ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N :
JULIE PILOTTE, BRUCE KERR, LORNA KERR and JOANNA KERR
Plaintiffs
– and –
GILBERT, WRIGHT & KIRBY BARRISTERS & SOLICITORS, IAN D. KIRBY, RAPHAEL PARTNERS LLP BARRISTERS AND SOLICITORS and G. JOSEPH FALCONERI
Defendants
Jeffrey Wm. Strype and Kyle Smith and Melissa Roach (clerk)
for the Plaintiffs
William S. Zener and Noam Uri (student)
for the Defendants Gilbert, Wright & Kirby, Barristers and Solicitors, and Ian D. Kirby
HEARD: October 13-16, 19-23 and 26-30 (inclusive), November 2, 3 December 7-11 and 14-18 (inclusive), 2015
AMENDED REASONS FOR JUDGMENT
1On Friday, February 25, 1993, the life of the plaintiff, Julie Pilotte, formerly Julie Kerr (Julie), changed forever. Julie was a passenger on a motorcycle in Jamaica, driven by her then boyfriend, Alan Farlinger (Farlinger), when he pulled out to pass another vehicle and collided head-on with an oncoming car. Julie sustained multiple injuries as a result of the collision.
2This matter has endured a long and convoluted history in the 22 years since the accident occurred in 1993. It culminates in this five-week trial in which the plaintiff claims compensation for accident benefits which she argues she would have received but for the negligence of the defendant, Ian D. Kirby (Kirby). She claims damages against Kirby and his law firm Gilbert, Wright & Kirby, Barristers and Solicitors (the law firm), for negligence and breach of fiduciary duty, claiming millions of dollars in damages, including interest.
3The problem in this case centres around the fact that the accident occurred in Jamaica and the family’s automobile insurance policy (the Policy) in which Julie was a named insured contained a Territorial Restriction limiting the insurer’s liability to accidents occurring in North America. Section 5.1 of their policy with Zurich Insurance (Zurich) (the standard automobile policy) states:
… this Policy applies to loss or damage to persons or property caused by an incident that arises out of the ownership, operation or use of an automobile and that occurs in Canada, the United States of America or on a vessel travelling between ports of those countries.
4The issues that surround that fact, the legislation in place at the time, what instructions were given to Kirby, what actions he took and what advice he did or did not give to Julie and her father Bruce Kerr (Kerr) are explored in this case.
5It is not disputed that Julie sustained serious injuries as a result of the accident. It is also not disputed that in December 1994, Kerr contacted Kirby, an expert in insurance and personal injury law, to ascertain whether insurance coverages existed to assist Julie with her ongoing treatment and expenses. Both parties agree that section 5.1 of the standard automobile policy contains a territorial limitation, and that Kirby did not submit an application for accident benefits before the expiry of the applicable limitation period on February 25, 1995.
6What is disputed in this case, however, is whether Kirby acted as a reasonable and competent practitioner specializing in insurance and personal injury law at the time. Specifically, this case raises several important issues such as: does a solicitor have a duty to foresee changes in the law that may be forthcoming? In a personal injury matter, does the fact that a client or potential client is seriously injured impact that duty? What was the standard of care for lawyers practicing personal injury and insurance law at the time? Would there be a higher standard for a known expert in the field? What should Kirby have done differently, if anything? What would likely have occurred if he did? What are the duties of personal injury lawyers when preparing the damages file on behalf of a client? All of these issues are considered within the context of this case.
7This is a case of a well-recognized lawyer practising in the insurance field and missing a limitation period within which his client, Julie, may have been entitled to accident benefits to a maximum of one million dollars. How can that be, you ask? Surely, he is liable for the relief that may have been granted to Julie had he acted differently. Surely, this constitutes gross negligence, as alleged by the plaintiff.
8However, after a thorough review of the evidence, including the expert evidence in this particular and rather unique situation, and in the context of the relevant statutory law and jurisprudence, I am satisfied by an overwhelming preponderance of evidence, that the defendant, Ian Kirby, did not breach the standard of care expected of a reasonably competent and diligent professional at the time and place in question.
9I am advised that no court decision has ever been rendered dealing with the territorial provision found in the Zurich Policy under the statutory regime existing at the time of the accident in February 1993.
background
10On Friday, February 25, 1993, Julie was a victim of a motorcycle accident in Jamaica, in which the driver, Farlinger, pulled out to pass another vehicle and collided head-on with an oncoming car. Julie was thrown into the air and although she did not lose consciousness, she was unable to move her body from the chest down when she landed on the ground a few feet away.
11The following morning, she was airlifted to the Jackson Memorial Hospital University of Miami, in Miami Florida for assessment and stabilization.
12Julie sustained multiple serious injuries as a result of the accident, including but not limited to a fracture at the 6th and 7th vertebrae of the thoracic spine and serious open compound fractures of her left tibia, fibula and left pubic ramus. Emergency surgery on her left leg was performed on the day she arrived at the hospital in Florida, and on her spine the following Tuesday morning.
13On the evening of March 12, 1993, Julie was flown by jet ambulance to the Ottawa Civic Hospital in Ottawa, Ontario which was relatively close to her home in Winchester, Ontario. She remained there until April 28, 1993. She was then moved to the Rehabilitation Centre in the Ottawa Hospital for a period of two months until her discharge on June 18, 1993.
14Over the years, Julie has undergone numerous surgical procedures on her left leg and back, including external fixation of her left leg fracture, decompressive laminectomy and internal fixation of her spine with Herrington rods and a bone graft.
15She has also received lengthy rehabilitative treatment, including chiropractic, massage, physiotherapy, naturopathic therapies, biofeedback, acupuncture and other treatments along with medications prescribed for pain and other symptoms.
16Julie was 19 years of age at the time of the accident. She is now 42 and is married with two children, Xander, born September 18, 2003 and Phoenix, born on March 1, 2012. Although her recovery has been described by some as “miraculous”, it is undisputed that she will suffer a permanent loss of mobility and will require ongoing treatment in the future.
17At the time of the accident, Julie was in first year university at the University of Ottawa and lived at home with her parents, Bruce Kerr and Joanna Kerr in Winchester, Ontario. The day after the accident, they flew to Florida to be with their daughter.
18By then, Kerr, who was in the insurance business, had contacted Great West Life’s head office in England. He confirmed his family coverage under a group insurance policy and arranged for Julie’s transport by Learjet from Jamaica to Miami. Julie was also a named insured under Kerr’s automobile insurance Policy with Zurich at the time.
19Kerr was anxious to pursue all avenues of insurance for his daughter, and to that end, he began to seek legal advice in August, 1994. He eventually contacted Kirby on December 6, 1994, about 21 months after the accident.
20By that date, the 30 and 90 day periods contained in their automobile Policy to give the insurer notice and file an application for accident benefits, respectively, had long passed. However, upon “reasonable excuse”, the limitation period could be extended to two years after the accident, which in this case, was February 25, 1995.
21Clearly, no such application was made within the 30 and 90 day timeframes and the relevant period for review is, therefore, the period between December 6, 1994 when Kirby was retained and February 25, 1995, when the two-year limitation period to make an application for accident benefits under the Policy with Zurich expired.
22Kirby’s expertise was in the area of insurance and personal injury law and after conducting research by reviewing the Policy, obtaining advice from others and reading the established texts in the field, he determined that the territorial restriction in the standard insurance automobile policy, the Zurich Policy in this case, would preclude coverage for any accident that occurred “outside Canada, the United States or a vessel travelling between the two countries.” It was his view that any claim for benefits under the Policy with Zurich would therefore be unsuccessful since the accident had occurred in Jamaica.
23Kirby says he explained to both Kerr and Julie separately what their rights would have been under the Policy had the accident occurred in North America, and his opinion that in this case any claim against Zurich would be unsuccessful. They deny that he did so.
24There was evidence at trial that Kerr was advised of the jurisdictional matter by other lawyers and professionals, as well as the insurer. According to Kirby, Kerr did not seem surprised when Kirby advised him and Julie that he had researched the matter and was of the view that there was no coverage under their automobile insurance policy with Zurich. In that regard, the testimony of the other individuals involved became important and relevant at trial.
25Also important are the opinions rendered by experts retained by each of the parties on the relevant statutory and jurisprudential law, the appropriate standard of care and whether Kirby acted in accordance with the accepted standard of practice for “an expert” in the personal injury and insurance bar at the time.
26After the expiry of the two-year limitation period, and due to new and “unexpected developments” in the case law, Kirby contacted the plaintiff to advise her of these developments, and that he had made an application to Zurich on Julie’s behalf for accident benefits. In November 2000, Kirby gave up carriage of the file and the plaintiff retained other counsel. On April 30, 2003, the plaintiff commenced an action against Zurich after they denied coverage under the Policy. The action was summarily dismissed in the Superior Court on February 20, 2006, as being statute barred due to various failures to satisfy limitations under the Policy and the Statutory Accident Benefits Schedule -- Accidents before January 1, 1994, R.R.O. 1990, Reg. 672 (“SABS pre-1994”).
27This case was commenced against Gilbert, Wright & Kirby Barristers & Solicitors, Ian D. Kirby, Raphael Partners LLP Barristers and Solicitors and G. Joseph Falconeri on March 16, 2004, and pleadings were amended on June 3, 2008 and again in 2014. As noted, it proceeded before this Court only as against Kirby and his law firm, Gilbert, Wright & Kirby, Barristers & Solicitors.
28This decision is divided into two main parts: Part A deals with the issue of Liability and Part B addresses the question of Damages.
part a - the issue of liability
THE LAW ON SOLICITOR’S NEGLIGENCE
a. Sources of Liability for Negligence
29The liability of a solicitor is a concurrent liability in contract, tort, and equity. A person can commence an action against a professional for breach of contract, negligence, and breach of fiduciary duty simultaneously and the professional could be held liable for any or all of these breaches. The source of the contractual liability comes from the retainer agreement between a lawyer and client. See Central & Eastern Trust Co. v. Rafuse (1986), 1986 29 (SCC), 31 D.L.R. (4th) 481 (S.C.C.), at pp. 521-522.
30Where the solicitor-client relationship is fiduciary in nature, claims may be grounded in equity for breach of a fiduciary duty to a client. The distinction between solicitor’s negligence and breach of fiduciary duty is articulated in Martin v. Goldfarb (1997), 1997 12430 (ON SC), 31 B.L.R. (2d) 265 (Ont. Gen. Div.), at para. 45, where the court cites S.M. Grant and L. Rothstein’s text, Lawyer’s Professional Liability, 2nd 3d. (Toronto: Butterworths, 1989):
the distinction is drawn between erroneous or improper legal advice, which gives rise to a claim of negligence, and a conflict of interest or failure to disclose a material fact, which gives rise to a claim for breach of fiduciary duty. The fundamental premise appears to be that erroneous or improper legal advice amounts to an error, or perhaps even gross carelessness, but it is not an abuse of the trust and loyalty which forms the core of a fiduciary relationship.
31A negligent misrepresentation or omission to convey information by a solicitor to a client may give rise to a cause of action for breach of contract, negligence, or for the breach of a fiduciary duty. The misrepresentation or omission must, however, be shown to be material in the sense that it would have been likely to have influenced the client's conduct or operated on the client's judgment. See Canada Trustco Mortgage Co. v. Bartlet & Richardes, 1996 CarswellOnt 1684 (Ont. C.A.); Fasken Campbell Godfrey v. Seven-Up Canada Inc., 1997 CarswellOnt 8 (Ont. Gen. Div.); affirmed, 2000 3985 (ON CA), 2000 CarswellOnt 89 (Ont. C.A.); leave to appeal refused, 2000 CarswellOnt 3844 (S.C.C.); Fellowes, McNeil v. Kansa General International Insurance Co., 2000 CarswellOnt 3093 (Ont. C.A.); leave to appeal allowed, 2001 CarswellOnt 1704 (S.C.C.).
b. The Standard of Care
32In an action against a solicitor for negligence, the standard of care is not perfection, but rather that of a “reasonably competent solicitor.” See Ristimaki v. Cooper (2006), 79 O.R. 3d (648), at para. 59. As Justice Le Dain stated in Central & Eastern Trust Co. v. Rafuse (1986), 1986 29 (SCC), 31 D.L.R. (4th) 481 (S.C.C.), at p. 523:
A solicitor is required to bring reasonable care, skill and knowledge to the performance of the professional service which he has undertaken … The requisite standard of care has been variously referred to as that of the reasonably competent solicitor, the ordinary competent solicitor and the ordinary prudent solicitor.
33In determining liability, the question is not whether the lawyer made a mistake, but rather whether he or she was negligent. See 285614 Alberta Ltd. v. Burnet, Duckworth & Palmer, 1993 7020 (AB KB), [1993] 4 W.W.R. 374 (Alta Q.B.), at p. 382.
34An error of judgment or ignorance of some part of the law is, by itself, not enough to make a lawyer liable for negligence. Rather, as Grant J. articulated in Brenner et al. v. Gregory et al., 1972 420 (ON SC), [1973] 1 O.R. 252, at p. 257:
In an action against the solicitor for negligence, it is not enough to say that he has made an error of judgment or shown ignorance of some particular part of the law, but he will be liable in damages if his error or ignorance was such that an ordinarily competent solicitor would not have made or shown it. [Emphasis added.]
35In Tiffin Holdings Ltd. v. Millican et al. (1964), 1965 639 (ON CA), 49 D.L.R. (2d) 216 (Alta S.C.), later confirmed at (1967) 1967 102 (SCC), 60 D.L.R. 469 (S.C.C.), Riley J. outlined the obligations of a lawyer in the context of determining whether an error of judgment or ignorance of the law was outside of the sphere of what an ordinarily competent lawyer would have done. These obligations are:
(1) To be skilful and careful.
(2) To advise his client on all matters relevant to his retainer, so far as may be reasonably necessary.
(3) To protect the interests of his client.
(4) To carry out his instructions by all proper means.
(5) To consult with his client on all questions of doubt which do not fall within the express or implied discretion left to him.
(6) To keep his client informed to such an extent as may be reasonably necessary, according to the same criteria.
See also Meier v. Rose, 2012 ABQB 82, 531 A.R. 369, at para. 19.
Knowledge of the Law
36A prudent solicitor does not need to know all of the law related to the legal services the solicitor is providing, but must have sufficient knowledge of the basic principles of the law. As Justice Le Dain wrote in Central & Eastern Trust Co. v. Rafuse:
A solicitor is not required to know all the law applicable to the performance of a particular legal service, in the sense that he must carry it around with him as part of his “working knowledge”, without the need of further research, but he must have a sufficient knowledge of the fundamental issues or principles of law applicable to the particular work he has undertaken to enable him to perceive the need to ascertain the law on relevant points.
37The required standard of care includes a combination of good working knowledge of the relevant law and further research, as necessary. See Marques v. Alexander, [2000] O.J. No. 1629 (Ont. S.C.).
38A lawyer who recommends one of two conflicting opinions of law is not negligent. See 285614 Alberta Ltd. v. Burnet, Duckworth & Palmer (1993), 1993 7020 (AB KB), 8 Alta. L.R. (3d) 212 (Alta. Q.B.), at para. 32. Where there are two accepted bodies of competent opinion, a professional may follow either. However, mere evidence that, in the opinion of some experts, the professional’s conduct was reasonable, does not necessarily establish a sufficiently authoritative practice.
Circumstances that Affect the Standard of Care and Corresponding Liability
39Surrounding circumstances particular to each case matter in the determination of a solicitor’s standard of care and corresponding liability. In Lawyer’s Professional Liability, at p. 31, Grant and Rothstein write that “the reasonableness of a lawyer’s impugned conduct is adjudged in light of the surrounding circumstances such as the time available to complete the work, the nature of the client’s instructions, and the experience and sophistication of the client.” See also Singer v. Lipman Zener Waxman LLP, 2014 ONSC 4521, 244 A.C.W.S. (3d) 969, at para. 110.
40In Duncan v. Cuelenaere, Beaubier, Walters, Kendall & Fisher (1986), 1986 3062 (SK QB), [1987] 2 W.W.R. 379 (Sask. Q.B.), at p. 382, Justice Wright listed a number of factors to consider in cases alleging solicitor’s negligence, which include: the sophistication of the client; the experience and training of the solicitor; the form and nature of the client’s instructions; the specificity of those instructions; the nature of the action or legal assignment; the precautions one would expect a solicitor, acting prudently and competently to take; the course of the proceeding or assignment; and the influence of other factors beyond the control of the client and adviser.
If the Lawyer is an Expert or Specialist
41The standard of care of a reasonably competent solicitor can be affected by the terms of the retainer agreement and any representations made to the client concerning the lawyer’s expertise. For example, a specialist in a certain area of law will be held to a higher standard than a generalist. See Elcano Acceptance Ltd. v. Richmond, Richmond, Stambler & Mills, 1985 CarswellOnt 445 (Ont. H.C.), at para. 37; reversed on other grounds, 1986 2591 (ON CA), 55 O.R. (2d) 56 (C.A.); Confederation Life Insurance Co. v. Shepherd, McKenzie, Plaxton, Little & Jenkins (1992), 29 R.P.R. (2d) 271 (Ont. Gen. Div. [Commercial List]), at para. 105, varied on other grounds (1996), 1996 3206 (ON CA), 88 O.A.C. 398 (Ont. C.A.).
Customary Practice
42The standard of care is also affected by a consideration of general or customary practice. However, a customary practice is not determinative. As Justice L'Heureux-Dubé wrote on behalf of a unanimous Court in Roberge v. Bolduc, 1991 83 (SCC), [1991] 1 S.C.R. 374, at pp. 436-437:
The fact that a professional has followed the practice of his or her peers may be strong evidence of reasonable and diligent conduct, but it is not determinative. If the practice is not in accordance with the general standards of liability, i.e. that one must act in a reasonable manner, then the professional who adheres to such a practice can be found liable, depending on the facts of each case.
43If a solicitor complies with the customary practice of solicitors in the community in which the solicitor practices, this is not conclusive evidence that the solicitor has exercised reasonable care in carrying out the legal work in question. See Gilvar v. Noble (1985), 8 O.A.C. 60 (Ont. C.A.).
44There are certain situations where the standard practice is “fraught with obvious risks” such that “anyone is capable of finding it negligent, without the necessity of judging matters requiring diagnostic or clinical expertise.” See ter Neuzen v. Korn, 1995 72 (SCC), [1995] 3 S.C.R. 674, at p. 697.
