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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