Road Hockey: Let the Kids Play

Ontario’s minister of Children and Youth Services Michael Couteau was in the news recently for his plea to Toronto city council to lift a ban on road hockey in the city. The by-law in questions states that:

“no person shall play or take part in any game or sport upon a roadway and, where there are sidewalks, no person upon roller-skates, in-line skates or a skateboard, or riding in or by means of any coaster, scooter, toy vehicle, toboggan sleigh or similar device, shall go upon a roadway except for the purpose of crossing the road, and, when so crossing, such a person shall have the rights and be subject to the obligations of a pedestrian.”

On July 15th, Toronto City Council voted to scrap the ban on street hockey. It was the right choice – this ban was an example of a law that goes too far. The purpose of the by-law was to keep kids safe and to reduce the risk of liability against a municipality if an injury occurs. These are admirable goals, but an absolute ban is not necessary. Obviously a complete ban would reduce the risk of children being hurt, but at what cost?

There are inherent risks in any activity. We don’t ban kids from playing sports, playing in parks or other activities that could cause harm. So if the concern is about kids being hurt in the act of playing road hockey that should be up to the kids and their parents to monitor – not the state.

On the issue of liability, there are already laws in place to protect a municipality. In a possible legal action against the municipality, a plaintiff would need to prove that the municipality failed to take reasonable care to keep the plaintiff safe. Unless a municipality had prior knowledge that children were playing on a street that was dangerous due to traffic or dangerous conditions, it is extremely unlikely that a municipality would be held liable for any injury to the child.

There is a better way.

“The prohibition is nothing short of stupid […] Street hockey gets kids outside and promotes a sense of community and fitness.”

– Darryl Singer, Toronto Personal Injury Lawyer

Toronto is not the only municipality that has banned street games including road hockey. Similar by-laws are in place in Montreal, Calgary and Halifax.

Kingston, Ontario allows road hockey on residential streets where the posted speed limits is 50 km/hr or less and has other guidelines set out in its Street Hockey Policy and Code of Conduct that states:

Street hockey may be played on a Local Street during daylight hours when there is good visibility. Street hockey may never be played before 9 a.m. or after 9 p.m.

Street hockey participants must:

Keep an ongoing watch for motor vehicle and bicycle traffic and must clear the street immediately of participants and equipment so that vehicles may pass safely

Remove all equipment from the street, sidewalk and boulevard as soon as the street hockey game is over and between 8 a.m. and 9 p.m.

Respect the rights of neighbours to the reasonable enjoyment of their property free from damage, inappropriate noise, or disrespectful conduct toward them or their property

The policy states that if a person breaches the Code of Conduct the person will lose the privilege of playing street hockey for 90 days.

In my view, this is a good compromise to promote safety and allow kids to continue to be active and play outside with friends. The City of Toronto and other municipalities should look to this model to once again allow road hockey and other outdoor activity. Let the kids play.

Read the Full Article on OTLA

No Interest on Litigation Loan for Injured Woman

A woman who suffered a brain injury in a car crash will not have to pay the interest on a litigation loan made by the wife of her former personal injury lawyer after the Divisional Court declared the agreement “unconscionable.”

Marta Narbutt was 17 when she hired Niagara Falls, Ont. lawyer Ashley Gnyś’ firm Sharpe Beresh Gnyś on a contingency fee agreement shortly after the 2004 accident that killed her boyfriend when their car was struck by another vehicle. According to the Divisional Court, between 2008 and 2009, Gnyś arranged three loans for his client totalling $13,500 with a company called Health Services Recovery Network.

However, Gnyś did not tell Narbutt that HSRN was owned and operated by his wife Valerie Gnyś, who, according to the firm’s web site, has worked as a paralegal there since 1986, and had done work on Narbutt’s file. Nor did he explain that Timothy Beresh, the man who talked Narbutt through the loan documentation, was actually working for both the law firm and the litigation loan company and not for her.

Narbutt switched lawyers in 2009, and settled for $306,000, but she didn’t repay the loans, so HSRN launched a court action in 2012 to get her to pay up. By June 2015, when a superior court judge granted HSRN’s motion for summary judgment, Narbutt’s bill had ballooned to $41,649, including about $28,000 in interest alone on the loans, which had an effective annual interest rate of 19.5 per cent. After losing the motion, she paid back the entire $13,500 she had originally borrowed, but continued her fight over the interest owed.

On April 29, a 2-1 majority of the Divisional Court granted Narbutt’s appeal, rescinded the loan agreement, and dismissed HSRN’s claim, expressing concern about the way the identity of the lender was concealed from Narbutt, and the lack of independent legal advice offered to her.