Legal Services for Transactions Governed by Statute
45If a solicitor undertakes to provide advice and legal services concerning a transaction that is governed or affected by a public statute, he or she bears the burden of exercising reasonable care and skill to ascertain whether the relevant legislation would affect the transaction. The solicitor must advise the client of any risks or concerns which such legislation may give rise to. See Clements (Litigation Guardian of) v. Clements, 2012 SCC 32, [2012] 2 S.C.R. 181 (S.C.C.); Confederation Life Insurance Co. v. Shepherd, McKenzie, Plaxton, Little & Jenkins, 1992 CarswellOnt 635 (Ont. Gen. Div. [Commercial List]); reversed on other grounds, 1996 CarswellOnt 135 (Ont. C.A.).
c. Causation
46For a lawyer to be held liable for professional negligence, it is not enough that he or she breached a duty of care; it also must be proven that the misconduct caused the client’s loss and that the client has suffered damages as a result. The general test for causation is the “but for” test on a balance of probabilities- the plaintiff must show that the injury would not have occurred “but for” the negligence of the lawyer. See Kings Lofts Toronto I Ltd. v. Emmons, 2013 ONSC 6113, 2013 CarswellOnt 13608, at para. 78; affirmed at King Lofts Toronto I Ltd. v. Emmons, 2014 ONCA 215, 2014 Carswellont 3328; Folland v. Reardon (2005), 2005 1403 (ON CA), 74 O.R. (3d) 688 (Ont. C.A.); Royal Laswer Corp. v. Rivas (2012), 2010 ONSC 1170 (Ont. S.C.); Dinevski v. Snowdon, 2010 ONSC 2715 (Ont S.C.), at paras. 130-131.
47Specifically, in an action for solicitor’s negligence, the plaintiff must demonstrate that if properly advised, he or she would have acted in a different manner and would have avoided the damages suffered. See Rider v. Grant, 2015 ONSC 5456, 2015 CarswellOnt 14310 at para. 145; Marcus v. Cochrane, 2012 ONSC 146, 2012 CarswellOnt 1472.
48In Folland v. Reardon, at para. 61, Justice Doherty stated as follows:
“But for” factual causation has been employed in solicitor's negligence cases, particularly those where the plaintiff contends that he received negligent advice and would have acted differently had he received appropriate advice. In those cases, the plaintiff must show on the balance of probabilities that if properly advised, he would have proceeded in a manner that avoided the damages suffered or obtained the benefit lost as a result of the negligent advice: Polischuk v. Hagarty (1984),1984 2076 (ON CA), 49 O.R. (2d) 71 (C.A.), rev. (1983), 1983 3067 (ON SC), 42 O.R. (2d) 417 (H.C.); Haag v. Marshall (1989), 1989 236 (BC CA), 39 B.C.L.R. (2d) 205 (C.A.); Major v. Buchanan, supra, at p. 514; Sykes v. Midland Bank Executor and Trustee Co., [1971] 1 Q.B. 113 (C.A.); Grant, Rothstein, Lawyers Professional Liability (2nd ed.) (Toronto: Butterworths, 1998) at 174-5.
THE STATUTORY LAW
- The OMPP Regime
49The evolution of Ontario’s no-fault accident benefits regime in the early to mid-1990s was inconstant and complex. The relevant legislation, regulations, and standard policies enforced during the timeframe underwent several incarnations, and this case emerges as the product of changes in the law. The provisions of the Acts, regulations, and policies relevant to this lawsuit can be summarized as follows.
50Beginning in the early 1970s, no-fault benefits became part of mandatory coverage in Ontario automobile insurance policies and were set out in the Insurance Act, R.S.O. 1990, c. I.8, s. 24. Section 201 of the Act (now section 227) gave the Superintendent of Insurance the authority to produce an owner’s Policy form outlining the benefits provided for in the Act; the Policy would serve as a basis for automobile insurance agreements between insurers and Ontarians.
51The mandated insurance Policy between 1972 and 1990 was called SPF 1. SPF 1 contained a territorial limitation that restricted accident benefit coverage to accidents occurring in North America.
52On June 22, 1990, the Ontario Motorists Protection Act (“OMPP”) came into force and substantially changed the nature of automobile insurance in the province. As a consequence of the OMPP, it was widely believed that most claims resulting from motor vehicle accidents would be satisfied by access to no-fault benefits, and no longer by tort action. The new regime introduced a threshold requirement whereby a person involved in a motor vehicle accident could no longer automatically bring an action in tort. If the threshold was not met, individuals involved in motor vehicle accidents, regardless of whether or not they were at fault, were required to look to their own insurer to receive benefits.
53The scope of the no-fault benefit coverage was particularized in a Regulation made pursuant to the Insurance Act, called the Statutory Accident Benefits Schedule -- Accidents before January 1, 1994, R.R.O. 1990, Reg. 672 (“SABS pre-1994”). Section 268 of the Insurance Act stated:
Every contract evidenced by a motor vehicle liability Policy, including every such contract in force when the Statutory Accidence Benefit Schedule is made or amended, shall be deemed to provide for the statutory accident benefits set out in the Schedule and any amendments to the Schedule, subject to the terms, conditions, provisions, exclusions and limits set out in that Schedule.
54The motor vehicle policy to which section 268 alludes is contextualized in light of section 227 of the Act (formally section 201). Section 227 authorized the Commissioner of Insurance to approve a standard automobile Policy form, which would provide the basis for automobile insurance contracts in Ontario. Section 227 states in relevant part:
(1) No insurer shall use a form of Policy, endorsement or renewal, a claims form or a continuation certificate in respect of automobile insurance other than a form approved by the Commissioner
(2) Where, in the opinion of the Commissioner, any provision of this Part, including any statutory condition, is wholly or partly inappropriate to the requirements of a contract or is inapplicable by reason of the requirements of any Act, he or she may approve a form of Policy, or part thereof, or endorsement evidencing a contract sufficient or appropriate to insure the risks required or proposed to be insured, and the contract evidenced by the Policy or endorsement in the form so approved is effective and binding according to its terms even if those terms are inconsistent with, vary, omit or add to any provision or condition of this Part
55Prior to the coming into force of the OMPP in 1990, and pursuant to the legislative authority under section 227, the Commissioner of Insurance approved a new standard policy to replace SPF 1. The new standard policy, “OPF 1”, was published in the Ontario Gazette on May 30, 1990. The Policy reproduced all of the accident benefit provisions set forth in the SABS.
56Since automobile insurers were required to use the approved standard owner’s policy as the basis for contractual coverage, OPF 1 governed insurance coverage in Ontario from June 22, 1990 to December 31, 1993, that is, from the OMPP’s implementation to the enactment of Bill 164. As Julie’s accident occurred on February 25, 1993, the coverage that her father held at the time was an OPF 1 Policy.
- Territorial Limitation in the OPF 1
57Of particular importance in this litigation, the OPF 1 stated that accident benefits coverage was to be limited to accidents occurring in Canada and the United States, or on vessels travelling between the two countries. The relevant provision is found in Part E of the OPF 1. Section 5.1 of the standard policy states:
This Policy applies to loss or damage to persons or property caused by an incident that arises out of the ownership, operation or use of an automobile and that occurs in Canada, the United States of America or on a vessel travelling between ports of those countries
58The OPF 1 makes it clear that the territorial limitation applied to accident benefits coverage provided for in Part B of the Policy. At the beginning of Part B, the Policy states:
PLEASE NOTE that the General Provisions, Definitions, Exclusions, and Statutory Conditions of this Policy found in Part E, sections 5.1 to 5.12, and Part F, sections 6.1 to 6.3, apply to every Party of the Policy, except as stated in those sections.
This Part of the Policy should be read subject to these provisions.
59Notwithstanding the inclusion of a territorial limitation in the Policy, the SABS pre-1994 itself did not contain any such limitation.
60At the time of the accident, there was no jurisprudence or legal authority which raised any question as to the legality, validity, or enforceability of the territorial restriction in the Policy. Alan O’Donnell’s textbook Automobile Insurance in Ontario (Markham: Butterworths, 1991) was widely used by practitioners and assumed the definition of an “insured person” was restricted by the territorial limitation: “[t]he named insured, the named insured’s spouse and any dependent of either of them can obtain the Ontario No-Fault Benefits when injured in a car accident anywhere in North America, whether as driver, passenger or pedestrian” (at p. 289). O’Donnell offered no indication that the restriction was somehow repugnant. See also: John Newcombe, The Standard Automobile Policy Annotated (Toronto: Butterworths, 1986) and Craig Brown, No-Fault Automobile Insurance in Canada, (Toronto: Carswell, 1988).
- Transition from the OMPP to the Bill 164 Regime
61On January 1, 1994, the automobile insurance industry underwent yet another substantial change when Bill 164 came into force and replaced the OMPP regime. Under Bill 164, accident benefits were set out in the new Regulation - Statutory Accident Benefits Schedule – Accidents on or After January 1, 1994 (“SABS 1994”). The Commissioner of Insurance concurrently approved a new standard policy to replace OPF 1. The new standard policy form was called “OAP 1”.
62Unlike the OMPP regime, the accident benefits specified in the SABS 1994 were not set out in full in the standard policy. Instead, the OAP 1 referenced the nature of the benefits, and then directed the reader to the more fulsome terms and conditions of the coverage set out in the SABS 1994. In the event of a conflict between the Policy and the SABS 1994, section 4 of the OAP 1 made it clear that the terms of the Regulation would prevail. This wording was not contained in the previous standard policy, the OPF 1.
63The definition of an “insured person” also changed under the new regime. The definition provided for in the SABS 1994 under Bill 164 read in part:
“insured person”, in respect of a particular motor vehicle liability policy, means,
(a) The named insured, any person specified in the Policy as a driver of the insured automobile, the spouse of the named insured, and any dependent of the named insured or spouse, if the named insured, specified driver, spouse or dependent,
(i) Is involved in an accident in or outside of Ontario that involves the insured automobile or another automobile
64Notwithstanding these important changes to the content of the Regulation and the standard policy, Section 1.2 of the OAP 1 contained, in modified form, the territorial limiting language found in Section 5.1 of the OPF 1. It read:
This Policy covers you and other insured persons for incidents occurring in Canada or the United States of America or on a vessel travelling between ports in those countries
65The territorial limitation in section 1.2 of the OAP 1 did not appear in the Regulation itself.
- The Decisions in Luu and Prasad
66The fact that the territorial limitation was produced in the Policy, the OAP 1, but not in the Regulation itself, was the subject of litigation in two separate lawsuits that made their way through Ontario courts between 1995 and 1997.
67The central question in both lawsuits was whether the territorial limitation contained in the OAP 1 conflicted with the definition of an insured person found in the Regulation, and whether this contradiction rendered the territorial restriction invalid. It is important to underscore at the outset that both cases were litigated within the Bill 164 context, unlike the case at bar, which is subject to the OMPP regime.
68In Luu v. Zurich Insurance Company, [1996] O.I.C.D. No. 45, the claimant was injured in a motor vehicle accident in Vietnam. At the time of the accident, the claimant and her husband were residents of Ontario and the husband held a standard policy with the defendant Insurer. The claimant applied for statutory accident benefits payable under the SABS 1994, but the Insurer denied her benefits on the basis that her insurance coverage was limited by section 1.2 of the Policy. Since the insured’s Policy only covered her for accidents occurring in North America, she could not claim coverage for an accident in Vietnam.
69In April, 1995, the Ontario Insurance Commission (OIC) Arbitrator in Luu found that the territorial limitation in the OAP 1 was inapplicable. This was so because the territorial limitation in the Policy conflicted with the benefits mandated by the Regulation: the definition of an insured person in the SABS, which provided for coverage “outside Ontario” without restriction, could not be interpreted consistently with the territorial limitation in the Policy (Luu at para. 29). Section 268 of the Insurance Act mandated that all accident benefits coverage must provide the benefits covered in the Regulation. If the territorial limitation in the Policy were applied, it would not give effect to section 268 of the Act since it would contradict the Regulation. As there was a conflict between the Policy - the OAP 1 - and the Regulation, the absence of a territorial limitation in the Regulation rendered the territorial limitation in the OAP 1 invalid.
70The Luu decision was appealed to the Director of Arbitrations of the OIC on July 4, 1996. The Director reversed the Arbitrator’s decision and found that there was no conflict between the Policy and the Regulation. Accordingly, the territorial limitation in the OAP 1 policy applied and there was no coverage for an accident that occurred in Vietnam. See: Luu v Zurich Insurance Co., 1996 CarswellOnt 3521.
71The claimant then sought judicial review of the Director’s decision at the Divisional Court. The Court decided the matter on March 17, 1997 and upheld the Director’s decision. It found that there was no conflict between the territorial limitation provision and the definition of insured persons in the Regulation. Rather, the two provisions ought to be read in harmony. See: Luu v. Zurich Insurance Co. (1997), 1997 16222 (ON SC), 32 O.R. (3d) 807, at para. 20.
72The same territorial issue was the subject of litigation in Prasad v. Gan Canada Insurance (1996), 1996 8040 (ON SC), 30 O.R. (3d) 316. The driver in Prasad was injured in a motorcycle accident in Mexico. He was denied coverage by his insurer, who partially relied on the territorial limitation in section 1.2 of the OAP 1 policy as the basis for denying the claim. The plaintiff sued the insurer, and the defendant insurer moved for summary judgment.
73The case came to Justice Herold on September 12, 1996, that is, before Herold J. could benefit from the Divisional Court’s ruling in Luu. Justice Herold found that the SABS clearly provided that the benefits were payable if the accident occurred anywhere outside Ontario, without limitation (Prasad, at para. 18). In ruling for the plaintiff, Justice Herold went on to note at para. 18:
Because the coverage is mandated by the Act and the schedule, the mere fact that the form of contract was approved by the Commissioner as required by s. 227 does not derogate from the Plaintiff’s rights. The plaintiff’s rights were guaranteed by Statute and any contractual difficulties created by the approval of the contract by the Commissioner cannot reduce those rights.
74As such, Justice Herold concluded that accident benefits were payable for any accident in or outside of Ontario, without restriction (at para. 22).
- The Court of Appeal Upholds Prasad
75In Prasad v. Gan Canada Insurance Co. (1997), 1997 1995 (ON CA), 33 O.R. (3d) 481, the Ontario Court of Appeal resolved the tension between Justice Herold’s decision in Prasad and the Divisional Court’s ruling in Luu. Justice Southey, sitting ad hoc, upheld Justice Herold’s ruling. In dismissing the insurer’s argument under section 1.2, Southey J. decided at para. 10:
I agree with the decision of the learned judge that a territorial limitation inserted in the contract of insurance by the defendant could not effectively reduce the coverage under the Benefits Schedule. That coverage was required by statute, and could be limited only by statute
He went on to note at para. 11:
With respect, I am unable to accept the conclusion of the Divisional Court [in Luu] that there is no conflict between the contractual provisions in the Policy and the provisions in the Schedule, or that, if there were, the more specific words of the contract should prevail
76After the Court of Appeal ruled in Prasad, the Divisional Court’s decision in Luu was appealed. The Court of Appeal overturned the Divisional Court’s ruling in a short two paragraph judgment, citing its reasons in Prasad as determining the issue (see: Luu v. Zurich (1999), 1999 18732 (ON CA), 43 O.R. (3d) 484).
- The State of the Law after Prasad and Luu
77In response to Justice Herold’s initial decision in Prasad, the Ontario Legislature amended the Insurance Act to ensure that the territorial provision applied to no-fault accident benefits coverage. The enactment of the new law did not involve any declaration as to the previous state of the law. Thus, only as of November 1, 1996, accident benefits were limited to losses or damages which occurred in Canada, the United States, vessels operating between ports of those countries, as well as any other territory that might be set out in the Schedule. To date, no additional territory has been added to Schedule.
the evidence (SUMMARIZED)
a) Plaintiff Witnesses
bruce kerr
(i) Kerr’s Background and Preliminary Actions
78Bruce Kerr is currently retired after working in the insurance business in various capacities since December 1966, including employment at Metropolitan Life Insurance Company for a period of 15 years prior to 1982. He obtained his license as a registered insurance broker in 1983 and in the course of his general insurance business thereafter sold automobile insurance policies for some Ontario automobile insurers, mainly Pilot Insurance. He then established Bruce R. Kerr Insurance and Investments Ltd. in 1988. Through that company, he sold investments, RRSP plans and dealt primarily with life, disability and group insurance policies. He sold the business in May 2007.
79Through his company, Kerr purchased group insurance coverage for his family members with Great West Life Insurance, and pursuant to that Policy, gained considerable financial assistance and support for Julie from the time of the accident onwards. That matter will be more fully explored under the damages section of this decision.
80It was not until August, 1994 that Kerr began to seek legal assistance and advice to help defray the increasing costs related to Julie’s condition and treatment. In summary, he sent letters first, to Catherine L. Jones, barrister and solicitor, on August 17, 1994, and then to Daniel Kimmel, Q.C. on October 12, 1994, outlining the circumstances of Julie’s accident and injuries, and stating to each that the reason he was writing was “to settle in our minds whether or not any insurance monies might be available, short of suing the Farlinger family.”
81By letter dated October 17, 1994, Mr. Kimmel responded, indicating that Julie had a claim against Farlinger particularly if he maintained liability insurance, and that Julie, in his words, “may also be entitled to benefits under your insurance policies”. He also informed Kerr that he had turned the file over to his partner, Murray Ages (“Ages”). Upon request, Kerr sent some documentation to Ages including the motorcycle rental agreement and particulars of his automobile insurance Policy with Zurich. In correspondence dated November 29, 1994, Ages asked Kerr for other documents which he had previously requested, adding,
There is a two year limit in Ontario to issue claims for this matter which occurred on February 25, 1993. Time is therefore of the essence and your prompt attention to this request would be very much appreciated.
82On December 5, 1994, Kerr notified Ages in writing that he did not wish to pursue the matter through his office.
(ii) Kerr’s Interaction with Kirby Prior to February 25, 1995
83Kerr contacted Kirby by telephone on December 6, 1994, upon referral from Douglas Grenkie, Q.C. By a letter dated December 7, 1994 to Kirby, Kerr summarized the particulars of the accident and Julie’s injuries and medical treatment, adding:
Our reason for being referred to you was to settle our minds whether or not any insurance monies might be available. Juli has permanent loss of mobility and will require ongoing treatment and expenses to assist her.
84On December 9, 1994, Kirby’s office commenced an investigation in which long distance calls were made to Queen’s Law Library in Kingston, Jamaica, for information on Jamaican law. Long distance calls were also made to contact a lawyer in Jamaica and subsequent calls were made to Kerr on December 22, 1994, and February 6, 1995. By a letter dated February 7, 1995, Kirby reported to Kerr as to his research and advice.
85In summary, in the letter of February 7, 1995 (which will be discussed in detail later in these reasons), Kirby sets out several potential avenues of insurance that could be available to the Kerrs. As well, he cites Part E, s. 5.1 (the Territorial Restriction clause) of the standard automobile policy in effect at the time and opines that, given the location of the accident, any insurance owned by Farlinger and Tim Hunt (who leased the motorcycle in Jamaica) would not respond to the loss, nor would the Family Protection Endorsement which deals with underinsured coverage. Then in a separate paragraph, he states that:
Given the above, the insurance coverage that your family had (at least those I am aware of) … would not provide any coverage for this incident.
