ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 06-CV-307354 PD3
DATE: 20140916
BETWEEN:
ANTHONY BAILEY
Plaintiff
– and –
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
Defendant
Self-represented
Michael W. Smith, for the Defendant
HEARD: April 8, 10, 14, 15, 16, 17, 22, 23, 24, 25, May 5, 6, 7, 9, 2014
REASONS FOR DECISION
Justice w. matheson
[1] In this action, the plaintiff seeks damages for the alleged breach of his automobile insurance policy and bad faith on the part of the defendant, his automobile insurer.
[2] The collision that underlies the claims in this action took place on March 6, 2000, in Toronto. The plaintiff received payment for the damage to his car, but disputes the amount of that payment. He also claims compensation for the loss of the contents of his car. There is a significant dispute about whether or not these claims are defeated by a one-year contractual limitation period. The bad faith claim is based upon some events in the course of handling the plaintiff’s insurance claims and in the conduct of this litigation.
[3] The plaintiff is not, however, challenging the statutory accident benefits that he received arising from that collision. The statutory accident benefits claim was settled in 2002. The plaintiff also sued the driver of the other car involved in the collision. That action was settled in May 2010.
[4] Although the plaintiff has represented himself in this action, he was represented by a paralegal in his accident benefits claim. His paralegal also provided him with some legal advice in connection with his property damage claim, specifically advising the plaintiff about the one-year limitation period that is at issue in this action. The plaintiff has also referred to obtaining legal advice about various issues during the trial of this action.
Witnesses Called at Trial
[5] In addition to his own testimony, the plaintiff called four witnesses: three personal friends and Laurentiu Schulder, a cleaner who worked at the car dealership where the plaintiff also worked at the time of the collision.
[6] The three friends of the plaintiff who testified spoke favourably about their friend, and described some of his activities. Messrs. Sinclair and Bucys also spoke about his business. However, none of them gave direct evidence about the collision in question or had any dealings with the defendant. Mr. Bucys did see the car both before and after the collision, but he did not testify about its condition.
[7] The defendant called a number of its employees as witnesses: Jeff Kope, a senior claims adjuster, and three other current employees in response to summonses by the plaintiff, specifically Ron Schenk (a claims team manager who was involved in a prior loss), Brian Donaher (a claims section manager who became involved upon service of the statement of claim) and Anne Lennox (the claims representative who handled the plaintiff’s accident benefits claim).
[8] No expert evidence was called.
Parties and Insurance Policy
[9] The plaintiff completed a Bachelor of Science at the University of Toronto in 1976. He also completed one year in dentistry after which he withdrew from that program. In the 1980s and early 1990s, he had a company called Datastat through which he offered certain technology services to customers. The plaintiff testified that he wound that company down in order to undertake other entrepreneurial activities.
[10] In the period leading up to the March 6, 2000 collision, the plaintiff was employed as the night security guard at a car dealership, responsible for security in the parking lot area. The plaintiff testified that his security guard responsibilities allowed him time to work on other projects in his car, such as a book he was writing about personal relationships. He testified that he was also working on litigation against the Ministry of Consumer and Commercial Relations regarding amounts owed to Datastat.
[11] The plaintiff had an insurance policy with the defendant – Policy #204 0981. Under the Policy, the plaintiff had coverage for the damage to his car and its contents. Certain items were subject to reduction based upon the degree of fault, as determined under the Fault Determination Rules, R.R.O. 1990, Reg. 668.
[12] The Policy incorporated the required standard terms, as set out in Ontario Automobile Policy 1 (O.A.P. 1), including a one-year limitation period for the commencement of actions against the insurer for loss or damage to the automobile or its contents. This action was commenced about six years after the collision.
Car and Collision History
[13] The plaintiff’s car was a 1983 Pontiac Firebird, which he purchased after it had been driven for about a year. At the time of purchase, the car had about 80,000 kilometres on it. At the time of the March 6, 2000 collision, it had over 230,000 kilometres on it.
[14] In the period leading up to the March 6, 2000 collision, the car was in the following collisions that were also covered by the Policy:
(i) In February 1997, the plaintiff was driving the car and struck a hydro pole. The car was determined to be a total loss.
