This highlights a new development that could cause some concern.
Previously such motions were simply brought ex parte as was the case in Laframboise v. Woodward, and any defects in the order could be dealt with by defence counsel, after the insurer was served with the statement of claim.
The right to bring a motion setting aside, varying or amending Ex parte orders, is entrenched in Rule 37.14 as long as it is done expeditiously.
Plaintiff’s counsel have however, shifted tactics, and begun a practice of bringing the motion on notice, serving the target insurer with the notice of motion.  Thus far, in our experience insurers have simply confirmed that coverage was in place and allowed the motion to proceed unopposed, often resulting in an Order being granted permitting service of the claim on the insurer, but without any sign of the undertaking.
This then leaves defence counsel with the difficult issue of having to seek an amendment of an Order made on notice.  Rule 59.06 can be used to seek such an amendment, but the test is higher, requiring demonstration of an omission, or mistake. In a recent unreported endorsement, the court was highly critical of the insurer as follows:
(The Insurer) had notice of the substitutional service motion.  It did not oppose it.  It did not seek any terms such as an U/T [undertaking].

They have not moved expeditiously to amend. The moving party has failed to establish proper grounds to amend pursuant to 59.06
As such, a motion to insert the undertaking into an order for substitutional service on the insurer was denied.
There are have been at least 3 other examples of plaintiff’s counsel seeking similar orders in recent years.
There is one simple and effective way to respond and avoid an order that could cripple the ability to defend a claim.
Insurers need to respond to and/or oppose any motions for substitutional service they receive.  
The first response can be to indicate that any Order sought, that does not include the undertaking both in regards to attendance at examinations for discovery, and for service of an affidavit of documents, will not be granted unopposed.
Counsel needs to be assigned either in-house, or externally to deal with the motion. The time when we can easily and cost effectively demand changes and appropriate terms is shortly after service of the motion.
If the motion is returnable soon, a demand for an adjournment is needed to allow counsel to be appointed and respond. At this point the Insurer is a non-party upon whom relief is sought.  The normal rules will not apply in terms of service and any reasonable adjournment request will be refused at counsel’s peril. A draft wording for the undertaking can be circulated for adjusters to propose.
Furthermore a test case needs to go forward seeking more.  The insurer and insured are also both hamstrung by the fact that in most cases, the Plaintiff is seeking amounts in excess of the policy limits.  It makes perfect sense, that if the Plaintiff wishes to use the shortcut of serving the defendants insurer, they should be limited to what that insurer can provide, namely the policy limits of the defendant.
A test case and expansion of the undertaking would remove the problematic issue of a Plaintiff obtaining a judgement in excess of the limits in one of these cases and seeking to enforce it against a defendant who has never received official notice of the claim. Hopefully an opportunity will present itself soon.     

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~ the interplay between the Insurance Act, R.S.O. 1990, c. 1.8., the Statutory Accident Benefit Schedule – Accidents after September 1, 2010, O. Reg. 34/10, and the Children’s Law Reform Act, R.S.O. 1990, c. C.12 

By Marie T. Clemens, Associate
Nelligan O’Brien Payne LLP

Imagine a scenario where a parent is killed in a motor vehicle accident, leaving their significant other and young child behind. The surviving parent is tasked with caring for their family, making funeral arrangements, dealing with estate issues, dealing with their own grief and satisfying daily demands.
In the midst of all this, they may also have to consider accident benefits available under their significant other’s policy of automobile insurance and potentially a tort claim against the at-fault driver. In an already difficult situation there is a need to address complex procedural and bureaucratic issues, tight and potentially unforgiving timelines, and significant financial pressures.
When access to no-fault benefits is recognized under the insured’s policy, there remain a series of hurdles to overcome before entitlement to a specific benefit is established. Many of these hurdles are logistical. Both the insurer and the surviving parent may face many difficulties as they attempt to comply with the increasingly impractical procedural requirements contained within Ontario’s Statutory Accident Benefits Schedule such as the payment of death benefits to minors. Unfortunately, there are a shocking number of unanswered questions associated with entitlement to, and the payment of, these benefits themselves.
This article is an overview of the issues associated with the payment of death benefits to minors, and provides guidance on accessing this benefit. It will also highlight factors to consider when determining whether death benefits payable to a minor should be paid into court to the benefit of the minor, or whether they can be paid directly to the surviving parent.

