Legal Review/Preview 09/10:
Richard Bickford, partner at Blouin, Dunn LLP.
December 11, 2009
Richard Bickford practices almost exclusively as an insurance litigator, specializing in tort law. He has over 14 years of experience in personal injury, products liability, property damage, defamation, and livestock and cargo claims. He is a partner at Blouin, Dunn LLP and based out of Toronto, Ont.
When asked what the top legal issues of 2009 were, and the biggest factors to affect the industry in 2010, Bickford quickly responded with the following:
Top issues of 2009
1. The constitutional challenge on Alberta's automobile insurance scheme.
Why? Alberta limits the damages awardable to persons who make claims on minor injuries and certain whiplash associated disorders to less than $4,000 for non-pecuniary damages.
A person involved in an accident claimed that the Alberta regulatory scheme infringed on her rights to equality and to her right not to be deprived of security of the person, except in accordance with the principles of fundamental justice.
The Alberta Court of appeal found that the regulatory insurance scheme did not breach the charter in either of the above ways. First the legislation was not discriminatory when it was taken as a whole because the regulatory scheme allowed for a treatment scheme meant to help those suffering from minor injuries. Secondly, while the regulatory scheme did create a system by which people with minor injuries would be assessed and treated and while it did limit their ability to sue for "pain and suffering," it did not infringe on their ability to seek treatment options as they saw fit. Therefore it did not impact on their Section 7 rights.
A similar decision occurred at the trial level in Nova Scotia, where it was found that a similar regulatory scheme was constitutionally sound because it was not discriminatory against plaintiffs with minor injuries.
Generally, these decisions appear to uphold statutory and regulatory schemes made by provinces to limit the cost of minor claims as long as they are also meant to help rehabilitate or treat those involved in minor accidents.
This matter has been appealed to the Supreme Court. Leave has not yet been granted or denied. This matter could therefore be something to watch in the coming year as well.
2. Facebook and production of records.
Why? Plaintiffs must face the reality that their personal information may be obtained for a lawsuit. Even documents held online at Facebook after information is deleted on their personal page may end up being disclosed, at the very least they should be included in an Affidavit of Documents according to the decision of Leduc v. Roman, [2009] O.J. No. 681.
Motions for production for Facebook records have been successful and are now requested regularly through the discovery process.
3. The effects of Supreme Court of Canada’s decision of Mustapha v. Culligan Water (released May 22, 2008).
The Supreme Court of Canada (SCC) dismissed an appeal in this matter, holding that an injury was not reasonably foreseeable. Although the defendant breached it's standard of care by supplying contaminated water to the plaintiff, the plaintiff failed to show it was foreseeable that a person of ordinary fortitude would suffer serious injury from seeing flies in a bottle of water. The SCC held that the injury must be serious and prolonged and rise above the ordinary annoyances, anxieties and fears that people living in society routinely accept.
This case establishes the parameter of foreseeability in lawsuits with a psychiatric component.
Why does this impact the insurance industry? This case has impacted the foreseeability of damages and has, and will, impact actions launched and litigated in the past year as well as in the future. Essentially it prevents a plaintiff who is psychologically "thin-skulled" from recovering damages.
4. The effect of Mary Carter Agreements on non-settling defendants and the issue of costs.
Court of Appeal heard a decision in 2009 involving the deductibility of settlement proceeds from a Mary Carter Agreement from the global assessment of damages.
In the case of Laudon v. Roberts [2009] O.J. No 1824 (ON. C.A.), the jury found that the plaintiff was to be awarded an amount that was smaller than the amount that had been paid by the settling defendant. This means that the plaintiff no longer had any losses, which, it could claim against the non-settling defendant. Because the Mary Carter Agreement requires that the matter proceed to trial against the non-settling defendant, cost consequences were awarded against the plaintiff for proceeding against the non-settling defendant when there were no further losses that were recoverable from that defendant.
This case highlights the significant risks of entering a Mary Carter Agreement for both a plaintiff and a settling defendant. Plaintiff's counsel will become highly cautious when entering into any Mary Carter Agreement given the draconian effects they may face in proceeding to trial.
5. The "faulty or improper design exclusion" in insurance contracts has been interpreted.
A design is not faulty or improper simply because it falls short of perfection in relation to all foreseeable risks. A design cannot be "faulty" if it conforms to the "state of the art"—an SCC decision in CNR co. v. Royal and Sun Alliance defines this ruling.
Top issues to watch for in 2010
6. Auto Insurance Reform.
Why? It may change access to accident benefits and push more claims into the tort realm thereby creating more litigation. Claims that would normally attract accident benefits through the no-fault regime may end up in litigation where liability may be hotly contested. Questions will arise regarding the threshold and these issues will need to be litigated in the next year.
7. Ontario Rules of Civil Procedure—Changes come into force in January 2010.
Why? The increase of the small claims cap and actions that will fall under the simplified rules will force a majority of claims to proceed on a more expedited basis through the court system. Discoveries will be time-limited and this will affect a defendant’s ability to fully investigate to the extent they have been able to in the past. |
