Court File and Parties
COURT FILE NO.: CV-16-3715 DATE: 2019 06 18 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Al-Khouri, Plaintiff AND: Mah'd Hasan Hawari, Defendant
BEFORE: TRIMBLE J.
COUNSEL: D. Himelfarb for the Plaintiff R. Mussalin for the Defendant
HEARD: June 7, 2019
ENDORSEMENT
[1] On June 7, 2019, I presided over the Pre-trial Conference in this matter. The parties have provided extensive Pre-trial briefs including the relevant medical documentation likely to be relied upon at trial.
[2] At the Pre-trial Conference, by hand written endorsement, I ordered that the Defendant pay the Plaintiff costs of the pre-trial Conference fixed at $1,000, for reasons to follow. These are those reasons.
[3] Rule 50.05(2) says:
A party who requires another person’s approval before agreeing to a settlement shall, before the Pre-trial Conference, arrange to have ready telephone access to the other person throughout the Conference, whether it takes place during or after regular business hours.
[4] At the Pre-trial Conference, the Plaintiff and his counsel were present. Defendant’s counsel was present along with a representative of Aviva Insurance Company, the Defendant’s automobile insurer who is defending the action on behalf of its insured, the Defendant.
[5] At the outset of the Pre-trial, Plaintiff’s counsel indicated that the defence has refused to negotiate possible settlement of the case. Further, Aviva agreed to engage in a mediation and took no position other than a no liability position. The Plaintiff argued that throughout the file, but most notably at the Pre-trial Conference, the Defendant’s insurer had acted in bad faith. Aviva’s position required everybody to attend the pre-trial Conference and then Aviva refused to negotiate.
[6] In response to this information I asked the defence if they were continuing with a no liability position. Counsel indicated they were.
[7] In light of the insurer’s position, I read out Rule 50.05 (2). I asked Aviva’s claims representative if she had authority to settle the case, up to policy limits if the facts supported it, or whether she had to report to a committee or an individual to obtain further instructions. I also asked her whether, if she did not have the authority, she had arranged to have an effective decision-maker available by phone, as required by the Rule.
[8] The claims examiner said two things: first, she indicated that she had not made arrangements that an effective decision-maker at Aviva was phone-ready to be contacted; and second, she confirmed that she reports to a committee for instructions.
[9] Defence counsel provided answers to the balance of my questions. She advised that the "committee" is merely an oversight committee. The claims representative before the court made recommendations based on the facts to the oversight committee. Counsel’s submissions, however, did not satisfy me that the claims examiner before the court was the, or even an effective decision-maker that had authority to settle.
[10] Rule 50.06 sets out the purposes of, and the things to be considered at the Pre-trial Conference, the first of which is the possibility of settlement. Rule 50.05 supports Rule 50.06 by requiring that the "parties" attend in person unless the Court orders otherwise, so that people present at the Pre-Trial have the ability to make decisions about the case. Where a third party liability policy protects a Defendant, the Defendant cedes control over the defence of the action to the insurer. The insurer, thus, becomes the "party" for the purposes of the rule.
[11] Rule 50.05(2) recognizes that in certain circumstances, the person at the Pre-Trial may not have sufficient authority to resolve the case, or to make decisions required to address the considerations of Rule 50.06. To accommodate circumstances just like those in this case, Rule 50.05(2), by the use of the word "shall", requires that where an insurer sends a claims representative to the Pre-Trial and the claims representative, having considered the discussions at the Pre-Trial, thinks that a settlement should be pursued or that a decision is required to give effect to any of the other considerations in Rule 50.06, the person to provide that authority is readily available, in short order, by telephone.
[12] Neither the claims examiner's nor defence counsel’s representations in this Pre-Trial satisfied me that the claims examiner in the room was an effective decision-maker, or that there was an effective decision-maker phone-ready to make decisions about settlement. Further, counsel’s representations to me did not satisfy me that anybody could make a decision on settlement without reporting to the oversight committee.
[13] Plaintiff's counsel decried Aviva’s approach to the Pre-Trial Conference and asked for costs of $2,500.
[14] Based on the representations of counsel and Aviva’s claims representative’s answers to my two questions, I determine that the Defendant had not complied with Rule 50.05(2), in the circumstances of this Pre-Trial Conference. Aside from filling in the Pre-Trial Conference Report, the Pre-Trial could not consider those things listed in Rule 50.06 because Aviva’s decision maker(s) was/were not present, or available, or even defined.
[15] I exercise my discretion under Rules 50.07(1)(c) and 50.12 to award costs of $1,000 against the Defendant, payable within 14 days of the date of the Pre-trial Conference. I do so solely because of Aviva’s breach of rule 50.05 (2). My award of costs is no comment on Aviva’s decision with respect to the merits of the Plaintiff’s claim or Aviva’s approach to the defence of a claim.
TRIMBLE J.
Date: June 18, 2019
COURT FILE NO.: CV-16-3715 DATE: 2019 06 18
ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN:
RE: Al-Khouri, Plaintiff AND: Mah'd Hasan Hawari, Defendant
COUNSEL: D. Himelfarb for the Plaintiff R. Mussalin for the Defendant
ENDORSEMENT
Trimble J.
Released: June 18, 2019