(ii) In February 1999, the car was damaged when it was being towed. The car was determined to be a total loss.
(iii) In July 1999, the car was damaged when the brake was released in what was thought to be an unsuccessful theft.
[15] After each of the above collisions, the plaintiff had the car repaired and continued to drive it. The plaintiff testified about improvements he made to the car between collisions, including, for example, a new engine and transmission.
[16] It was not until the collision that is the subject of this action that the car was branded irreparable and therefore could not be repaired and put back on the road.
March 6, 2000 Collision
[17] The March 6, 2000 collision took place just beyond the point where Lakeshore Blvd. East curves to go north/south and becomes Woodbine Avenue. At that point, Woodbine Avenue had two lanes in each direction, a curb lane and a passing lane. There was also room for street parking without blocking the curb lane.
[18] The police report, which was admitted on consent for the truth of its contents, shows that the collision occurred as the plaintiff was headed northbound on Woodbine Avenue, toward Queen Street. It was around 8:30 PM and dark, with street lights and clear conditions. The other driver came around the curve travelling in the same direction, in the passing lane. It was travelling fast. The plaintiff testified that he was waiting behind the line of parked cars to merge into the curb lane from behind the line of parked cars. The plaintiff moved left into the curb lane. The crash then took place.
[19] The left side of the plaintiff’s car was caved in, with the damage concentrated in the area of the driver’s side door. The front end of the other car was also caved in. The plaintiff was able to get out of his car, but later was taken to hospital by ambulance and suffered some injuries requiring treatment and recuperation. The other driver did not go to the hospital.
[20] The plaintiff admits that he does not have a clear memory of the collision, the day or two before it, or a week or more after it. He testified about the route he took that night, merging on to Woodbine Avenue, on the basis of his normal routine when driving from home to work.
[21] One of the witnesses gave a statement to police that it looked as if the plaintiff was trying to make a “U” turn. However, I am satisfied based upon the police report, the roadmap and the plaintiff’s evidence that it could have appeared to an onlooker like an attempted “U” turn even if the plaintiff was, as he said, merging northbound into the curb lane.
[22] Both drivers were charged under of the Highway Traffic Act, R.S.O. 1990, c. H-8: the plaintiff under section 142(1) (change of lane not in safety) and the other driver under section 130 (careless driving). According to the plaintiff, the charges against both of them were ultimately dropped. The plaintiff testified that the charges against the other driver were dropped because the police officer in question did not appear for the trial on more than one occasion.
Car Loss and Evidence of Value
[23] The defendant had the damage to the plaintiff’s car assessed by the same appraiser who had been involved in the prior claim arising in 1999. The plaintiff had previously been satisfied with that appraiser.
[24] The appraiser concluded that the car was a total loss and irreparable. The associated vehicle inspection report describes the pre-loss condition of the car as average or, with respect to aspects of the exterior condition, below average. The defendant had the prior assessment and also did an ADP/Autosource Market Search, which identified eleven cars. While there was one car identified at a higher amount (between $9,999 and $11,581 – model not identified), five of the cars had values between $500 and $2,083 and five of the cars had values between $3,667 and $5,249 (nine of which were Trans Ams).
[25] Sarah Hunter, the claims representative handling the claim, ultimately determined the value of the car based upon the prior assessment of $5,700, less an amount for the increased mileage, resulting in a value of $4,400. After deductions for retained salvage and the $300 deductible under the Policy, the amount owing to the plaintiff was $4,025.
[26] By letter dated May 1, 2000, the plaintiff was advised that the car had been deemed a total loss and had been branded irreparable. The letter attached a proof of loss form and invited the plaintiff to submit information about the value of the car. By letter dated May 4, 2000, Ms. Hunter wrote to the plaintiff providing a cheque for $4,025 as well as a Salvage Retention Statement and a Notice of Owner Retained Salvage form for the plaintiff’s signature. The letter referred to the amount of $4,025 “as agreed.” The plaintiff cashed the cheque, but did not sign or return the Statement or Notice.
