Court File and Parties

CITATION: Watt v. TD Insurance and TD Meloche Monnex, 2022 ONSC 1514

DIVISIONAL COURT FILE NO.: DC-19-108

DATE: 2022-03-11

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

Heeney, Backhouse, Gibson JJ.

BETWEEN:

EDWARD WATT

Appellant

– and –

TD INSURANCE and TD MELOCHE MONNEX

Respondents

Counsel:

Robert N. Kostyniuk, Q.C. for the Appellant

Benjamin Hutchinson, Hyla Korn and Arfa Saeed, for the Respondents

HEARD by videoconference at Brampton on March 8, 2022

Reasons for Judgment

The judgment of the court was delivered by:

HEENEY J.:

[1] The appellant appeals the judgment of LeMay J. released November 14, 2019, which determined his net entitlement to insurance proceeds arising out of the loss of his home and contents to a fire, which occurred on March 25, 2012.

[2] By way of brief background, the appellant insured his home and contents with the respondents (collectively, “TD”) from fire, up to a policy limit of $1 million. Extensive negotiations took place for over two years following the fire in an attempt to settle the value of the home and contents, as well as other losses claimed, such as additional living expenses. TD retained Win-Mar Construction to do an estimate as to the cost of rebuilding the house, on the understanding that they would actually build it for the quoted price, if the appellant opted to do so. That price, after several revisions, was $494,678.54.

[3] Ultimately the appellant decided to build a substantially larger home himself, given that he is a general contractor with many years of experience in the construction industry. The original house was 1,100 sq. ft. on the main level, with a further 1,000 sq. ft. of finished space on the lower level. The new residence was 3,200 sq. ft. TD paid him the sum of $493,857.87 toward the cost of reconstruction which, in their view, represented the amount it would have cost to rebuild a substantially similar residence to the one that was destroyed. The actual cost to the appellant of the larger house built by him was considerably more than that.

[4] However, the appellant did not agree that this sum represented full compensation for the loss of the house, and claimed additional construction costs and administration expenses he had incurred. He also disagreed with TD’s assessment of his claims for the loss of his household contents, artwork and comic book collections, and his additional living expenses. This litigation was the result of that disagreement.

[5] The trial took place from January 14 to 18, 2019. The decision of the trial judge provided as follows:

a) The appellant was awarded the additional sum of $74,936.49 for the loss of his household contents, artwork and comic book collection;

b) The court concluded that TD had overpaid for the loss of the house, since it paid replacement cost instead of actual cash value. A set-off in favour of TD was allowed in the amount of $49,467.85 (representing 10% depreciation on Win-Mar’s quote), resulting in a net judgment in favour of the appellant in the amount of $25,468.64;

c) The appellant’s other claims, including a claim for general damages, were dismissed.

[6] The following issues were argued in this appeal:

a) Did the trial judge misapprehend the appellant’s evidence and, as a result, draw an erroneous adverse inference against his credibility; and did the trial judge erroneously fail to draw an adverse inference against TD for their failure to call two witnesses?

b) Did the trial judge err in permitting TD to set off its overpayment against the judgment awarded to the appellant, when no claim for this relief was pleaded by them?

c) Did the trial judge err in his assessment of the loss payable for the artwork collection and additional living expenses?

[7] An appeal lies to this court from a final order of a judge of the Superior Court of Justice for a single payment of not more than $50,000: s. 19(1.2)(a) of the Courts of Justice Act, R.S.O. 1990, c. C.43. Jurisdiction turns on the amount actually ordered to be paid: McGrath v. Woodrow (2001), 2001 24163 (ON CA), 52 O.R. (3d) 732 (C.A.). The sum ordered here is $25,268.64, and accordingly this court has jurisdiction over this appeal.

Issue #1: Misapprehension of the evidence

[8] Although this was argued as a stand-alone ground of appeal, the first issue only really has relevance to the extent it affects the third issue.