  • October 1, 2015 motor vehicle accident in which the insured, John Doe, was fatally injured; 
  • At the time of the loss, John Doe had one child under the age of 16; and 
  • John Doe’s child was a dependent of he and his wife (surviving parent).

Accordingly, pursuant to Section 26(2)2 of the Statutory Accident Benefit Schedule [i] (the “SABS”), the insured’s child is entitled to death benefits in the amount of $10,000.00, unless “Optional Benefits” were purchased, in accordance with section 28(1)(6) of the SABS, which increases the amount payable to $50,000.00.
In Ontario, a minor is considered a “party under disability”, and in accordance with Rule 7.01 of the Rules of Civil Procedure[ii] (the “Rules”) must commence litigation through a litigation guardian. The Rules also generally require that any settlement be approved by the Court. However, Court approval is not always necessary; there is interplay between the Insurance Act[iii] (the “Insurance Act”), the Children’s Law Reform Act[iv] and the SABS when addressing death benefits to a “minor”, in accordance with the SABS.
Generally, an insurer who admits liability for insurance money payable to a minor, such as the above described death benefits, must pay the money and any applicable interest into court to the credit of the minors in accordance with s.271(1.1) of the Insurance Act. There is, however, an underutilized escape clause, and it is found at s.271(1.4) of the Insurance Act.
Section 271(1.4) of the Insurance Act provides that an insurer may, despite subsection (1.1), pay the death benefit to a person referred to in subsection 51(1) of the Children’s Law Reform Act, if the total amount of money paid does not exceed $10,000.00.
The Children’s Law Reform Act, subsection 51(1), states that “[i]f no guardian of a child’s property has been appointed, a person who is under a duty to pay money or deliver personal property to the child discharges that duty, to the extent of the amount paid or the value of the personal property delivered, subject to subsection (1.1), by paying money or delivering personal property to,

(a) the child, if the child has a legal obligation to support another person;
(b) a parent with whom the child resides; or
(c) a person who has lawful custody of the child.  [Emphasis added]
As mentioned, subsection 51(1.1) sets the prescribed amount indicating that “[t]he total of the amount of money paid and the value of personal property delivered under subsection (1) shall not exceed the prescribed amount or, if no amount is prescribed, $10,000.  [Emphasis added]
As indicated above, if “Optional Benefits” were purchased increasing the amount payable to $50,000.00, then these sections would not apply (i.e. money would be payable into court).
As an aside, subsection 26(1)(a) of the SABS provides that the death benefits are due within 180 days after the accident. As such, it would be imperative that the death benefits be paid within the time required as to not accrue interest which would cause the benefit to exceed the prescribed $10,000.00 limit. 
In a scenario as described above, although death benefits may be paid directly to John Doe’s wife, consideration should be given to the following:
  • While paying the benefits directly may allow for the payment to be made in a more timely fashion, it may be in the child’s best interest to have the money paid into court to protect the child’s rights to the money (i.e. if parent has addiction issues, etc.);
  • When death benefits are paid into court, the insurer will receive confirmation that discharges their obligation to the child;
  • If there is a concern surrounding the payment of benefits - interim payment vs. final payment - consideration should be given to have the payment made into court;
  • If death benefits are paid into court there are additional costs associated with the Motion;
  • The parent may require the death benefits immediately for the child (i.e. daycare, medical expenses, etc.); and
  • The parent may have enhanced investment options for the death benefits. 
Prior to making a decision as to how death benefits are to be paid, an insurer should carefully consider how the surviving parent intends to use the death benefit on behalf of the child. If there are any uncertainties, it would be advisable to pay the death benefits into court in order to preserve the child’s rights to those funds.
The Children’s Law Reform Act provides that the parent with whom a child resides, who receives and holds money, per s.51(1) of the Children’s Law Reform Act, has the responsibility of a guardian for the care and management of the money. As such, it would appear that after an insurer pays the death benefits to the parent, it becomes the parent’s responsibility and legal obligation to ensure that the money is appropriately disbursed in the minor’s best interest.
Although this Article is designed to provide accurate information, we note that every case is fact specific. If legal advice or other expert assistance is required, please contact the author directly.
[i] – Accidents after September 1, 2010, O. Reg. 34/10.
[ii] R.R.O. 1990, Reg. 194.
[iii] R.S.O. 1990, c. 1.8.
[iv] R.S.O. 1990, c. C.12.

