In Imeri et al v. Laidman et al, 2023 ONSC 5095, the plaintiff, who previously settled their accident benefits claim against Aviva (the priority insurer) attempted to bring a claim in punitive and aggravated damages against TD General Insurance (“TD”) for non-payment of accident benefits. TD brought a motion for summary judgement to have the claim dismissed.
This decision arose from a motion for summary judgement, brought by the defendant TD General Insurance Company (“TD”). TD was initially the insurer who provided statutory accident benefits (“SABS”) to the plaintiff as a result of a motor vehicle accident which occurred on August 27, 2013.
Based on the priority of insurance regime, Aviva Insurance Company (“Aviva”) ultimately administered the accident benefits claim. The decision with respect to priority as between TD and Aviva was made on March 13, 2016. Aviva repaid TD for the benefits it had paid. On July 28, 2020, the plaintiff settled his claim for accident benefits with Aviva, and signed a full and final release in favour of Aviva.
Simultaneously, the plaintiff maintained an action in respect of the accident, which was set for an 8-week trial commencing October 2, 2023. The remaining two defendants in the action were the driver/owner of the motor vehicle that struck the plaintiff, and TD. The claim against TD was for punitive and aggravated damages which were alleged to arise out of the conduct of TD in failing to provide SABS to the plaintiff.
TD brought the motion for summary judgement on three grounds: (1) the plaintiff failed to mediate the issue of punitive and exemplary damages as required under section 280 of the Statutory Accident Benefits Schedule; (2) the plaintiff had settled his accident benefits claim and there was no independent cause of action for punitive and aggravated damages; and (3) on the merits, the plaintiff had not established that the conduct of TD rises to the level required to entitle the plaintiff to punitive damages and, further, the plaintiff had not led sufficient evidence to establish aggravated damages.
The Court noted that this was a unique case and was unlikely to arise again in the future due to the Licence Appeal Tribunal (“LAT”) now having sole jurisdiction of disputes over accident benefit claims.
1. Should the claim be dismissed because the plaintiff failed to mediate the issue of punitive and aggravated damages?
2. Is the plaintiff precluded from pursuing this claim against TD as a result of his settlement of his claim for SABS and extra contractual damages with Aviva?
The Court found that there was no genuine issue requiring trial. The plaintiff was precluded from pursuing his claim against TD as a result of him signing the all encompassing full and final release with Aviva that precludes any future claims. The claim would not have been dismissed on the basis that the plaintiff failed to mediate the punitive and aggravated damages.
The Court held that, the failure to mediate the issues of punitive or aggravated damages does not, in and of itself, preclude the plaintiff from pursuing his claim for punitive and aggravated damages.
The plaintiff settled his accident benefits claim with Aviva, and executed a release that contained a no admission of liability clause. The claims asserted by the plaintiff against TD all flowed from the denial of benefits, which had been resolved, on a full and final basis, for all past, present and future benefits.
The Court relied on the Ontario Court of Appeal decision in Mader v. Hunter, 2004 CanLII 17834, in which it had been found that the plaintiff’s claims for damages for mental distress or bad faith flowed from the respondent’s alleged breach of the insurance policy at issue in that case. In some cases, a breach of an insurer’s duty of good faith or intentional infliction of mental distress can constitute an independent cause of action (Whiten v. Pilot Insurance Co. 2002 1 SCR 595). However, there was no separate actionable wrong in this case.
In Arsenault v. Dumfries Mutual Insurance Co., 2002 CanLII 23580, Justice Abella noted that in s.279 of the Insurance Act, the legislature mandated that disputes “in respect of” any claim to no-fault benefits must be resolved in accordance with ss.280 – 283 of the Insurance Act.
The plaintiff, by resolving his accident benefits claim with Aviva, and signing a release for all past, present and future benefits, had fully resolved his accident benefits claim, and could no longer pursue TD for such claims. As the claims for punitive and exemplary damages arose from the accident benefits claim, and there was no independently actionable conduct giving rise to these claims, the claims as against TD were untenable in law.