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ONCA Rules Appraisals are All in Good Time Under the Insurance Act

 May 25, 2017 3:00 PM
by Alexandra Wilkins

The Court of Appeal has brought some clarity to time limits for appraisals under the Insurance Act.

In 56 King Inc. v. Aviva, the plaintiff commenced a claim against its Insurer seeking coverage for damage to commercial property arising from a windstorm, as well as damages for breach of the Insurer’s duty of good faith in handling the claim.

The Statement of Claim was issued in February 2014. Sometime in late December or early January 2016, the Insurer admitted coverage. Three weeks later, the Insurer elected an appraisal under Section 128 of the Insurance Act. The plaintiff rejected the appraisal on the basis that it was too late and because the bad faith claim could not proceed by appraisal. The Insurer brought a motion to determine whether an appraisal should be ordered.

See All in Good Time: No Time Limit on Appraisals Under the Insurance Act for a summary of the motion judge’s findings.

In short, Justice Lofchik granted the Insurer’s motion. Justice Lofchik emphasized that the appraisal wording in Section 128 of the Insurance Act is mandatory and that the appraisal process must be continually available, noting no timeline that an election for appraisal must be made by. Justice Lofchik also found the appraisal did not prevent the plaintiff’s from having the issue of bad faith determined at trial.

The plaintiff appealed the motion judge’s finding as follows:

  1. The motion judge did not have jurisdiction to make the order because the matter must be brought by application and not by motion;
  1. The two-year delay prior to the demand for appraisal is a bar to an appraisal; and
  1. The effect of the motion judge’s decision is to bifurcate the trial.

The Court of Appeal rejected all submissions and found for the Insurer.

Importantly, with respect to delay, the Court stated the legislation signals a decided preference for appraisal, but the language of Section 128 does give the Court discretion to curb abuse. In the case at hand, the Court found no abuse on the part of the Insurer, noting the appraisal was requested within three weeks of the Insurer’s admission of coverage.

This Court of Appeal decision is distinguished from prior decisions of the Court which dismissed Insurer’s requests for appraisal due to the requests being brought too late. (see 1633092 Ontario Ltd. and Ouellette Estate v. North Waterloo Farmers Mutual Insurance Company)

It remains to be seen what will be considered “abuse” such that a Court will find an insurer is out of time for an appraisal.

See 56 King Inc. v. Aviva Canada Inc., 2017 ONCA 408

Alexandra practices insurance related litigation with a focus on accident benefits and bodily injury claims. 

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Div Court Lets LAT Iron Wrinkles

 May 10, 2017 8:15 PM
by Neil Colville-Reeves

The Ontario Divisional Court has weighed in on an application under the JRPA for a stay of LAT proceedings pending a review of 2 rulings refusing the insurers requests for an adjournment.

In Taylor v. Aviva there was a threshold legal issue as to whether the claimant was involved in an 'accident'. After the case Conference, and facing an unexpected affidavit in a written hearing proceeding, the insurer sought an adjournment of the case in order to cross examine the affiant and was denied. Twice. With no substantive reason provided. The insurer turned to the Divisional Court for relief and in particular a stay of the proceeding pending judicial review of the refusal to grant the adjournment. It was argued that there was a serious issue to be tried (relating to procedural fairness) and that irreparable harm would result if the stay was not granted.

The Divisional Court ‎didn't buy it. Not only did they not accept the arguments regarding the serious nature of the issue to the insurer they found that the insurer's application was premature because they had not exhausted all of the remedies available in the LAT such as a Request for Reconsideration. Importantly the court noted the importance of allowing a relatively new tribunal such as the LAT the opportunity to 'iron out wrinkles in procedural issues' and to let it do 'what the legislature directed it to do' - to provide a dispute resolution mechanism that is fair, efficient and proportional.

See Aviva Canada Inc. v Taylor, 2017 ONSC 2661 (CanLII)

Neil Colville-Reeves

Neil is a Partner of Samis+Company. Neil focuses exclusively on insurance-related litigation. He has handled a broad range of matters before the Ontario Superior Court of Justice and the Financial Services Commission of Ontario, as well as advocating on behalf of his clients in private arbitrations.