“I find that these agreements are unconscionable because there was an imbalance of power, the Respondent took unfair advantage of the imbalance of power and the bargain was improvident.

“Furthermore, the Appellant had every reason to believe that everyone who spoke with her about the loans was representing her interests,” wrote Ontario Superior Court Justice Julie Thorburn in the Divisional Court decision, with Justice Graeme Mew concurring.

“The Appellant dealt with the lender in the belief that the lender was independent of her lawyer, who had been instrumental in the arrangement of the loan and choice of lender. She reasonably understood her law firm as assisting her in borrowing what was for her a substantial sum of money when in fact the Respondent, Valerie Gnyś, was the lender, her lawyer was the lender’s husband and employer and Mr. Beresh, who did accident benefits work for her lawyers, was in fact acting for the lender,” they added.

In a dissent, Justice James Kent, the third member of the panel, saw no reason to interfere with the decision of the motion judge, who found the lack of disclosure around the loan agreement was “irrelevant” because Narbutt could not have got a better deal elsewhere than HSRN gave her, and had, therefore, suffered no loss.

“My client is delighted,” says Margaret Hoy, another Niagara Falls, Ont. lawyer who took over Narbutt’s personal injury case and also acted for her in the loan dispute. “She was always prepared to pay back the principal. The problem was the interest they were charging her. When you have a young vulnerable person, it’s important to get them to realize how much this kind of borrowing will actually cost them.”

In an interview, Ashley Gnyś, who represented his wife at the Divisional Court, tells Law Times they will not appeal the majority verdict. Even in the event of a victory at the Court of Appeal, he says the most likely outcome would be an order for a full trial of the matter.

“A full trial is what we were trying to avoid in the first place with the summary judgment motion. It would be a little bit like winning the battle and losing the war,” he says. “The amount of money at stake in the grand scheme of things is not such a huge amount that you would want to devote those kinds of resources to it.”

Gnyś says his wife continues to offer litigation loans, but they have adjusted their practice to respond to the concerns raised in the judgment.

“We have learned from this case and made changes,” he says. “All we can hope is to make new mistakes, and not repeat old ones.”

Darryl Singer, a Markham, Ont. personal injury lawyer, says the decision highlights the importance of disclosure by lawyers in cases where they have an interest in a litigation lender.

“I’m not aware of any lawyers who are involved to that extent in loans, but if they are, the lesson is that they need to disclose their connection to the lender, and then send the client down the street to another lawyer for independent legal advice. It’s hard at that point for them to come back later and say they didn’t understand the agreement,” Singer says.

Alison Burrison, a partner at personal injury firm McLeish Orlando LLP, says her firm views litigation loans as a last resort. She says Narbutt got a competitive interest rate, since typical annual rates are currently around 24 per cent. However, she adds that Gnyś may have got more sympathy from the judges if the law firm had explored other options apart from a litigation loan, such as an advance from the tort insurer or a personal line of credit.

“The average case takes at least three to four years, so a loan at 24 per cent compounding monthly is going to add up pretty quickly. You don’t want clients incurring that kind of rate if you can avoid it,” Burrison says. “At the same time, a litigation loan can be important for access to justice. If one side is forced into settling prematurely because they are running out of funds, that puts them in an unfair position.”

Hoy says she was stunned to find out the hidden identity behind HSRN in 2012, soon after negotiating Narbutt’s final settlement.

The revelation prompted her to file a complaint with the Law Society of Upper Canada about Ashley Gnyś’ conduct, which in turn prompted HSRN to seek costs against Hoy personally after its original success at the summary judgment motion.

However, Ontario Superior Court Justice Robert Nightingale wrote in his Sept, 30, 2015 judgment on costs that the claim was undermined by the fact that the LSUC investigation concluded that the law firm was in an actual or potential conflict of interest regarding the loan situation.

According to the Divisional Court, the law society concluded no disciplinary action was required, deeming the failures matters of “best practice.”

Read this Article on Law Times

New Accident Benefit Dispute Regime Burdens Applicants, Law firms

A new system that came into effect April 1 will see accident benefits disputes head to the Licensing Appeals Tribunal (LAT) instead of the Financial Services Commission of Ontario (FSCO) — but as Toronto personal injury lawyer Darryl Singer tells Law Times, he already has a number of key concerns with the new process.

While the system promises a speedy resolution of disputes, Law Times says it remains to be seen if it can deliver on its goal to resolve matters in a six-month time frame. Singer, principal of Singer Barristers Professional Corporation, says the fact that applicants have to pay a $100 fee at the start of the process is a problem.