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By Erin H. Durant and Aruba Mustafa (Student-at-Law)
Borden Ladner Gervais LLP

A review of the threshold motion decisions from 2015 suggests that the year has been a successful one for insurers.  There are ten threshold motion cases reported on CanLII from 2015 as of the middle of November. The defence has been successful in each and every motion in obtaining a ruling that the plaintiff’s injuries did not meet the section 267.5(5) threshold in the Insurance Act (the “Act”).[i]  A chart of these cases can be found at the end of this article, along with the other damages awarded in each case (if any). Of the ten decisions, eight of the actions were dismissed outright as the jury had not awarded any income loss or housekeeping/ home maintenance damages.

Review of the Threshold
The Act provides a statutory “threshold” that limits plaintiff’s claims in minor motor vehicle accidents. The threshold provides that the owner or occupier of a motor vehicle and any person present at an automobile accident are not liable for health care expenses or claims for non-pecuniary loss resulting from bodily injury unless the injured person sustained a “permanent serious disfigurement” or “permanent, serious impairment of an important physical, mental, or psychological function.”[ii] Ontario Regulation 461/96 (the “Regulation”) defines the words “permanent serious impairment of an important physical, mental or psychological function” and outlines evidence the plaintiff must lead to satisfy the Court that the threshold has been met.  The test is important and is outlined below.

Injury Must be “Serious”: The plaintiff must show that his or her injury is “serious” by showing that the impairment substantially interferes with the person’s ability to (a) continue his or her regular or usual employment despite reasonable efforts to accommodate the plaintiff’s impairment and the plaintiff’s reasonable efforts to use the accommodation to allow the plaintiff to continue employment; [iii] (b) continue training for a career in a field in which the person was being trained before the incident, again, despite reasonable efforts to accommodate the plaintiff’s impairment; [iv] or (c) participate in most of his or her usual activities of daily living, considering the plaintiff’s age.[v] If none of these criteria are met, the plaintiff’s injury is not serious and the case will not pass the threshold.

Function Impaired must be “Important”:  The plaintiff also must satisfy the court that the “function” impaired is “important” by meeting one of four criteria. The plaintiff must prove that  the function (1) is necessary to perform the activities that are essential tasks of the person’s employment (taking into account accommodation),  (2) is necessary to perform the activities that are essential tasks of the person’s training for a career in a field in which the person was being trained before the incident (again, taking into account accommodation), (3) is necessary for the person to provide for his or her own care or well-being, or (4) is important to the usual activities of daily living, considering the person’s age.[vi] Again, if this test is not met, the case will not pass the threshold.

Impairment must be “Permanent”: For an impairment to be permanent the plaintiff has to lead evidence that the impairment has been continuous since the incident and must, based on medical evidence and subject to the person reasonably participating in the recommended treatment of the impairment, be expected not to substantially improve. The plaintiff must be able to continue to meet this standard and the impairment must be of a nature that is expected to continue without substantial improvement when sustained by persons in similar circumstances.[vii] If the injury is not permanent, the case does not pass the threshold.

