Supreme Court renders decision in Fidler v. Sun Life

Connie Fidler v. Sun Life Assurance Company of Canada

Case number: 30464

The financial outcome: The $20,000 award of the lower court for mental distress endured over five years of disruption to Fidler's insurance was maintained, but the $100,000 punitive damages award was set aside.

"I'm thrilled with what the Supreme Court of Canada did in terms of clarifying the law on damages for mental distress. I think the decision is very significant in holding that in disability cases, mental distress arising from breach of contract alone will be recognized and will attract compensation. Importantly, no limit was set on the amount of compensation.

The court's approach to punitive damages showed a heavy reliance on the trial judge's findings. The legal standard remains on a sound footing - the insurer must "assess the merits of the claim in a balanced and reasonable manner. It must not deny coverage or delay payment in order to take advantage of the insured's economic vulnerability... A decision to refuse payment should be based on a reasonable interpretation of its obligations under the policy." The case leaves open a claim for punitive damages where these requirements have been seriously violated. "

Faith E. Hayman
Trial & Appellate Lawyer
Emailed comment to FM-CFS Canada

"The five-year denial by Sun Life of disability benefits without medical support for denial is, to say the least, inappropriate," Chief Justice Beverley McLachlin and Madam Justice Rosalie Abella wrote for an 8-0 majority.

"Supreme Court says it was ‘extremely troubling' that Sun Life lacked medical evidence in its claims that she was faking symptoms."

"The Court's reasoning removed a legal hurdle plaintiffs face in bearing out a claim of mental distress, making it easier to successfully sue in future breach of contract cases."
Source: Globe and Mail, 30, June, 2006

The June 29th Decision:
http://scc.lexum.umontreal.ca/en/2006/2006scc30/2006scc30.html

Comment
FM-CFS Canada attended the Supreme Court hearing to observe. Sun Life had considerably more lawyers in attendance, with two volunteer lawyers serving Connie Fidler: Faith Hayman and Joseph J. Arvay, Q.C..