COURT FILE NOS.: CV-12-1009-00; CV-12-0208-00

DATE: 20140523

ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: CV-12-1009-00

BETWEEN:

Paulet Morant

Plaintiff

– and –

Sun Life Assurance Company of Canada

Defendant

C. Cairns, for the Plaintiff

S. H. Shantz, for the Defendant

HEARD: May 2, 2014

COURT FILE NO.: CV-12-0208-00

ONTARIO

SUPERIOR COURT OF JUSTICE

AND BETWEEN:

Paulet Morant

Plaintiff

– and –

Cesar Fernandez Rengifo and Natalia Vasselucci and TD Insurance Meloche Monnex

Defendants

C. Cairns, for the Plaintiff

B. Straitman, for the Defendant TD Insurance Company

HEARD: May 2, 2014

REASONS FOR JUDGMENT

DALEY J.

[1] Two motions were brought in the above-styled actions where Paulet Morant (“Morant”) is the plaintiff in both actions.

[2] These actions and the motions brought have a common history and they proceeded to a private mediation together, which was held on September 12, 2013. At the conclusion of mediation, all parties agreed to the settlement of the plaintiff’s claims against the defendant insurers.

[3] Subsequent to the mediation the plaintiff, through her counsel advised that she was resiling from the settlements achieved at the mediation.

[4] The plaintiff’s actions arise from injuries sustained by her in a motor vehicle accident which occurred on January 21, 2011. As a result of the injuries sustained, the plaintiff pursued the payment of Long Term Disability (“LTD”) benefits from the defendant Sun Life Assurance Company of Canada (“Sun Life”); Statutory Accident Benefits from her auto insurer, the defendant TD Insurance Meloche Monnex (“TD Insurance”); as well as tort damages from TD Insurance, given that the defendants Cesar Fernandez Rengifo and Natalia Vasselucci, the owner and driver of the motor vehicle involved in the accident were uninsured.

[5] The plaintiff’s position is that she has lawfully resiled from the settlement of her claims against the defendants Sun Life and TD Insurance in respect of her entitlement to LTD benefits and tort damages. Her claim with respect to Statutory Accident Benefits is not in issue on these motions.

[6] In accordance with the agreement of the plaintiff, Sun Life and TD Insurance, the parties executed an Agreement to Mediate on September 12, 2013. All parties were in attendance with counsel at the mediation.

[7] The Agreement to Mediate provided among other things: “It is agreed that where a settlement is reached, the parties and their counsel will carry out the terms of the settlement as soon as possible and will sign the appropriate Minutes of Settlement.”

[8] The parties and their counsel conducted the mediation with a private mediator on September 12, 2013, with the mediation lasting the full day.

[9] During the mediation the plaintiff agreed to settle her claim with Sun Life for the all-inclusive sum of $110,000. Minutes of Settlement were executed by the plaintiff, the Sun Life representative and its counsel. The plaintiff also executed a Full and Final Release in favour of Sun Life and a consent providing for the discontinuance of the plaintiff’s action against Sun Life.

[10] The Full and Final Release in favour of Sun Life included the following declaration:

AND THE RELEASOR HEREBY DECLARES that at all times relative hereto she has been represented by legal counsel of her own choosing who has advised her concerning this Release and that she fully understands the terms of this Release, and that in executing this Release she has done so with full knowledge of any and all rights which she may have under or in connection with the Policy and the issues raised in the Action, and represents that no promise, inducement or agreement not herein expressed or attached has been made to her, and that the consideration is accepted by her voluntarily in order to make a full and final compromise, adjustment and resolution of all claims, causes, matters and things released hereunder.

[11] In accordance with the terms of the settlement, Sun Life forwarded the settlement funds to the plaintiff’s solicitor by overnight courier on September 18, 2011. Counsel for the plaintiff confirmed that these settlement monies remain in the solicitor’s trust account.

[12] On October 3, 2013, counsel for the plaintiff advised counsel for Sun Life that he had received instructions from the plaintiff to the effect that she wished to resile from the all-inclusive settlement of $110,000 and that he would be bringing a motion before the court to set aside the settlement.

[13] Counsel for the plaintiff did not proceed with any motion in respect of the Sun Life settlement and the present motion was brought by Sun Life for judgment in terms of the settlement as set out in the Minutes of Settlement dated September 12, 2013.

[14] During the course of mediation, the plaintiff also settled her claim with respect to the defendant TD Insurance in regard to her claim for tort damages with respect to the uninsured defendant owner and driver in the all-inclusive sum of $250,000. At the conclusion of the mediation, the plaintiff executed a Full and Final Release and Assignment in favour of TD Insurance.

