Dams v. TD Home and Auto Insurance Company, 2016 ONCA 4

This decision concerns the relief from forfeiture provisions at ss. 129 of the Insurance Act and 98 of the Courts of Justice Act.  The provisions were invoked because the plaintiff, who was involved in a motor vehicle accident with an unidentified driver, failed to comply with the reporting requirements in s. 3 of the Schedule attached to the Uninsured Automobile Coverage regulation under the Insurance Act (the “Schedule)”.

Released January 6, 2016 | Full Decision [CanLII]

Section 129 of the Insurance Act states:

Where there has been imperfect compliance with a statutory condition as to the proof of loss to be given by the insured or other matter or thing required to be done or omitted by the insured with respect to the loss and a consequent forfeiture or avoidance of the insurance in whole or in part and the court considers it inequitable that the insurance should be forfeited or avoided on that ground, the court may relieve against the forfeiture or avoidance on such terms as it considers just.  R.S.O. 1990, c. I.8, s. 129.

Section 98 of the Courts of Justice Act states: “A court may grant relief against penalties and forfeitures, on such terms as to compensation or otherwise as are considered just.”

Section 3 of the Schedule (and s. 5.3.5 of the Ontario Automobile Policy) imposes the following two obligations on an insured advancing a claim under the Uninsured Automobile Coverage provisions of his policy:

  1. the person must report the accident to a police officer within 24 hours after it occurs or as soon as is practicable after that time (s. 3(2)); and
  2. the person must give the insurer a written statement within 30 days after the accident occurs or as soon as is practicable after that date setting out the details of the accident (s. 3(3)).

In this case, the accident occurred on July 26, 2009.  The plaintiff was not aware he had the right to initiate a tort action until he had a chance meeting with a lawyer in February 2010.  He then attempted to file a report with the police and sent a statutory declaration to his insurer six months after the accident.

The defendant insurer argued the plaintiff’s delay in reporting the accident amounted to non-compliance of his reporting obligations under the Schedule.  Non-compliance, it argued, unlike imperfect compliance, bars an insured from relying on s. 129 of the Insurance Act.

The Court disagreed with the insurer’s classification of the plaintiff’s delay.  It relied on the Supreme Court of Canada’s decision in Falk Bros. Industries Ltd. v. Elance Steel Fabricating Co. [1989] 2 S.C.R. 778 (“Falk”), which held sections like s. 129 are remedial in nature and “should be given an appropriately broad interpretation.”  According to this decision, Falk makes clear that:

[F]ailure to give notice of a claim in a timely fashion constitutes “imperfect” compliance with a statutory condition as to the proof of loss” and falls within the terms of the relief provision.  By contrast, the failure to institute an action within the prescribed time period would be a more serious breach, akin to non-compliance.

It should be noted that the discretion afforded to the courts under s. 129 if the Insurance Act is limited to policy conditions relating to proof of loss issues.

Read the full decision on CanLII
Michael Ettedgui
Written by

Michael practices exclusively in the field of personal injury law at Campisi LLP.

Michael was called to the Bar in 2014. He received his law degree from Osgoode Hall Law School, where he participated in various programs geared towards access to justice and practical legal education. In particular, Michael volunteered with unrepresented litigants at family court and was the student co-ordinator of Osgoode Hall's Pro Bono Students Canada chapter.

When he is not working, Michael enjoys spending time with his wife and three young children.