Court File and Parties

COURT FILE NO.: 16-67371 DATE: 2020/05/25 ONTARIO SUPERIOR COURT OF JUSTICE

B E T W E E N:

DENICE MEARNS, RIDER SULLIVAN, a minor by his Litigation Guardian, DENICE MEARNS, and IZABELLA SULLIVAN, a minor by her Litigation Guardian, DENICE MEARNS Plaintiffs – and – TYLER SULLIVAN Defendant

Counsel: Sig Pantazis for the Plaintiffs Dalton McGuinty, Jr., for the Defendant

HEARD: In Writing

Endorsement

(Motion for Approval of Infant Settlement)

Corthorn J.

Introduction

[1] This action arises from a single vehicle accident that occurred on January 4, 2013 in Renfrew County. The defendant, Tyler Sullivan, was driving a car in which Denice Mearns and Rider Sullivan were passengers. Ms. Mearns was the front seat passenger. The minor plaintiff, Rider, was two years old at the time. Ms. Mearns describes Rider as having been “properly secured” in a rear seat. The other minor plaintiff, Izabella, was not yet born.

[2] Ms. Mearns’ evidence is that, as the car was travelling on Highway 60 in Renfrew County, her attention was drawn to Rider in the back seat. As she returned her view to the front of the car, Ms. Mearns heard Mr. Sullivan swear and then the car struck a deer that had jumped into the path of the car. At the time of the collision, Ms. Mearns’ head remained turned somewhat towards the back seat. The front passenger seat airbag deployed.

[3] Ms. Mearns was the only occupant of the car who was injured. Her recovery is said to have been unusual. She returned to full-time employment only to find that her condition deteriorated over time. Ms. Mearns alleges that the full extent of the residual effects of the injuries suffered in the accident were not known until more than two years after the date of the accident. The action was not commenced until 2016 – more than three years after the date of the accident.

[4] Ms. Mearns and Mr. Sullivan were common-law spouses at the date of the accident. It is not known whether they remain together. They are the parents of Rider, born in November 2010, and Izabella, born in May 2015.

[5] The relief sought on the motion is not clear. The notice of motion identifies that the motion is brought pursuant to r. 7.08 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (“Rules”). That rule applies to settlements on behalf of persons under disability. Yet, the draft order to which the defendant consents includes a term that provides for approval of the overall settlement (i.e., including the damages, interest, and costs payable to Ms. Mearns).

[6] The reason for the inclusion, in the draft order, of approval of the overall settlement is not explained in either the notice of motion or the supporting affidavits. The grounds set out in the notice of motion do not suggest that Ms. Mearns is a person under disability within the meaning of r. 1.03(1).

[7] The minutes of settlement identify the full amount of the overall settlement, do not identify the amount to be paid to the minor plaintiff(s), and require the plaintiffs to bring a motion for approval of the “infant settlements”. The minutes of settlement do not require the plaintiffs to seek approval of the overall settlement.

[8] Affidavits from both the litigation guardian (“the Mearns Affidavit”) and plaintiffs’ counsel (“the Pantazis Affidavit”) are included in the motion record. In his affidavit, Mr. Pantazis says that “[a] final settlement was reached between the parties in the all-inclusive amount of $630,000.00 subject to court approval, inclusive of all claims, interest, and costs in damages.” Counsel’s evidence in that regard does not accord with the terms of the minutes of settlement.

[9] The contents of both affidavits address the injuries sustained by Ms. Mearns, her efforts to return to work, the potential value of her claim for damages for loss of income, the accident benefits paid to Ms. Mearns to date, and the accident benefits that remain available to Ms. Mearns. Her application for a declaration that she is catastrophically impaired was accepted by the accident benefits insurer.

[10] A number of experts reports are included as exhibits to the Pantazis Affidavit. The reports are from health care professionals who examined Ms. Mearns at the request of her accident benefits insurer, the accountant retained by the plaintiffs to provide an opinion as to the value of Ms. Mearns’ claim for damages for past and future loss of income, an engineer retained on behalf of the defendant, and the human factors expert retained by the plaintiffs.

