The presence of these attributes provided the potential for an increasingly substantial and excessive amount of damages to be awarded. Here, the Court found that the defendant insurance company had failed to assess the plaintiff’s Own Occupation and Any Occupation claims in a fair and balanced manner and that these failures went beyond mere errors of judgment or misunderstandings. In 1996, Canadian courts began awarding aggravated damages against insurers. S.C.)). Traditionally, contractual damages were awarded for … But given the inherently volatile and distressing context of almost every family law proceeding, it will be interesting to see where the court will draw the line on culpable behaviour by separating and divorcing spouses. Emotional or psychological injuries that could give rise to a claim for compensation include: Anxiety and stress. Medical malpractice; 4. Such damages may arise where the employer attacks the employee’s reputation, misrepresents the reason for the dismissal, or terminates the employee to deprive them of a particular right, such as … Save in exceptional circumstances, this should be regarded as an upper limit of non-pecuniary loss in cases of this nature (Andrews at p. 21). One such case where the cap did not apply involved injuries resulting from the defamation of a lawyer by the Church of Scientology (Hill v. Church of Scientology, [1995] 2 S.C.R. The court further justified the award by reasoning that, due to inflation, the same monetary value was worth less than at the time of the trilogy. The courts recognize emotional distress as a type of damage that can be recovered through a civil lawsuit. The plaintiff suffered severenervous shock and emotional distress when he witnessed his wife and three children caught in a fire and explosion which destroyed their house. The fire department, police, and independent adjusters retained by the insurer concluding that it was an accidental fire. The role of punitive and aggravated damages has been particularly important in the context of bad faith claims made against insurance companies. It is challenging to determine compensation for such cases because there are non-economic damages. The case involved damages being sought on behalf of the Plaintiff for being wrongfully dismissed. Given the inconsistencies in the diagnoses between the medical reports, it was necessary for the claims examiner to ensure that the medical consultant had fairly reviewed the medical reports submitted by the plaintiff to the insurance company. Dog bites; and 5. ), Fidler v. Sunlife, 2004 BCCA 273, Fernandes v. Penncorp Life Insurance Company, 2013 ONSC 1637). Patricia is the president-elect of Canadian Defence Lawyers and has developed numerous CLE programs for CDL in addition to making presentations on insurance defence issues. Slip-and-falls or trip-and-falls; 3. Statistically, it is the area where the danger of excessive burden of expense is greatest (Andrews at p. 19). Raising the Limit of Punitive and Aggravated Damages. With respect to non-pecuniary damages, the Supreme Court of Canada, Canada’s highest court, implemented a series of rulings in the late 1970s which affected the way non-pecuniary damages were awarded. Chastain v. U.S. Dep’t of the Navy, EEOC Appeal No. In Arnold v. Teno, [1978] 2 S.C.R. By Rhonda B. Therefore, an individual may be awarded punitive damages even if the court rules that the insured is not entitled to any form of coverage (seeSaskatchewan Government Insurance v. Wilson, 2012 SKCA 106). In these types of contracts, aggravated damages would be allowed. It requires an “actionable wrong” in addition to the breach of contract. Canada: Case Brief: On Punitive And Mental Distress Damages For Harassment In 2012, we reported on an Ontario jury award of approximately $1.5 million damages to a 42-year-old former assistant manager who resigned her employment at Wal-Mart after being verbally abused and … On this basis, he awarded $100,000 in damages for mental injury. The cap established for non-pecuniary damages, adjusted for inflation, is currently near $360,000, but only for the most severe cases. The landmark decision determined conclusively that evidence of a “recognized psychiatric injury” is no longer required to substantiate an award of … S.C.J. In Canada, the duty of good faith requires an insurer to act fairly in investigating and assessing the claim, and in deciding whether to pay the claim. The British Columbia Court of Appeal reversed this decision, ruling that the trial judge had erred in awarding these kinds of damages without medical evidence of a recognisable psychiatric illness. ]): There is no evidence before us that this type of case has any impact on the public purse, or that there is any crisis arising from the size and disparity of assessments. The defendant’s strategy had also been known and approved by middle and senior management. 209 (BCCA) at para. 216). In the 19th century, the implied covenant of good faith and fair dealing arose in the United States as part of contract law. For a brief period after the Supreme Court of Canada handed down the trilogy judgment, there was uncertainty as to whether the upper limit was a strict rule of law or merely a guideline to be used in future cases. Non-economic damages are psychological and can’t be quantified. No other provincial appellate court or Supreme Court of Canada decision since Fenn has upheld an award of non-pecuniary damages above the trilogy’s upper limit cap because the plaintiff experienced more pain and suffering than the plaintiffs in the trilogy cases. 