Canada. Many other jurisdictions around the world seek to compensate a victim from loss arising from pain and suffering. In Canada, aggravated damages are awarded to compensate a party for the mental distress experienced from another party’s misconduct or misbehaviour. In awarding punitive damages, the Court found that the claims examiner’s rejection of the Own Occupation coverage was severely flawed, as it imported improper considerations and concluded without any foundation that motivational factors were dominating the claim. Generally, punitive damages are imposed in rare circumstances where there has been high-handed, malicious, arbitrary or highly reprehensible misconduct that departs markedly from ordinary standards of decent behaviour. We have a right to fear a situation where none but the wealthy could own or drive automobiles because none but the wealthy could afford to pay the enormous insurance premiums which would be required by insurers to meet such exorbitant awards (Arnold at p. 28). As a general principle in Canada, damages for mental distress resulting from a breach of contract are not normally awarded. The Supreme Court of Canada has held: “Damages are a monetary payment awarded for the invasion of a right at common law”. The plaintiff suffered severe brain damage resulting in physical and mental impairment. The fire department, police, and independent adjusters retained by the insurer concluding that it was an accidental fire. The awarding of non-pecuniary damages in a civil action is by no means unique to Canada. 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. 57 (Prince George) et al., [1978] 2 S.C.R. 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. AIG’s actions established a pattern of abuse as punitive damages of $60,000 had previously been awarded against AIG for undertaking a similar action in another case. The presence of these attributes provided the potential for an increasingly substantial and excessive amount of damages to be awarded. the employee for breach of the implied term of the employment contract to provide reasonable notice of termination. Damages may be awarded in other headings to provide equality in the amount of compensation a plaintiff receives in a negligence case. 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 judge in the Merrifield case observed that it is similar to the tort of harassment, but with a couple of distinctions. In the seminal case of Bardal v. 217 (Nfld. It is in this area that awards in the United States have soared to dramatically high levels in recent years. The Court also noted that the claims examiner’s notes do not give any weight to the fact that the plaintiff’s disability was recognized by Canada Pension Plan Disability benefits. The plaintiff in this case was a university student who was suspected by her professor to be a child sex abuser. In Godwin v Desjardins Financial Security Investments Inc.[1], the Supreme Court of British Columbia found that the Insurer breached its duty of good faith by failing to assess the plaintiff’s disability claims in a fair and balanced manner. The court’s fear was partially grounded on the developing landscape of non-pecuniary damage awards in the United States. The amounts awarded would instead be considered additional money to help the plaintiff in making his or her life more endurable. Non-economic damages are psychological and can’t be quantified. Currently, the typical range for aggravated damages in Canada is $10,000 to $100,000 but most of the awards fall on the lower end of the spectrum. Claims examiners are required to weigh the totality of the medical evidence against the insurance policy requirements; A claims examiner cannot deny coverage on the basis of a test, such as “significant and prolonged impairment”, if such a test is not found in the definition of Total Disability set out in the insurance policy; A delay in payment of a disability claim may be sufficient to warrant mental distress compensation. Notably, the Court held that had the insurance company’s conduct only marginally aggravated the plaintiff’s symptoms. Mental anguish lawsuits seek damages for the pain and suffering resulting from another person’s negligent or intentional conduct. Not surprisingly, the insurers in Branco have appealed the case to the Saskatchewan Court of Appeal. This means you can sue someone for emotional trauma or distress if you can provide evidence to support your claims. CRY ME A RIVER: RECOVERY OF MENTAL DISTRESS DAMAGES IN A BREACH OF CONTRACT ACTION A U.S./CANADA COMPARISON by Ronnie Cohen* and Shannon O’Byrne** I. See our article: “Seeking punitive and mental distress damages in a Long-Term Disability (LTD) Claim”. 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. If there is no evidence to indicate that society would suffer an economic burden from the award, such as an increase in insurance premiums, the upper limit cap appears not to apply. On January 19, 1978, the Supreme Court of Canada tackled this issue head-on by ruling on a trilogy of cases to limit the maximum amount of non-pecuniary damages a plaintiff could receive in a civil action (Andrews v. Grand & Toy Alberta Ltd., [1978] 2 S.C.R. [Fenn]). Her family doctor indicated that the plaintiff’s chances of going back to work were “extremely good” but that the plaintiff should not go back to her former employment. This area is open to widely extravagant claims. Torts can be intentional or unintentional. The Court of Appeal reinforced the BC Supreme Court’s reasoning that the courts are bounded by the trilogy with the upper limit to be applied as a rule of law. Since the trilogy judgment was handed down over 30 years ago, Canadian courts have held strong in their stance on non-pecuniary damages. In these types of contracts, aggravated damages would be allowed. The Supreme Court of Canada noted that: Insurance contracts are sold by the insurance industry and purchased by members of the public for peace of mind. The obligation of good faith dealing means that the insured’s peace of mind should be the insurer’s objective, and the insured’s vulnerability ought not to be aggravated as a negotiating tactic. 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. As no Supreme Court of Canada case has ruled on aggravated damages in bad faith claims, the damages are specific to the provinces and vary in range. A case that came before the Ontario Superior Court of Justice highlights the need for appellants to bring evidence of actual mental distress when seeking aggravated damages. She defends individuals and companies against claims for personal injury, particularly claims involving complex medical issues, brain injuries, auto-immune diseases and psychological and psychiatric claims. The Supreme Court of Canada restored the $1 million award having found that the insurer attempted to take advantage of the plaintiff’s financial difficulties, its superior resources, and bargaining power to obtain a favourable settlement. Damages for mental distress can be claimed when the breach of contract by one party causes the other party an intangible injury, such as additional stress, anxiety, frustration, humiliation, and emotional or psychological distress. Since the Trilogy, the Supreme Court of Canada has exempted the application of the upper limit cap in particular types of cases. 79 at p. 29 [ter Neuzen]). Suing for emotional damages, or “pain and suffering,” has long been a routine tag-on in personal-injury cases. Vancouver, British Columbia V6B 2L3 In citing the Supreme Court of Canada Fidler decision[2], which sets out the rationale for mental distress damages caused by breach of a disability insurance policy, the Court awarded mental distress damages of $30,000 and another $30,000 for punitive damages. The law of damages in Canada has undergone unique changes over the past 50 years which have helped shape the actions of Canadian society. Evidence Required for Claims of Mental Distress. 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