[11] There is no evidence as to (a) the nature of Ms. Mearns’ relationship with Rider prior to the accident, (b) the manner in which that relationship was affected as a result of the injuries sustained by Ms. Mearns, and (c) the extent, if any, to which Rider continues and may, in the future, continue to experience a loss of the care, guidance, and companionship that he might otherwise have received from his mother.

[12] But for some discussion of the case law provided as examples of damages awarded to claimants pursuant to the Family Law Act, R.S.O. 1990, c. F.3, and why, in the opinion of Mr. Pantazis and Ms. Mearns, the $10,000 proposed for Rider is reasonable, the court would be left with the impression that the approval sought is of the settlement of the claims made by Ms. Mearns.

[13] A request is made for approval of the settlement of Izabella’s claims on the basis that she will (a) receive no monetary award, and (b) not be required to contribute any monies towards the solicitor-client account delivered by plaintiffs’ counsel. The proposed relief is not framed in that manner; it is, however, obvious that is what is intended. Izabella was born more than two years after the date of the accident. She does not fall within the scope of family members who are entitled to damages for loss of care, guidance and companionship.

[14] Clarification is required with respect to the request for approval of the claims advanced by Ms. Mearns. Additional evidence is required in support of the request for approval of the settlement of Rider’s claims.

Review of the Motion Record

a) The Notice of Motion and the Motion Record Generally

[15] The plaintiffs propose that the motion be heard in writing “because it is unopposed”. The plaintiffs rely on subrule 37.12.1(1).

[16] The motion record includes a copy of the minutes of settlement. The motion record also includes a “Consent to Order”, signed by plaintiffs’ counsel on behalf of defence counsel. Attached to the “Consent to Order” is a copy of the order which the plaintiffs filed as the draft order, independent of the motion record. In the circumstances, the parties are entitled to have the motion heard in writing because it is on consent (not because it is unopposed).

[17] The relief requested in the notice of motion and incorporated in the terms of the Consent Order includes “dispensing with the requirement of the approval of, or a report by, the Office of the Children’s Lawyer or the Public Guardian and Trustee pursuant to Rule 7.08(5) of the Rules of Civil Procedure”. The subrule cited does not require that the Children’s Lawyer become involved in every motion for approval of a settlement on behalf of a minor. That subrule gives the court the discretion to involve the Children’s Lawyer. The relief sought by the plaintiffs, based on r. 7.08(5) of the Rules is not required.

[18] With respect to the settlement of Rider’s claims, the relief requested in the notice of motion and set out in the draft order includes a term pursuant to which plaintiffs’ counsel “shall pay the amount of $10,000 as general damages to the Accountant [for] the Superior Court of Justice” (“Accountant”). As currently framed, the draft order entitles Rider to enforce the order for payment of $10,000 as against his counsel.

[19] The appropriate relief is an order that the defendant pay $10,000 to Rider and that the settlement funds be paid to the Accountant. Framed in that manner, the relief entitles Rider to enforce the settlement, if necessary, as against the defendant.

[20] It is incumbent upon not only the plaintiffs, but the parties to the action to consider the relief sought. Defence counsel has a role to play in motions of this kind. That role includes considering the relief required and scrutinizing the terms of a draft order presented for approval or for which consent is requested.

[21] The pages of a motion record are to be numbered from start to finish, independent of any pagination of individual documents within the record: r. 37.10(2). The pages of the motion record in this matter are not consecutively numbered as required by that subrule. The record appears to be comprised of at least 200 pages.