Required Evidence: Failure to provide the correct evidence can result in a threshold motion being granted. The plaintiff must obtain evidence from one or more physicians that explains the nature and permanence of the impairment, the specific function that is impaired and the importance of the function to the person.[viii] The physician must be experienced in the assessment or treatment of the type of impairment that is alleged and must base his or her opinion on medical evidence, in accordance with generally accepted guidelines or standards of the practice of medicine. [ix] The physician’s evidence must include a conclusion that the impairment is directly or indirectly sustained as the result of the use or operation of an automobile.[x]  In addition to evidence from a physician, the plaintiff must also provide evidence that corroborates the change in the function that is alleged to be a permanent serious impairment of an important physical, mental or psychological function.[xi] The Court of Appeal has determined that a plaintiff is able to provide his or her own corroborating evidence regarding the physician’s opinion with regards to change in function.[xii]

The 2015 Decisions
The majority of the 2015 threshold motions were granted because the plaintiff’s injuries could not meet the statutory definition of “serious”. Three cases in particular were decided almost exclusively based on the “serious” criteria: Malfara v. Vukojevic, Abousamak v. Izzo and Ayub v. Sun.

In Malfara Justice Firestone accepted that the plaintiff’s neck and back pain were “permanent” injuries and that the impairments were to “important functions”. However, the defence motion was granted because the impairment was not “serious.” The plaintiff resumed his full-time job as a plumber’s apprentice within a few weeks of the accident and later became a licensed plumber working full time. The impairment did not substantially interfere with his activities of daily living. Justice Firestone adopted the reasons in Sabourin v. Dominion of Canada General Insurance Co. where the court observed that “the plaintiff must do more than simply experience pain in order to bring herself within the exception to the threshold wording. The onus us on her to prove on a balance of probabilities that the pain she is experiences has substantially interfered with most of her activities of daily living.”[xiii] The plaintiff had continued, with pain, to do his housekeeping activities, including yard work and snow shoveling. The plaintiff no longer played hockey, basketball or soccer and did not go to the gym as often, in part because he was “too busy.” The plaintiff’s action was accordingly dismissed.[xiv]

In Abousamak a plaintiff again failed to meet the “serious” threshold. The defence had conceded that the plaintiff’s upper back problems were “permanent”. The plaintiff maintained his employment with the RCMP. He did not miss work after the accident and his position and schedule were accommodated. The plaintiff led evidence that his ability to work overtime was reduced but Justice Diamond found that the plaintiff was able to carry out essentially all of his employment duties and obligations with adequate accommodation. Justice Diamond also rejected the plaintiff’s argument that the accident prevented him from joining a specialized unit in the RCMP that he had hoped to join prior to the accident. The court found that the plaintiff was, at most, self-training for a potential position. The legislation is clear that the person must have been “being trained before the incident” and that the plaintiff had undergone no formal training prior to the accident within the RCMP. The plaintiff also did not show that his injuries interfered with most of his activities of daily living. The plaintiff did not provide a full narrative of his activities of daily life before the accident, other than to say that before the accident he “worked out” five to seven times a week. He was also able to perform his housekeeping duties with a need to pace himself or request assistance from his wife. Accordingly, the defendant’s threshold motion was granted.[xv]

In Ayub v. Sun was another case decided by Justice Diamond and another case where the plaintiff failed to show the alleged impairment was “serious.” The defence conceded that the plaintiff had an impaired function as a result of the headaches, knee, ankle and back pains sustained in the subject motor vehicle accident and that the impairment was permanent.  The plaintiff continued his household activities with pain. The plaintiff had never been employed before or after the accident. The plaintiff was enrolled in an English as a Second Language Program before the accident and this course was completed post-accident. The plaintiff’s expert admitted at trial that there was nothing stopping the plaintiff from performing light work as long as he did not sit for too long and that he could participate in normal housekeeping and light activities. Accordingly, the defendant’s motion was granted and the plaintiff’s action was dismissed.[xvi] The defendants were granted costs of the five day trial on damages and of the action in the amount of $32,500.[xvii]