86He goes on to suggest other possible avenues of insurance through credit cards used in the purchase of tickets or travel insurance; and failing that, to look to various defendants for recovery through a tort action, in particular Tim Hunt, Alan Farlinger, who drove the motorcycle at the time of the accident, as well as the owner and lessor of the motorbike, Vision Bike and Car Rental Co., and possibly Donald Isaacs who owned and operated the other vehicle involved in the accident. He suggests they issue a tort action against them “to protect against the limitation period” noting that the statute of limitations in Jamaica for the bringing of a motor vehicle accident claim is six years, as opposed to two years in Ontario. Finally, he confirmed Kerr’s instructions to issue such a claim against Farlinger et al.
87At trial, Kerr said he had turned over the letter of February 7, 1995 to Julie and he was unsure if he had read it. He could not recall having any discussions with Kirby or anyone in his office regarding the matter of accident benefits or details of coverage under his insurance Policy with Zurich. If he had read the February 7, 1995 letter, he thought the territorial restriction quoted in the letter applied only to the Hunt and Farlinger matter. At no time was the issue of accident benefits under his insurance Policy with Zurich raised, discussed or explained.
88Kirby also sent a letter to Julie dated February 21, 1995 and copied to Kerr, confirming her instructions to send future correspondence to her with a copy to her father, and enclosing the opinion letter of February 7, 1995, previously sent to Kerr. The letter also described progress in serving the defendants with a statement of claim and other issues dealt with in the Hunt and Farlinger matter. Kerr denies any knowledge of that letter, indicating that this was a busy time in his office and he left it to “Julie and her mom”.
(iii) Kerr’s Involvement with Kirby After February 25, 1995
89Having become aware of the Luu and Prasad decisions in and around 1996, and the decision of the Ontario Court of Appeal in May 1997, Kirby wrote a letter to Julie on November 12, 1998, copied to Kerr, advising her that recent court decisions resulted in the possibility that accident benefits may be recoverable from her insurance company. He also wrote to Zurich placing them on notice of the claim and requesting an application for accident benefits. He submitted the application to Zurich in June 1999, notwithstanding that Zurich had taken the position that they would deny the claim based on the late notice and failure to bring the application within the two-year period.
90In November 2000, due to a conflict in his office, Kirby gave up carriage of the file. The plaintiff retained Raphael Partners LLP and the matter was transferred to Joseph Falconeri on November 22, 2000, who applied for mediation. Zurich refused to mediate and an action was commenced against Zurich on April 30, 2003, on behalf of Julie, claiming entitlement to accident benefits pursuant to the Policy coverage. That action was summarily dismissed by Wilton-Siegel J. on February 20, 2006 as being statute barred due to various failures to satisfy limitations under the Policy and SABS (see: Pilotte v. Zurich North America Canada (2006), 2006 4757 (ON SC), 80 O.R. (3d) 62).
91The within action was commenced against the defendants on March 16, 2004, claiming damages for negligence against various parties in the handling of the plaintiff’s claim. As noted, it is only the claims against Kirby and his law firm that are before this Court.
(iv) Kerr’s Evidence at Trial
92Kerr stated that in his work as a general insurance broker since 1987, he had no experience with accident benefit claims or motor vehicle claims nor was he familiar with the accident benefit scheme in force in 1993. At that time, he was a life, disability and group health insurance broker and, as such, he had no familiarity with the requirements under the motor vehicle liability insurance legislation nor specifically, the accident benefit coverages.
93As noted, he did not recall reading Kirby’s letter of February 7, 1995, before he gave it over to Julie. According to him, he did not have any discussions with Kirby or others in his law office about the territorial provision or Julie’s right to accident benefits. He did not recall receiving a copy of the February 21, 1995 letter addressed to Julie and copied to him, stating that he was busy at the time with RSP season in his office and if he had read it, he didn’t understand it.
94Two important documents were placed before him in examination-in-chief and later, in cross-examination: first, two reports of Madeline Joseph, a social worker at the Ottawa Rehabilitation Centre where Julie was an in-patient from April 28, 1993 to June 18, 1993 and second, an affidavit dated June 7, 2005, which he had sworn in the action against Zurich .
95In the first report, Ms. Joseph had suggested to Kerr that he contact the Ontario Insurance Commission (the OIC) and his insurer to ascertain whether accident benefits would be available for Julie. In the second report, the discharge report of June 29, 1993, Ms. Joseph states, in part:
There was no insurance coverage on the motorbike and both Mr. Kerr and worker established that other funding sources (coverage through his own automobile Policy and the Motor Vehicle Accident Fund) was not applicable outside North America.
96Kerr did not recall speaking with Ms. Joseph or reading the discharge summary, and could not understand why anyone would ask him to look into this, which he did not. That was why he retained legal counsel to look into all avenues of insurances available for Julie.
97The second important document put to Kerr was his sworn testimony at the time that he “referred all the facts of Julie’s accident to Rob Brown of Zurich by phone in April or May, 1993 and that Mr. Brown called him back and advised there was no coverage for accident benefits or tort damage since the accident occurred outside of North America”. Kerr goes on to state in the affidavit that “we did not file any further request for benefits assuming that the insurance legislation did not provide for any benefits given the territorial exclusion”.
98At trial, Kerr distanced himself from the statements in the affidavit, stating that those were “not his words” but since the affidavit was prepared by legal counsel, he signed it. In any event, he thought the coverage mentioned related to Hunt and Farlinger, and not to Julie, and he did not recall making the call or discussing the matter with a Mr. Brown or anyone at Zurich.
(v) The Issue of Finances
99From the outset, the Kerr family was concerned about finances payable over and above the coverages provided by OHIP and Great West Life. Indeed, in May 1993, three months after the accident, they held a fundraiser to collect monies for the Julie Kerr Trust Fund to help defray costs.
100In December 6, 1994, in his letter to Mr. Grenkie, Kerr indicates a need to pursue “as rigorously as possible every insurance avenue and any other avenue to help compensate Julie for the extraordinary expenses over the past 21 months and years to come”. In Julie’s correspondence as well, there is mention of her condition and her expenses. In Julie’s evidence, she explained her concerns about this and the effect on the family’s resources.
101Early on, Kerr explained to Kirby the need for funding to cover Julie’s ongoing treatment and expenses. When confronted with an invoice from Ages for services rendered in the sum of $1,029.29, he refused to pay it calling it “very excessive” since he had received nothing in writing from Mr. Ages.
102He says he never discussed legal fees at all with Kirby and there is nothing in their correspondence regarding this.
julie pilotte
103Julie’s evidence on the matter of liability was brief: a few pages in her handwritten diary record initial conversations with Kirby on February 6 and 16, 1995, in which she records discussions regarding her injuries and expenses, and a possible claim against Farlinger. Since the ongoing diary appears to have been misplaced, these are the only relevant entries.
104According to Julie, she had “no idea until she sat down with Mr. Strype in June 2002, that an accident victim under an Ontario automobile Policy could collect the cost of rehabilitation and medical expenses from a car insurance company.”
105Initially, she did not recall receiving the letter of February 21, 1995, but on further questioning she did recall some aspects of it, including having the Acknowledgments and Directions enclosed therein witnessed by a lawyer after she signed them. However, she adamantly denied having seen the letter dated February 7, 1995 addressed to her father that was stated to be enclosed therein. In reading the letter subsequently, she thought the reference to the territorial restriction applied only to the Hunt and Farlinger action, and not to any rights she may or may not have had under the Zurich insurance Policy.
106She denied speaking with her father or anyone else about any rights she may have had in that regard. In her words, “that’s why we got a lawyer. I didn’t know my rights at all. I was depending on my lawyer explaining everything to me”.
107Julie did recall Kirby’s letter of November 12, 1998, setting out the particulars and status of the case against Hunt and Farlinger and others, and noting that due to “unexpected developments” in the law, he had applied to Zurich for accident benefits on her behalf.
barbara legate
108Barbara Legate was called to the Ontario Bar in 1981. She has practiced almost exclusively in the area of personal injury litigation since 1993 and has been a frequent presenter before various legal associations on matters related to personal injury law. In particular, she addressed the Law Society of Upper Canada on automobile insurance reform under the OMPP in 1992. She became a specialist in civil litigation in 1995. She was qualified as an expert to give evidence in this case in personal injury and insurance litigation.
109According to Ms. Legate, the standard of care for counsel at the relevant time was to inquire from a client or proposed client as to the status of any claims for accident benefits, and if no application had been made, to immediately give notice to the insurer and make an application for benefits pursuant to their automobile insurance Policy.
110She explained the law and practice in motor vehicle cases as she understood it, in the relevant period of 1993 to 1995 under the OMPP regime and after Bill 164, which she described as “one of the most complex pieces of legislation in insurance litigation”.
111She testified that, by the time Bill 164 was passed, reference to the Regulation was the norm. In support of this proposition, she referred to two legal conferences organized by the Advocates Society in 1990 and 1992, and a conference held by the Ontario Trial Lawyers’ Association in 1994 where references to the Regulation in Bill 164 were made. In her view, she perceived a conflict between the general conditions in the standard insurance policy and the absence of a territorial clause in the Regulation, which would necessarily be resolved pursuant to section 268 of the Act in favour of the Regulation.
112She expounded her opinion on the importance of submitting an application for accident benefits to the insurer within the limitation period, by indicating:
The application was simple, straightforward and inexpensive. Thus, lawyers should “move quickly” to do this, particularly in matters involving serious injury which would have been a “red flag” in this case.
In her practice, even when receiving a “cold call” for advice, she would advise the person calling to submit an application, or even do it for them.
She likened the situation as akin to a slip and fall incident where counsel would give a municipality notice of a claim before one is certain that such a claim exists.
This would have given Kirby an opportunity to research the matter, by referring to the Regulation, which, she noted, was usual and the norm at this time.
Moreover, if a claim was asserted and denied, the Act gave one an additional two years from the denial to mediate the matter and thus also, conduct further research.
In her view, it is always better to be safe than sorry and there would be no “downside” in taking this course of action.
113The other aspect of Ms. Legate’s evidence was focused on the issue as to whether there was a common belief amongst counsel in the insurance bar at the time as to the meaning of the territorial restriction in the standard automobile policy.
114It was her evidence that this particular matter had never come up either in discussions amongst counsel, conferences, case law or publications. She could not state that there was any common belief about the territorial limitation for accident benefits in the SABS or the Act, or any indication as to entitlement to benefits in that situation.
115When asked what likely would have occurred, if Kirby had sent in an application to Zurich on behalf of Julie at the time, she explained that her practice is “entirely plaintiff-based”, and hence, she was unable to comment upon what an adjudicator would have done if faced with notice or an application for benefits in this matter. Finally, on a review of the correspondence, she was not sure that Kirby even turned his mind to the matter of accident benefits for Julie.
116In conclusion, she opined that Kirby’s conduct, in not submitting an application to Zurich for accident benefits for Julie within the two-year limitations period, fell below the standard of practice of a reasonably competent practitioner in the insurance field at the time.
rita uRbonavicius
117Rita Urbonavicius (Rita) was a student-at-law for Kirby and the defendant law firm in 1995 and 1996 before her call to the Ontario Bar in February 1997; she returned to the firm for about three years as an associate after her call, working mainly for Kirby. It was her evidence that about 80% of Kirby’s practice was in the field of accident benefits on the insurer’s side. After her return to the practice, she was given an overview of the accident benefit schedule, where to look for the law, regulations and so on, as well as a copy of Mr. Flaherty’s text.
118In respect of the Kerr v. Farlinger file, she recalled motions for a change of venue and for service of the statement of claim in London, England. In a memorandum dated December 11, 1996, she was advised by Kirby of the Prasad case in the recent edition of the Ontario Reports that had “potential application to a number of files” he had; she was asked to contact Harry Brown, counsel for the defendant insurer or his office, to find out whether or not the decision was under appeal. By return memo dated January 30, 1997, Rita advised that she had made the call and learned that the appeal had been launched immediately after the decision was rendered in September, but there was no date set for the appeal as yet.
119In her view, Kirby’s practice was mainly defendant based and “any plaintiff files I had any knowledge of were neglected”.
120In regard to this case and others, there were tort files and accident benefit files which included opinion letters on the law under the SABS regime. In her view, the February 7, 1995 letter to Kerr dealt only with the tort claim. She also stated that Kirby had told her he was giving the plaintiff’s case to others “since he had missed a limitation period”.
michael gillen
121Michael Gillen was called to the Ontario Bar in 1980. He worked in the Crown’s office from 1984 until March 1993, when he joined a law firm and began to practice law in the area of personal injury.
122At one point, due to the fact that his practice included a number of Vietnamese clients, he and his partner wondered whether the Accident Benefits Schedule would cover them if they were involved in a motor vehicle accident in Vietnam. In summary, they saw no difference in the Regulation under the OMPP and the Schedule under Bill 164 since both were silent as to the territorial limitation.
123Thus, when Ms. Luu retained his firm in 1995 after she was involved in a motor vehicle accident in Vietnam in which her husband was killed, he immediately filed a claim under their insurance policy for accident benefits.
124The response from Zurich Insurance was that the OAP 1 restricted coverage in the Policy to North America. Mr. Gillen disagreed based on his research and his interpretation of the statutory law, including ss. 227 and 268 of the Act; in his view, if there was a conflict, s. 268 would take precedence.
125In the resulting litigation, he took the position on behalf of the Luu family that the territorial restriction in their Policy with Zurich (the standard policy) did not and could not apply to the Schedule. Mr. Gillen did not read the Luu family insurance policy or any texts to reach this conclusion.
126The back and forth decisions in the Luu and the intersecting Prasad cases are a matter of record and are discussed in other sections of these reasons.
127Suffice it to say that in giving his testimony, Mr. Gillen stated that to his knowledge, no one else was discussing the territorial restriction in CLE seminars or otherwise, and that he was unable to find any case law, either from the courts or the Ontario Insurance Commission at the time that dealt with the issue.
128Mr. Gillen also confirmed that the accident in the Luu case which occurred on February 23, 1995 was subject to the provisions of Bill 164, and to his knowledge, there has never been a case where someone injured in a motor vehicle accident outside North America has recovered accident benefits under the OMPP Policy and regime.
(b) Defence Witnesses
ian kirby
129Ian Kirby graduated from Osgoode Hall Law School in 1980 and was called to the Ontario Bar in 1982. While in law school, he took courses in civil litigation, trial advocacy, insurance and advanced insurance. He articled at Gilbert, Wright and Flaherty (now Gilbert, Kirby and Stringer), where he still practices today. He and his partners specialize in the practice of personal injury and insurance law.
130In 1988, Kirby was a member of the Canadian Bar Association – Ontario (CBAO) Automobile Insurance Committee and in 1989, he became the chair of that Committee. The insurance bar at the time knew that big changes were coming for automobile insurance reform. As such, Kirby had meetings with insurers, government officials and other groups about the proposed changes.
131His law practice consisted of about 80% defence and 20% plaintiff files and this has remained largely consistent over the years. However, the big changes in insurance law resulted in a decreased opportunity for tort claims and a corresponding increase in the accident benefits claims such that by 1994, about two thirds of his practice involved no fault accident benefits work.
132When contacted by Bruce Kerr in December 1994, Kirby had never experienced a case involving an accident that had occurred outside North America. Accordingly, he told Kerr he would do some research and get back to him, which he did. He made notes of his conversation with Kerr, translated into a memorandum to file dated December 9, 1994. In it, he noted that Kerr was arranging to send him documentation “so the matter can be investigated and a claim issued”. Kirby also asked his law clerk to do a search of the limitation period for accidents occurring in Jamaica and once he received that information, he indicated in his memo to file that efforts be made “to track down any insurance and issue a claim to protect the time”.
133In the meantime, he received a letter from Kerr dated December 7, 1994, outlining the salient aspects of the accident and the medical care Julie had received. Kerr noted that the “reason for being referred to you was to settle our minds whether or not any insurance monies might be available”, since Julie has permanent loss of mobility and “will require ongoing treatment and expenses to assist her”.
134By a letter dated January 16, 1995, Kerr wrote to Kirby enclosing a copy of an account from Ages which he termed “very excessive” and in effect, asked Kirby for advice regarding this.
135On February 6, 1995, Kirby recorded a ten-minute long distance call to Bruce Kerr (it is noted that the Kerrs lived in Winchester, Ontario whereas Kirby’s law practice was located in Toronto). According to Kirby, by then, he had done some research and had determined that there would be no coverage under the Kerr’s auto insurance Policy with Zurich due to the territorial exclusion, as Julie’s accident had occurred outside North America.
136According to Kirby, he first took time to explain to Kerr, as he did to every client, what Julie would have been eligible for if the accident had occurred in Ontario, such as accident benefits for pain and suffering, loss of income, claims by potential family members, as well as the maximum amounts that would have been recoverable in that event. Then, he gave him the “bad news” that there was no coverage for Julie under the Zurich Policy due to the territorial restriction, and that would apply to the family protection clause or underinsured coverage as well. Moreover, there would be no coverage for indemnification of the tortfeasors should they have Ontario automobile insurance. Kirby then spoke about other avenues of insurance that might be available to Julie.
137He followed this up with the February 7, 1995 letter addressed to Kerr and arranged a call with Julie. He spoke with Julie by telephone on February 8, 9 and 16, 1995, and there is a memorandum to file indicating that all future correspondence was to be sent to Julie with a copy to her father. In that memo, Kirby summarized what Julie had told him about the accident, Julie’s injuries, her prior and subsequent medical problems, schooling, summer employment and out of pocket expenses, her social life, etc. During the calls, Kirby took notes in handwriting. The calls with Julie took 1 ½ hours. He always wrote notes of things his clients told him but, of course, not what he told them.
138It was Kirby’s evidence that, in those telephone conversations with Julie, he apprised Julie of all of the particulars he had told Kerr on February 6, 1995. In a letter dated February 21, 1995 to Julie, copied to Kerr, Kirby confirmed “our several recent telephone conversations”, and he enclosed a copy of the February 7, 1995 correspondence to her father as well as Authorizations and a Direction for her to sign and return.
139At the same time, Kirby stated that he did not propose to get too far along the path of collecting information “until we have some clearer idea of the actual proceeds that are available.”
140When asked at trial if he told Kerr and Julie about the two-year limitation period, he answered, “Not specifically no, but it didn’t matter as there was no coverage”.
141He noted that in any event, the limitation period in Ontario was mentioned in the letter of February 7, 1995.
142When asked why he didn’t file a simple application for accident benefits, he again answered: “There was no point. There was no way around the territorial exclusion”. In his view, there was no doubt about this; it was both clear and obvious.
143Kirby also recalls discussing legal fees with Kerr though there was no written retainer. He explained to Kerr, who was funding the matter, that he charged what he recalled was $225 per hour for the time spent on the file, plus disbursements, which would be billed once the work was completed. That was standard in his practice at the time.
