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Sloppiness Will Not Give Rise To Punitive Damages.

No Punitive Damages for Sloppiness

In the recent decision of C.P. v. RBC Life Insurance Company, the British Columbia Supreme Court declined to award punitive damages for sloppiness but did award aggravated damages for mental distress in the amount of $10,000.00.

The claimant was seeking damages for mental distress of $50,000.00 to $100,000.00 plus punitive damages of between $1.3 and $1.6 million.

The court refused to award punitive damages even though the court agreed with the Plainiff that that insurance company was “very sloppy in handling the plaintiff’s legitimate claim for residual disability.” In the case the insurance company had reinstated and paid all arrears within one year of the lawsuit being commenced. The court did however award damages for menal distress stating that:

“The defendant’s actions would reasonably be contemplated to heighten the anxiety and stress of the plaintiff beyond reasonable norms, i.e. “a degree sufficient to warrant compensation” (Fidler, para. 47).”

On the issue of sloppiness, the court stated:

[67] In argument, defendant’s counsel submitted that her client’s actions were “sloppy, very sloppy”. After hearing all of the evidence and, in particular, the testimony of Ms. Davidson and Ms. Wadhwani, I find defendant’s counsel’s description of sloppiness is apt. The evidence does not support plaintiff’s counsel’s general assertion of deft deflection and delay aligned with the defendant’s financial interests or an “egregious level of stone-walling and dishonesty”.

[68] I note that whenever a business is sloppy with a customer it may affect its business reputation with possible financial consequences. In the case at bar, in addition to this general risk, there was a specific risk that the plaintiff’s mental health could be so affected that she would need to be on full long-term disability rather than residual disability.

[69] In short, the plaintiff’s file should not have been closed and after being closed, it should, as Ms. Gauthier testified, have been reopened much earlier than it was. The defendant admits that its own AP&C procedures were not followed and that the plaintiff’s file should not have been closed without the plaintiff’s consent. The cause was the defendant’s sloppiness which in part may have flowed from Ms. Davidson’s and Ms. Wadhwani’s caseloads. As noted, Ms. Wadhwani described her caseload as a “bit overwhelming”.

[70] In my view, this explains why the plaintiff’s claim remained closed without credible grounds, the second of the plaintiff’s counsel’s outlier reasons. Sloppiness may give rise to damages for mental distress but, without more, will not give rise to punitive damages.

To award punitive damages, the court would have required much more than mere sloppiness and delay in paying of benefits.

The case can be located at


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