[27] The defendant’s log for this claim includes an entry on May 4, 2000, by Sarah Hunter. She notes that she talked to the plaintiff and discussed how the above amount was arrived at and the note goes on as follows: “[the plaintiff] said he will accept this, will send in documentation in future for us to review… He understands this may not make a difference in the value.”
[28] The plaintiff testified that he accepted the cheque subject to the right to continue to argue about the car’s value. He also testified that he was under duress. While the plaintiff was still receiving medical treatment at the time, I do not find evidence establishing duress. There is no evidence that the defendant pressured him in any way. However, there is also insufficient evidence to establish that the plaintiff accepted the cheque in full satisfaction of his claim under the Policy for damage to his car. He did cash the cheque but did not sign any of the forms, and the above log supports his position that the issue was left open at least from his standpoint.
[29] In discussions about the value of the car both in the claims process and at trial, the plaintiff referred to receiving about $7,500 for it in the 1997 collision. However, I am satisfied based upon the evidence of Mr. Kope and related documentation that the plaintiff only received $4,200 at that time. Mr. Kope produced the applicable bank draft and confirmed that there were no others in the file. The plaintiff produced no bank records to the contrary.
[30] Obviously, after each of the series of collisions involving the car the plaintiff had to have it repaired. The plaintiff also testified about the improvements he made to his car before the collision at issue here. At trial, the plaintiff sought $11,000 as the value of his car in part based upon those improvements. However, he provided no third party appraisals or valuations or other evidence that would justify a finding of $11,000 based on the make, model, mileage, state of repair and overall condition of his car.
[31] With respect to fault, the defendant initially determined that the plaintiff was 100% at fault using the Fault Determination Rules. It therefore applied the full deductible of $300 to its payment. The defendant had made a number of requests for the police report, which was not received until December of 2000. Once it did arrive, and given its information about the Highway Traffic Act charges against both drivers, the defendant changed its fault assessment to 50%. It then sent the plaintiff an additional cheque for half of the deductible, $150, which the plaintiff also cashed.
Contents of Car
[32] The plaintiff testified at trial that some of the contents of his car were recovered by him and his friends after the collision, but he was unsure of what was recovered (other than a broken laptop). At trial, the plaintiff sought $11,500 for the contents of his car, based upon his evidence and the evidence of Mr. Schulder.
[33] The plaintiff testified about the many things he kept in his car, explaining that he worked in his car while working as a security guard, used a laptop, had a second laptop as a backup system, and had a myriad of other things in his car including a lot of sports equipment.
[34] Mr. Schulder testified about the contents of the plaintiff’s car. He was the nighttime cleaner at the car dealer where the plaintiff also worked. In the period of time leading up to the collision, the plaintiff regularly cleaned his car at the dealership at night, while Mr. Schulder was working. Mr. Schulder observed the plaintiff emptying contents of his car for the purpose of cleaning it two or three times a week over a period of about three years. He testified that the plaintiff had an unusual amount of things in his car, including for example: sports bags, considerable sporting equipment, two laptops, a heater, a small portable television and many CDs.
[35] I found Mr. Schulder to be a straightforward and reliable witness, simply recounting what he saw, over and over again, when the plaintiff cleaned his car at their mutual place of work. Mr. Schulder also assisted the plaintiff in preparing a list of the contents in 2001.
[36] After the plaintiff and Mr. Schulder prepared the list in 2001, the plaintiff assigned amounts to the various items, totaling about $12,000. At trial, he testified that he may have given incorrect prices on the list. Further, in addition to not being sure what items were recovered after the collision, he was not sure whether all of the items on his list were in his car at that particular time.
Timing of Claim
[37] The one-year limitation period for the commencement of an action, which applied to the plaintiff’s claims, would ordinarily come to an end on March 6, 2001. The plaintiff wrote to the defendant about the contents and value of the car just before the deadline, by letter dated February 22, 2001. He did not address his letter to the people handling his 2000 claim. The letter was addressed to George Georgiou and Ron Schenk, other employees of the defendant. Mr. Georgiou handled one of the plaintiff’s 1999 claims. He reported to Mr. Schenk, who had a small involvement in that 1999 claim. The plaintiff testified that he addressed this letter to Mr. Georgiou and Mr. Schenk because he was unhappy with the people who were handling his 2000 claims.