144After a meeting held with Julie and her parents in Ottawa, on June 21, 1996, Kirby again recorded the information given to him about Julie’s treatment and expenses related to the accident.
145It was not until the fall of 1996 that the Luu and Prasad cases were first heard. The Prasad decision came to his attention in December of that year after which he ascertained through Rita that the decision was under appeal.
146On November 12, 1998, Kirby wrote to Zurich explaining the situation and requesting an application for benefits. On that date as well, he wrote to Julie confirming that all of the defendants had now been served with the Statement of Claim issued against Hunt, Farlinger, Vision Bike and Car Rental Co., and Donald Isaacs, and noting the success of the interim motions as to service and venue in that matter. He also advised her of the two recent decisions in Ontario courts and stated “there is some possibility that those no fault benefits could be recovered from your own automobile insurer”, and that he had accordingly made an application for benefits on her behalf.
147In November 2000 Julie again took notes of her conversations with Kirby and his advice and information detailing both claims – claims for general and special damages in the Hunt and Farlinger lawsuit and a potential action against Zurich who had turned down the application for benefits on the basis it was statute barred. He detailed what the law would allow for accident benefits and the amounts they could claim under various headings.
148He also informed Julie of a conflict that had arisen in his office and gave her names of three insurance counsel working in the area. In March 2001, Kirby transferred the file to Joseph Falconeri.
149When asked in cross-examination why he made an application for benefits in 1998 on behalf of Julie but not earlier within the limitation period, he simply answered that initially there was “no hope of a successful outcome as there was no coverage and hence no relief from forfeiture” whereas later, based on the jurisprudence, there was a “faint hope” of recovery.
lee samis
150Lee Samis was called to the Ontario bar in 1978 and has dealt with accident benefits under the Ontario automobile insurance system for about 35 years. He was there when the major reforms were rolled out in 1989 and was retained later by the insurance industry to assist with what led to Bill 164.
151Over the years, Mr. Samis has been heavily engaged in all aspects of the Ontario Automobile insurance system as a litigator, educator and legal advisor to the public, the government and other stakeholders. He argued the Luu case on behalf of the insurer before the Divisional Court and was successful in upholding the territorial exclusion there.
152He was qualified to give opinion evidence on no fault insurance and the history and changes in insurance law in 1990 and 1994.
153Mr. Samis explained the underpinnings of insurance law from the 1970s to date, the underlying rationale for the radical changes made, particularly from the perspective of the defence bar and the insurers, and the results vis-à-vis the public interest.
154In the course of doing so, he stated that for a hundred years, automobile insurance had been a matter of contract. The changes made in 1990 and then 1994 represented in his words “legislative intrusion into the contractual nexus”, that is, the legislature began to re-shape the character of insurance products. They started with liability coverage and how, in the contract between the insured and the insurer, to protect injured parties from liability to others. This involved discussions about, among other things, statutory conditions required in the contract or insurance policy, indemnity for the no fault position, the underinsured and the shape of the standard policy which was under the authority of the Superintendent of Insurance. The Superintendent was charged with the supervision of policy forms as part of the insurance contract to be approved and published in the Ontario Gazette.
155The SPF 1 prior to 1990 was the standard Ontario automobile Policy Form that served as a “convenient reference point for dealing with insurance and this is what the customer got.”
156The OMPP in June 1990 represented a major change in Ontario.
157Indeed, according to Mr. Samis, there was much in the new standard policy (the OPF 1) that was not in the Act. As the discussion developed, and the OMPP was implemented, the no fault provision had to be in the Policy, and clause (g) of s. 121(1) was the regulation-making power to describe the benefits to be provided under the contract. The OPF 1 was approved in May 1990 and published in the Gazette June 16 of that year.
158In Mr. Samis’s view, the OMPP was the natural evolution of what came before – essentially the Policy booklet looked “pretty much the same” as the provisions from SPF 1 but one of the differences was that the phrase that “each part of the Policy should be read subject to the general provisions, definitions, exclusions and statutory conditions of the Policy found in Part E, sections 5.1 to 5.12 and Part F, sections 6.1 to 6.3, apply to every part of the Policy except as stated in those sections,” was repeated three times in the OPF 1 as opposed to one place in its predecessor form.
159In his view, it was made very clear that the standard automobile policy was custom made for the OMPP environment.
160When asked whether it was sufficient for a prudent solicitor to read just the Act and regulations when acting for a client at the time, Mr. Samis answered “Absolutely Not”. One would need to know “who what when” and for that you would need to look at the contract itself to ascertain, for example, if there was an endorsement, increased optional benefits, what cars were included and other details of the contract that would not be in the Act but in the Policy.
161Then with Bill 164, in effect as at January 1, 1994, the OAP 1 took the place of the OPF 1 and one had to look elsewhere for benefits, and refer to the Regulation. Prior to this, there was no difference in what constituted the Policy and the Regulation – they comprised one document, a small booklet given to the insured and utilized regularly by insurers, brokers, lawyers and the insured.
162According to Mr. Samis, prior to the cases of Luu and Prasad, the legal community had “no inkling” of an issue regarding the territorial exclusion, nor would anyone practicing law in the area have suspected that the standard approved policy did not faithfully represent the benefits schedule or have reason to look behind the Policy to the Schedule which formed an integral part of it. Specifically, the OPF1 Policy unambiguously applied the territorial limitation to accident benefits.
163When asked about a potential conflict between ss. 227(2) and 268 of the Act, Mr. Samis was aware of one case at the time that forcefully endorsed the changes that could be made to the Policy by the Superintendent and he referred also to the book by Alan O’Donnell entitled Automobile Insurance in Ontario. Mr. O’Donnell was involved in the development of the OMPP system and was an advisor to the government at the time. In Mr. Samis’ view, there was no conflict between ss. 227(2) and 268 of the Act and no issue regarding which would take precedence before the advent of Bill 164.
164In summary, he testified that when the standard policy is in force, it represents a valid contract; and counsel must look to the client’s automobile policy for direction. The contractual language in the OPF 1 as regards to accidents outside of North America was prominent and clear. On the other hand, according to Mr. Samis, the regime of accident benefits under Bill 164 upon which the decisions in Luu and Prasad were decided, was “extremely complex, often counter intuitive, and introduced concepts previously unknown to insurance and personal injury practitioners”. In any event, it was not in operation at the time of the plaintiff’s accident in 1993.
165In Mr. Samis’ view, the sequence of events leading to Luu and Prasad decisions were not known, suspected or foreseeable prior to their emergence.
nigel gilby
166Mr. Gilby was called to the Ontario Bar in 1980 and has been a partner in what is now Lerners LLP since 1985. His practice is comprised primarily of plaintiff personal injury cases with 10% or less insurance defence work. In the early days, he did predominantly jury trials, 95% of which were motor vehicle accident cases, and later included more accident benefit cases at the OIC and The Financial Services Commission of Ontario (FSCO).
167In the period leading up to the passing of the OMPP in 1990, Mr. Gilby took a leading role in organizing FAIR – Fair Action in Insurance Reform. He ran the Southwest Ontario and Northern division to organize events, spoke to lawyers and attended legislative hearings. FAIR took the position that the legislation was draconian and would seriously impair an injured party’s tort rights.
168Mr. Gilby was qualified at trial as an expert to give evidence on personal injury litigation and insurance law. According to Mr. Gilby, it was a longstanding understanding among the plaintiff personal injury bar both pre and post OMPP that accident benefits were not available to an injured client due to the territorial restriction in the Policy if the accident occurred outside North America.
169He himself only dealt briefly with one case when the accident occurred in Cuba and he was asked to give advice about someone’s rights under his insurance policy. He did and they did not pursue benefits. He assumed this was due to the territorial restriction therein.
170The Superintendent of Insurance would authorize the Policy put into booklet form. To his knowledge, the Superintendent’s authority to approve the standard policy was never questioned. Neither did he perceive a conflict between the Policy and what appeared in the Regulation – it was all one document in the OPF 1 Form.
171As opposed to Ms. Legate’s opinion, it was Mr. Gilby’s stated view that the first thing plaintiff’s counsel always looked to was the Policy to see what the client was entitled to and any exceptions to the allowed benefits. Indeed, when asked in cross-examination whether he would look at the Insurance Act, the regulations and the Policy, his answer was “No I can’t agree with that as everything was contained in the Policy”.
172He did not recognize Ms. Legate to be known as a leading member of the plaintiff bar in the early 1990s, and he found her analysis to be “simplistic”.
173Mr. Gilby was also involved in proceedings leading to Bill 164 which he and other counsel referred to as “The Fat Book”. Now, the regulations were too large and complex to be all in one small booklet.
174In his view, there was no conflict between the general conditions in the Policy and the absence of the territorial clause in the regulation prior to the emergence of Bill 164.
175Moreover, during the period in question, an application for accident benefits would have attracted legal costs in addition to filing the application, although matters proceeded much more quickly then.
176Accordingly, had Kirby submitted an application for benefits for Julie at the time, it would be questionable whether Julie or her father would have been prepared to incur the costs of pursuing the claim given the opinion there was not a right to benefits and the “significant expense” that would be incurred.
177Moreover, had Kirby brought an application for benefits, in Mr. Gilby’s view, it would have been disposed of long before the Luu and Prasad decisions were determined.
178In summary, Mr. Gilby concluded that it would be unreasonable to expect a lawyer to anticipate changes in statutory interpretation based on future court decisions which were not foreseeable; and further, it would be unreasonable to hold Kirby to a higher standard than other lawyers practicing in the same area of law with the same level of expertise.
179In conclusion, he stated that Kirby acted as would a competent, skilled and knowledgeable practitioner practicing in automobile and personal injury litigation at the time.
guy farrell
180Mr. Farrell was called to the Ontario Bar in 1982 and practiced insurance and personal injury law for about five years. He joined the Samis firm in December 1987 and was a partner at the firm for about ten years.
181Starting in 1990, Farrell practiced primarily first party accident benefits litigation; he had one to three plaintiff files at any given time during thirteen years, as well as limited tort work on the defendant side (including accident benefits claims).
182In June 2000, he joined Gilbert Wright and Flaherty and since January 2002 his practice has involved mainly plaintiff personal injury cases.
183When he joined the defendant law firm in 2000, he had six or seven insurance companies sending him work, Zurich Insurance being his largest client. Zurich did not want him or anyone in the firm doing first party litigation against them. This conflict applied to existing clients as well, which would include the plaintiff’s file. This led to Kirby and his law firm’s decision to give up any plaintiff files against Zurich in order to accommodate Mr. Farrell within the firm.
murray ages
184Mr. Ages was admitted to the Ontario Bar in 1972. In 1993, his law firm, Kimmel, Victor, Ages merged with Soloway Wright and he practiced there in the areas of criminal and family law and some personal injury work. In late 1994, Mr. Kimmel forwarded to him a letter he had received from Kerr. Mr. Kimmel practiced mainly real estate law, as he still does, and would refer personal injury work to him. The note from Kerr indicated that he was looking for insurance coverage for his daughter as a result of the accident that had occurred in Jamaica in 1993.
185Over a period of four days, Mr. Ages docketed 3.6 hours of work. In summary, he contacted Kerr as well as people in Jamaica for information; he also spoke with at least two people or possibly more at Zurich Insurance and ascertained that a person by the name of Tom Nicholas had some knowledge about the case.
186As he had had some files with Mr. Nicholas and knew him to be “a nice fellow, capable and well informed”, he spoke with him about coverages under the Policy, and the answer he obtained was that there were none as the accident had occurred outside North America.
187He then had a general conversation with Mr. Hagen, a lawyer in his firm, and asked him to check into the matter of coverage. When asked why he did this, he answered that Hagen was a competent insurance lawyer doing a lot of that type of work, and this was more complex than a typical personal injury file, even for the preparation of a statement of claim. Moreover, Mr. Hagen had done some work with Zurich.
188Mr. Hagen later reported back to him that he had ascertained that no coverage was available in these circumstances. By a letter dated November 29, 1994, Mr. Ages wrote to Kerr indicating that time was of the essence since there was a two-year limitation period to issue claims which would expire on February 25, 1995.
189In the meantime, Mr. Ages had spoken with Kerr, requesting more information as he continued to explore all options of coverages. According to Mr. Ages, “he was to send me that documentation and it never came”.
190Approximately a month later, Ages sent Kerr a letter again requesting the required information, and was then told by Kerr that he had hired someone else. He subsequently sent an account to Kerr who indicated he was not happy with it.
191Mr. Ages has had no insurance law experience since 1996 and has passed his personal injury files to others.
192In 2005, he heard from Mr. Strype’s office who requested an affidavit from him. He did sign an affidavit upon which he was cross-examined, and which related to the claim against Zurich.
193As far as he remembered, he would have passed on the information he had learned from Messrs. Hagen and Nicholas to Kerr though he cannot specifically recall this.
194In cross-examination, he stated that he had never spoken with Julie. It was Kerr who was looking for insurance coverage to help his daughter and asked him to do something to bring a claim on her behalf.
peter hagen
195Mr. Hagen is a lawyer, called to the Ontario Bar in 1978. In 1994, he was practicing at the law firm now known as Soloway, Wright LLP in Ottawa, Ontario. The primary focus of his practice at the time was insurance and personal injury work on the plaintiff’s side as well as general litigation.
196He had limited recollection of the matter but recalls that another member of the firm, Murray Ages, sought his advice on the Pilotte matter, as he had done some work with Zurich and Mr. Ages had questions about coverage for an accident in Jamaica. Accordingly, Hagen called his contact, Tom Nicholas, a claims adjuster at Zurich in Ottawa, and was told there would be no coverage.
197Mr. Hagen also had a copy of the OPF 1 at his desk at the time and reviewed it. He then advised Mr. Ages that he didn’t think there was any coverage in the circumstances. He has a vague recollection of transferring the file back to Mr. Ages whom he said practiced family law and personal injury as well. He had no discussions with Julie or Kerr.
madeleine joseph
198Ms. Joseph obtained a diploma in social work studies in England, took post graduate medical social workers courses in 1960, emigrated to Canada in 1964, and obtained a Masters in Social Work from Carleton University in 1981.
199She worked at the Rehabilitation Centre in Ottawa as a social worker in the spinal cord program from February 1982 to 1998 when she retired.
200Julie was admitted to the Rehabilitation Centre of the Ottawa Civic Hospital on April 28, 1993 and was discharged on June 18, 1993.
201Ms. Joseph was part of a team to help assess and treat Julie’s condition in order to assist in her recovery. The team met once a week with the family to plan, discuss Julie’s progress and give the family feedback; as well, each professional met separately with Julie and her family members on a regular basis. It was Ms. Joseph’s role to look into Julie’s ability to cope with her disability and her family’s coping as well, funding issues for certain equipment and to suggest community resources, which she did.
202Her observations were reduced to writing in two reports. Indeed it was a requirement to meet with patients and their families within two weeks of admission and to produce written admission and discharge reports to be stored as part of the hospital records. As part of her role, Ms. Joseph would obtain a global picture of the family’s finances as a basis to make suggestions for various equipment and to devise the best way to proceed.
203In her first report dated June 8, 1993, among other things, Ms. Joseph stated:
Financial
Julie understands that the family have comprehensive insurance, but did not know the details. Mr. Kerr was investigating coverage on the motorbike. Worker provided him with the Ontario Insurance Commission number for information if necessary or other available coverage (such as the possibility of using his own car insurance.) [Emphasis added.]
204In the second Discharge Report, Ms. Joseph stated, among other things, the following:
Goals accomplished
Funding
Mr. Kerr paid equipment costs up front and will claim from his own insurances. There was a considerable amount of local fund raising. Ms. Kerr gave interviews both on radio and for local papers, which she found an enjoyable experience. There was no insurance coverage on the motorbike and both Mr. Kerr and worker established that other funding sources (coverage through his own automobile Policy and the Motor Vehicle Accident Fund) were not applicable outside North America. [Emphasis added.]
205Ms. Joseph explained her memory of this in cross-examination and stated “This report represents my work with the client. What is in my report is accurate”.
THE ISSUES
206The matter of liability is rooted in two main issues, namely Standard of Care and Causation.
207Issue No. 1- Standard of Care: Did Ian Kirby’s conduct fall below the standard of care of a reasonably competent lawyer with expertise in personal injury and insurance law litigation?
Specifically, would a lawyer specializing in personal injury and insurance law at the relevant time accept that the Territorial Restriction contained within the standard insurance policy (“the Policy”) was applicable in this case and no claim for accident benefits could be successfully brought, or should he have submitted an application for benefits despite the territorial limitation clause in the plaintiff’s Policy?
Did Kirby properly explain to the plaintiff what her rights to accident benefits were or would have been under the family’s car insurance Policy with Zurich Insurance?
208Issue No. 2 - Causation: What would likely have occurred had Kirby filed an application for benefits, despite his views regarding the territorial limitation? That is, was there a reasonable prospect of a successful application for accident benefits at the time and place in question?
ANALYSIS
issue no. 1 - STANDARD OF CARE
209The plaintiff framed this case as a simple matter of a lawyer missing a limitation period. In doing so, she relies on such cases as Din v. Hage, [2006] O.J. 2805 (Ont. S.C.), appealed [2007] O.J. No. 3636 (C.A.), which held that failure to issue process within the relevant limitation period constitutes negligence. See also: Glivar v. Noble, [1985] O.J. No. 80, 80 O.A.C. 60 (C.A.), in which Blair J.A. stated at para. 67:
In all matters where exercise of a client’s rights is restricted by time limitations it seems to me that it is the duty of a solicitor to be certain what those time limits are before presuming to advise the client or to take any proceedings on his behalf. This is particularly true of statutes like the Assessment Act which are regularly amended and frequently used.
209That portrayal, though true, presents in my view a very simplistic assessment of the evidence and represents a distorted view of the factual nexus in this case.
210This case involves a complex and unusual set of circumstances on many levels and viewed from various different perspectives. My conclusion in favour of Kirby rests on a number of areas of evidence that, when viewed broadly and in context, are, in my view, clear, unambiguous and insurmountable.
211The broad categories of evidence are:
The retainer
The testimony of Kerr and Julie
The actions and interactions between Kerr, Julie and Kirby
The expert evidence
Changes in the law
212In discussing each of these items, I will review the evidence in summary fashion and make findings of fact and credibility accordingly.
1. THE RETAINER
What were the facts surrounding Mr. Kirby’s retainer?
213It was not until 21 months after the accident of February 25, 1993, that Kerr contacted Kirby on December 6, 1994. As we have seen, prior to that date, Kerr had consulted a number of other counsel, and made his own independent inquiries regarding possible avenues of funding or insurance monies that could be available to Julie.
214Kerr’s intention in contacting Kirby is clearly set out in his letter of December 6, 1994 to Douglas Grenkie, Q.C., in which he states,
We must pursue as rigorously as possible every insurance avenue and any other avenue to help compensate Juli for the extraordinary expenses over the past 21 months and years to come.