“FSCO had no fee until an application for arbitration was made. Well over 50 per cent settled quickly at the mediation stage with no out-of-pocket disbursements. When the $100 was paid, the insurer had to file $3,000 to respond and engage outside counsel. It was a leverage to get a lot of files settled,” he says.

As Singer explains, at the LAT, insurers will also pay on a points system, proportional with their usage of the process.

“Under the old system, the payment came out of the reserve the adjuster had set aside for the file. I suspect it will now come out of a different pool and will not affect the adjusters. It is a global amount, not a file-by-file amount,” he says in the article.

Singer thinks that this will prove to be a burden for applicants and law firms who act on a contingency basis.

“It will weed out the firms that will take these files, especially the smaller, paralegal firms. It’s not economically feasible to take a lot of smaller files. The mechanism to fight them is not advantageous. We will end up like family law with so many self-represented parties,” he says.

The FSCO also had a 90-day timeline that worked out to an average of nine months.

“There are just too many applications for the resources. It won’t take very long for the back to break on this system,” he adds.

“Given how long it takes to get records from doctors, hospitals, and OHIP, the timeline isn’t ever able to be met in practical terms.”

Singer also says he is concerned that the new case conference may often be done by phone.

“There is a lot of leverage in face-to-face, in-person meetings. Until the adjuster and defence lawyer meet with the person, there is no human element. When they are there in person, they can see the person has injuries and that they will make a good witness. They see that they have some exposure and should settle. At the LAT, the case conference administrator has the sole discretion to decide whether our hearing is in person or a paper hearing,” he says.

Source

 

ATE insurance resolves plaintiff intimidation over trial costs

For plaintiffs who might not otherwise be able to risk an adverse costs award by going to trial, the advent of after-the-event (ATE) insurance in Ontario has levelled the playing field, Toronto personal injury lawyer Darryl Singer tells Law Times.

As the article notes, several companies in Ontario are now offering ATE insurance or indemnities that can be purchased once a case has been instigated. These products allow litigants to protect themselves from the risk of a cost order, and can also be provided as a blanket policy for a law firm that needs protection for its disbursements.

Singer explains that the importance of the product weighs in at the negotiation stage, as “cases which would not settle at mediation because the plaintiff would be intimidated by potential costs consequences now stand their ground and get the case resolved. In addition, cases that would get dropped on the eve of trial by the plaintiff can now proceed to trial.”

In a typical scenario, before companies like legal expense insurer DAS Canada and BridgePoint Indemnity Company came on the scene, Singer says the insurer, the mediator or the judge would tell clients that they might win, but if they don’t, a two-week trial could cost $100,000.

“The clients would fold like a pack of cards. This allows me as a lawyer to sit there, slap the certificate on the table, and say, ‘You don’t care if you lose and have to pay costs. Well, neither do we.’ Now the single biggest leverage they’ve got is off the table. It has taken a major weapon away from the defence side.”

Singer currently has a blanket policy that covers every personal injury file he opens.

“I pay $200 to cover up to $10,000 in disbursements with a rider that allows me to increase coverage to $50,000 without any review. If I decide that I am going to trial in a couple of weeks and the $50,000 is not enough, I can increase it to $100,000 or higher,” says Singer, who has chosen to use the indemnity product from BridgePoint.

Singer tells Law Times that he knows of firms with a higher blanket policy. “My practice has a high volume of small files. Some firms have blanket coverage of $50,000 to $60,000.”

The indemnity covers adverse costs, including defence legal fees and the plaintiff lawyers’ disbursements, but not the plaintiff lawyer’s legal fees.

Flood of special award claims unlikely to follow rare ruling

A recent Financial Services Commission of Ontario ruling to grant a special punitive award against an insurance company for its handling of a client’s application for catastrophic impairment is unlikely to open the floodgates to a rash of special award claims, Toronto personal injury lawyer Darryl Singer tells Law Times.

In Waldock v. State Farm Automobile Insurance Company, the plaintiff was helping a car stuck in a snow bank when he was struck by a vehicle that had lost control coming down a hill, the article says.

He subsequently applied for and received statutory accident benefits from State Farm, but disputes arose between the two parties about whether or not his injuries were deemed ‘catastrophic.’

In 2014, a preliminary issues hearing to determine if he was catastrophically injured ruled in favour of the plaintiff, but LawTimes reports that the arbitrator deferred the decision on hearing costs until a later date.

“When the 2014 decision was released, [Arbitrator Knox] Henry found that the insurer’s medical assessor failed to follow the accepted guidelines to determine whether a person is catastrophically impaired, and ruled the insurer based its denial of catastrophic impairment on a flawed report.”