[9] At paras. 28-9 of the reasons for judgment, the trial judge indicated that he approached the evidence of the appellant “with some caution as there was a tendency to exaggerate that permeated his testimony”. As an example of that exaggeration, the trial judge pointed to the appellant’s claim to have been a general contractor for 35 years. After noting that this would have meant that the appellant was working as a general contractor at the young age of 17, he found his evidence on that point to be “a stretch”.

[10] The appellant claims that the trial judge misapprehended the evidence in coming to this conclusion. However, at p. 42 of the transcript of the appellant’s evidence at trial, the following exchange took place during his examination in chief:

Q. And how long have you been a general contractor?

A. For 35 years.

[11] While he gave evidence at other points in his testimony with more detailed information about his background, it can hardly be argued that the trial judge misapprehended the evidence when the appellant said precisely what was referenced in the reasons for judgment.

[12] It should be noted that there are other examples in the reasons for judgment where the trial judge made an adverse finding of credibility against the appellant. In particular, he found that a document tendered by the appellant, which he said was created by an adjuster who worked for TD, Ms. Hopkins, and which supposedly reflected an agreement they reached to settle the value of the household contents for 78% of the replacement cost, was actually created by the appellant.

[13] We find no merit to this ground of appeal.

[14] The appellant also argued that an adverse inference should have been drawn against TD for failing to call two witnesses who were involved in the file. This argument is made in para. 33 of the appellant’s factum, which reads as follows:

The Defendant failed to call Mary Anne Hopkins, or John Parr, to give evidence, although both were available. An adverse inference ought to have been made against TD of the evidence they would have made had they testified.

[15] The problem with this argument is that the appellant fails to identify precisely what adverse inference should have been drawn, what evidence would have been given had they been called to testify, and how such an inference may have affected the result.

[16] We find no merit to this ground of appeal either.

Issue #2: The Claim for Set-off

[17] This was the central issue argued on this appeal.

[18] The replacement value of a similar home to the one that was destroyed was the subject of much disagreement and negotiation between the parties. Several estimates were obtained as to the cost of building a comparable home. As already noted, TD relied on the final quote from Win-Mar, which was an all-inclusive price of $494,678.54 to build a substantially similar home. They then paid the appellant the sum of $493,857.87. It is not clear why there is a slight difference between the quote and the amount paid, but there is no dispute that this payment reflected what TD was prepared to pay for the loss of the home.

[19] The trial judge accepted the quote as accurately representing the cost of replacing the home that was destroyed by fire with a comparable residence. That finding is not challenged on this appeal.

[20] What is challenged, however, is the fact that the trial judge allowed TD to claim depreciation on the replacement cost of the home, and to deduct that as a set-off as against the other amounts the appellant was claiming in the litigation. TD did not claim a set-off in their Statement of Defence, nor did they allege therein that they overpaid for the loss of the home and were entitled to offset that overpayment against any other monies found to be due to the appellant. While they did “plead and rely upon … the terms of the contract of insurance between the plaintiffs and the defendant”, that would clearly not put the appellant on notice that they were seeking a credit for an alleged overpayment, nor the reason therefor, nor the amount thereof.

[21] It is undisputed that this claim for a set-off was never raised as an issue during discoveries, during the pre-trial conference, nor at any other time prior to the eve of trial. TD did not seek to amend their pleadings at trial to claim a set-off, but merely advanced the claim in their closing submissions.

[22] The credit claimed by TD arises from the difference between the “Guaranteed Reconstruction Cost” and the “Actual Cash Value” as defined by the policy. The policy provides that the insurer will pay the actual cost of reconstruction, subject to the condition that “repairs or reconstruction must be effected on the same premises with materials of similar quality”. If that condition is not met, the insurer is obligated only to pay the “Actual Cash Value”, which is defined as the cost of replacement less any depreciation.