[38] The plaintiff also wrote a letter dated February 28, 2001, and addressed it to Messrs. Georgiou and Schenk. That letter said that it included a further copy of the February 22, 2001 letter and other material that related to both the value of the car and the contents claim.
[39] Both February 2001 letters were sent by fax. With respect to the timing of the letters, the plaintiff testified that he had been expressly notified about the one-year limitation period by his paralegal and the first of the two letters was his attempt to deal with it. That letter concluded as follows:
For these reasons, I will deal with the contents and the other matters regarding the value of the car settlements at a much later date.
If there are any changes to this you must let me know immediately by fax (call first) so I may start legal proceedings if needed.
[40] There was no response. The defendant denies receiving either the February 22 or February 28, 2001 letter until after the plaintiff’s examination for discovery in this action.
[41] The plaintiff followed up with a letter to the people who were handling his 2000 claims (Dave Elliott and Sarah Hunter) dated April 30, 2001, which requested a response to the prior letter but did not say what the prior letter was about. The defendant’s log, which records all communications for each claim, records the receipt of the April 30th letter and states that the February 28th letter the plaintiff referred to was not in the file. The plaintiff also wrote to these individuals by letter dated June 15, 2001. That letter provided an even more general reference to waiting since February 28, 2001 to hear from them. The defendant’s log also records a communication on that day, although there is no specific reference to the February 28, 2001 letter.
[42] The plaintiff testified at some length about two different fax systems that he was using at the time of the 2001 letters. He used one system for short faxes, such as the above April 30 and June 15, 2001 letters, both of which were received. He used a different system for longer faxes. At the time of the February 2001 letters, he had a new version of software for that system. He testified that he sent the February 22, 2001 letter using that system to test the new software, and also used the new software to fax the February 28, 2001 letter because of its length.
[43] Mr. Schenk testified that he did not receive either February 2001 letter. He further testified about the defendant’s process when a letter was received that did not have a claim number on it and did not appear to be a matter currently being handled by the addressees (as was the case with these two letters). An administrative person would search for the file and redirect the correspondence to the correct person. I found Mr. Schenk to be a straightforward and fair witness. I accept his evidence about the process the defendant would have followed and conclude that if these two letters had been received they would have been properly redirected to the people handling the plaintiff’s claim.
[44] Mr. Kope also testified. He has been a claims adjuster at the defendant for about 26 years and took over the plaintiff’s claim arising from the March 2000 collision after the litigation commenced in March 2006. At that time, he reviewed the file. While he fairly agreed at trial that the fax numbers on the February 2001 letters were correct and that it was possible that files or documents could be lost, he testified that neither letter was in the file when he reviewed it in 2006. As with Mr. Schenk, I found Mr. Kope to be a straightforward and fair witness. I accept his evidence that the February 2001 letters were not in the defendant’s file.
[45] Having considered all of the evidence, I conclude that while the plaintiff reasonably believed that he had sent these faxes in February 2001, they were not actually received by the defendant, likely due to a technology glitch or human error. They therefore did not come to the attention of either the addressees or the people actually handling the plaintiff’s claim. While the plaintiff did follow up in 2001, he did not re-send either letter and did not continue to pursue a response. Other matters were dealt with, including the plaintiff’s statutory accident benefits claim, which was settled in 2002.
[46] The plaintiff did not communicate with the defendant at all in the period from 2002 to 2006.
Conduct of the Action
[47] One of the plaintiff’s chief complaints is that when he raised his claims again in 2006, he was forced to commence this action. It appears that the plaintiff, who believed he had a small but meritorious claim, thought he should receive a settlement rather than having to sue. Mr. Kope testified that the defendant did not attempt to settle this matter when the plaintiff re-surfaced because it had paid what was owed and because of the one-year limitation period.
[48] At trial, the plaintiff attempted to get each of the defendant’s witnesses to agree that even when it was highly likely that a claimant was “not telling the truth” or “faking,” the defendant would still settle as a business decision if the amount at issue was small. None of the defendant’s witnesses agreed, each indicating that every claim was assessed on its own merit, based on entitlement under the applicable policy.