215In a similar letter of December 7, 1994 to Kirby, Kerr asks what insurance monies might be available to Julie. By the time Kirby became involved, the 30 day and 90 day periods for the giving of notice and filing an application for accident benefits had passed, and the 2-year limitation for the filings to be extended for “reasonable excuse” was looming. Kirby was aware that other lawyers had worked on the file, and indeed, he requested a copy of the file from Ages, who had previously been “retained” by Kerr.
216Once contacted by Kerr on December 6, 1994, Kirby proceeded to conduct research around the fact that the accident had occurred in Jamaica. After reading the Kerr’s Policy with Zurich and the available texts, he came to the conclusion that given the territorial restriction, no coverage would be available to Julie under the Policy. Kirby also made inquiries as to the avenues of insurance funding in Jamaica and elsewhere in accordance with his retainer. He immediately contacted a lawyer in Jamaica and made inquiries as to the relevant law. He ascertained that an action in tort could be commenced against Messrs. Hunt and Farlinger in Ontario using Jamaican law; and could include, as well, the owner and lessee of the motorcycle in question and the owner and operator of the other vehicle involved in the accident.
217On or about February 10, 1995, after having advised Kerr and Julie of his opinion that since the accident had occurred in Jamaica, no coverages would be available to Julie under their Policy with Zurich, and having obtained instructions from both Bruce Kerr and Julie to do so, Kirby commenced an action in the Superior Court against Tim Hunt, Alan Farlinger and others; motions were brought to facilitate service abroad and to respond to a motion for a change of venue.
Why did Kirby not also apply for accident benefits on behalf of Julie within the 2-year limitation period?
218According to Kirby, once he determined that the territorial limitation in the Kerr’s Policy would preclude any coverages for benefits for Julie including accident benefits, there was no point in making an application - the limitation period was not a factor where no benefits were available.
219When it was suggested filing an application was an inexpensive and trivial step to take, he responded, “if there was no merit to it, it would make no sense to expose a client to additional cost. I don’t issue claims in every situation.”
220When asked if he obtained instructions NOT to proceed with a claim against Zurich, he explained that his practice was to emphasize the positive and move forward.
- THE TESTIMONY OF KERR AND JULIE
(a) Bruce Kerr
221In giving his testimony at trial, Kerr did not present as the efficient and knowledgeable person he appeared to be when dealing with Great West Life and the tragedy that befell the family, or indeed, in pursuing financial assistance on behalf of Julie. All of his inquiries at the time appeared to be professionally written and appropriately inquisitive.
222However, at trial, when asked by his counsel if he received Kirby’s letter of February 7, 1995 explaining the relevant law as he perceived it to be at the time, Kerr was “not sure if he read it”. When asked if he recalled receiving it, he answered “It’s possible. Probably not as this was the busiest time of the year for us”.
223He did not recall receiving a phone call from Liz, Kirby’s office assistant on February 9, 1995; he did not recall speaking with Kirby on or about February 21, 1995. When asked by his counsel in examination in-chief whether he had further discussions with Kirby after 1995, he said he couldn’t recall, but he was busy then and left it up to “Julie and her mom”.
224He did not recall swearing his affidavit of June 7, 2005 in the action against Zurich, in which he stated he had spoken to Rod Brown of Zurich in April or May, 1993 who had called him back and “advised that there was no coverage for accident benefits or tort damages since the accident occurred outside North America”. He had no memory of the circumstances covered therein and when asked about this by his counsel, he stated, “I looked at it (the affidavit) and I signed it”.
225In cross-examination, when asked about the affidavit, he stated, “Those were not my words….when my lawyer sends me something to sign, I sign”, though he himself swore the contents of the affidavit were true before a commissioner of oaths at a lawyer’s office. Later in the cross-examination, and in regard to the reference to a Rod Brown from Zurich, rather than denying making the call, as he had previously, he said: “Mr. Brown did not say there was no coverage for accident benefits or tort damages, as stated in this affidavit, but rather that there was probably no coverage.
226When asked whether given his extensive background in the insurance industry, he was at some point familiar with the standard automobile policy in effect in Ontario since 1972, he replied “I didn’t know or I forgot it”. Though this may have been true, it was established that there were four insurance brokers in his office who sold car insurance policies at the time and though he said he learned about the two-year limitation period from them, he knew nothing about accident benefits. Is this reasonable?
227Kerr also had no memory of speaking to people at the Rehabilitation Centre (where Julie was an in-patient from April 28, 1993 to June 18, 1993) about accident benefits for Julie, or reading the Discharge Report dated June 29, 1993, which clearly stated that he had conducted his own inquiry into accident benefits with the OIC and had been told, as had they, that Julie would not be covered under the Zurich Policy due to the fact the accident had occurred in Jamaica.
228To be fair, finally, after several questions, Kerr did admit that he probably had received advice from a number of sources that the territorial provision would make the insurance coverage under his Policy unavailable in Ontario.
229At the same time, however, he denied being advised of the accident benefits schedule or the limitations period by Ages and others despite the explicit written instruction of Ages regarding the limitation period and that “time was of the essence.”
230He answered several of these questions by rote as did Julie, stating “I thought that referred to Hunt & Farlinger”.
231When asked at trial whether he had ever discussed fees with Kirby, Kerr answered that he had not. I appreciate there is nothing in writing about fees, but I cannot accept that they did not discuss the legal fees that would be involved. Even if I were to accept Kerr’s assertion that in all his years in the insurance business or personally he had no occasion to pay legal fees to anyone related to a legal action, certainly his experience with Ages would alert him to the fact that legal work costs a client money.
232I accept Kirby’s evidence that in the usual course he discussed his fees with his clients, and at the time, his hourly fee was about $225. His custom was to hold the account and bill the client at the end of the case, as he said he would do here even when handing over the file to other counsel. Any suggestion to the contrary does not hold water and I reject it.
233Early on, Kerr had suggested they correspond as much as possible by fax or in writing which they did. Given Julie’s condition, her school and work obligations, Kerr’s busy insurance and investment business and the fact that the Kerrs resided in Winchester, Ontario, this was a reasonable accommodation.
234But it is incomprehensible that Kerr would have no recollection of the only meeting that he, Julie and his wife Lorna attended in June 1996 with Kirby. Lorna remembered it. Further, Kirby recalled that it took place near the airport and that Kerr had arranged to use a friend’s office for the meeting.
235Kerr’s testimony regarding this and other matters simply cannot be believed. I find that given his experience in selling automobile insurance, his discussions with and notes of the worker at the Rehabilitation Centre, and his telephone call to Mr. Brown at Zurich in April or May 1993, he was well aware of the existence of accident benefits and that they were said not to be available to Julie due to the fact the accident occurred in Jamaica.
236I will discuss the letter of February 7, 1995 that Kirby sent to Kerr under a separate heading. Suffice to say, I found Kerr’s evidence at trial to be contrived and for the most part, untrue. He did not present as a credible witness.
(b) Julie Pilotte
237Julie’s evidence, at trial, followed the same mode as that of her father – on important points, she was evasive and portrayed a selective memory.
238It was her evidence that she had “no idea” until sometime after June 2002, when she was told by Mr. Strype, that an accident victim insured under an Ontario automobile policy could collect the cost of rehabilitation and medical expenses from a car insurance company.
239Yet, Kirby’s letter of November 12, 1998 to Julie reported on what had been done in the case against Hunt & Farlinger, described some “surprising” new developments in the law and stated that as a result, he had given written notice of a claim to Zurich on her behalf for accident benefits. In addition, Julie made copious written notes, as was her custom, of her discussions with Kirby which included details of accident benefits that would be available to her.
240Indeed, Julie’s own notes, written sometime in or after 1996, confirm that she was provided with significant detail about accident benefits by Kirby, specifically that the benefits provided for $500,000 in coverage for medical expenses for 10 years’ worth of medical bills. In her examination-in-chief, Mr. Strype showed Julie her own notes referencing her conversation with Kirby on this issue. The following is that exchange:
Q: I’m going to refer you to another document from the liability brief, this is tab B29. It’s still in volume one. Julie, do you recognize this document?
A: This is my writing, yes, I do.
Q: Can you read through it and tell us – I don’t see a date on here so first of all, can you read through it then tell us if you recall more or less when you wrote this?
A: Well from what I know now it has to have been after ’96 because it’s referring to the cases in Mexico and Vietnam.
Q: And the paragraph that refers to them, can you just read – there’s some terminology in here that I can’t totally read. Can you read from the portion…
A: It’s my shorthand.
Q: Exactly, can you read from, “There has been.”
A: “There has been a change in law. We could not use Ontario Insurance policy for off continental U.S. Now two cases, one in Ontario Court of Appeal, one in Mexico and one in Vietnam.”
Q: And then also the next paragraph.
A: “So Ian is going to write Zurich and try to claim. We have up to $500,000 in coverage for medical expenses for 10 years’ worth of medical bills. Zurich will say too late, not within two years, but Ian Kirby will just say too bad, law has changed.”
Q: Do you recall having that conversation with Mr. Kirby about what you wrote there?
A: This is me writing down a phone conversation with him. This is me making notes of a phone conversation with him.
241I do not accept Julie’s assertion that she had no idea of her right to claim accident benefits under the Zurich Policy prior to her discussion with Mr. Strype in 2002. Her own notes to the contrary speak for themselves.
242At trial, Julie denied she had any discussions with her father regarding insurance coverage or any inquiries he had made or advice he had received about this. For example, when asked about her father’s affidavit sworn June 7, 2005 that in April or May 1993, Rod Brown from Zurich had advised him there was no coverage for accident benefits or tort damages, as the action had occurred outside North America, she denied knowledge of this. The following is an excerpt from her cross-examination on this issue:
Q: In answer to one of Mr. Smith’s questions last week, you indicated that you do not know whether your father talked to anyone at Zurich Insurance about any rights you might have under the Insurance policy issued covering your family’s vehicles, is that correct?
A: That’s true.
Q: Were you really unaware last week when you gave that evidence of the affidavit that your father signed- and we’ll put that up on the screen… this was an affidavit that was filed in opposition to a summary judgment motion brought in your action against Zurich Insurance and your father swore that – and I believe – can we go down to the bottom – on June 7th, 2005 – and if we go back up a little – you’ll see that he swears in that affidavit that,
“I referred all facts of Julie’s accident to a Mr. Rod Brown of the Zurich Insurance Company by phone. Mr. Brown was located at the Carling Executive Park. I spoke to Mr. Brown in April or May of 1993,”
and at paragraph eight, “Mr. Brown thereafter called me back and advised me that there was no coverage for accident benefits or tort damages since the accidence occurred outside North America.”
Now would you agree with me that it appears that your father was told within three months of your accident by a representative of your family’s automobile insurance company that accident benefits were not available to you because your accident occurred outside North America?
Q: Do you believe that your father submitted a false affidavit?
A: No, no. …
A: I think he believed it to be true.
Q: Over the years that you’ve known your father, have you known him to be an honest man?
A: Yes.
Q: Do you know of any reason why this wouldn’t represent the honest truth then?
A: No.
243Further, she answered several similar questions in the negative, such as:
Q: You have no recollection of your father’s mentioning that Steve Ault had suggested you make an application for accidents benefits.
A: No
Q: --- there is a letter from Daniel Kimmel, QC in October 1994 (to Kerr), stating that Julie certainly has a claim against Alan Farlinger, and “Julie may also be entitled to benefits under your insurance policies.” Were you shown that letter?
A: No
244It was not until she was read the following answer from the discovery transcript that she admitted being advised by her father of “what was going on” at the time.
Q: He advised you of what was going on?
A: Yes
245Not only is Julie’s own evidence inconsistent on this matter, but it would be difficult to fathom that Kerr did not make his daughter aware of this very important information.
246As her father did, Julie displayed “limited understanding” as well as selective memory of important matters. She often evaded questions by saying she thought various statements by Kirby related to the “Hunt and Farlinger matter”.
247In February 1995, Julie asked that all further correspondence from Kirby be sent to her directly with copies to her father. She lived in the family home after the accident and commencing in the fall of 1994, worked part-time in the garage where her father carried on his insurance business. Yet, she said she denied ever discussing insurances coverages or anything learned about it, with her father.
248By all accounts, Julie is an intelligent, productive person who worked for her father in the insurance industry for many years and who completed a university degree in good time after the accident. She kept a diary, listed details of numerous (even minor) expenditures made, displayed a full understanding of her condition and the various medical treatments she incurred at each stage of the rehabilitative process and wrote letters to her doctors and others in good hand. Interestingly, Julie’s diary has apparently been lost or misplaced and was not produced in court. When Kirby was asked about this as it was noted in his memo taken at the June 1996 meeting of the parties, there is this exchange:
Q: And there’s reference to keeping a diary now. Did you ever see that diary?
A: No.
249I find on the evidence that both Julie and her father knew about accident benefits available under their Policy with Zurich, and that they were not available to Julie because of the territorial limitation therein, way before 2002. The fact that Julie suggested she knew nothing about accident benefits until her conversation with Mr. Strype in 2002 only serves to undermine her credibility.
3. THE ACTIONS AND INTERACTIONS BETWEEN THE PARTIES
Kirby’s Letters to Kerr and Julie
250Counsel have indicated that the crux of this case rests on the proper interpretation of the opinion letter from Kirby dated February 7, 1995 addressed to Kerr and enclosed in the letter of February 21, 1995 to Julie. The relevant passages of the letters read as follows:
(a) The letter of February 7, 1995 from Kirby to Bruce Kerr reads in part:
As Advised, I have conducted some research on the matter and can report as follows:
- If Messrs. Hunt and Farlinger were insured under standard policies of automobile insurance in the Province of Ontario, such policies would not respond to this loss. By virtue of Part E, Section 5.1, the Standard Automobile Policy “applies to loss or damage to persons or property caused by an incident that arises out of the ownership, operation or use of an automobile and that occurs in Canada, the United States of America or on a vessel travelling between ports of those countries”.
Given the location of this accident, by virtue of the above provision, the Policy is not applicable.
- I am also of the opinion that the OEF 44 (Family Protection Endorsement), which deals with underinsured coverage, would be of no assistance in this case. While the Endorsement does not specifically speak to the jurisdictional issue, the concluding phrase in the Endorsement is:
“Except as otherwise provided in this Endorsement, all limits, terms, conditions, provisions, definitions and exclusions of the Policy shall have full force and effect”.
In other words, the provision in the Policy dealing with the limitation on coverage to accidents occurring in Canada and the United States applies to the Endorsement as well. As such, the Endorsement is of no assistance in proving uninsured coverage for this loss.
- Given the above, the insurance coverage is that your family had (at least those that I am aware of) would not provide any coverage for this incident. However, having said that, it occurred to me that there may well be one or two other possible sources of insurance coverage, which we have not as yet discussed.
In any event, as discussed with you, we have done some preliminary research on Jamaican laws and have ascertained that the statute of limitations for the bringing of a motor vehicle accident claim is six years, rather than two as in Ontario. Nonetheless, in order to protect against any potential liability issue, I confirm our discussion wherein I recommended that we issue a Claim simply to protect against the limitation period. I acknowledge receipt of your instructions in that regard.
Note: Kirby stated and Julie agreed that the words “insurance coverage is” in paragraph 3 appeared to be a typo, meant to read “insurance coverages”.
(b) The February 21, 1995 letter from Kirby to Julie reads in part:
This will confirm our several recent telephone conversations.
At the outset, I confirm your instructions that henceforth, all correspondence is to be sent to you, with a copy to your father. To the above end, I am enclosing a copy of correspondence which was previously sent to your father, before receiving your specific instructions.
I confirm that we discussed the facts of the accident, your injuries and resulting medical treatment in great detail. While using that information as a basis on which to commence collection of the requisite information, I do not propose to get too far along the path on collecting information, until we have some clearer idea of the actual insurance proceeds that are available. I do not believe that it makes any sense to incur significant expense until this is known.
Why do Kerr and Julie go to such lengths to disclaim any knowledge of these pieces of correspondence?
251The plaintiff claims in her pleading, among other things, that the defendants did not explain her rights to statutory accidents benefits to her nor “any limitations” that may apply to such rights, at any time. On the other hand, the defendants argue, based on the above letters as well as Kirby’s viva voce evidence, that he did, in fact, advise each of them directly and in writing that the family’s automobile insurance Policy would not provide coverage due to the territorial restrictions in their Policy, and what rights would be affected by this.
252Kerr’s testimony in regard to the February 7 1995 letter vacillates. He first asserted that he had turned the letter over to Julie and was unsure if he had read it. Then, he said if he had read it, he only understood that an action would be brought against Farlinger and others. At the time, he was busy with RSP season in his business and if he read it, he did not understand it.
253The letter was 3 ½ pages in length and addressed the very matters that Kerr had retained Kirby to investigate and address. Given that Kerr was a reputed insurance broker and given his assiduous ability to get things done, I cannot accept his testimony.
254Julie’s testimony was similar. The memories of all of the witnesses 22 years after the fact may not be detailed, and I accept that. But, the “selective” memory of Julie when giving her evidence was quite astonishing. She was certain initially, that she never received the letter of February 21, 1995 and then, that she had definitely not received the February 7, 1995 letter, previously sent to her father, enclosed therein.
255Regarding the receipt of the February 21, 1995 letter, Julie in cross-examination was asked,
Q: Thank you, Now, you’ve admitted receiving this letter, right?
A: I don’t remember receiving this letter. I don’t remember receiving a letter. I remember receiving the authorizations.
Q: I understood your evidence from last week to be you remember receiving this letter..
A: This letter, yes.
Q: and you remember receiving…
A: I’m sorry
Q: …two authorizations?
A: …I remember receiving this letter, yes, and the authorization.
Q: And the authorizations?
A: Yes.
Q: Okay. You’re not denying that you received this letter? There’s no doubt in your mind you received it, correct?
A: I received this letter.
256Mr. Zener then referenced questioning in the examination for discovery in August 2007, where Julie had said, “I probably received the letter but I can’t remember 100 percent”. Mr. Zener then asked:
Q: So you can’t even remember 100 percent whether or not you received the letter, how can you possibly recall that it did not include the February 7th letter?
A: Because I know I hadn’t read it. I hadn’t seen it.
Q: And if that’s the case, I suggest this is the time to tell me. So you admit that you probably received the letter and you do not suggest that you did not receive the enclosures to the letter, is that fair?
A: I received the enclosures because I sent them back signed.
257In that letter, Kirby confirmed Julie’s instructions that further correspondence was to be sent to her, with a copy to her father. That she remembered. The letter of February 21, 1995 also enclosed an Acknowledgment and Direction for her to sign, have witnessed and returned. After some questioning, she did vaguely recall going to a lawyer’s office to have these documents witnessed. Reluctantly, but that she remembered. I am satisfied on the evidence that Julie did receive and, did read the letter of February 21, 1995.