[22] Included as exhibits to the Pantazis Affidavit are copies of the notice of action, statement of claim, amended statement of defence, and minutes of settlement. Those documents are part of the record in this action. They should be included in the motion record not as exhibits to an affidavit, but rather as discreet documents separate from the affidavits.

b) The Litigation Guardian

[23] When the action was commenced, Ms. Mearns was required to swear an affidavit of litigation guardian. A copy of that document is included as exhibit “A” to the Mearns Affidavit. Once again, I point out that the affidavit of litigation guardian forms part of the record in the action. It should be included in the motion record as a discreet document, not as an exhibit to an affidavit.

[24] For the affidavit of litigation guardian to comply with the Rules of Civil Procedure, it had to include a statement by Ms. Mearns that she “has no interest in the proceeding adverse to that of [Rider and Izabella]”: r. 7.02(2)(g). That statement is included at paragraph 5 of Ms. Mearns’ affidavit of litigation guardian.

[25] In her evidence on this motion, Ms. Mearns says that the contents of her affidavit of litigation guardian remain accurate, with the exception that the court file number in the document is incorrect. It is uncertain that the statement made at paragraph 5 of the affidavit of litigation guardian was true when that affidavit was sworn; it is uncertain that the statement is true at this time.

[26] Given that the injured plaintiff and the litigation guardian for the minor plaintiffs are one and the same, it is important to consider whether the damages claimed by the plaintiffs exceed the third party liability limits available under the subject policy of motor vehicle insurance. There is no evidence as to the third party liability limits available to Mr. Sullivan. I take judicial notice of the fact that (a) it is unusual to see individuals have third party liability limits in excess of $2,000,000 on a policy of insurance for a passenger vehicle; and (b) individuals frequently have third party liability limits of $1,000,000 or less.

[27] The prayer for relief in the statement of claim includes particulars of (a) the general non-pecuniary damages claimed by Ms. Mearns and each of the two children, and (b) special damages claimed by Ms. Mearns. Those amounts total $1,450,000. The amounts claimed by Ms. Mearns for damages for cost of future care, future loss of income, and housekeeping/home maintenance are not included in the prayer for relief.

[28] In addition to the damages particularized in the statement of claim, there is some evidence on this motion as to the potential value of the plaintiffs’ claims. For example, Mr. Pantazis’ evidence includes his estimate of the high end of the range at which Ms. Mearns’ damages may be assessed. Mr. Pantazis does not provide a breakdown of the estimated high-end figure to demonstrate how he arrived at it. Nor does he provide a figure (and a breakdown of it) which, in his opinion, represents the low end of the range of damages to which the plaintiffs may be entitled.

[29] It appears that the statement of claim has not been amended to increase or include particulars of the damages claimed by Ms. Mearns for cost of future care, future loss of income, and housekeeping/home maintenance. Regardless, it is possible that the damages and pre-judgment interest claimed by Ms. Mearns and Rider total an amount in excess of the third party liability limits available to Mr. Sullivan.

[30] As a result, it is not certain that Ms. Mearns is in a position to fulfill the requirements of r. 7.02(2)(g). If the damages and pre-judgment interest claimed exceed the third party liability limits available to Mr. Sullivan, then Ms. Mearns has an interest that is adverse to Rider’s interests in the action.

[31] If Ms. Mearns is not in a position to fulfill the role of litigation guardian for Rider, then another individual needs to (a) be substituted for Ms. Mearns in that role, and (b) provide evidence in support of the motion for approval of the settlement of Rider’s claims in this action.

[32] While it is clear that Izabella is not entitled to damages in this action, she too may be represented by a litigation guardian who is not in a position to fulfil the requirements for that role. There is little, if anything, to be gained by approving the settlement of Izabella’s claims independent of approving the settlement of her brother’s claims. Therefore, if it is necessary for someone to take over as litigation guardian for Rider then that individual shall also do so for Izabella.

c) Evidence of Rider’s Losses

[33] Evidence addressing the following matters is required with respect to Rider’s claim for damages for loss of care, guidance, and companionship:

• The nature of Ms. Mearns’ relationship with Rider, age two at the time of the accident;
• The extent to which Ms. Mearns’ injuries have impacted the care, guidance, and companionship that Rider might otherwise have expected to receive from his mother from the date of the accident to the present; and
• The extent, if any, to which the residual effects of Ms. Mearns’ injuries continue to and will, in the future, impact on the care, guidance, and companionship that Rider might otherwise have expected from his mother.