[23] The trial judge interpreted this to mean that the appellant was entitled to have an 1,100 sq. ft. bungalow rebuilt on his property. However, he was not entitled to receive the replacement value of that building, and then use the funds to build himself a 3,200 sq. ft. home. The trial judge therefore discounted the cost of reconstruction of $494,678.54 for depreciation by 10%, resulting in a credit to TD of $49,467.85, which was offset against other monies found to be due to the appellant.

[24] It is noteworthy that this interpretation of the contract is at odds with the testimony of Ken Su, who was the only representative of TD to testify at trial. During cross-examination, he was asked that if it cost $600,000 to replace the appellant’s home, but he built a bigger home at a cost of $1.6 million and paid the extra out of his pocket, would he be entitled to receive the $600,000? Mr. Su’s answer was as follows:

If our scope of work states as $600,000 to rebuild the house [as] it was before the fire and he – and Mr. Watt build [sic] a completely different home, he will still be entitled for the full replacement of the house.

[25] Despite that evidence, no challenge was mounted on this appeal as to the trial judge’s interpretation of the contract of insurance. Rather, the challenge was as to whether TD should have been allowed to make the claim for set-off at all, given that it was not claimed in their pleadings and was only raised as an issue at the eleventh hour.

[26] The trial judge dismissed the argument proffered by the appellant that TD was precluded from making this claim by virtue of issue estoppel. However, he did not address the question as to whether TD should be precluded from making this claim because it was a new issue that should have been pleaded but was not.

[27] The importance of pleadings in a civil proceeding cannot be overemphasized. In Colautti Construction Ltd. v. Ashcroft Development Inc., 2011 ONCA 359, Cronk J.A., speaking for the court, said this, at para. 42:

It is beyond dispute that civil lawsuits are to be decided within the boundaries of the pleadings and that the parties are entitled "to have a resolution of their differences on the basis of the issues joined in the pleadings": Rodaro v. Royal Bank of Canada (2002), 2002 41834 (ON CA), 59 O.R. (3d) 74 (C.A.), at para. 60, citing 460635 Ontario Ltd. v. 1002953 Ontario Inc. (1999), 1999 789 (ON CA), 127 O.A.C. 48 (C.A.), at para. 9. See also A-C-H International Inc. v. Royal Bank of Canada (2005), 2005 17769 (ON CA), 197 O.A.C. 227 (C.A.), at paras. 15-18; TSP - INTL Ltd. v. Mills (2006), 2006 22468 (ON CA), 81 O.R. (3d) 266 (C.A.), at paras. 29-35. Were it otherwise, a party would be denied the right to know the case it has to meet and the right to a fair opportunity to meet that case: Rodaro, at para. 61.

[28] Claims for set-off are dealt with in s. 111 of the Courts of Justice Act, R.S.O. 1990, c. C-43, which provides as follows:

111 (1) In an action for payment of a debt, the defendant may, by way of defence, claim the right to set off against the plaintiff’s claim a debt owed by the plaintiff to the defendant.

(2) Mutual debts may be set off against each other even if they are of a different nature.

(3) Where, on a defence of set off, a larger sum is found to be due from the plaintiff to the defendant than is found to be due from the defendant to the plaintiff, the defendant is entitled to judgment for the balance.

[29] Since this is a defence that may be claimed, one can infer that such a claim should be found in the defendant’s pleadings. This view is reinforced by Myers v. Simcoe & Erie General Insurance Co., 1994 CarswellOnt 2206 (C.A.), where the court said the following, at para. 5:

Although a set-off is commonly referred to as a defence, it nevertheless involves a claim by the defendant who asserts set-off.

[30] Rule 25.07(4) requires affirmative defences to be pleaded:

(4) In a defence, a party shall plead any matter on which the party intends to rely to defeat the claim of the opposite party and which, if not specifically pleaded, might take the opposite party by surprise or raise an issue that has not been raised in the opposite party’s pleading.