258Julie was certain however, that the February 7, 1995 letter was not there. She denied this despite that fact that Kirby’s February 7, 1995 opinion letter was sent to her first, on February 21, 1995 and later on November 12, 1998. Moreover, as noted, her father stated in examination-in-chief that he had given the February 7, 1995 letter to Julie in the house saying, “Julie, this is a letter from Gilbert, Wright and Kirby about the accident. If you need any help, give me a call”.
259Julie insisted she did not see the letter until many years later. When asked, “do you recall anything else being attached to the letter of February 21, 1995”, her answer was a definite “No”.
260Nevertheless, she eventually admitted that she had read the February 7th letter. The following excerpt from her cross-examination, in the transcript at pp.77-79, and begins by Mr. Zener going through the content of the main part of the letter with Julie:
Q: Well, let’s go to the next page and the sentence that you now that you understand was intended in paragraph three, “Given the above, the insurance coverage is that your family had, at least those that I am aware of, would not provide any coverage for this incident.” Wouldn’t you understand that to mean your family’s automobile insurance policies?
A: No, I-you see I don’t know anything – I’m asking Mr. Kirby to explain all of this to me, and I appreciate that you’re explaining all of this to me now, but he didn’t explain any of this to me.
Q: Well you…
A: I’m supposed to read – this didn’t come with a law book, this letter. I am relying on him to explain the insurance and the law to me, and I read this letter and I didn’t get any of this out of it.
Q: And you didn’t ask Mr. Kirby about this letter?
A: I tried. He didn’t return my call. I didn’t- you know what, I didn’t – read the letter. I thought I understood it and I didn’t get that out of it. I-I didn’t get – what you’re getting out of it, I didn’t get that out of it. I don’t have a law degree. I am – I didn’t get any of this out of this letter.
261Again, the fact that Julie first insisted that she never saw the letter, and then changed her story and admitted that she had read the letter but that she didn’t understand it to be referring to accident benefits undermines her credibility as a witness.
262When asked what she would have understood the letter to mean, she thought the part about the territorial restriction applied to Hunt and Farlinger. Both Kerr and Julie fell back on this very flimsy explanation in cursory fashion. However, this interpretation is not borne out by a careful reading of the letter itself.
263Plaintiff’s counsel made much of the fact that the February 7, 1995 letter does not contain the words “accident benefits”. To suggest that accident benefits were not encompassed in the words “insurance coverages” as explained, is far reaching. Further, the suggestion that a person reading the letter might believe that it relates only to coverage available to Farlinger and Hunt, even though the letter refers to the “insured coverages that your family had”, is hard to accept. It does not make sense that they would take the insurance Policy of their “family” to mean coverages relating to Hunt and Farlinger. Certainly, the family’s Policy would not be available to Hunt and Farlinger whom they were suing.
264I find on the evidence that both Kerr and Julie received the February 7, 1995 letter from Kirby; that they read it; that they understood that their Policy with Zurich would not provide them with insurance coverage due to the territorial restriction in the Policy, and further that the reference to coverages included accident benefits and any and all coverages that would have been available to them, had the accident occurred in North America.
The Confirming Evidence and the Issue of Knowledge
265But there is more, for the evidence of other independent witnesses contradict the testimony of both Kerr and Julie that they had no appreciation of Julie’s rights to accident benefits under the Policy, summarized as follows:
There were four insurance brokers in Kerr’s office who sold auto insurance policies and it was from them that he apparently learned of the two-year limitation for bringing claims.
Ms. Joseph documented her discussions with Kerr and that he had received confirmation that coverage through his own automobile Policy and the Motor Vehicle Accident Claims Fund were not applicable outside North America.
Kerr sent letters to other lawyers to ascertain “whether or not any insurance monies might be available short of suing the Farlinger family”. This makes Kerr’s assertion that he believed Kirby’s opinion letter to refer to Farlinger more unbelievable – he must have known by this time that this was the only route available to them.
Kerr’s sworn affidavit on June 7, 2005 reports the advice of Zurich’s representative to Kerr that there was no coverage for accident benefits given the territorial exclusion in his Policy.
Messrs. Kimmel, Ages, and Hagen all spoke as lawyers to “your insurance policies”, and their discussions included both accident benefits and underinsured coverage as being unavailable due to the territorial provision.
266The following excerpt from Kerr’s cross-examination is telling:
Q. In April or May, 1993, you called Zurich and made inquiries?
A. I got an opinion only that they thought there was no coverage under the standard policy.
Q. Did you follow up?
A. I was too busy.
Q. Did you know there as a 2-year limitation?
A. Some of the stuff was going to have to wait.
Q. Who told you about the limitation period?
A. That’s standard.
Q. Mr. Ages?
A. I provided all the information re: the car insurance. There was no need to prove what I already knew.
Q. Who told you about the limitation period?
A. The insurance office.
267As noted, Kerr did finally admit that he probably had received advice from a number of sources that the territorial provision would make the insurance coverage under his Policy unavailable in Ontario. To say that he would have misunderstood this in Kirby’s opinion letter is simply not believable. Nor is it reasonable that he would not have discussed these matters with Julie.
268The confirming evidence underscores my finding that Kerr and Julie both read and fully understood Kirby’s letter of February 7, 1995 to include accident benefits coverage as among those “coverages” excluded by the territorial limitation. Indeed the information obtained by Kerr from the OIC in April or May 1993 may well explain why he did nothing until the fall of 1994 to pursue a claim for any available insurance coverages for Julie.
269However, I must say that the plaintiff’s “knowledge” is, in no way determinative of the issue before this Court. This finding goes to the matter of credibility only and provides the broad context within which further actions of the parties can be assessed.
Did Kirby explain to Julie and Kerr the details of and her entitlement to benefits?
270It is the plaintiff’s contention that Kirby’s conduct fell below the appropriate standard of care as he failed to put the insurer on notice, and he did not properly explain Julie’s rights to accident benefits, her entitlements, the risks or costs of making a claim, nor did he take instructions from her until long after her rights had expired.
271While Kirby had no clear recollection of the exact details of their lengthy discussions at the time, 21 years ago, his standard practice was to review with accident victims their sources of income, if any, and the sources of compensation available to them under the OMPP. This would form part of his standard practice with new clients and would not necessarily form the subject of a memo to file or a confirming letter to the client. In fact, in this case, once Kirby reviewed a telephone note of an hour long call on February 6, 1995 with Kerr, a day prior to his sending him the letter of February 7, 1995, he believed this was when the discussion would have taken place, followed by a similar discussion with Julie on February 8, 1995, lasting 1 ½ hours. In his words, he would explain the potential claims against the other motorist for pain and suffering, loss of income, future care costs, claims by family members for care, guidance and companionship, as well as no fault benefits and the amount of coverages available. Subsequent calls to Julie were recorded on February 9 and 16, 1995.
272When Kirby was asked in cross-examination if he had asked Julie if she was getting accident benefits, there was this exchange:
Q. You didn’t ask her if she was getting accident benefits?
A. We discussed accident benefits and tort claims and the territorial restriction.
Q. But did you ask if she was getting accident benefits?
A. Yes, I asked her regarding her sources of funding.
273To the assertion that he did not actually mention the words “accident benefits” in his correspondence or turn his mind to this, he answered, “accident benefits are always in my mind”. To the allegation he did not obtain instructions in writing, he answered, “I told them what I would do and what I couldn’t do and he was fine with that. But I also told him that because his daughter was an adult, I need to speak with her before I could do anything as this was largely going to be her lawsuit”.
274The following are the reasons why I accept Kirby’s evidence in this regard:
- Kirby gave his evidence in a straightforward, consistent, and rather understated manner. He gave specific details of what he recalled and, if he did not recall something, he said so. When it was noted that he did not ask Kerr or Julie in the letters sent to them, for instructions regarding a claim against Zurich, he replied:
A: I gave them my opinion on the available or lack of available coverages for any kind of claim against Zurich and they said, “Fine.” And Mr. Frank – Mr. Kerr frankly, didn’t seem at all surprised by that. But as, I didn’t know at the time, but I subsequently learned I wasn’t the first person to tell them that.
This litigation was commenced in 2004, and Kirby has been subject to a number of cross-examinations, spanning hundreds of pages of testimony. Plaintiff’s counsel attempted to show a few inconsistencies in that evidence, but, in my view, there were none (an apparent “admission” that he would do things differently was subsequently explained in context a few minutes later).
His evidence was not only internally consistent, but it was externally consistent with the other evidence in this case. For example, when confronted with questions as to why he didn’t write down the advice he would give to a client, he countered that he would write notes of “to do” things for a client, but not everything he tells them. This practice was confirmed when, in November 1998, he spoke to Julie about new developments in the law, and her potential rights to now claim accident benefits. Although Julie took detailed notes of the conversation, none of that appeared in Kirby’s contemporaneous handwritten notes or correspondence.
Much of the testimony that contradicted Kirby’s was proven to be inaccurate and/or unbelievable. For example, Kerr was adamant that they had never discussed fees, as noted above, whereas it was Kirby’s testimony that “I told him it was a straight hourly rate because back then contingency fees were illegal” – a much more reasonable scenario.
Kirby’s correspondence confirmed his awareness of Kerr’s financial concerns when he indicated he did not propose to go too far along the path of collecting information until there was a clear idea of actual insurance monies available, or when he deferred his account after giving over carriage of the file until Julie’s claims were concluded. Clearly the question of funds was apparent in Kerr’s mind when making his decisions.
Most, if not all, of what Kirby said he would do, including the issuance of a tort action against Farlinger and others, came to fruition. His evidence about both Kerr and Julie’s instructions to proceed with that action, in the context of Kirby’s opinion that their Policy with Zurich would not bear fruit and Julie’s words “that’s fine” when he spoke with her, are reasonable and I accept Kirby’s evidence in that regard.
There was some question as to who was Kirby’s client. The plaintiff contends it was her, Julie, but Kirby perceived both Bruce Kerr and Julie as clients. This too was borne out by the evidence: Kirby’s correspondence and actions were directed to each of them separately. Kirby understood that Kerr would be funding the matter. Indeed, it was Kerr who first contacted Kirby as part of his search for a lawyer to help Julie. Kerr’s family members confirmed the fact that it was Kerr who played a management role and paid the bills. The mere fact that Julie asked for future correspondence to be sent to her with a copy to her father does not derogate from the fact of them both being clients of Kirby - on the contrary, it tends to confirm this.
275In all the circumstances, I accept the evidence of Kirby that he explained Julie’s rights under the Policy and the applicable legislation to her and to Kerr, and they each instructed him accordingly.
276I find that Kirby acted as a prudent, reasonable and competent solicitor in his dealings with both Julie and Kerr throughout this matter.
277As for the evidence proffered by Rita Urbonavicius, I totally disregard her testimony, in particular that Kirby neglected plaintiff files and that Kirby told her he turned over the file as he “missed a limitation period.”
278I accept the testimony of Kirby that Ms. Urbonavicius was a good lawyer but not good with people and therefore, he tended to give her only defence files to work on. If this matter is an example, Kirby did anything but neglect the file. He did research, took instructions, issued a claim, provided for service of documents in Jamaica and England, attended at motions, gave opinions, sent letters, and recorded phone calls all in an efficient and professional manner.
279Moreover, Rita’s testimony about Kirby saying he missed a limitation period has been shown to have been untrue. On the contrary, as explained by Mr. Farrell, a conflict arose when Farrell joined Kirby’s law firm and was told by his client, Zurich, that there could not be any first party plaintiff claims against Zurich by anyone in the firm, if he wanted to keep the files he had and continue to do business with them.
280When Rita applied to come back to the law firm in 2013, she was not hired as she had left the firm previously with little notice.
281Given the above circumstances, it is apparent that Rita’s testimony was not only inaccurate but also biased, and I do not accept it. She was not a credible witness and I reject her testimony in its entirety.
Findings of Fact
282On the evidence in this case, I find that Kirby did properly explain to the plaintiff, as well as to her father, Bruce Kerr, Julie’s right to statutory accident benefits under the Zurich Policy and the details thereof.
283In addition, after conducting some research, Kirby expressed his opinion in the letter of February 7, 1995 that given the territorial limitation and the fact the accident occurred in Jamaica, Julie would not be covered for those benefits under the family's automobile insurance Policy.
284I find that Kerr himself had made independent inquiries about Julie’s rights under the Zurich Policy and had received information from other lawyers to the same effect. Further, Mr. Ages wrote to him that time was of the essence since there was a two-year limitation for issuing a claim. Kirby in his February 7, 1995 opinion letter also made some reference to the two-year limitation period in Ontario.
285I find that both Julie and Kerr had full knowledge and understanding of the meaning and import of Kirby's advice; and that they came to the decision not to apply for accident benefits, as set out in Kerr’s sworn affidavit of June 7, 2005.
286I find that Kirby was cognizant of the Kerrs' concerns about finances and, as he noted in his letter to Julie of February 21, 1995, and in his testimony at trial, he did not want to do excessive work on the file unless there was a prospect of the availability of insurance monies. In my view, this was a reasonable, and even laudable, approach to have taken in the circumstances.
4. the expert evidence
Was Kirby’s Interpretation of the relevant legislation reasonable?
287The expert evidence in this case is not overly complex or divisive.
288It is Barbara Legate’s view that the making of an application for accident benefits on behalf of Julie within the two-year limitation period was a simple, straightforward and inexpensive step that lawyers in the field would normally take. She likened this as akin to giving a municipality notice of a snow and ice claim before one is certain that such a claim exists. Any required research, she opined, could have been conducted with reference to the regulation thereafter.
289In addition to Ms. Legate’s opinion that an application for accident benefits should be filed in every case to preserve the limitation and any necessary research conducted afterwards, the plaintiff also relies on the case of Marques v. Alexander, [2000] O.J. No. 1629 (Ont. S.C.). That case cites Grant and Rothstein’s text at pp. 20-22 to show that a lawyer has a responsibility to ensure that his client is making fully informed decisions, and a client is not fully informed if her solicitor is only able to give incomplete advice due to inadequate research. The required standard of care includes a combination of good working knowledge of the relevant law and further research as necessary.
290When asked to respond to Ms. Legate’s assertion, Kirby answered,
A: I did hear say that and indeed if Mr. Kerr or Ms. Kerr had phoned me the day before the two year time limit and I had not had a chance to research the matter, I might very well have done that just to protect the client until such time that had occurred, but by the time that I have this discussion with the Kerrs in February of 1995 I had done the research. I had, I think there were two texts at the time that gave me some guidance. One was by the now late Alan O’Donell Husey (ph), and the other was by this point by my former partner Jim Flaherty and they made it – well, Mr. O’Donnell’s book made it more clear but Mr. Flaherty’s book also made it clear that there seemed to be no way around the territorial exclusion.
291When asked if he had any doubts about his opinion, Kirby responded,
A: No. No, there was nothing, there was nothing in the whole time that I had been practicing law. There was nothing in anything that I had heard or read as a result of any CLE program or as a result of anything that I had communicated with the government that the territorial change had changed. In fact the wording was exactly the same. There was nothing in either of the texts that I referenced and it was clear and obvious that – because it’s highlighted and it’s right at the beginning, that territorial exclusion applies and unfortunately Jamaica is not part of – I shouldn’t say “unfortunately”. Jamaica is not part of Canada or the Continental United States and accordingly no coverage. And you know, to the extent that one looks at the policy the Insurance Act made it abundantly clear that the superintendent or the commissioner of insurance as he was then called, could make this policy and that was it. So having not the luxury but having had the opportunity to fully investigate I was able to say to Mr. Kerr and then to Ms. Kerr with confidence that unfortunately there’s no coverage available under their policy with Zurich.
292When it was put to him that filing the application constituted a trivial and inexpensive step to take, with no downside, Kirby responded,
A: But then what, Mr. Strype? You’re gonna get back an answer, “No” and then you’re gonna have to file an application for mediation, these things don’t sit out there in a vacuum. As you well know, there are time limits to these things…
Q: Yes.
A: …and more and more and more time and money is going to be expended on a claim that I have already researched and, and determined that again, there is no law to the contrary to this day that I know of that says that that would’ve been a viable accident benefit claim. That respectfully, sir would have been irresponsible given that I was dealing with a client who was very conscious about money.
293Finally, when it was suggested in cross-examination that Kirby was obliged to protect his client’s right to make a claim, this exchange took place:
Q: And as a plaintiff solicitor, your job is to protect your client’s right to make a claim?
A: Yes, but it’s not a, it’s not a responsibility done without responsibility on my part, it’s – in other words, I don’t just go off and do everything you possibility can, apply for everything you possibly can, don’t worry about what it’s going to cost, because these things do cost. I believe as a plaintiff’s counsel that it is my responsibility to be responsible and to give responsible opinions and advice to my clients and that’s respectfully, what I believe I did.
294It is noted that when Ms. Legate was a panelist at an Advocate’s Society program in January 1992 on automobile insurance reform, the program dealt with the forthcoming Bill 164 and not the OMPP regime, and the territorial provision was not mentioned. Since, at the relevant time, there was no discussion, CLE or case law regarding the territorial limitation, Ms. Legate was unable to state that there was any common belief about how to proceed when a client or potential client was injured in an action outside of North America. She herself had never encountered such a situation.
295It is common ground that counsel practicing in the field were generally familiar with the OMPP system in operation since 1990 and Bill 164 which took effect January 1, 1994. Without exception, all witnesses attested to the complexity of the provisions in the Bill and the “shocking” effect it had on the insurers and the insurance bar.
296Ms. Legate described the period in question as a “very scary period of time for counsel”; and Bill 164 as “one of the most complex pieces of legislation in insurance litigation”. According to Mr. Samis, the legislation was “extremely complex and it introduced concepts previously unknown to insurance and personal injury practitioners”.
297It is noted that subsequent developments in the law ultimately leading to the jurisprudence in favour of extraterritorial application all occurred well after Kirby’s opinion was rendered to his clients and after the two-year limitation had passed. Indeed, Mr. Samis, who was heavily involved in insurance education and practice at the time, stated that, notwithstanding numerous contacts with insurers, lawyers, regulators and arbitrators in the period from 1990 to 1995, the issue was not raised with him until May, 1995, after the limitation period in this case had expired. It was his evidence that the legal community had “no inkling” of an issue with respect to the territorial limitation during the relevant period.
298It was Mr. Gilby’s view that, given the inventive nature of lawyers and legal organizations, if someone had believed that a challenge could be made to the territorial limitation in the standard policy or the OMPP, there would have been articles written and challenges to the legislation. There were none. Yet there may well have been accident victims injured in other parts of the world during that period. Even Mr. Gillen, appearing for the plaintiff, agreed that it was highly likely that accidents occurred abroad between 1972, when accident benefits were first mandatory in Ontario policies, and 1993 when the accident occurred. His answer on cross-examination was “I concede that’s a very real possibility”.
299This was, I find, not a situation where counsel would “as a matter of course” make an application for accident benefits. I agree with the expert testimony of the defence witnesses that counsel would be obliged to tell their clients exactly what, I find, Kirby told the Kerrs, and that is that given the territorial restriction in the Policy, insurance coverages would not be available to them pursuant to their automobile insurance Policy with Zurich.
