What is a notice letter?

If you have sustained an injury that is the result of the negligence of another person – you could have an action for damages. Your entitlement to damages begins at the moment you suffer your loss. However, as anyone who has brought a lawsuit before knows – you will not get paid for a long time.

Since you are entitled to your damages right away, but you often have to go through the legal process to get them, the court allows for something called prejudgment interest. This interest accumulates on the money you are owed before you are paid it.

In order to claim prejudgment interest from a motor vehicle claim, you must notify the person who caused your damages that you are hurt and will be seeking damages from them. In personal injury law we call this a “notice letter”.

There is no standard format for a notice letter, and every law firm has a slightly different version. Generally speaking the letter should identify the injured person, how and when they were injured and inform the recipient that a lawsuit against them is being considered. In Ontario most people who receive a notice letter immediately pass it on to their insurance company who handles the claim from there.

The Ontario Court of Appeal recently considered the amount of prejudgment interest in motor vehicle claim in a pair of cases: Cobb v. Long Estate [2017] O.J. No. 4830 and El-Khodr v. Lackie, [2017] O.J. No. 4828.

The Court clarified that prejudgment interest is to be calculated by the Courts of Justice Act section 128(2): “the bank rate at the end of the first day of the last month of the quarter preceding the quarter in which the proceeding was commenced”. An action commenced in the fourth quarter of 2017 for example would have a prejudgment interest rate of 0.8%.

A notice letter entitles an injured party to claim this interest in a motor vehicle tort claim. It also has other benefits such as preservation of evidence. For example in a slip and fall case, it is important to notify stores with video cameras quickly before they delete the crucial evidence for the case.

Lastly, a notice letter is critically important if a municipality could be at fault.  According to the Municipal Act section 44(10): “no action shall be brought for the recovery of damages under subsection 2 unless, within 10 days after the occurrence of the injury, written notice of the claim and of the injury complained of has been served upon or sent by registered mail to the Clerk of the Municipality.” There are some exceptions to this rule if a reasonable explanation for the delay can be given – but it is best not to take the risk of your action being stopped before it can even get started.

A notice letter is the first step in most lawsuits. They are important because they entitle the plaintiff to prejudgment interest and they help preserve evidence. If a municipality could be at fault they need to be sent within 10 days of the injury. Consulting with a lawyer quickly after an injury is important so that a notice letter can be sent to the right parties, at the right time.

Brendan Sullivan
Written by

Brendan is a lawyer working in Hamilton Ontario at Harvey Katz law office. He has had the privilege of working closely with Harvey Katz and assists seriously injured people with claims arising from motor vehicle accidents, slip and falls, dog bites, life insurance denials and long-term disability. Brendan completed his articles in 2016 with a large insurance defence firm where he assisted with a seven week jury trial in Toronto. Brendan is a member of the Hamilton Law Association and the Ontario Trial Lawyers Association.