[31] The claim for set-off here is clearly intended to defeat the claim of the appellant, at least to the extent of the amount of the set-off. TD argued, and the trial judge agreed, that if the court finds that the appellant is entitled to the sum of $74,936.49 for the loss of his household contents, that claim should be defeated to the extent of $49,467.85 because the appellant owes TD a refund in that amount, since he was overpaid for the loss of his house. There is no question, on the record before us, that this took the appellant by surprise. Thus, on the plain wording of this rule, the claim should have been pleaded.

[32] Nordheimer J.A. dealt with the failure to plead the defence of non est factum in Teefy Developments (Bathurst Glen) Limited v. Sun, 2021 ONCA 870, and said the following, at para. 14:

Actions are decided on the basis of the pleadings. Affirmative defences must be pleaded: Rules of Civil Procedure, R.R.O. 1990, Reg. 194, r. 25.07(4).

[33] A claim for set-off is an affirmative defence: see OZ Optics Ltd. v. Dimensional Communications Inc., 2004 35937 (Ont. S.C.J.).

[34] Finally, in Midland Resources Holding Ltd. v. Shtaif, 2017 ONCA 320, Brown J.A., speaking for the court, explained the rationale for this rule, at paras. 109-11:

Rule 25.07(4) of the Rules of Civil Procedure requires a defendant to plead any matter on which he intends to rely to defeat the claim of the opposite party and which, if not specifically pleaded, “might take the opposite party by surprise or raise an issue that has not been raised in the opposite party’s pleading.” This requires a party to plead an affirmative defence, such as a plaintiff’s lack of standing to sue: SIPGP No. 1 Inc. v. Eastern Construction Co., 2010 ONSC 2168 (Ont. S.C.J.), at paras. 102-105; Huber v. Way, 2014 ONSC 4426 (Ont. S.C.J.), at paras. 66-68.

The reason for this pleading rule is quite simple. The just determination of a civil proceeding on its merits requires a fair adjudicative process. Trial by ambush is not fair. Accordingly, trial unfairness may result where a defendant is permitted to rely on an unpleaded defence which, if pleaded, might have prompted counsel to employ different tactics at trial: S. (W.E.) v. P. (M.M.) (2000), 2000 16831 (ON CA), 50 O.R. (3d) 70 (Ont. C.A.), leave to appeal refused, (2001), [2000] S.C.C.A. No. 532 (S.C.C.), at para. 37. As this court stated in Hav-A-Kar Leasing Ltd. v. Vekselshtein, 2012 ONCA 826 (Ont. C.A.), at paras. 69-70:

The failure to raise substantive responses to a plaintiff’s claims until trial or, worse, until the close of trial, is contrary to the spirit and requirements of the Rules of Civil Procedure and the goal of fair contest that underlies those Rules. Such a failure also undermines the important principle that the parties to a civil lawsuit are entitled to have their differences resolved on the basis of the issues joined in the pleadings.... [W]here a defence to a civil action is not pleaded and no pleadings amendment is obtained, judges should generally resist the inclination to allow a defendant to raise and rely on the unpleaded defence if trial fairness and the avoidance of prejudice to the plaintiff are to be achieved.

The rule is not absolute. This court has excused defendants from their failure to raise an affirmative defence in the pleadings where the issue was otherwise clearly raised and put in issue before trial: Reliable Life Insurance Co. v. M.H. Ingle & Associates Insurance Brokers Ltd. (2002), 2002 41603 (ON CA), 59 O.R. (3d) 1 (Ont. C.A.), at para. 36. However, raising a potentially dispositive issue during closing submissions, after the close of evidence, may well prove too late.

[35] There is no dispute that this issue was not raised by TD before the commencement of trial and, in our view, this resulted in unfairness to the appellant. Had it been raised earlier, there are many ways in which it might have affected his litigation strategy. Obviously, it would have been the subject-matter of oral and documentary discovery. The appellant may have retained an expert to provide opinion evidence as to the appropriate amount of depreciation to be allowed. In that regard, the percentage to be applied, if any, was a live issue in this case, since the house in question had been heavily renovated, which would tend to reverse much of the natural impact of ageing and wear and tear. Counsel would have had the opportunity to conduct legal research, and thereby equip himself to argue this issue at trial.