[49] I am satisfied that the defendant did not depart from a business practice of settling small claims whatever their merit and instead made its decision about the plaintiff’s claim based on the factors identified by Mr. Kope.
[50] This action was commenced by notice of action issued on March 6, 2006. Pleadings were exchanged in 2006 and the plaintiff was examined for discovery. The plaintiff did not examine the defendant for discovery. On September 24, 2009, he set this action down for trial.
[51] This action was originally scheduled for trial in June of 2012. However, on June 4, 2012, at the plaintiff’s request, the trial was adjourned to May 6, 2013, peremptory to the plaintiff. Again, the trial did not proceed. It was adjourned to Monday, April 7, 2014, at the plaintiff’s request, again peremptory to the plaintiff. On that day, the plaintiff again sought an adjournment, which was not granted. The trial was then set to commence on Tuesday, April 8, 2014. On that day, the plaintiff sought an adjournment before me, which was not granted although an extended schedule was employed that meant that the plaintiff did not have to open his case until the following week.
[52] In the period leading up to the commencement of the trial, the plaintiff had dealings with defendant’s counsel, some of which are now being advanced in support of the plaintiff’s bad faith claim. I will not attempt to set out each and every complaint made but will focus on those that were most prominent during the trial and in argument. In that regard, the plaintiff placed most emphasis on complaints about the production of documents, the defendant’s failure to comply with the plaintiff’s requests that defendant’s counsel organize all of the plaintiff’s own answers to undertakings for him in order that he could complete them, defendant’s counsel taking about a week to respond to summonses to have certain of the defendants present and former employees as trial witnesses for the plaintiff, and other complaints about trial preparation and communications between the parties.
[53] For example, the plaintiff complained that the defendant was holding back the original photographs of the damaged car. He had been provided with copies of the photographs taken by the appraiser, but not the originals. It appears that the plaintiff misunderstood a reference to a claim of privilege over photographs in Schedule B to the defendant’s draft affidavit of documents, believing that the general reference meant that original collision photos were being withheld. However, the passage relied upon by the plaintiff is a generic claim of privilege over all sorts of materials including any photographs, not a claim over specific photographs. Indeed, Mr. Kope testified that the defendant did not have the original photographs.
[54] There is no question that communications with the plaintiff have been and can be very challenging. It was apparent at trial that this contributed to the communications problems between the parties.
Challenged Reports
[55] As part of his bad faith claim, the plaintiff complained about the use, by the defendant, of a valuation report from a company called CCC. According to the report, CCC claims to be an authority in vehicle claims management. The plaintiff was provided with the CCC report in 1997, in relation to one of the earlier collisions for which he made a claim. The report provided information about the possible value of a 1983 Pontiac Firebird in Toronto, based on local vehicle databases, adjusted to reflect factors such as mileage. It set out values ranging from very small amounts to about $1,300. At trial, the plaintiff provided no third party critiques of this company or its reports, instead relying upon his own review. The plaintiff did not establish that the report was used in his 2000 claim in any event.
[56] In addition, the plaintiff complained about a report prepared by Dennis O’Sullivan in relation to one of the 1999 claims. Mr. O’Sullivan was asked to inspect the plaintiff’s car after the July 1999 collision. The report describes the condition of the car body as very poor. Again, the plaintiff rejects this report as flawed, challenging the observations about the condition of the car. However, as described above, the defendant had an inspection report done in 2000 that is more relevant to this claim.
[57] The plaintiff did not introduce any evidence other than his own to establish the alleged ill motives or fabrication with respect to either report.
Issues
[58] The main issues in this action are as follows:
(1) whether the defendant met its contractual obligations under the Policy in relation to the claim for damage to the plaintiff’s car;
(2) whether the defendant met its contractual obligations under the Policy in relation to the contents claim;
(3) whether the claims for property damage to the car and for the loss of the contents are defeated by the one-year limitation period in the Policy;
(4) whether a release given in connection with the statutory accident benefits settlement releases these property damage claims; and,
(5) whether the defendant breached its implied duty of good faith giving rise to a claim for punitive damages.
