Disclaimer: Some of the historical blogs refer to services and/or products that are predecessors to the new legal expense insurance product we refer to as LISC Legal Cost ProtectionTM. They should not be relied upon and are for informational purposes only.
Aviva ordered to pay significant costs to elderly plaintiff protected by LISC legal expense insurance policy.1
In February, 2009, Maria Persampieri was a passenger in a car when it was rear ended. She was 76 years old at the time of the accident. Her quest for damages would span almost a decade against the defendant insurer Aviva Canada (“Aviva”), whom relying on their notorious defensible program had determined that no offer to settle would be made.
Throughout the course of her litigation, Ms. Persampieri received a consistent and recurring message from Aviva: agree to a dismissal of the action without costs or proceed to trial (notwithstanding that liability was admitted at a 2015 mediation). Aviva rejected all of Ms. Persampieri’s offers to settle, including a $20,000 Rule 49 Offer in March 2017 and her last, a Rule 49 offer to settle for just $10,000, net of the applicable statutory deductible plus partial indemnity costs and pre-judgment interest.
Seven years post accident and now 84 years old, Ms. Persampieri, backed by a legal expense insurance policy from LISC, proceeded to trial for two weeks in June 2017.
At the opening of trial, Aviva attempted to have the case dismissed on summary judgment, which was unsuccessful. They then launched a threshold motion, which was unsuccessful. The Jury ultimately awarded Ms. Persampieri $40,000 for general damages, $25,000 for housekeeping and home maintenance, $2,000 for attendant care, and $500 for medical and rehabilitation expenses. After reductions for the statutory deductible and other benefits received, the net award was $20,415.
In its costs decision2, the Court was highly critical of the tactics employed by Aviva throughout the litigation.
“Sanctioning insurers’ litigation strategies . . . would be, in my view, to sanction under compensation of Plaintiffs for costs legitimately incurred to make many lawsuits uneconomic and could generally discourage Plaintiffs with modest claims, even if valid from pursuing them.
“If pursuing such an approach or strategy were to have the effect of generally discouraging Plaintiffs from bringing and pursuing modest sized claims, [even in cases such as here where liability has been admitted] the benefits to insurers could be significant and wide ranging.
“Insurers can, of course, pursue whatever strategy options they deem fit, but especially where such strategies may have wide ranging and adverse implications involving widespread denial of access to justice, the use of such strategies should not be encouraged by the giving of costs breaks.
“Total unwillingness to reassess/discuss settlement based on full information and advice should not be sanctioned or encouraged in any way.”
The Court awarded costs to the Plaintiff of $237,018, a figure more than ten times the net damages.
According to her lawyer, George Bekiaris, “The LISC policy gave my client the peace of mind to take the case to trial, as it has for other clients of mine facing obstinate defence positions. She had a lot to lose, but principle played a large part here. Aviva was dismissive of her rights from the outset, even when my client was willing to settle her claim over five years prior to trial for a quantum similar to what was ultimately awarded. You just can’t treat people that way without consequences. Regardless of their age. I am delighted for her that the Judge and jury felt the same way. Justice Sanderson clearly sent a message that real and tangible cost consequences are vital to ensuring access to justice for injured people with ‘moderate’ damages claims. If insurers do not have the deterrent of paying costs for these types of trials, then nothing will stop them from continually strong-arming injured people and bullying them. The purpose of our court system is to provide justice. The jury in this case did just that and Her Honour, via her cost decision, ensured that there would be access to justice for future Plaintiffs finding themselves in my client’s position. Make no mistake - having adverse cost protection in place is just as important for access to justice. There is a good chance that my client may not have opted to go to trial without it. She is a retired widow living on a pension. Without the protection she would have been left with the choice of risking her home in order to fight for what she is legally entitled to.”
This decision sends a strong message that the Courts will not be sympathetic when assessing costs against insurers where the litigation could be resolved at a much earlier stage for significantly less, thus alleviating stress on an overburdened court system. The stonewalling tactics increasingly being employed by auto insurers in Ontario, forcing cases to trial rather than paying out under a policy, will not be condoned.
LISC is pleased to have assisted yet another deserving plaintiff with access to justice in the courtroom in such instances. This case marks one of several recent plaintiff trial victories against Aviva where our legal expense insurance has played a supporting role. We hope that this decision and others like it will encourage insurers to rethink their scorched-earth approach notwithstanding the tremendous advantages they have been provided under the current Ontario auto insurance regime.
To read the decision, please click here.
1Underwritten by Omega General Insurance Company
2Persampieri v. Hobbs, 2018 ONSC 368