[36] Perhaps most importantly, it could potentially have affected the appellant’s settlement strategy. In that regard, we were advised by counsel that both sides served Rule 49 offers to settle. TD’s offer was for $50,000 plus costs. Since the appellant did not beat this offer with the net award he recovered, he was awarded costs only to the date of that offer, and had to pay TD’s costs from that date forward. The set-off in question was sufficient to make the difference between beating TD’s offer or not.

[37] Pleadings can, of course, be amended at any time, including at trial, pursuant to Rule 26.01, which reads as follows:

26.01 On motion at any stage of an action the court shall grant leave to amend a pleading on such terms as are just, unless prejudice would result that could not be compensated for by costs or an adjournment.

[38] A considerable body of caselaw has been developed as to the application of this rule. However, TD did not avail itself of it, and did not seek an amendment to its pleadings.

[39] We are of the opinion that the trial judge erred in law in allowing TD to claim a set-off, without having made such a claim in its pleadings. Accordingly, the credit in the amount of $49,467.85 awarded to TD in that regard must be set aside.

Issue #3: Loss payable for the artwork collection and additional living expenses

[40] Although the trial judge dealt with many items in arriving at a figure for the loss of the appellant’s household contents, the one that was the focus of this appeal was the figure for the appellant’s artwork collection.

[41] The appellant claimed that his artwork was worth $127,150. TD obtained an opinion from an auctioneer, Mr. Payne, that the artwork was worth no more than $9,000, but nevertheless paid the appellant $20,000 for that loss. The trial judge did not accept that the auctioneer was an expert in art appraisal, but he was permitted to testify about the value that this particular artwork would obtain at auction as a matter of fact, as well as whether the work of particular artists had ever been auctioned off by his firm or other auction houses before. In the end, given the paucity of evidence he had to work with, the trial judge concluded that the art collection was worth more than TD had paid, but not a great deal more. He fixed the loss payable for the art collection at $30,000.

[42] The appellant did not retain an art expert to provide opinion evidence as to the value of his art collection, as one might have expected him to do. To place a value on unique articles, such as a work of art, resort must normally be had to an expert opinion as to the value of the thing lost: Short v. Guardian Insurance Co. of Canada, 1984 5588 (NS CA), [1984] N.S.J. No. 74 (C.A.) at para. 34. The evidence that the appellant did put forward is summarized in paras. 116 to 118 of the reasons for judgment:

In the joint book of documents, there are a series of reports that Mr. Watt has provided. They originate from his father, who had them in his files. These reports are all valuations of artwork prepared by Robert C. Parks. None of these valuations relate to Mr. Watt’s art, and none of them were performed for Mr. Watt. In addition, the author of the reports did not testify.

As a result, these appraisals are of almost no value. I have reviewed the list of artists whose work has been appraised by Mr. Parks and determined that, with one exception, Mr. Parks did not appraise the work of any of the artists whose prints and paintings Mr. Watt owned.

The one exception was the work of Les Tait. Mr. Tait was the brother of Mr. Watt’s ex-girlfriend, and was also known to Mr. Payne. From the reports that were filed from both sides, there was some intrinsic value to the works completed by Mr. Tait.

[43] It is worthwhile to review, in full, the reasoning that the trial judge engaged in in arriving at a final figure of $30,000. That is found at paras. 119 – 127 of the reasons for judgment:

I start with the observation that Mr. Watt bears the onus of establishing the value of his art collection. Other than the works of Les Tait that were covered in the evidence of both sides, there was very limited evidence in terms of the value of Mr. Watt’s artwork.

The evidence I do have is that the artwork would have fetched very little in the way of proceeds at an auction. However, this is not necessarily the replacement cost of the artwork. In my view, the replacement cost within the meaning of Mr. Watt’s policy should be more reflective of what it would cost to replace certain prints at the AGO, or to purchase frames for the artwork than what the pieces would fetch at auction. Mr. Watt testified that some of this artwork was framed, and the frames were destroyed along with the art.