[15] The plaintiff assigned to TD Insurance her right to recover the settlement amount paid to her and to pursue judgment in her name against the uninsured owner and driver, who were noted in default in the plaintiff’s action against them.

[16] In its motion, TD Insurance seeks default judgment on its cross-claim against the defendant owner and driver in the settlement amount paid to the plaintiff of $250,000; along with the sum of $10,250 in respect of property damage sustained by the plaintiff’s vehicle; and costs of the action, inclusive of applicable taxes and disbursements of $28,746.19, for an all-inclusive total of $288,996.19.

[17] In support of its motion, TD Insurance has filed affidavit evidence outlining the plaintiff’s medical history and her course of treatment following her motor vehicle accident as well as particulars as to the pecuniary losses sustained as a result of her injuries.

[18] In response to the motions of Sun Life and TD Insurance, two affidavits were filed on behalf of the plaintiff, both by the plaintiff’s solicitor Harry Steinmetz. In his affidavit, sworn on March 14, 2014, filed in response to the Sun Life motion for judgment, the solicitor states that he attended on the private mediation with the plaintiff on September 12, 2013, and at the conclusion of the mediation the plaintiff executed a Full and Final Release in favour of Sun Life in respect of the settlement amount of $110,000, all-inclusive. He also confirms that Minutes of Settlement were signed by the plaintiff and himself as well as the Sun Life representative and its counsel.

[19] Plaintiff’s counsel further states that he was instructed by the plaintiff on September 30, 2013, to rescind the settlement with Sun Life, which had been agreed to at the conclusion of mediation. He states in his affidavit that: “The plaintiff advises me that at the time she agreed to settle her claims, she was in physical and emotional pain; was extremely fatigued; and felt unduly stressed and pressured during the entire mediation process.”

[20] Plaintiff’s counsel also states in the affidavit: “The plaintiff has further advised me that she does not believe the settlement is in her best interest and would like to rescind the settlement entered into at the conclusion mediation when the Minutes of Settlement and Full and Final Release were executed.”

[21] In response to the motion by TD Insurance for judgment against the uninsured owner and driver, the plaintiff’s counsel filed an affidavit in which he outlines essentially the same reasons why the plaintiff wishes to rescind the settlement of her tort damage claim with TD Insurance. In that affidavit the plaintiff’s counsel also asserts that as there was no settlement of the claim against TD Insurance with respect to the tort damages, the insurer has no right to a judgment against the uninsured defendants.

Analysis

[22] On the agreement of counsel for the parties, the present motions were heard together as the issues involved clearly overlap, given that the actions both proceeded to a global mediation with the view to settling all claims at one time. The affidavit evidence filed in both actions and the submissions of counsel for all parties were considered in determining the outcome of these motions.

[23] Although TD Insurance has not brought a motion for judgment in accordance with the terms of the settlement reached at the conclusion of the mediation, but rather has moved for judgment in terms of the settlement against the uninsured parties, given that Sun Life has moved for judgment in terms of the claims made against it and as the whole of the evidence allows for the determination of whether or not both of the actions were resolved on a full and final basis, I have concluded that it is open to the court to make that determination in respect of both actions on these motions.

[24] With respect to the Sun Life motion, it is brought pursuant to Rule 49.09 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, which provides that where a party to an accepted offer to settle fails to comply with the terms of the offer, the other party may make a motion for judgment in terms of the accepted offer.

[25] It is common ground that the LTD claim and tort claim were settled at the mediation and that the Minutes of Settlement and Full and Final Release and Assignment documentation contained in the record were executed by all parties and their counsel on September 12, 2013.

[26] It is further clear that all parties were present with counsel and that each party provided instructions to their counsel during the course of the mediation to resolve the actions on a final basis in the terms of the Minutes of Settlement executed.

[27] In response to the clear and un-contradicted evidence offered by Sun Life and TD Insurance on their motions, it is notable that the plaintiff chose not to file an affidavit in her own name but has provided evidence as to her position via affidavit evidence from her counsel.

[28] Rule 39.01(4) represents a principled exception to the rule against hearsay evidence and states:

An affidavit for use on a motion may contain statements of the deponent’s information and belief, if the source of the information and the fact of the belief are specified in the affidavit.

[29] While the plaintiff’s counsel recounts the plaintiff’s statements made to him in both of the affidavits submitted, he does not state that he believes the facts to be true. While this may not make the affidavit evidence inadmissible, it certainly reduces the weight that may be accorded to it, particularly where the plaintiff has elected to offer no evidence herself.