(1) Claim regarding Car
[59] Under the Policy, the plaintiff is entitled to be compensated for the loss of the value of his car, subject to a potential deductible, an offset for salvage and the limitation period. The offset for salvage is not at issue.
[60] With respect to the value of the car, the plaintiff has not established that a higher value ought to have been used by the defendant. While I accept that the plaintiff believed his car was worth more, in this action he ought to have put forward independent evidence substantiating the higher value, rather than relying on his own opinion. There was some evidence of range of values of similar cars advanced by the defendant, and the value assigned by the defendant fell within that range. It was reasonable to take into account the mileage and the car’s history. This was a 17-year old car with 232,000 kilometres on it, which had been in several collisions. Without the repairs and improvements that had been made by the plaintiff, the car would have been worth a great deal less than the amount paid by the defendant.
[61] The only issue with respect to the deductible is the question of whether or not the defendant properly applied a 50% fault determination (resulting in a deductible of $150). The plaintiff submits that he was not at fault.
[62] The fault determination must be conducted under the Fault Determination Rules. I conclude that section 20(2) of those rules applies. The degree of fault of the insured must therefore be determined in accordance with the ordinary rules of law. Based upon the evidence before me, I conclude that the driver of the other car was primarily at fault, but the plaintiff bore some responsibility as the merging car. He was merging into the curb lane when the other car was approaching in the passing lane. I find that the other car, which was speeding, hit the plaintiff’s car and dragged it into the position shown in the police report. I conclude that the plaintiff was only 25% at fault.
[63] As a result of this fault determination, the plaintiff ought to have received the return of more of his deductible, another $75, subject to the issue of the limitation period.
(2) Claim regarding Contents
[64] Under the Policy, the plaintiff was entitled to be compensated for the loss of the value of the contents of his car, subject to the issue of the limitation period.
[65] I accept that the plaintiff kept an unusual amount of things in his car. However, I find that he has not proved that all the goods on the list he prepared in 2001 were actually in his car at the relevant time. Further, the plaintiff has not proved the value of the goods in his car. He testified that the bills for some new sporting equipment were in the car and were also destroyed or stolen. Bills are not, however, the only way to establish the value of those goods. The plaintiff did not adduce any third party evidence about the value or approximate value of any of the contents of his car. While expert evidence may not have been required, no other evidence (such as printouts of prices of comparable goods available for sale in stores or online) was even tendered at trial.
[66] Given the many frailties of the evidence on contents and value, only a nominal amount can reasonably be assigned to the contents. Bearing in mind the nature of the goods, I assign a total value to the contents lost in the collision of $2,000.
(3) Limitation Period
[67] The Policy included a one-year limitation period in subsection 9(4) of O.A.P. 1, as follows:
Limitation of Actions – Every action or proceeding against the insurer under this contract in respect of loss or damage to the automobile or its contents shall be commenced within one year next after the happening of the loss and not afterwards, ...
[68] The one-year limitation period begins to run on the date of the collision, subject only to discoverability and fraudulent concealment: McNaughton Automotive Ltd. v. Co-operators General Insurance Co. (2003), 66 O.R. (3d) 112 (S.C.J.); 12955030 Ontario Inc. (Go Trucking) v. Royal SunAlliance Insurance Company of Canada, [2009] O.J. No. 76 (S.C.J.). There is no issue in this case about discoverability. The plaintiff has testified that he was specifically advised about this one-year limitation period and took steps to address it. Nor is there a basis to find fraudulent concealment.
[69] The key question is whether the plaintiff’s letter of February 22, 2001, effectively gave the plaintiff an extension of time until this action was commenced in 2006. I would characterize that letter as a request to waive the deadline. In that I have found that this letter was not received, I do not find that the defendant agreed to extend the deadline. Nor did it fraudulently conceal any material facts. However, even if it had been received, the steps taken by the plaintiff were insufficient to secure an extension of time through to 2006. In the circumstances, to effectively extend a one-year limitation period for as long as four or five years requires more than silence from the opposite party.
[70] The plaintiff did not commence his action within one year, nor did he effectively obtain an extension of time to 2006. I therefore conclude that the property damage claim in respect of the car and its contents is barred by the above contractual limitation provision.