Based on the limited evidence I do have, the question becomes what do I accept the value to be?

Mr. Demeter testified that he had prepared a listing of the artwork. Mr. Watt seeks to rely on Mr. Demeter’s listing as evidence in this case. The problem is that Mr. Demeter fairly acknowledged that he obtained the listing of the value of this artwork from Mr. Watt. Mr. Demeter’s evidence is based solely on information he obtained from Mr. Watt, and on this issue is no more reliable than Mr. Watt’s evidence.

This brings me back to Mr. Watt’s evidence. Mr. Watt has provided a list of the pieces of art and the claimed value for these pieces of art. However, other than for the Les Tait pieces, there is no substantiation for the values that Mr. Watt has claimed. The evidence that could have been provided by Mr. Watt to substantiate the replacement cost of the artwork includes:

a) Receipts from the purchase of this artwork. None were provided.

b) Price listings from catalogues or other art guides. None were provided.

c) Listings for the purchase/sale of this artwork from art galleries, websites, or any other source. Again, none were provided.

Mr. Watt has the burden of proving the value of the items lost, and there were other sources of evidence that could have been provided to the court, but were not. As a result, I am not prepared to accept Mr. Watt’s valuation of his art collection. This is particularly true given Mr. Payne’s evidence that most of Mr. Watt’s collection would not have fetched anything at all at auction.

That being said, the collection (particularly the works of Les Tait) must be worth something. The frames have a replacement value, as do the prints, even if that value is not large.

TD paid $20,000.00 on account of the artwork. This was part of the global payment for chattels. I am of the view that a larger amount is required. I reach this conclusion for three reasons:

a) Mr. Payne’s evidence that the collection would not have fetched anything significant at auction must be considered in light of his evidence that many of the items would have been more expensive to replace at an art shop or at the AGO.

b) Mr. Payne’s evidence does not consider the fact that many of these items were framed, and that frames have a cost. I did not have any direct evidence on what a frame actually costs, but I accept that there is a cost to replace a frame.

c) On the evidence of both sides, the works of Mr. Tait had some value over and above the value ascribed to the works of other artists. I am not persuaded that this value was considered in the assessment by TD.

Given all of these points, I am left to determine a value of the artwork. Given the paucity of evidence from both sides, my determination is, of necessity, somewhat arbitrary. However, I conclude that a value of $30,000.00 for Mr. Watt’s artwork, inclusive of HST, is appropriate.

[44] Putting a value on artwork that no longer exists because it has been destroyed by fire can be a difficult exercise. In TMS Lighting Ltd. v. KJS Transport Inc., 2014 ONCA 1 at para. 61, Cronk J.A. discussed the task facing a trial judge in difficult circumstances:

It is also beyond controversy that a plaintiff bears the onus of proving his or her claimed loss and the quantum of associated damages on a reasonable preponderance of credible evidence. Further, as the trial judge recognized in this case, a trial judge is obliged to do his or her best to assess the damages suffered by a plaintiff on the available evidence even where difficulties in the quantification of damages render a precise mathematical calculation of a plaintiff's loss uncertain or impossible. Mathematical exactitude in the calculation of damages is neither necessary nor realistic in many cases. The controlling principles were clearly expressed by Finlayson J.A. of this court in Martin v. Goldfarb, 1998 4150 (ON CA), [1998] O.J. No. 3403, 112 O.A.C. 138 (Ont. C.A.), at para. 75, leave to appeal to S.C.C. refused, (1999), [1998] S.C.C.A. No. 516 (S.C.C.):

I have concluded that it is a well established principle that where damages in a particular case are by their inherent nature difficult to assess, the court must do the best it can in the circumstances. That is not to say, however, that a litigant is relieved of his or her duty to prove the facts upon which the damages are estimated. The distinction drawn in the various authorities, as I see it, is that where the assessment is difficult because of the nature of the damage proved, the difficulty of assessment is no ground for refusing substantial damages even to the point of resorting to guess work. However, where the absence of evidence makes it impossible to assess damages, the litigant is entitled to nominal damages at best.