In mid-November, the arbitrator ruled that State Farm had refused to accept his original ruling of catastrophic impairment.

“Because the insurer had ample evidence to support Waldock was in fact seriously injured and partially incapacitated by the collision, he found the company was responsible for withholding or delaying payments, and he ordered a special award of 30 per cent of the $361,520 still owing, plus accumulated interest, calculated at two per cent per month and compounded monthly starting from early July 2010. Waldock was also awarded $125,435 for his bill of costs and disbursements of $45,824,” Law Times reports.

While Singer says Waldock is not a ruling that will lead to a flood of special award claims, he tells Law Times that it is a “sound decision” that reinforces the court’s discretion in making such rare awards.

“The conduct has to be essentially so egregious; in this particular case, it should have been patently obvious to the insurer the client was catastrophically injured,” he adds.

The arbitrator ruled because the insurer decided to force the matter to arbitration, and even after the ruling on catastrophic impairment, only paid the client about a third of what was owing, Singer tells AdvocateDaily.

Litigation protection products get more elaborate

Ontario courts are in the process of considering the security and treatment of “after- the-event” legal cost indemnities and insurance. These products allow litigants to protect themselves from the risk of a cost order, giving them the security to proceed to trial. They can also be provided as a blanket policy for a law firm that needs protection for its disbursements. While still relatively new in Ontario, a view is emerging that there is a duty on lawyers to advise clients of the availability of this protection.

In the last few years, there has been some attention given to litigation cost insurance as an access to justice tool, with most products available as “before-the-event” (BTE) blanket coverage. There are now several companies in Ontario who are offering “after-the-event” (ATE) insurance or indemnities that people can purchase once a case has been instigated. Law firms can purchase it on behalf of clients and recover the cost from them later or maintain it as an expense for the benefit of the client, as a marketing exercise.

In other parts of the world, ATE insurance is a mature mainstream product, most notably in the United Kingdom. In Ontario, it has only entered the market in the last two or three years. In fact, there are two types of product — after-the-event insurance and adverse-cost indemnities.

Legal expense insurer DAS Canada offers such products and believes it has an upper hand in the embryonic market because it is a regulated insurance company, as opposed to other financial companies offering adverse-cost protection or settlement loans. “It’s a comfort knowing that insurance companies have huge requirements to have enough capital to cover all risks,” advises David Smagata, vice-president and chief legal officer of DAS Canada. His colleague, Nick Robson, manager, ATE & Special Initiatives, points out that the Trial Lawyers Association of British Columbia has placed some restrictions on the providers of settlement loans and cost-protection indemnities, and that the Ontario Trial Lawyers Association is drafting a code of conduct in relation to the use of indemnities.

With an ATE insurance policy, the policyholder is always the litigant. The firm can be delegated to accept certain risks to get standard coverage of $100,000, which can then be changed as litigation progresses. Smagata explains that it is not an intrusive product in terms of directing the litigation. “You don’t have to worry that someone’s going to come in and tell you how to run your case. It is not heavy-handed.”

Darryl Singer of Singer Barristers of Markham, Ont. has chosen to use the indemnity product from BridgePoint Indemnity Company. He has a blanket policy that covers every personal injury file he opens. “I pay $200 to cover up to $10,000 in disbursements with a rider that allows me to increase coverage to $50,000 without any review. If I decide that I am going to trial in a couple of weeks and the $50,000 is not enough, I can increase it to $100,000 or higher.” He knows of firms with a higher blanket policy. “My practice has a high volume of small files. Some firms have blanket coverage of $50,000 to $60,000.”

The indemnity covers the adverse costs, including defence legal fees and the plaintiff lawyers’ disbursements. It does not cover the plaintiff lawyer’s legal fees. John Rossos, chairman and CEO of BridgePoint, explains that because legal fees are on a contingency basis, in a downside case the court could say that you shouldn’t get a contingency fee because the lawyer has essentially borne no risk.

Rossos refers to the situation in the U.K. “In 1999, the Access to Justice Act mandated a situation that where ATE insurance, as it is known in the U.K., is purchased, a defendant had a duty to pay the premium. It then became ubiquitous in the legal community and evolved to be a standard of care. If counsel is not advising their clients that it is available, they are negligent.”

Rossos believes that a similar phenomenon is occurring here. “It is becoming the standard of care for personal injury lawyers launching a lawsuit to advise claimants of the products’ availability. If an unprotected client subsequently finds out about protection, the next question to the lawyer will be, ‘Why didn’t you advise me about it?’”

