This week, the Court of Appeal released its ruling in Monks v. ING Insurance Company of Canada. This was a claim for statutory accident benefits brought by, ironically, a woman who, prior to her injury, had worked in the insurance industry. At the 2005 trial, Mr. Justice Paul F. Lalonde was quite critical of ING in the course of awarding very substantial damages to the plaintiff. These took the form of declarations of entitlement to various types of benefits, past and ongoing, as well as an award of aggravated damages in the amount of $50,000.
The sole ground upon which ING’s appeal was allowed was in relation to a $75,000 risk premium that had been awarded by Justice Lalonde. The trial decision pre-dated the Supreme Court of Canada decision in Walker v. Ritchie and the Court of Appeal’s ruling in The Manufacturer’s Life Insurance Co. v. Ward. Both courts held that risk premiums cannot be awarded. So, this part of the C.A. decision was pretty much a foregone conclusion.
The decision of the court was written by Justice Eleanore Cronk. (The other members of the panel were Justices Eileen Gillese and John Watt.)
Ms. Monks had been injured in three separate car accidents over the course of six years. The first was relatively minor but the second was more serious. At the time of the latter, she was insured by Zurich Insurance and sued for accident benefits as a result of neck injuries suffered in that accident. That litigation was still ongoing when the third accident happened. The injuries from that accident at first seemed minor but, over time, Ms. Monks underwent spinal decompression surgery and eventually became an incomplete quadriplegic. She was insured by ING at the time of the third accident.
Zurich Insurance settled the claim arising from the second accident but by the time the settlement was completed, ING had bought Zurich’s personal lines and it ended up being ING that made the payment ($1.275 million) in settlement of the litigation arising out of the second accident.
Shortly after that settlement, ING, which had been paying benefits to Ms. Monks in relation to the third accident, terminated those payments, on the basis that Monks was not catastophically impaired. Ms. Monks sued.
Evidently, ING changed its position once the litigation began. It admitted that Ms. Monks was catastrophically impaired, but contended that this was a result of the first two accidents and a pre-existing spinal condition.
One of the big issues on the appeal was whether the trial judge could declare, as he did, that the plaintiff was entitled to benefits on an ongoing basis (as opposed to merely declaring her entitlement to past benefits). The Court of Appeal found that the declarations with respect to future entitlement were proper. However, its finding rested, in part, on the fact that at trial, ING had conceded that a declaration as to future entitlement could be made, so long as the benefits were not quantified. The Court of Appeal noted that the trial judge had done exactly what ING said he was entitled to do.
Justice Cronk went on to observe that the declarations by Justice Lalonde “co-exist with the scheme envisaged by the SABS for the determination of accident benefits….The result of this finding, which underpins the challenged declarations, is that Ms. Monks is entitled to the ongoing benefits in question subject to proof, in accordance with the SABS, of specific expenses falling within each category of benefits.” In other words, Ms. Monks would still have to prove the amount of her entitlement, but it would be up to ING to prove that she is entitled to payment.
ING also alleged, in the Court of Appeal, that the trial judge had been biased against it. This is always a tough argument to make on appeal and this case was no exception. The Court of Appeal accepted that the trial judge had been, at times, “blunt” and even “harsh” in his findings about the defendant and its expert witnesses. But, said Cronk J.A., “these are matters squarely within the trial judge’s domain.” This ground of appeal did not succeed.
Another ground of appeal was that the trial judge had erred by applying the “material contribution” test of causation instead of the “but for” test. But, as the Court of Appeal pointed out, ING had itself argued at trial that the plaintiff had only to show that the third accident had “significantly contributed to the severity or duration of the plaintiff’s symptoms”. [Emphasis ING’s.]
Further, the Court said that the use of the material contribution test in an accident benefits case was in keeping with the caselaw and that ING had not adduced any authorities to the contrary.
Finally, ING failed to persuade the Court that the trial judge had erred in his treatment of the deductibility of the proceeds of the Zurich settlement nor in making an award of aggravated damages.