[45] We are satisfied that the trial judge did the best he could in assessing the value of the art collection, given the poor quality of the evidence he had to work with. We see no palpable and overriding error in his findings. This ground of appeal is dismissed.

[46] The final area addressed on this appeal relates to the appellant’s claim for additional living expenses (“ALEs”). TD paid the appellant a total of $44,000 in that regard, but at trial he claimed the additional sum of $51,000.

[47] The trial judge rejected the appellant’s claim for ALEs in its entirety. The reasons for arriving at that decision included the following:

• The bulk of the additional expenses arose from the length of time it took for the appellant’s new house to be built. This delay was, the trial judge found, attributable to the appellant, arising from his delay in advising TD that he was going to rebuild the house himself, and the fact that he chose to build a much larger house, which took a correspondingly longer period of time;

• The trial judge concluded, on the evidence, that had a house similar to the one which was destroyed been built, construction would have been completed by August 2013 at the latest. The appellant submitted expenses that were incurred as late as November 2015;

• The list of expenses submitted by the appellant, for the most part, did not identify the time period during which the expense was incurred, nor did it provide any corroboration in the form of receipts or other documentary support. Given the trial judge’s concern over the credibility of the appellant, he was not prepared to simply take the appellant at his word.

[48] The credibility findings of a trial judge are entitled to considerable deference by a reviewing court. In Waxman v. Waxman, 2004 39040 (Ont. C.A.), the court said the following, at paras. 359-60:

Although the “palpable and overriding” standard of review applies to all factual findings, Housen, at 254-55 recognizes that findings of fact grounded in credibility assessments will be particularly difficult to disturb on appeal. Credibility assessments are inherently partly subjective and reflect the life experience of individual judges and their own perception of how the world works. Credibility assessments are also grounded in numerous, often unstated considerations which only the trial judge can appreciate and calibrate.

Deference to the findings of credibility includes giving full force and effect to those findings. An allegation that a trial judge has made a palpable and overriding error in assessing a witness’s credibility can only be evaluated by examining the entirety of the record touching on that credibility assessment. Where a trial judge advances several reasons for rejecting a witness’s testimony in its entirety as incredible, a demonstrated error in relation to just one of those reasons will not necessarily warrant reversal of the credibility assessment.

[49] We have been directed to no palpable and overriding error in the trial judge’s credibility findings, nor in the other findings of fact that support his conclusions. This ground of appeal is dismissed.

Result:

[50] In the result, the appeal is allowed in part. The set-off of $49,467.85 awarded to TD is set aside, such that the amount payable to the appellant is $74,936.49. The appeal is otherwise dismissed.

[51] The appellant is entitled to prejudgment interest on the additional amount awarded as a result of this appeal, calculated in the same manner as his original award. We will leave the calculation of that amount to counsel.

[52] With respect to costs, the ruling on costs at trial is varied by setting aside the award to TD in the amount of $30,000. The appellant is awarded additional costs at trial in the agreed upon amount of $10,000.

[53] Costs of the appeal are awarded to the appellant in the agreed upon amount of $15,000 all inclusive.

Heeney J.

I agree_______________________________

Backhouse J.

I agree______________________________

Gibson J.

Released: March 11, 2022

CITATION: Watt v. TD Insurance and TD Meloche Monnex, 2022 ONSC 1514

DIVISIONAL COURT FILE NO.: DC-19-108

DATE: 2022-03-11

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

Heeney, Backhouse, Gibson JJ.

BETWEEN:

EDWARD WATT

Appellant

– and –

TD INSURANCE and TD MELOCHE MONNEX

Respondents

REASONS FOR JUDGMENT

Heeney, J.

Released: March 11, 2022