300I do not accept the trite statement of Ms. Legate that there would be “no downside” to making an application for benefits in these particular circumstances. The Act contains provision for time limits and requirements for both the insured and the insurer, and while the action of filling out the application for benefits may be a simple and inexpensive measure, proceeding with the claim against the insurer, is not. To do so would have likely incurred, in this case, time, energy and expense to move the matter forward with little or no chance of success.
301This was explained, not only by Kirby, but also by Mr. Gilby in cross-examination when asked about the facility in which one could file for benefits:
A: No, because you are making it sound far too simplistic. Otherwise anytime anyone walked into your office you have someone operating a computer or whatever we had at that point in time, I think we were still using electronic typewriters, to just be putting out what was with no merit to it. It would make no sense. Why would I be doing that and it would potentially expose me and the client to additional cost?
Q: We have heard evidence that the additional cost is about $22.50. You are talking $3,500 in medical records that you may have got to look after a client. So you are not quibbling about $22.50 to send a notice to Zurich at all?
A: You are assuming, I think, that that is all that happens and it isn’t just that you send that and then the world comes to a standstill and you wait until some day maybe something changes that then allows you to proceed forward. This is the conceptual problem I have with what you are suggesting. It didn’t work that way in the real world. Things move forward. Steps have to be taken and things have to be done.
302I accept the conclusion of Mr. Gilby that on the whole, a reasonably competent practitioner would not have anticipated the final decisions in the Luu and Prasad cases. Indeed, the legislature changed the law to accord with Kirby’s perception of it, even before the final decision in Prasad was published. Further, the actual claims in those two cases were not even reported to their insurers until after the limitation period passed in this case.
303Moreover, Mr. Gillen, who argued Luu, did so on the basis of Bill 164 since the accident in that case had occurred within its scheme. I would agree with the defence experts that Bill 164 and its detailed complexity may have “opened the door” for an argument as made in Luu that the Policy and regulations were separate entities for this purpose. That door was closed for any similar extraterritorial case under the OMPP.
304This is not a slip and fall case, where it is necessary to give short notice to an insurer and research the facts within the jurisprudence and statutory framework afterwards. Here, any required research was properly and efficiently conducted; and it produced similar results from different sources. There was no need to do more.
305According to Ms. Legate, it appeared from Kirby’s opinion letter of February 7, 1995, that he had not turned his mind to the question of accident benefits. It seems to me that throughout this case, the plaintiff has taken the position that, if something is not in writing, it did not happen, which is a proposition this Court cannot accept.
306Seventy-five percent of Kirby’s law practice at the time consisted of accident benefit files, albeit largely on the defence side. Ms. Legate’s speculative opinion is contrary to the evidence in this case and I reject it.
307I also reject her testimony that counsel would look to the Act and regulations and not to a client’s insurance policy when dealing with a claim for benefits. When Mr. Samis was asked if one could have proceeded with an action under the OMPP regime without reference to a client’s actual insurance policy, his answer, which I accept, was “absolutely not”.
308Both Mr. Samis and Mr. Gilby had a copy of the Standard OPF 1 (or its predecessor SPF 1) in their pockets when giving testimony and Mr. Samis suggested that I hold the actual Policy booklet in my hand. I did so, and it helped to persuade me that indeed, the Policy and the Regulation were “one package” under the OMPP. To Mr. Strype’s suggestion that when Mr. Gilby argued cases at the OIC, he never referred to the client’s insurance policy he answered:
Yes. I mean, if you are asking what I looked at, I looked at this and why did I look at this is because it was to my understanding and as far as I knew other lawyers understanding that this was approved by the commissioner of insurance and this set out the schedule that showed what benefits you were entitled to and the exclusions that you would have to deal with, and I am not just talking about if the action happened outside of North America but there were other exclusions to getting benefits depending upon the circumstances of the accident. So it contained everything that I needed to know in order to deal with the accident benefits. I am not sure that I can say it any other way.
309When it was suggested that he would also have known what the Insurance Act and the Schedule said, he responded:
You have to take me back to the time again. I think, as I said, the best thing I can say is that whenever there was an issue or a question that I had to deal with accidents and benefits, I would go into the left-hand drawer and pull this out [the Standard Policy at the time] and reference this because it to my knowledge contained all of the information that I required in order to deal with the accident benefits.
310I mention in passing the lengthy cross-examination of Mr. Gilby on a paper written June 14, 1990 titled “Adjusting your Practice” in which he highlighted the need to interpret the new threshold legislation under the OMPP favourably to accident victims in order to get them in the door of lawyers; and the importance of not trusting insurance agents’ opinions on coverages. In the paper, Mr. Gilby poses various scenarios that have merit but are general in nature and cannot be applied to this very narrow situation. In cross-examination, Mr. Gilby makes it clear that his paper was “talking about threshold and talking about tort.” Nevertheless, he did agree in cross-examination that, as he said in his paper, it was always best to obtain an acknowledgement from a client when giving them advice and as well, to obtain written instructions on how to proceed. When asked:
Q: So given your experience, doesn’t that lend even more importance to you protecting your client’s right by either issuing the claim or getting instructions?
A: No. I don’t think so because now you are assuming in every single situation, whatever the situation is, because something may happen that you would never expect is ever going to happen, you should get something in writing. I mean, I don’t agree with that.
311Mr. Gillen, witness for the plaintiff, was asked in cross-examination whether in 1993, Lee Samis, witness for the defence, was recognized as one of the pre-eminent resource people on what the Schedule meant. He replied,
I would recognize Mr. Samis as being one of the pre-eminent insurance defence lawyers and particularly with respect to statutory accident benefits or no-fault benefits.
312Given Mr. Samis’s background and hands-on experience dealing with the legislative changes and their rationale, the fact that his perspective and files were defence–oriented does not impair his testimony in any way. I accept his evidence that it would not have been reasonable or necessary at the time to look to the regulation under the OMPP as anything but confirming the territorial provision in the Policy. The provisions in Part B of the Kerrs’ standard policy of insurance and Part E of the OPF 1 are clear and unambiguous. The available texts at the time underscored Kirby’s view of the meaning and interpretation of the territorial clause in the standard insurance policy.
313As previously noted, Ms. Legate never had a case involving an insurance coverage dispute regarding this issue and had never read Part E of the standard automobile policy. Her evidence consists of a bald assertion that her practice constituted the standard of care of the profession at the time. There was, however, no credible evidence to support this assertion. I accept the views of Kirby, Gilby and Samis on this issue.
314In the result, I find that Kirby’s opinion and advice to the Kerrs was reasonable, proper and appropriate and it was consistent with the custom in the insurance and personal injury bar at the time.
5. changes in the law AND THE DIFFERENCES IN THE OMPP AND BILL 164
315Was there a difference in the legislation underpinning the OMPP as opposed to the statutory scheme under Bill 164? As noted, the Luu and Prasad cases were decided under Bill 164 and not the OMPP system under which rubric this matter would be determined. According to Mr. Gilby and Mr. Samis, this posed a significant difference to the practice of insurance and personal injury law at the time.
316The plaintiff has taken the position that the same accident benefit coverage was available under the OMPP as in Bill 164 and thus, Julie had access to accident benefits as an insured with Zurich, pursuant to the prevailing jurisprudence.
317As noted above, it is undisputed that the changes perpetrated in Bill 164 were by all accounts, extremely complex and detailed. Accordingly, all the changes to the Regulation could no longer be contained in the standard policy as set out in Part B of the OMPP. I accept the contention of Mr. Gilby that this situation “opened up” the argument that there was no territorial limitation for accident benefits as the Regulation which was silent on the point (as it was in the OPF 1), was separate and apart from the standard policy. Indeed, counsel now referred to it as “The Fat Book.”
318Moreover, the evidence disclosed that the predecessor regime was qualitatively different than the new one under Bill 164. There was, for example, no equivalent in the OAP 1 to Section E, the general provision, definitions, exclusions and statutory conditions in the OPF 1.
319Thus, a review of the standard policy and Regulation separately cleared the path to an arguable case under Bill 164, whereas there was no ambiguity in the OMPP that the territorial restriction to accident benefits in the OPF 1 in force at the relevant time was incorporated in Part B of the Policy.
320Interestingly, Mr. Gillen, who was involved in the Luu case, never even looked at his client’s insurance policy at the time, nor did he consult the definitive texts on insurance law. At the risk of being repetitive, I quote this passage in the cross-examination of Mr. Gillen which underlines why his evidence or the Luu case does not assist in this situation:
Q. Mr. Gillen, in Luu, the definition of insured person involved in an accident outside of Ontario (that) involves the impugned automobile or another automobile.
A. Yes.
Q. Clause B in OMPP re: the territorial references includes in the definition of an insured person an “accident that involves the insured automobile” but does not include the words “or another automobile’
Q. Would you agree that it is highly unlikely accidents abroad between 1972 when accident benefits were first mandatory in Ontario policies and 1993 when you returned to practice, would not have been successful?
A. I concede that’s a very real possibility.
Q. There were no cases that suggested that benefits had ever been paid for somebody who was injured in that situation?
A. There were no cases at all.
Q. The reaction as to the profession’s belief generally when you brought Luu case (contained) the word preposterous?
A. Well that’s entirely possible, yes.
321I accept the view of the defence experts, and particularly Mr. Samis who, when asked if one could have proceeded with an action under the OMPP without reference to a client’s actual insurance policy, answered “absolutely not”. That may well have mirrored the practical reality in the profession at the time.
322In order to further show that the OMPP legislation differs from Bill 164 in significant respects, however, it is necessary to follow the history of the insurance legislation which is summarized below:
From 1972 until April 1996 (when the first decision of the arbitrator was made in Luu), the view of the profession was that accident benefit coverage was contained in the standard insurance Policy and as pertaining to this situation, in the provision in Part E regarding territory.
No court cases, academic writing, or opinions questioned the wording of the territorial provision in regard to all parts of the Policy. As Mr. Samis stated, within the legal community there was “no inkling” of an issue with respect to the territorial limitation even as the mandate and other aspects of the legislation were being discussed or challenged.
Paragraph 4.2 of the OAP under Bill 164 states:
The details of the Accident Benefits Coverage are set out in the Statutory Accident Benefits Schedule of the Insurance Act (Ontario). This section outlines the benefits that you and other insured persons may be entitled to receive if injured or killed in an automobile accident. If there is a difference between the interpretation of the wording in this Section and the interpretation of the wording in the Statutory Accident Benefits Schedule, the Statutory Accident Benefits Schedule prevails.
It is noteworthy that no such wording existed in the OMPP Policy or in any academic writings at the time. The wording that establishes the supremacy of the regulation over the coverages outlined in the OAP 1 Form did not exist in the OPF 1 Policy under the OMPP.
The Superintendent of Insurance or Commissioner had approved the Policy in the OPF 1 form in June, 1990 pursuant to his authority made under s. 227(2) of the Act, and his authority to do so had never been challenged.
Not only was the Superintendent’s authority to approve a form of Policy as published in the Ontario Gazette not challenged, but it was specifically endorsed. See, for example, Ontario v. Saskatchewan Government Insurance Office, [1981] O.J. No. 1128, at para. 7, where the Court states:
Counsel for the defendant submitted that s.201(3) [now s. 227(2)] was intended to give the Superintendent authority only over matters of form in policies, such as matters affecting the clarity of meaning, but did not authorize the Superintendent to prohibit the inclusion in policies of provisions which other sections of the statute provided were permissible. I am unable to accept that contention, because any such restricted interpretation of the powers given to the Superintendent under s. 213(3) would, in my view, be contrary to the express terms of the subsection, particularly the concluding words. [Emphasis added.]
The pre-OMPP Policy (SPF 1) contained a single reference to the application of Part E, the General provisions which were to apply to each part of the Policy, where the OMPP contained no less than three such references.
Moreover, there was no equivalent in the OAP 1 to section E in the OPF 1.
323In all the circumstances, I find that the scenario before Kirby in 1994 and 1995 pursuant to the OMPP under which the Kerrs’ insurance Policy applied, was significantly different from the scenario that was before the Court of Appeal in the Luu and Prasad cases.
324Specifically, I find that the common practice under the OMPP in a matter such as this would be to look at the Policy including the Regulations as a whole, whereas under Bill 164, the Regulations were uppermost; and this may well have led to the conclusion of the Court of Appeal in the Luu and Prasad cases.
325There was much discussion at trial about the potential conflict between s. 227(2) and section 268 of the Act, particularly in regard to Justice Southey’s differing pronouncements on this issue in the Saskatchewan Government case, supra, and in the Court of Appeal’s judgment in Prasad.
326This highlights the differing views of the relevant legislation at various intervals of times.
327Section 268 of the Insurance Act, which was in force during both regimes states:
Every contract evidenced by a motor vehicle liability Policy, including every such contract in force when the Statutory Accidence Benefit Schedule is made or amended, shall be deemed to provide for the statutory accident benefits set out in the Schedule and any amendments to the Schedule, subject to the terms, conditions, provisions, exclusions and limits set out in that Schedule.
328When Mr. Gilby was asked about this in cross-examination, he stated:
Q: I am showing you the Insurance Act. I have in front of you section 268?
A: Yes.
Q:
“Every contract evidenced by a motor vehicle liability policy shall provide for the no fault benefits set out in the no fault schedule benefits subject to terms conditions and limits set out in that schedule.”
Do I read it correctly?
A: That is what the wording is, yes.
Q: And you would have read that?
A: I would have at some point in time read this. Yes.
Q: And you would agree with me that the terms, conditions, provisions, exclusions and limits set out in the schedule are only those set out in the schedule according to the Insurance Act?
A: Well, that is –that is where you get into that issue, I guess, because of the fact that 272 (sic) of course gave the –
THE COURT: 227?
THE WITNESS: Sorry, 227 gave the superintendent insurance to make the policy, and it could be in contradiction to the regulations but had the authority to make the policy. It was suggested that that was the supreme power or document.
Q: But it’s a conflict. You are looking at the actual Insurance Act that’s passed by the legislature as opposed to the policy compounded by the superintendent of insurance and you are going to think to yourself, wait a minute, is there an issue here about whether the exclusions apply under the policy?
A: Well, again, I am not trying to be argumentative at all but I think the difficulty is that in 20/20 hindsight I could say now, yes, but it wasn’t done. It wasn’t the practice. So, you know, it’s going to be again up to Her Honour to decide. If that was the standard then I guess we were all negligent.
329I accept the testimony of both Messrs. Gilby and Samis that there was no suggestion prior to Luu of any limit to the power of the Superintendent; and that the common view of the practitioners who practiced predominantly in this area confirmed both his or her authority and the validity of the approved forms he or she endorsed.
330Whether or not there was at the time, in reality, a conflict between the various sections of the Act is not before me. The issue is whether a competent professional would have perceived a conflict under the OMPP regime. I accept the evidence of the experts who practice in the field that they would not have perceived such a conflict.
331In the result, I find that Kirby’s opinion rendered to his clients as to the applicable law was reasonable and in accord with the standard of practice in Ontario at the time.
THE PLAINTIFF’S ALTERNATIVE CLAIM
332A collateral issue appears to have arisen late in the proceedings, in which the plaintiff questions the actions of Kirby after he learned about the Prasad decision in late December, 1996. In doing so, she relies upon some aspects of the Decision and Reasons of Mr. Justice Wilton-Siegel in Pilotte v. Zurich, supra. I find this alternative argument to be totally without merit for the following reasons:
After a comprehensive review of the facts, the learned Justice granted Zurich’s motion for summary judgment due to his finding that the plaintiff’s action was statute-barred under the applicable provisions of the SABS and the Policy. This finding reported missed limitation periods relating to the 90 day written receipt of notice (though Kirby was not retained then), the late written report to Zurich in November 1998, the failure to submit a properly compiled application for mediation with FSCO until September 29, 2002 (after Kirby had given over the file) and failing to commence an action until April 10, 2003 (a matter also under the auspices of new counsel).
Among other things, the Court stated at paras. 65-67 the following:
65 The conflicting sequence of decisions in Luu and Prasad commenced in September 1996 with the Superior Court decision in Prasad overruling an administrative decision in Luu rendered in July 1996. In his affidavit, Kirby says that he first became aware of the Prasad action in the late fall of 1996. There is no explanation why counsel waited until November 12, 1998 before submitting an application. There is no reason why he could not have filed an application for accident benefits in late 1996 to protect his client while awaiting the outcome of the Prasad action, which he understood from counsel in that action was under appeal. There is similarly no explanation for the delay after the decision of the Court of Appeal in November 1997 that overruled the Divisional Court decision in Luu.
66 A party seeking relief against forfeiture must come before the Court with evidence that the party acted in an expeditious manner after determining the circumstances giving rise to a continued right to assert the claim or a compelling explanation for the failure to do so. The plaintiff has not satisfied this requirement in this action.
67 I would note, however, that my comments in this paragraph are not to be interpreted as comments on whether the solicitor’s actions satisfied his professional responsibilities, as I am not satisfied that all the relevant facts for this issue are before the Court on this motion.
There is a clear agreement between counsel in this matter endorsed by Archibald J. that the action against Kirby relates to the limitation period ending on February 25, 1995, and there would be no relief of forfeiture after that time under any circumstances. Moreover, the notation of Justice Wilton-Siegel that he was not satisfied all the relevant facts on this issue were before the Court in the Zurich action, is exceedingly well-taken.
As previously noted, Kirby’s explanations for the delay in making the application in 1998, including the fact Julie did not return the completed forms to him for six months and the quickly changing circumstances in the law, were, in my view, reasonable.
Not only was this matter not properly raised in the pleadings or the evidence, but the closing submissions of the plaintiff formulated the issues in this case as being firstly, Kirby’s missing the February 25, 1995 limitation period; and secondly, his not properly advising Julie of her rights. Those matters have been dealt with in these Reasons.
Finally, the action against Zurich incorporated an agreed statement of facts and for the most part, rested upon a different factual and legal perspective than appears in this case.
333This line of argument now asserted by the plaintiff is, in my view, without merit and I reject it.
conclusion on issue no. 1
334In an action against a solicitor for negligence, the standard of care is not perfection, but rather that of a reasonably competent and prudent solicitor. See, for example, Central and Eastern Trust, at para. 29. In this case, I have framed the inquiry according to the standard of an expert in the field which demands a higher test. I have done so as Kirby held himself and his law firm out as experts in the field of insurance law and personal injury litigation; and the plaintiff relied upon this when retaining him and seeking his advice.
335Even so, Kirby met that higher standard of care. In doing so, his conduct accorded with the standard of care of the insurance and personal injury bar at the time. Nevertheless, as the cases point out, although the standard of care is affected by a consideration of general or customary practice, that alone is not determinative of professional negligence. See Roberge v. Boldue.