(4) Release
[71] The defendant also relies on a release given by the plaintiff. In December 2002, the plaintiff settled his accident benefit claim with the defendant. In the course of doing so, he provided the defendant with a full and final release. That release included the following language:
I [the plaintiff] hereby release and forever discharge [the defendant] from any and all actions, causes of action, mediations, arbitrations, claims and demands for statutory accident benefits including past, present and future claims under the Statutory Accident Benefits Schedule or under [the Policy], arising out of a motor vehicle accident which occurred on or about March 6, 2000 and from all claims which were or were not the subject of mediation or arbitration under the Financial Services Commission of Ontario.
[72] As I interpret this release in the circumstances in which it was given, it does not extend to release the property damage claims asserted in this action.
(5) Implied Duty of Good Faith
[73] There is no dispute that the defendant has an implied duty of good faith connection with the Policy. However, in order to justify an award of punitive damages, any breaches of the Policy or that implied duty must exceed a very high threshold. Punitive damages are very much the exception rather than the rule. They are imposed only if there has been high-handed, malicious, arbitrary or highly reprehensible misconduct that departs to a marked degree from ordinary standards of decent behaviour: Whiten v. Pilot Insurance Co., 2002 SCC 18, [2002] 1 S.C.R. 595 at para. 94.
[74] The plaintiff has made numerous allegations in support of his bad faith claim. I have considered all of them and specifically address those that were most significant based upon the trial evidence. They generally fall within these categories:
(i) the use of two allegedly “manipulated” or “fabricated” reports that allegedly knowingly distorted data in relation to the valuation of his car;
(ii) other complaints about the claims administration;
(iii) the failure to settle the claim, resulting in the plaintiff being obliged to commence this action;
(iv) the failure to provide the plaintiff with assistance in the prosecution of his tort claim and in this claim; and
(v) other complaints about the conduct of this action.
[75] With respect to the reports, the plaintiff has failed to prove that they were in any way fabricated or knowingly distorted or manipulated, as alleged. These are serious allegations and must be met with substantial evidence. Yet the plaintiff introduced no evidence about the intentions of the author of either report, and certainly nothing to establish an improper motive. He gave his own view, challenging the data in the CCC report and certain statements in the O’Sullivan report. He did not establish any misconduct. Further, these reports were in relation to two earlier collisions, not the 2000 collision.
[76] With respect to claims administration, the plaintiff complained about a number of things, for example, that it took the defendant four requests to get the police report and that there were errors in its log. I find that the defendant was diligent in its attempts to get the police report, and there is no evidence to suggest that the delay was the defendant’s fault. Further, while there were minor errors in the log, they were consistent with the defendant’s evidence that once log entries were made they could not be changed. This approach, which removes any concern about after-the-fact tampering, is reasonable even though it means that typos will remain in the log. Overall, the claims administration reflected a patient approach with the plaintiff, and a reasonable effort to deal with him and the matters he raised.
[77] With respect to settlement, I have found that the defendant did not depart from any business practice regarding settlement that merits any criticism of its conduct as regards the plaintiff’s claims.
[78] With respect to the tort claim, the plaintiff has complained that the defendant did not assist him in proving who was at fault in the collision for the purposes of his tort claim. However, I do not find that the implied duty of good faith required that the defendant help the plaintiff prove who was at fault in his tort claim against the driver of the other car.
[79] With respect to the fault determination on the property damage claim, although in hindsight there was an error on the part of the defendant, it does not, by itself, found a punitive damages award. Every breach of contract is not also a breach of the implied duty of good faith – punitive damages are confined to exceptional cases in which the misconduct is of a nature that takes it beyond the usual opprobrium surrounding breaking a contract: Agribrands Purina Canada Inc. v. Kasamekas, 2011 ONCA 460 at para. 78. Further, this is not a case where the Fault Determination Rules prescribed a specific percentage that ought to have been used by the defendant. In addition, the defendant did adjust its fault determination from 100% down to 50%. Lastly, the monetary amount associated with my further reduction to 25% is very small.
[80] With respect to the conduct of this action, the plaintiff relies upon a number of things, such as the failure to provide the original photographs, the failure to provide other documents requested by him, the failure to send him his own undertakings to assist him in completing the rest of them, complaints about summonses to various proposed witnesses for trial and other matters.