In Saleh v. Nebel Justice Myers granted the defendant’s threshold motion without even getting into the statutory requirements contained in the Insurance Act or the Regulation as the plaintiff did not put forward insufficient evidence that the plaintiff’s chronic pain was caused by the motor vehicle accident.[xviii] Dr. Cameron was called on behalf of the defence and presented strong evidence that the plaintiff was exaggerating his levels of pain.[xix] The defence would have been awarded $100,000 costs for the action but the defence was denied its costs for not following case management orders, serving late expert reports and causing delays throughout the brief trial.[xx]

In Morgan v. Saquing Justice Glustein reviewed the medical evidence and found that the plaintiff’s injuries were not permanent. The plaintiff’s expert, Dr. Alpert, diagnosed the plaintiff with chronic pain because the plaintiff had experienced pain for 13 years post-accident and, thus, had reached the point that it had become chronic. The defence called Dr. Boynston. Dr. Boynston’s tests and conclusions showed that the plaintiff’s pain could be reversed with treatment and also identified contributing causes of the pain that were unrelated to the motor vehicle accident. Dr. Boynton recommended exercises for stabilizing muscles that would correct the muscle imbalances that led to the development of the plaintiff’s pain. Justice Glustein accepted Dr. Boynston’s evidence that the injuries could be corrected and were not permanent. The defence also relied on surveillance evidence to show that the plaintiff did not have the permanent restrictions on his function that were claimed in Dr. Alpert’s report. The surveillance showed the plaintiff did not have a substantial interference with his ability to perform his usual daily activities and that he was able to continue his regular employment as a personal trainer. Justice Glustein dismissed the plaintiff’s claim for non-pecuniary damages.[xxi]

In Ramrup v. Lazzara Justice Rady granted a threshold motion, in large part because the plaintiff and her partner lacked any credibility. Justice Rady concluded that the low impact collision could not have resulted in the magnitude of the injuries and symptoms that had been reported. The plaintiff was observed by Justice Rady to exaggerate her symptoms and disabilities and avoid answering questions about her pre-accident health. The medical records showed that the plaintiff had been significantly impaired in function prior to the motor vehicle accident. She failed to demonstrate that the accident caused or materially contribute to a diminution of her function. The notes and records from various health care providers pre-accident revealed an individual with a variety of physical and psychological issues. The threshold motion was accordingly granted.[xxii]

Justice Firestone also granted the defendant’s threshold motion in Jogmohan v. Royle. The motion had no real impact on the result as the jury had already returned its verdict awarding nothing to the plaintiff for general damages, future housekeeping/home maintenance or future care costs. Justice Firestone was obviously as unimpressed with the plaintiff’s case as the jury. The 65 year old plaintiff suffered from pre-existing osteoarthritis and degenerative changes to her shoulder and knee – the areas that she alleged to have injured. The plaintiff had already stopped working prior to the motor vehicle accident. Even if there was an exacerbation of the pre-accident condition, the court found that these new or increased impairments were not the type that impacted her usual activities of daily living. Although her housekeeping and home maintenance tasks, self-care and recreational activities were “more difficult” for her to do, this was not enough to surpass the threshold.[xxiii]

In Berfi v. Muthusamy Justice Stinson granted a threshold motion where a plaintiff had allegedly suffered left shoulder, arm and hand problems as a result of the accident. The plaintiff underwent shoulder surgery as a result of the collision. However, the plaintiff failed to attend a follow up appointment with his surgeon and did not follow his family doctor’s advice to pursue further physiotherapy.  The plaintiff also continued to work full time in his usual employment right up until the time for trial (except for a 17 day recovery period after the surgery). The plaintiff’s evidence was that he was willing to work through the pain until he turned 65 later in 2015 when he was able to retire and receive his union pension. However, during the course of trial the defendant was able to summon a representative from the union to give evidence following late disclosure of a pension document that indicated that the plaintiff had chosen to elect to continue working after receiving his pension. This, obviously, impacted the court’s impression on the plaintiff’s credibility. The court did not accept he plaintiff’s evidence that his activities of daily living had been significantly impeded, referring to the plaintiff as a “vauge historian.” The threshold motion was granted.[xxiv]

