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July 21, 2015
On July 16, 2015, the New Brunswick Court of Appeal ordered an insurer to produce a significant amount of its financial and business information to a plaintiff in a first party claim involving bad faith and punitive damages. The decision may impact how insurers – particularly automobile and disability insurers – defend claims of bad faith.
THE DECISION
In Wade v. Wawanesa Ins. Co., 2015 NBCA 43, Ms. Wade sued her insurer for loss of income benefits under NB’s standard automobile policy. Her claim also included fairly boiler plate allegations that the insurer had acted in bad faith and that Ms. Wade was entitled to punitive damages. The insurer subsequently admitted it was liable to pay benefits to Ms. Wade, but the amount of the benefit was in dispute.
In the insurer’s view, there wasn’t any factual support for any of the bad faith allegations. In fact, Ms. Wade’s counsel admitted at oral discovery that the bad faith claim was based largely on her counsel’s own interactions with the insurer and “suspicion” and “innuendo” among the plaintiffs’ bar. Ms. Wade also couldn’t articulate how she herself had been treated other than in good faith. Nevertheless, by way of a motion, Ms. Wade sought production of the following documents or information on the basis that they were relevant to the issues of bad faith and punitive damages:
The NB Court of Queen’s Bench decided the insurer had to produce this information and the NB Court of Appeal agreed.
Read the NB Court of Appeal’s decision in Wade v. Wawanesa Ins. Co., 2015 NBCA 43. Read the NB Court of Queen’s Bench decision in 2014 NBQB 96 (unreported) (PDF).
4 KEY IMPLICATIONS
Here are 4 key implications of the NB Court of Appeal’s decision on how insurers might defend bad faith claims in NB:
Please contact your McInnes Cooper lawyer or any member of our McInnes Cooper Insurance Defence Team to discuss this topic or any other legal issue.
McInnes Cooper has prepared this document for information only; it is not intended to be legal advice. You should consult McInnes Cooper about your unique circumstances before acting on this information. McInnes Cooper excludes all liability for anything contained in this document and any use you make of it.
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