[81] While the plaintiff may benefit from some latitude as a self-represented party, he also must take responsibility for the conduct of his action. By setting the action down for trial, he communicated to this court that he was ready for trial. Many of his complaints relate to requests for documentary discovery made well after he set his action down for trial. Even then, if the plaintiff needed something to properly prepare for trial he could have brought a motion and sought leave of the court to obtain late discovery. He did not do so. As the plaintiff in this action it was his responsibility to make an effort to familiarize himself with his rights and obligations in the action. At trial, it was apparent that he did so in that he referred to obtaining legal assistance from time to time. Yet the plaintiff did not pursue discovery in a timely way. The plaintiff must bear significant responsibility for any difficulties arising from his late discovery requests.
[82] There is, however, one aspect of the discovery process that I wish to single out for special comment. The defendant provided only an unsworn affidavit of documents, with only a generic Schedule B. I understand that this is not unusual in practice, and is sometimes the subject of an agreement between the parties. But, absent an agreement, it is not in compliance with Rule 30.03 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. In this case, with a self-represented plaintiff, the generic reference to photographs in Schedule B created a misunderstanding and confusion that persisted through the trial, and the lack of a sworn affidavit of documents exacerbated the disputes between the parties about the adequacy of the defendant’s documentary discovery.
[83] The above practice is unacceptable except where there is an agreement between the parties. The provision of a sworn and complete affidavit of documents is a positive obligation under the Rules, not something that a plaintiff must request. In this case, I do not conclude that this omission is sufficient to found the punitive damages claim. But, going forward, the practice should come to an end where there is no express agreement between the parties.
[84] With respect to his own answers to undertakings, I would have liked to see more of an effort on the part of the defendant to be helpful even though not required to do so. However, it remains the case that once litigation begins a defendant is not tasked with providing litigation support to a plaintiff beyond what is required under the applicable rules of practice and of professional conduct.
[85] Similarly, I do not find the plaintiff’s complaints about witness availability sufficient to found a claim for punitive damages. It took the defendant about a week to respond to the numerous summonses to witness delivered by the plaintiff, which is neither speedy nor especially slow. This and other pretrial and trial skirmishes between the parties in this case, in the context of our adversarial system, are more appropriately addressed when it comes to the question of costs.
[86] In his final submissions, the plaintiff made serious allegations against three of the defendant’s employees who testified as witnesses: Mr. Kope, Ms. Lennox and Mr. Donaher. He accused these witnesses of deceiving the court. These allegations are unfounded. As set out above, I found Mr. Kope to be a straightforward and fair witness. Ms. Lennox and Mr. Donaher, who testified in response to the plaintiff’s summonses, were as well.
[87] The plaintiff also submitted that two physicians evaded his service of summonses to witness, and suggested this was the defendant’s responsibility, without evidentiary support for either proposition.
[88] I conclude that the circumstances on which the plaintiff relies for his punitive damages claim are insufficient to meet the required very high threshold. There has not been high-handed, malicious, arbitrary or highly reprehensible misconduct.
Other Allegations
[89] The statement of claim also asserts a claim for damages for mental suffering and a claim for money allegedly due for the prior collision. To the extent that damages for mental suffering may be advanced as a separate legal claim from the punitive damages claim, it was not the subject of any particular focus at trial. Nor was there the required medical evidence to found such a claim. Similarly, there is not the required evidentiary foundation to pursue the claim for money allegedly due in connection with the prior collision.
Conclusion
[90] I therefore dismiss the plaintiff’s claims. If the parties are unable to agree on costs, the defendant shall deliver a costs outline and up to ten pages of written costs submissions by September 29, 2014. The plaintiff shall deliver his responding written costs submissions by October 20, 2014. The defendant may deliver a two-page written reply by October 23, 2014.
Justice W. Matheson
Released: September 16, 2014
COURT FILE NO.: 06-CV-307354 PD3
DATE: 20140916
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
ANTHONY BAILEY
Plaintiff
– and –
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
Defendant
REASONS FOR DECISION
Justice W. Matheson
Released: September 16, 2014