Justice Lemay granted a threshold motion in Gill v. Sivaranjan. In this case, as in Berfi, the jury had already returned a verdict favorable to the defendant and had decided that the plaintiff’s alleged chronic pain disorder was not related to the motor vehicle accident. Justice Lemay also found the plaintiff’s evidence not to be credible as the plaintiff’s evidence contradicted the medical records and his own evidence on discovery.  The plaintiff exaggerated the seriousness of the accident, his injuries and also the amount of his pre-accident income. The plaintiff did not seek medical attention for his injuries until eight months after the accident, even though he had visited his doctor for other reasons. The plaintiff started physiotherapy two years after the accident – after he had seen a lawyer. During the eight year period from the date of the accident to the trial date the plaintiff only complained of his injuries to his doctor on two occasions. The action was, not surprisingly, dismissed.[xxv]

Justice Faieta ruled that a plaintiff who allegedly suffered long lasting soft tissue injuries to the left side of her body did not meet the threshold in the case of Lee v. Rezai. The accident was a low impact collision that caused $1,000 in property damage. The plaintiff was not employed before or after the accident but acted as a volunteer at an organization established by herself and her husband. Her injuries did not prevent her from volunteering. Her injuries also did not substantially interfere with most of her activities of daily living as she was able to walk around stores to shop, load large bags into and out of the back seat of her car, drive for long distances, read for leisure, and travel by plane to Hawaii, Korea, Japan, Baltimore and Brazil. These findings alone would have been sufficient to grant the defendant’s motion. However, Justice Faieta went on to consider the medical evidence and found that the impairment did not meet the test for “permanence” either. Dr. Lipson, the defence expert, was preferred over the plaintiff’s expert Dr. Kekosz, given that he performed a more critical assessment of the subjective complaints presented by the plaintiff. Dr. Lipson opined that the plaitniff’s alleged complaints were not those that one would normally see from a minor rear-end collision. Further, Dr. Lipson observed the plaintiff demonstrated pain magnification and pain focused behaviour during his assessment.  Accordingly, the defendant’s motion was granted and the plaintiff’s claims for non-pecuniary damages and health care expenses were dismissed.

The 2015 threshold cases demonstrate that insurers have built a solid foundation of law to rely upon to defend motor vehicle accident claims that result in minor injuries.  Although it is up to the defendant to bring a threshold motion at the conclusion of the trial, it is up to the plaintiff to call evidence to satisfy the court that the threshold is met. The recent cases show that this is not an easy task for the plaintiff.

Summary of 2015 Cases (as of November 16, 2015)
  • Abousamak v Izzy, 2015 ONSC 3884: Action dismissed: $30,000 general damages, $0 for past income. $0 for future loss of income
  • Morgan v. Sacking, 2015 ONSC 2647, Non-jury trial: Action dismissed: $15,000 for general damages, $0 for past income loss. $0 for future income loss
  • Ramrup v Lazzara, 2015 ONSC 2573: Threshold motion granted but plaintiff entitled to judgement of $38,500 for past income claim.: $1,053 for general damages, $38,500 for past income, $0 for special damages, $0 for future loss claims
  • Ayub v Sun, 2015 ONSC 1828: Action dismissed: $25,000 for general damages, $5,000 for future health care expenses
  • Jugmohan v. Royle et al., 2015 ONSC 1497: Action dismissed: $0 for general damages, $0 for future housekeeping/ home maintenance , $0 for future cost of care
  • Berfi v. Muthusamy, 2015 ONSC 981: Threshold motion granted but plaintiff entitled to judgement of $6,000 for past loss of income.: $43,000 for general damages, $6,000 for past loss of income, $0 for future loss of income
  • Gill v. Sivaranjan, 2015 ONSC 841: Action dismissed: $0 for all claims (jury found that injuries were not caused by the motor vehicle accident)
  • Saleh v. Nebel, 2015 ONSC 747: Action dismissed: $30,000 for general damages, $0 for past loss of income, $0 for future loss of income, $0 for future care
  • Malfara v. Vukojevic, 2015 ONSC 78: Action dismissed: $7,700 for general damages, $1,326 for past loss of income reduced to nil by trial judge due to receipt of collateral benefits, $0 for future loss of income
  • Lee v. Rezai, 2015 ONSC 1926: Action dismissed: $0 for general damages, $0 for special damages, $0 for future care costs