Rob Findlay, a Hamilton personal injury lawyer, agrees that there is a standard of care concern. “In our regulations, we are mandated to talk to clients about cost exposure. You’re certainly going to include this in that discussion. If it becomes routine enough in everyday practice and the client goes to trial and is hit with $100,000 costs, they may be looking for a pocket to recover from.”

Singer thinks the importance of the product weighs in at the negotiation stage. “After-the-event insurance has levelled the playing field for plaintiffs who might not otherwise be able to risk an adverse costs award by going to trial. Cases which would not settle at mediation because the plaintiff would be intimidated by potential costs consequences now stand their ground and get the case resolved. In addition, cases that would get dropped on the eve of trial by the plaintiff can now proceed to trial.”

Singer recalls that, in a typical scenario, before DAS and BridgePoint came on the scene, the insurer or the mediator or the judge would remind clients that they might win, but if they don’t, a two-week trial can cost $100,000. “The clients would fold like a pack of cards. This allows me as a lawyer to sit there, slap the certificate on the table, and say, ‘You don’t care if you lose and have to pay costs. Well, neither do we.’ Now the single biggest leverage they’ve got is off the table.
It has taken a major weapon away from the defence side.”

There are now several court decisions addressing the use of the products. Recently, a master ordered a plaintiff to purchase ATE insurance instead of paying into court, finding that the policy would provide sufficient security. There have also been several cases where a pre-existing policy has been raised as a defence to a security for costs motion, sometimes successfully and sometimes not.

The more vexed question is whether a successful plaintiff can claim the premium as a disbursement.Markovic v. Richards, rendered on Dec. 12, 2015 by the Ontario Superior Court of Justice, produced a finding that the premium paid for ATE is not payable by the insurer. James Greve of Camporese Sullivan Di Gregorio of Hamilton, Ont., who represented the insurer, says this is the first case in Canada to consider the issue, but he does not expect it to be the last. “My argument was that it is not consistent with the rules of civil procedure relating to the cost consequences of failing to accept offers to settle. It would insulate parties from that risk.”

Findlay, who represented the plaintiff, points out that the decision was not based on the representations of either party, which were minimal, and refers to the wrong product. He takes issue with the judge’s finding that the product was purchased as a voluntary option and did nothing to advance the litigation. He refers to the obligations imposed by the Automobile Insurance Rates Stability Act to try and affect resolution and encourage settlement. “How is it not consistent with that? If you have insurance, it will prolong efforts at resolution and make it more likely….”

Flood of special award claims unlikely to follow rare ruling

A recent Financial Services Commission of Ontario ruling to grant a special punitive award against an insurance company for its handling of a client’s application for catastrophic impairment is unlikely to open the floodgates to a rash of special award claims, Toronto personal injury lawyer Darryl Singer tells Law Times.

In Waldock v. State Farm Automobile Insurance Company, the plaintiff was helping a car stuck in a snow bank when he was struck by a vehicle that had lost control coming down a hill, the article says.

He subsequently applied for and received statutory accident benefits from State Farm, but disputes arose between the two parties about whether or not his injuries were deemed ‘catastrophic.’

In 2014, a preliminary issues hearing to determine if he was catastrophically injured ruled in favour of the plaintiff, but LawTimes reports that the arbitrator deferred the decision on hearing costs until a later date.

“When the 2014 decision was released, [Arbitrator Knox] Henry found that the insurer’s medical assessor failed to follow the accepted guidelines to determine whether a person is catastrophically impaired, and ruled the insurer based its denial of catastrophic impairment on a flawed report.”

In mid-November, the arbitrator ruled that State Farm had refused to accept his original ruling of catastrophic impairment.

“Because the insurer had ample evidence to support Waldock was in fact seriously injured and partially incapacitated by the collision, he found the company was responsible for withholding or delaying payments, and he ordered a special award of 30 per cent of the $361,520 still owing, plus accumulated interest, calculated at two per cent per month and compounded monthly starting from early July 2010. Waldock was also awarded $125,435 for his bill of costs and disbursements of $45,824,” Law Times reports.

While Singer says Waldock is not a ruling that will lead to a flood of special award claims, he tells Law Times that it is a “sound decision” that reinforces the court’s discretion in making such rare awards.

“The conduct has to be essentially so egregious; in this particular case, it should have been patently obvious to the insurer the client was catastrophically injured,” he adds.

The arbitrator ruled because the insurer decided to force the matter to arbitration, and even after the ruling on catastrophic impairment, only paid the client about a third of what was owing, Singer tells AdvocateDaily.