In Dams v. TD Home and Auto Insurance Company, 2016
ONCA 4, the Ontario Court of Appeal continued its trend of
liberalizing relief from forfeiture – this time allowing
imperfect compliance with the statutory reporting requirements for
uninsured automobile coverage.
The plaintiff injured himself after he fell from his motorcycle
to avoid an accident with an unidentified vehicle. He did not
report the accident to police within 24 hours or give the insurer a
written statement within 30 days, as required by his policy and a
Schedule to the Uninsured Automobile Coverage Regulation.
Instead, he notified his insurer, TD, two months after the accident
and applied for accident benefits. After a chance meeting with a
lawyer, he realized that he could sue for his pain and suffering.
He tried to file a police report and then commenced a tort action
against TD seeking damages under the Uninsured Automobile Coverage
provisions of his policy.
TD argued that the plaintiff was prohibited from bringing his
action because he failed to comply with the notice requirements in
his policy. The trial judge disagreed, finding that relief under s.
129 of the Insurance Act was available for the plaintiff 's
"imperfect compliance" with those requirements. The
plaintiff had a reasonable explanation for the delay and TD did not
suffer any prejudice as a result of the delay.
TD appealed, arguing
that the reporting requirements were "preconditions" to
the plaintiff being able to commence an action. TD pointed to
section 8(1) of the Schedule to the Uninsured Automobile
Coverage Regulation which stated that no person could bring an
action unless the requirements of the Schedule, including the
reporting provisions, were complied with.
The Court of Appeal upheld the trial judge's decision to
grant the plaintiff relief from forfeiture, rejecting TD's
argument for two reasons. First, it noted that the Supreme Court in
Falk Bros had already determined that failure to give
notice of a claim under an insurance policy amounted to imperfect
compliance. Second, TD's interpretation of the Schedule was
untenable as it required the Court to preclude relief from
forfeiture for all requirements under the Schedule, including
matters that were specifically afforded relief under s. 129 of the
Insurance Act. The Court determined that Schedule 8 should be read
in light of s. 129 and the principles in Falk Bros and it did not
transform its requirements to preconditions to a claim where relief
from forfeiture was available.
Dams is another example of the Ontario Court of Appeal liberally
applying relief from forfeiture to imperfect compliance with
reporting requirements. It also gives some comfort to policy
holders who have a reasonable explanation for their failure to
comply promptly with such requirements. This is consistent with
other recent jurisprudence such as Lloyd's Underwriters v.
Blue Mountain Log Sales Ltd,2015 BCSC 630, where
relief from forfeiture was available to an insured who was found to
have "clean hands" after waiting two years to give notice
of several claims.
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