[i] R.S.O. 1990 c. 18.
[ii] Ibid., s. 267.5(3)(a) and (b) and s. 267.5(5)(a) and (b).
[iii] Ontario Regulation 461/96, s. 4.2(1)1.
[iv] Ibid., s. 4.2.(1)1.ii.
[v] Ibid., s. 4.2.(1)1.iii.
[vi] Ibid., s. 4.2(1)2.
[vii] Ibid. s. 4.2(1)3.
[viii] Ibid. s. 4.3(2).
[ix]  Ibid. s. 4.3(3).
[x] Ibid. s. 4.3(4).
[xi] Ibid. s. 4.3(5).
[xii] Gyorffy v. Drury, 2015 ONCA 31 at para. 44.
[xiii] Sabourin v. Dominion of Canada General Insurance Co., [2009] O.J. No. 1425 (S.C.) at para. 99.
[xiv] Malfara v. Vukojevic, 2015 ONSC 78 at paras. 28-40.
[xv] Abousamak v. Izzo, 2015 ONSC 3884 at paras. 44-61.
[xvi] Ayub v. Sun, 2015 ONSC 1828 at paras. 34-46.
[xvii] The trial was only five days as liability had been admitted. Ayub v. Sun, 2015 ONSC 2369.
[xviii] Relying on the court’s reasons in Dinham v. Brejkaln, 2005 CanLII 46749 at paras. 20-26.
[xix] Saleh v. Nebel, 2015 ONSC 747 at pgs. 5-9.
[xx] Saleh v. Nebel, 2015 ONSC 3680.
[xxi] Morgan v. Saquing, 2015 ONSC 2647 at paras. 113-266.
[xxii] Ramrup v. Lazzara, 2015 ONSC 2573 at paras. 45-100. 
[xxiii] Jugmohan v. Royle, 2015 ONSC 1497 at paras. 27-38.
[xxiv] Berfi v. Muthusamy, 2015 ONSC 981at paras. 21-38.
[xxv] Gil v. Sivaranhan, 2015 ONSC 841 at paras. 33-44.

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CDL News


Canadian Defence Lawyers Foundation logoThe CDL Foundation, dedicated to the continued education of lawyers practicing civil defence law, has launched an annual essay competition for students enrolled in any Canadian law school. Promotion of this prize will increased the visibility of CDL within the academic legal community, and promote the civil defence bar as a preferred area of practice for new graduates.

Of course, to support this important and worthy initiative, the CDL Foundation Board is actively encouraging CDL members and colleagues to donate. The foundation is a registered Canadian charity and appropriate tax receipts will be issued. Help support our goals!

Visit for more information and to donate.

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CDL Board of Directors is pleased to announce the formation of the In-House Counsel Standing Committee, tasked with encouraging CDL membership and engagement amongst this growing group of insurance law professionals. The Standing Committee has representation from numerous insurers across the country, along with CDL board members. Together, they are committed to promoting CDL and ensuring membership and programming meets the needs of in-house lawyers. Interested in the work of this committee? Contact David Festeryga

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CDL’s flagship Insurance Symposium will take place on February 4 in Toronto. Click here for current details. Online registration is now open, and more information will follow.

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Member Spotlight

Congratulations to CDL member Mark Lichty, Blaney McMurtry, recipient of the 2016 Honsberger Award from Toronto Lawyers Association. Click here for the press release.

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