[30] At its highest, the plaintiff has put forward evidence that she had a change of heart or what could be described as “buyer’s remorse” approximately three weeks after the conclusion of the settlement of her claims with both insurers. This does not constitute proper grounds for the setting aside of a properly concluded settlement: see Thompson v. Rogers Communications Inc., 2013 ONSC 6975; Perrin v. Cara Operations Ltd, 2004 8625 (ON SC).

[31] Counsel for the plaintiff quite appropriately acknowledged that the record did not demonstrate that the plaintiff was subject to any form of duress at the time these settlements were concluded.

[32] While medical documentation was produced regarding the plaintiff’s medical history, no evidence was offered that would even suggest that the plaintiff was medically unfit at the time of mediation or that she did not have the capacity to enter into agreements with the defendants to settle these actions.

[33] Counsel for the plaintiff urged that the settlements be set aside and declared unenforceable based on the courts equitable jurisdiction; however, he provides no evidentiary basis nor any authority upon which any equitable relief could be granted to the plaintiff in the circumstances of this case.

[34] As a general rule parties are to be held to their bargains and to settlements which they negotiate and conclude. The court may exercise its discretion not to enforce the terms of a settlement where there is evidence that:

(a) the resulting agreement and settlement was unconscionable, fraudulent or based on a party’s misapprehension of a material fact which was known to the opposite party;

(b) the solicitor representing the party was not retained or did not have authority to settle the action and this limitation was known to the opposite party; and

(c) the party lacked the legal or mental capacity to enter into the settlement agreement at the material time.

[See Milos v. Zagas (1998) 1998 7119 (ON CA), 38 O.R. (3d) 218; Sher v. Paletta, 1996 286 (ON CA); Vanderkop v Manufacturers Life Insurance Company, 2005 39686 (ON SC)]

[35] No evidence has been offered to suggest that counsel for the plaintiff was not retained nor fully instructed with respect to the terms of the settlement by the plaintiff. Further, there is no evidence that the plaintiff lacked the requisite capacity to engage in the settlement discussions at the mediation and to conclude settlements of her claims with Sun Life and TD Insurance.

[36] Although it is not expressly asserted in the affidavit material filed on behalf of the plaintiff, there is no evidence whatsoever that suggests that the settlement of the plaintiff’s claims was unconscionable. Counsel for the plaintiff, in the affidavits filed on her behalf, sets forth in summary form the nature and extent of her injuries and outlines the plaintiff’s claimed income loss. However, counsel does not state in either affidavit that the settlements achieved were grossly unfair or improvident or that there was an overwhelming imbalance in the parties’ bargaining positions and that the defendants took advantage of her vulnerability. Further, there is no assertion that the plaintiff lacked suitable legal advice prior to entering into these settlements.

[37] In the result, I have concluded that the plaintiff entered into binding settlements with Sun Life and TD Insurance and as such the settlements should be enforced.

[38] Sun Life is therefore entitled to judgment in terms of the Minutes of Settlement of September 12, 2013, requiring payment by it to the plaintiff of the all-inclusive sum of $110,000 in exchange for the Full and Final Release and the discontinuance of the action.

[39] Having concluded that the plaintiff entered into a binding settlement with TD Insurance in the sum of $250,000, and having considered the affidavit evidence submitted on its behalf, I have determined that the settlement of the insurer’s liability to the plaintiff, pursuant to the uninsured motorist coverage in her policy, has been concluded thereby resulting in the assignment of the plaintiff’s rights against the uninsured driver and owner to TD Insurance. I am further satisfied that TD Insurance is therefore entitled to judgment against the uninsured defendants Cesar Fernandez Rengifo and Natalia Vasselucci jointly and severally, in the sum of $288,996.19.

[40] I have also concluded that TD Insurance is entitled to recover the damages related to the property damage sustained by the plaintiff’s motor vehicle and the costs of the action, both of which are included in the sum referred to above.

[41] Counsel for the defendant insurers in both actions shall deliver submissions with respect costs of no longer than two pages plus a costs outline within 15 days. Counsel for the plaintiff shall deliver submissions of a similar length within 15 days thereafter.

[42] An order shall issue accordingly in each of the above styled actions.

Daley J.

Released: May 23, 2014

COURT FILE NOS.: CV-12-1009-00; CV-12-0208-00

DATE: 20140523

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:
Morant v. Sun Life Assurance Company of Canada

AND BETWEEN:
Morant v. Rengifo et al.

REASONS FOR JUDGMENT

Daley J.

Released: May 23, 2014