[34] For the purpose of identifying a range of damages, the Pantazis Affidavit includes a discussion of three Ontario decisions. Based on the decisions cited, Mr. Pantazis opines that the range of damages in cases of this kind is $20,000 to $50,000. The respective ages of the FLA claimants in those decisions are not identified. There is no discussion as to the nature of the losses experienced by the FLA plaintiffs in those decisions. No comparison is made between of the losses experienced by the claimants in those decisions and the losses Rider is alleged to have suffered.

[35] Taking into consideration the current statutory deductible of $20,000 (rounded figure), the proposed payment to Rider of $10,000 represents an assessment of damages for loss of care, guidance, and companionship of slightly less than $30,000 (after accounting for pre-judgment interest and without accounting for contributory negligence, if any, on Ms. Mearns’ part: Insurance Act, R.S.O. 1990, c. I.8, s. 267.5(7), item 4).

[36] The proposed payment to Rider of $10,000 may very well be reasonable and in his best interests. However, the court is unable to approve the settlement of Rider’s claims without the following:

a) evidence as to the losses Rider is alleged to have suffered; b) a comparison of Rider’s losses to those experienced by the FLA claimants in the cases cited by plaintiffs’ counsel; and c) if necessary, evidence from a litigation guardian, whom the court can be certain, does not have interests adverse to Rider’s interests in the action.

[37] With respect to (c), either the plaintiffs confirm that the damages and pre-judgment interest claimed do not exceed the third party liability limits available to Mr. Sullivan or a new litigation guardian must be appointed for the minor plaintiffs. In the latter event, the new litigation guardian would provide an affidavit in support of the approval motion.

d) Risks

[38] In their respective affidavits, Mr. Pantazis and Ms. Mearns provide evidence with respect to the risks associated with this litigation. Those risks include (a) the defence of inevitable accident, (b) Ms. Mearns’ alleged contributory negligence, (c) the defence of a lack of causation, and (d) a limitation period defence because the action was commenced more than two years after the date of the accident.

[39] The risks are discussed in general terms only. A specific percentage is not assigned to each individual risk. In her affidavit, Ms. Mearns says that the settlement represents less than ten per cent of the high end of the range in which the plaintiffs’ damages may be assessed at trial. Neither Ms. Mearns nor Mr. Pantazis provides any evidence as to the percentage which the settlement represents of the low end of the range in which the plaintiffs’ damages may be assessed at trial.

[40] The risks associated with the litigation – whatever they are – may be far more relevant to the settlement of Ms. Mearns’ claims than they are to the settlement of Rider’s claims. If approval is required only of the settlements of the infant plaintiffs’ respective claims and little, if any, discount has been applied to apportion $10,000 from the overall settlement for Rider, then, the risks associated with the litigation may not be a significant factor in the approval process. If the settlement of Ms. Mearns’ claims also requires approval, then a more detailed discussion of the litigation risks is required.

Summary

[41] Additional materials are required to address the concerns raised in this endorsement. If there is anything that the parties wish to raise with the court before the additional materials are delivered, counsel may contact the Office of the Trial Co-ordinator to schedule a telephone case conference.

[42] I remain seized of the matter and the additional materials shall be filed electronically in compliance with the Notices to the Profession in the East Region. When filing the additional materials, counsel are asked to identify that the materials are to be forwarded to my attention.

[43] As a result of the suspension of usual court operations, this endorsement is being issued under my electronic signature. Once normal operations resume, a copy of this endorsement shall be added to the court file.

Madam Justice Sylvia Corthorn Released: May 25, 2020