336In hindsight, of course, everything is possible. However, in the circumstances of this case, I am persuaded that Kirby consulted the most appropriate sources, correctly identified the relevant provisions in the statute and the clients’ car insurance Policy with Zurich, described their import and coverage details to both Kerr and Julie, applied the provisions and his findings appropriately to his client’s circumstances, and advised the plaintiff and Kerr accordingly.
337Counsel are not obliged under the law to have a crystal ball and look into the future. Kirby would not have been able to foresee the developments in the jurisprudence under the new insurance regime in 1994.
338I have found that the plaintiff, in conjunction with her father, were able to and did consider Kirby’s opinion with full knowledge and understanding of the applicable law and the available options, and that he proceeded in accordance with their instructions.
339In the rather unique circumstances of this case, I find that Kirby at all times acted as would a reasonably competent expert practicing in the area of automobile insurance and personal injury litigation at the relevant time.
issue no. 2 - CAUSATION
a) The Applicable Law
340The onus is on the plaintiff to show, on a balance of probabilities, that if advised differently, she would have acted differently in these circumstances; that, with the appropriate advice, she would have proceeded in a manner that avoided the damages or obtained the benefit lost as a result of the negligent advice.
341The cases emphasize that evidence given in hindsight is to be assessed warily and with “great caution.” In other words, “hindsight is not the touchstone of negligence.” I refer to comments in the case of Sports Pool Distributors Inc. v. Dangerfield, 2008 BCSC 9, where the trial judge said at para. 97:
in cases of professional negligence a bare assertion that a client would have
behaved differently if he or she had received proper advice should be viewed
with some scepticism.
342Justice Groberman in that case endorsed this observation of Southin J.A. in Hong Kong Bank of Canada v. Touche Ross & Co. (1989), 1989 2737 (BC CA), 36 B.C.L.R. (2d) 381, at p. 392 (C.A.):
It is always easy for a witness to say what he would have done and for a
judge to say he accepts that assertion. But such evidence is, in truth, not
evidence of a fact but evidence of opinion. It should be tested in the crucible of reason.
343See also Wade v. Canadian National Railway, 1977 194 (SCC), [1978] 1 S.C.R. 1064 and Fraser Park South Estates Ltd. v. Lang Michener Lawrence & Shaw, 1999 CarswellBC 130 (B.C.S.C.) at para. 47, “a professional’s conduct should not be judged with the wisdom of hindsight but rather in light of the knowledge that reasonably ought to have been possessed at the time of the alleged negligence.”
b) The Kerr’s Likely Decision
344Julie was asked what she would have advised Kirby to do had she been apprised of her right to accident benefits, and the details of what that meant, despite Kirby’s advice that there would be no coverage under the Zurich Policy of insurance. In other words, if she had full knowledge, would she have taken the risk and submitted the application? Her answer was a definitive “yes”.
345The defendant, on the other hand, says that more probably than not, Julie and Kerr would have accepted his advice and would not have pursued Zurich even if (assuming he did not), he had told them of the value of the benefits. First, Kerr expressed concerns about money from the outset, as exemplified in his attitude towards Mr. Ages’ account. Second, when trying to distance himself from his June, 2005 affidavit sworn in the case against Zurich, he said “when my lawyer sends me something to sign, I sign it.” In dealing with lawyers, he continued, “I have faith in the people I deal with and I assume they are acting in my best interests.”
346In the circumstances here, given that Kerr was sensitive as to how his money was spent, that he relied upon advice of his lawyers and that there is no example where he or Julie ever declined to do so, it is reasonable to conclude they would have accepted Kirby’s recommendation to pursue only the tort claim and not proceed with the claim for accident benefits. There is no credible evidence to hold otherwise. The plaintiff has not satisfied her onus to show if advised differently she would have acted differently in this case.
c) The Likelihood of Success
347The second aspect of this inquiry begs the question: was there a reasonable prospect of a successful application for accident benefits had Kirby submitted an application for accident benefits on behalf of Julie within the two-year limitation period?
348The timing becomes essential in respect of this inquiry. Since Kirby was first contacted by Kerr in December 1994, the 30 day and 90 day notice periods had passed. If Kirby had made the application, he would have had to argue that there was reasonable excuse for an extension of time to do so. In all likelihood in this case, an extension would have been granted to February 25, 1995, two years after the accident.
349The accident in the Luu case occurred on February 23, 1995 in Vietnam; and the application for benefits was provided to Zurich on or about April 13, 1995 after the limitation period in the subject case had expired. In the circumstances, I accept the opinions of both defence experts that any claim against Zurich would have been resolved in summary fashion and been unsuccessful for the plaintiff, long before the decisions in Luu and Prasad were determinative, about 14 months later.
350The fact that there were no cases at all then, or seminars or discussions amongst counsel regarding the territorial exclusion would strongly suggest and confirm the defence experts’ opinions that the common view was that a claim asserted in that period against Zurich, or another insurer, would have been denied, and later dismissed.
351Ms. Legate was unable to comment or speculate what an insurance adjuster would have done in similar circumstances. Clearly, it was not only Kirby’s view, after conducting his research that the territorial restriction in the standard policy would apply to cases where an accident occurred outside North America, but it was common knowledge in the insurance industry generally, as opined by the experts, the insurers, and as reported in the then current texts.
352The shocked reaction of the bar and the fact that the legislature saw fit to clarify the law and confirm the territorial restriction in 1996 prior to the final determination of the Court of Appeal in Prasad underlines this conclusion.
353Given the clear and unambiguous provisions under the OMPP and its Regulations and the expert evidence that I have adopted in this case, had Kirby with or without his client’s instructions, sent Zurich an application for accident benefits on behalf of Julie within the two-year limitation, I find, on a balance of probabilities, it would have been denied. Further, an action brought pursuant thereto would likely have proceeded in summary fashion, and been ultimately unsuccessful.
conclusion on part a - the issue of liability
354On December 6, 1994, Bruce Kerr contacted Ian Kirby, Barrister and Solicitor, to ascertain “whether or not any insurance monies might be available” to Julie as a result of the accident that occurred in Jamaica on February 25, 1993.
355It is undisputed that Kirby did not apply for accident benefits under the family’s car insurance Policy with Zurich in the required two-year limitation period.
356The reasonableness of such a decision must be judged in light of the surrounding circumstances, such as the time available to complete the work, the nature of the client’s expectations, and the experience and sophistication of the clients. See Singer v. Lipman Zener Waxman LLP, supra.
357The relevant time period in this case commences with Kirby’s retainer on December 6, 1994 and ends with the expiry of the limitation period on February 25, 1995, a ten-week time span. I have found that Kirby carried out his mandate in a professional and competent manner within that short time frame and as well, while he had carriage of the plaintiff’s file.
358I find the other elements such as the nature of the client’s instructions and the experience and sophistication of the clients to fall, on a balance of probabilities, in the defendant’s favour.
359I have judged the defendant’s actions and conduct on the higher standard of an expert in his field, and even so, I have found that he met that higher standard of care.
360Much of this case was rooted in my findings of credibility in respect of the 3 major witnesses - Kirby, Kerr and Julie. I am aware, however, that in deciding issues of credibility, it is not simply a matter of accepting the evidence of one party over another based on how the witness performed in the witness box. As noted in the case of Faryna v. Chorny (1951), 1951 252 (BC CA), [1952] 2 D.L.R. 354 (B.C. C.A.), the real test of the truth of the story of a witness must be its harmony with the preponderance of probabilities which an ordinary and informed person would readily recognize as reasonable in that place and those conditions.
361In the result, I have found, on the totality of the evidence, that Kirby met the test of a reasonably competent expert practicing insurance and personal injury law at the time. Further, had Kirby submitted a claim for accident benefits on Julie’s behalf or advised her to do so prior to the expiry of the limitation period, there was no reasonable probability that the claimed benefits would have been allowed. Certainly, the plaintiff has not satisfied the onus to show otherwise.
362Accordingly, the plaintiff’s action is dismissed against Ian D. Kirby and Gilbert, Wright, & Kirby, Barristers and Solicitors, with costs.
part b - damages
INTRODUCTION
363Based on my findings on liability and causation, there are no damages owing to the plaintiff.
364However, in the event I am incorrect on the issues of liability and causation, I am obliged to assess the plaintiff’s damages. I do this on the assumption that Kirby breached the standard of care in not filing an application for accident benefits for Julie prior to the two-year limitation period and that had he done so, Julie would have likely received certain benefits at the time.
365I must say that I found this to be a very difficult exercise for two main reasons. First, the plaintiff’s damages action rests almost entirely on the evidence of a number of expert witnesses who prepared comprehensive reports on many heads of damages, at the request of her solicitor. However, the objectivity of some of the experts and their underlying assumptions were seriously challenged in cross-examination. Secondly, the plaintiff’s damages claim kept changing both prior to and as the trial progressed. In the end, despite hundreds and hundreds of documents filed with the Court, the plaintiff never prepared a proper or clear submission on damages.
366Nevertheless, since well over 60% of Court time was devoted to the matter of damages, I will do my best to deal with it.
THE LAW ON DAMAGES
Test of Reasonable Foreseeability
367In Canada Trustco Mortgage Co. v. Bartlet & Richards (1991), 1991 7336 (ON SC), 17 R.P.R. (2d) 190 (Ont. Ct. Gen. Div.) at p. 204, affirmed 1996 526 (ON CA), 28 O.R. (3d) 768 (C.A.), the Court held that the test for damages in both contract and tort could be framed in terms of “reasonable foreseeability.” Where a solicitor’s negligence results in a loss of opportunity to obtain some benefit or protection or avoid some risk, there must be some reasonable probability that the benefit could have been obtained or the loss avoided for damages for the lost chance to be recoverable. See Graybriar Industries Ltd v. Davis & Co. (1990), 1990 1572 (BC SC), 46 B.C.L.R. (2d) 164 (S.C.), affirmed 1992 1838 (BC CA), 72 B.C.L.R. (2d) 190 (C.A.).
368The plaintiff must not only prove that her losses were caused by the defendant lawyer’s negligence, but also that they were foreseeable. In Froude v. Nash (c.o.b. Nash, Tolmie & Johnston), [1994] O.J. No. 1100 (Gen. Div.), a lawyer failed to advise the purchasers of a title defect. Since the losses resulting from the subsequent aborted sale of the property were reasonably foreseeable, they were recoverable. However, in Ekkebus v. Lauinger (1990), 1990 6894 (ON SC), 73 O.R. (2d) 743 (H.C.J.), a lawyer who ensured the purchasers of a residential property that a hot tub complied with municipal by-laws did not have to indemnify them for liability they incurred when a child fell in the hot-tub and was injured because the injury was not reasonably foreseeable at the time the contract for legal services was made.
369Zuber J.A., speaking for the Ontario Court of Appeal in Kienzle v. Stringer (1981), 1981 1851 (ON CA), 35 O.R. (2d) 85, 1981 CarswellOnt 530 (C.A.), a case involving a solicitor’s breach of duty to his client, said there is little if any difference between the analysis of foreseeable damages between torts and contracts. According to Zuber J.A. at paras. 15-17:
One problem that intrudes but briefly in this case is whether the liability of the solicitor is based in contract alone or in tort as well. (reference omitted) However, in this case, the question is of little consequence. Liability is admitted, no limitation period intervenes; the sole question is the question of damages. The extent of recovery for damages for breach of contract is described in the classic words of Baron Anderson in Hadley v. Baxendale (1854)…In tort, the measure is reasonable foreseeability. It is, I think, apparent that neither of these tests is a measure of precision and I number myself among those who are unable to see any real difference between them: see H Parsons (Livestock) Ltd. v. Uttley Ingham & Co., [1978] Q.B. 791, [1978] 1 All E.R. 525, [1977] 2 Lloyd's Rep. 522 (C.A.).
For the purpose of simplicity, I shall use the term "reasonable foreseeability" as embracing the test in both tort and contract…
Where Damages are Difficult to Assess
370It is the plaintiff's onus to prove his damages. As the Court of Appeal has pointed out in Martin v. Goldfarb (1998), 41 O.R. (3d) 161 (C.A.), 1998 4150, leave to appeal to S.C.C. refused, [1998] S.C.C.A. No. 516, “...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,” and must not deny damages based on the difficulty of assessment. Finlayson J.A. stated at para. 75:
…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.
371That 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: see Rider v. Grant, at para. 172.
372In determining damages in the present case, it is instructive to look at the Alberta Court of Appeal case Fisher v. Knibbe, 1992 ABCA 121, which finds as follows:
After conducting the ‘trial within a trial’ to determine what damages, if any, a negligent solicitor is liable for missing a limitation, three results are possible. First, the trial judge could find that had the case gone to trial the plaintiff would have been successful and in such case 100 percent of the lost damages would be awarded against the solicitor. Second, the trial judge could find that the plaintiff would not have been successful therefore only nominal damages may be awarded against the solicitor. Finally, where time has passed to such an extent that a “trial within a trial” would be impossible, then the court must to the best of its ability calculate the value of the opportunity lost to the plaintiff and award damages against the solicitor on that basis.
373In Stephen Grant, Linda Rothstein & Sean Campbell, Lawyer’s Professional Liability, 3rd ed. (Markham: LexisNexis, 2013), at §7.54, the authors explain how damages for the loss of a chance to bring or defend proceedings have been calculated by the courts: “by multiplying the lost claim’s likelihood of success expressed as a percentage by the amount that a successful judgment would have awarded”. These figures are derived from the “trial within a trial” whereby the plaintiff’s lost claim is assessed. In Henderson v. Hagblom, 2003 SKCA 40, leave to appeal to S.C.C. refused, [2003] S.C.C.A. No. 278, the Saskatchewan Court of Appeal made the following remarks about the “trial within a trial” approach at para. 201:
Litigants are required to pay for the expense of a “trial within a trial” such that the case is before the Court for the purposes of assessment. To assess the case based on an all or nothing approach compels one to ask the question why the parties are put to the trouble of a trial for such a limited purpose. Moreover, by compensating for a loss of a chance, a court neither over-compensates litigation parties by awarding full compensation or under-compensates them by awarding them nothing.
Nominal Damages
374Courts can award nominal damages in cases where the plaintiff establishes that a legal right has been infringed, but is unable to prove any actual damages as a plaintiff failed to prove any real loss or injury. See Grant and Rothstein, supra at p. 173.
375The authors of Lawyers’ Professional Liability at §7.102 explain that there are many examples of nominal damage awards in reported cases against barristers and solicitors given that the action is framed in contract or tort and the client proved that the lawyer’s conduct fell below the standard of care but not that any damages flowed from the breach.
376For example, in Messineo v. Beale (1978), 29 O.R. (2d) 49 (C.A.), nominal damages were awarded to the plaintiff for the lawyer’s failure to discover defect in title in land. In Ott v. Fleishman (1983), 1983 489 (BC SC), 46 B.C.L.R. 321 (S.C.), the plaintiff was awarded nominal damages for the solicitor’s breach of his contractual obligation to maintain confidentiality. In Marko v. Perry (1979), 18 B.C.L.R 263 (Co. Ct.), nominal damages were awarded for the solicitor’s failure to register a mortgage. In Scott v. Sills, [1990] O.J. No. 2085 (Gen. Div.), nominal damages were awarded for failure to detect the existence of an easement which caused no loss in the value of the land.
377Nominal damages have been awarded for negligence in cases of missed limitation periods where the plaintiff could not show that her actions would have succeeded had it been commenced in time: see Fisher v. Knibbe; Stealth Enterprises Ltd. v. Hoffman Dorchick, 2003 ABCA 58, [2003] A.J. No. 151; Gardi v. MacIsaac, Clark & Co., [1990] B.C.J. No. 1595 (S.C.); Gadsby v. Khan, 2003 BCSC 1697, [2003] B.C.J. No. 2582.
THE SCHEDULE (SABS)
378The relevant provisions of the No Fault Statutory Accident Benefits Schedule, Ontario Regulation 672/90, for coverage of medical and rehabilitation benefits are set out in sections 6(1) through 6(8) as follows:
6.(1) The insurer will pay with respect to each insured person who sustains physical, psychological or mental injury as a result of an accident all reasonable expenses resulting from the accident within the benefit period set out in subsection (3) for,
(a) Medical, psychological, surgical, dental, hospital, chiropractic, nursing and ambulance services and the service pf physiotherapists;
(b) Prostheses, dentures, prescription eyewear, hearing aids and other medical or dental devices;
(c) Rehabilitation, life-skills training and occupational counselling and training;
(d) Transportation for the person to and from treatment, counselling and training sessions, including transportation for an assistant;
(e) Home renovations to accommodate the needs of the insured person;
(f) Other goods and services, whether medical or non-medical in nature, which the insured person requires because of the accident.
(2) For the purpose of this section, the benefit period is the longer of the two following periods calculated from the day of the accident and ending on the anniversary of the accident:
Ten years.
Twenty years less the age of the insured person on the day of the accident.
(8) The maximum amount payable under this section is $500,000 with respect to each insured person.
379Section 7 deals with attendant care benefits and reads:
- (1) The insurer will pay with respect to each insured person who sustains physical, psychological or mental injury as a result of an accident, for the care, if any, required by the insured person,
(a) the reasonable cost of a professional caregiver or the amount of gross income reasonably lost by a person other than the insured person as a result of the accident in caring for the insured person; and
(b) all reasonable expenses resulting from the accident in caring for the insured person after the accident.
(2) The maximum amount payable per month under this section is $3,000 a month with respect to each insured person.
(3) The maximum amount payable under this section is $500,000 with respect to each insured person.
THE EVIDENCE
a) Julie’s Family Members
PAUL PILOTTE
380Paul Pilotte met Julie in February 1998 through a co-worker at Siemans Company where he was employed. At the time she was walking with a cane. They were engaged about nine months later and married in September 1999.
381In 1998, he accompanied Julie and her family to Miami where she received biofeedback treatments. Although she walked with a single cane (when not in a wheelchair), he observed that her gait was off. She continued with physiotherapy, chiropractic and massage treatments and was working for her father in his insurance business at the time. In January 1999, Julie moved into his townhouse in Ottawa, Ontario. A few months later they bought and renovated a house. It was a two storey house on a cul-de-sac, close to her parent’s home, in Winchester, Ontario. Since he had the technical ability to do renovations, Paul fixed 90-95% of the electrical, plumbing and drywall, and renovated the garage. He also added railings to the front of the house, fixed the back deck and built a ramp there for Julie.
382At their wedding on September 11, 1999, Paul and her father carried Julie to the front door. Though Julie wanted to be able to walk down the aisle on her own, she used a cane on one side and her father supported her on the other. After the ceremony, Paul carried her back up the aisle.
383To go upstairs at home, Julie would grab the two railings and pull herself up with her arms while awkwardly dragging her legs behind her at an odd angle. Sometimes Paul would carry her upstairs and she would slide down on her butt.
384In 2001 Paul converted the garage to a family room with a full seating area and TV.
385Paul’s job earned