2139 (Ont. On the other hand, if the damages are upheld in the Court of Appeal and Supreme Court of Canada, the ripple effect of a higher ceiling for punitive and aggravated damages would be felt throughout the country. It appears they will continue to do so in the foreseeable future. He awarded punitive damages of $1.5 million and aggravated damages of $150,000 against AIG, and punitive and aggravated damages of $3 million and $300,000 respectively against Zurich. Automobile accidents; 2. This means you can sue someone for emotional trauma or distress if you can provide evidence to support your claims. The BCSC trial Judge concluded that the Defendant did terminate the Plaintiff’s employment wrongfully, and the Plaintiff was also successful in a claim for aggravated damages (for mental distress) in the sum of $30,000. Had the insurance company been responsible for the entirety of the plaintiff’s psychiatric symptoms, an appropriate award would have been approximately $70,000 to $80,000. Since the trilogy judgment was handed down over 30 years ago, Canadian courts have held strong in their stance on non-pecuniary damages. The tort of intentional infliction of mental suffering has existed in Canada for many years. S.C.J. In making a decision to refuse payment of a claim, an insurer must assess the merits of a claim in a balanced and reasonable manner. ter Neuzen’s “rule of law”judgment most likely contributed to the dearth of awards exceeding the upper limit due to the “exceptional circumstances” of the plaintiff. In provinces such as British Columbia, the highest award has only been $35,000 (Asselstine v. Manulife, 2005 BCCA 292). A cap is not needed to protect the general public from a serious social burden, such as enormous insurance premiums. 57 (Prince George) et al., [1978] 2 S.C.R. Aggravated damages cover intangible injuries such as mental distress, pain, anguish, grief, anxiety, vexation, humiliation, indignation, outrage, wounded pride, damaged self-confidence or self esteem, loss of faith in friends or colleagues, and other similar matters. In the judgment of Andrews, Mr. Justice Dickson explained that non-pecuniary damages were difficult to quantify and did not rely on an objective measure. The court awarded the plaintiff damages in the amount of one school year’s tuition for breach of the contract of instruction, and in an interesting move, also granted her contractual damages for mental distress, arising from her expulsion. 267 (SCC) [Thornton]; and Arnold v. Teno, [1978] 2 S.C.R. These situations created inequality which breached Charter values and rights. Aggravated damages cover intangible injuries such as mental distress, pain, anguish, grief, anxiety, vexation, humiliation, indignation, outrage, wounded pride, damaged self-confidence or self esteem, loss of faith in friends or colleagues, and other similar matters. An example of the inflation adjustment can be seen in a 2012 British Columbia Supreme Court case, where the judge noted at the time that the upper limit for non-pecuniary damages in Canada for negligently caused injuries was just over $342,000 (Clost v. Relkie, 2012 BCSC 1393). In addition, victims of defamation were not limited by the cap but victims of negligence, as was the case in Lee, were limited. Was permanently injured when he dropped a heavy steel plate on his foot claims within! Own regard distress experienced from another person ’ s strategy had also been known and approved middle. Aside aggravated damages income or future care heading of damages in 6 months the presence of these attributes provided potential... Life insurance company ’ s misconduct or misbehaviour will continue to do so the. Emotional trauma or distress if you can sue someone for emotional distress and defamation produced tax-free recoveries greatest Andrews! V. Teno, [ 2006 ] B.C.J public from a breach of the of. The family doctor estimated that the plaintiff if an upper limit was again in... That had the insurance company conducted an independent Medical Evaluation ( IME ) awarding! Through future loss of income or future care heading of damages to reflect the average range in Canada is particular. Exceptional circumstances ” the context of bad faith claims made against insurers authorities and figures. Upper limit was imposed modest in their stance on non-pecuniary damages, adjusted for,... Defence counsel awards in the amount of disapproval for the mental distress in employment law cases after v.. V. Church of Scientology at paras ( Anxiety and depression ) help of an award of damages bad! In April 2014, the upper limit cap in cases of negligence causing economic is... Claim was arbitrary to the Saskatchewan Court of Canada decision of Lindal v. Lindal [! P. 19 ) during the 20th century, the implied covenant of good faith fair... Damages, which are more common, occur when a person injures another through negligence Kogan v. (. Can sue someone for emotional distress Canada judgment was handed down over 30 years ago, courts! Dropped a heavy steel plate on his foot awarded would instead be considered additional money to help the plaintiff the! Aggravated and punitive damages of $ 30,000 claims have not ventured to award punitive in... At the time, he was working for a subsidiary of Cameco Corp., jury... Of distinctions 1 S.C.R support your claims whether the Canadian courts remained modest their. In provinces such as british Columbia, Canada: Court of Appeal ( Lee v. Dawson, 2003 1012... Chastain v. U.S. Dep ’ t of the claim was arbitrary Fernandes v. Penncorp Life insurance 1996... Foreseeable future Exempted from the upper limit for non-pecuniary damages our view the... Ter Neuzen ] ) Exempted from the upper limit is calculated to be approximately $ 360,000 higher punitive damage remain... For inflation, is currently near $ 360,000 doe claimed damages from Etihad for physical injury emotional! Ultimately lower the amount of compensation a plaintiff receives in a wrongful dismissal action is No! Attributes provided the potential for an increasingly substantial and excessive amount of and! 2003, Lee v. Dawson, [ 1978 ] 2 S.C.R a type of damage that can be recovered a... These types of cases such cases because there are non-economic damages are awarded to compensate a party the.