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Court of Appeal Brews Starbucks into Occupier of Sidewalk

 May 10, 2017 8:00 PM
by Neil Colville-Reeves

The Court of Appeal has affirmed a Superior Court decision which determined that Starbucks assumed responsibility and control and became an occupier of a portion of a municipal sidewalk.

In McKay v. Starbucks, a Starbucks customer was exiting a Starbucks patio onto an adjacent sidewalk when she fell and suffered injuries. The court noted that an ‘occupier’ under the Occupiers Liability Act is either (a) someone in physical possession of premises (Starbucks was not in physical possession of the sidewalk) or (b) someone who has “responsibility for and control over the condition of premises or the activities there carried on, or control over persons allowed to enter the premises”. The Starbucks in question is located at the intersection of Queen and Hammersmith in Toronto’s ‘Beaches’ neighborhood. The shop had a patio on the east side with an exit directly onto the Hammersmith sidewalk.

The court found that Starbucks had assumed responsibility and control over the sidewalk as a result of the following:

  • Starbucks expected customers would use this entrance to Starbucks out of convenience by parking across the street on Hammersmith and would cross the street to enter off Hammersmith thereby forcing them to utilize this stretch of sidewalk;
  • Starbucks set up the entrance this way for its commercial benefit;
  • The sidewalk was used by a group of people (Starbucks customers) only for the purpose of entering Starbucks and this ‘use’ of the sidewalk was created by Starbucks and for Starbucks benefit; ;
  • Starbucks customers had no choice but to use that portion of sidewalk when they used the Hammersmith entrance;
  • Most users of the sidewalk in the morning were Starbucks customers such that it was ‘almost’ exclusive use by Starbucks customers;
  • Starbucks assumed some control of the sidewalk area with a protocol for employees to monitor the condition of the pathway and clear, salt and sand that sidewalk area;

As a result they were an occupier of the sidewalk and had duties to customers to take reasonable steps to ensure they could enter the premises safely.

This case does not stand for the proposition that a business is responsible for all adjacent sidewalks. It is only where a business has behaved in a way that they have assumed control of the sidewalk that they will bear some responsibility for the condition of the sidewalk. It is worth bearing in mind that Starbucks set up their premises in a way that would create significant traffic on the sidewalk which was for its commercial benefit. In addition, as a general rule, once a person (or business) starts to manage a sidewalk by cleaning, inspecting, maintaining there is significant momentum created to a finding that they are an occupier.

See MacKay v. Starbucks Corporation, 2017 ONCA 350 (CanLII)

Neil Colville-Reeves

Neil is a Partner of Samis+Company. Neil focuses exclusively on insurance-related litigation. He has handled a broad range of matters before the Ontario Superior Court of Justice and the Financial Services Commission of Ontario, as well as advocating on behalf of his clients in private arbitrations.

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Samis+Company Lawyers, Firm Ranked Among Canada's Leaders in Lexpert's 2017 Directory

 May 8, 2017 2:00 PM
by Samis + Company

Samis+Company lawyers Daniel Strigberger (Partner) and Lee Samis (Counsel) have been recognized and ranked again in the annual Canadian Legal Lexpert Directory (2017).

Daniel Strigberger is ranked as a “Repeatedly Recommended” Leading Practitioner in Kitchener-Waterloo in the Litigation - Commercial Insurance category. Lee Samis is ranked as a “Repeatedly Recommended” Leading Practitioner in Toronto in the Litigation - Commercial Insurance category and a “Consistently Recommended” Leading Practitioner in Toronto in the Personal Injury category.

Samis+Company is also ranked as a “Repeatedly Recommended” leading firm in Toronto in the Litigation - Commercial Insurance category.

The Canadian Legal Lexpert Directory (the Canadian Lexpert Directory) profiles leading practitioners across Canada in over 60 practice areas and leading law firms in over 40 practice areas as identified via an extensive, annual peer survey.

Congratulations Daniel and Lee!



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