Lumsden v. Manitoba, (2009) 236 Man.R.(2d) 130 (CA)

• Judge: Scott, C.J.M., Freedman and MacInnes, JJ.A.
• Court: Court of Appeal (Manitoba)
• Case Date: February 17, 2009
• Jurisdiction: Manitoba
• Citations: (2009), 236 Man.R.(2d) 130 (CA);2009 MBCA 18

Lumsden v. Man. (2009), 236 Man.R.(2d) 130 (CA);

      448 W.A.C. 130

MLB headnote and full text

Temp. Cite: [2009] Man.R.(2d) TBEd. FE.034

Kevin Drew Lumsden (plaintiff/respondent) v. The Government of Manitoba (defendant/appellant)

(AI 07-30-06833; 2009 MBCA 18)

Indexed As: Lumsden v. Manitoba

Manitoba Court of Appeal

Scott, C.J.M., Freedman and MacInnes, JJ.A.

February 17, 2009.

Summary:

The plaintiff left his employment as of November 5, 2002, suffering from a constellation of medical problems, including myofascial pain, fibromyalgia, depression and Raynaud's disease. His employer, the province of Manitoba, provided long-term disability benefits managed by an insurer. On six occasions, the insurer denied the plaintiff's benefits claim on the basis that the medical evidence provided failed to support the plaintiff's claim to be totally disabled from performing his own employment or any other employment for which he was reasonably suited. The plaintiff sued the province to enforce his claim.

The Manitoba Court of Queen's Bench, in a judgment reported at (2007), 219 Man.R.(2d) 97, allowed the action. Although not totally disabled as of November 5, 2002, the plaintiff was totally disabled from performing his own occupation from January 10, 2003 to January 10, 2004, and disabled after that date to the present time from performing any occupation. Further, the court awarded the plaintiff $45,000 damages for mental distress, as the denial of his claim was unfair and caused the plaintiff compensable mental stress. The province appealed, submitting that the trial judge committed palpable and overriding error in concluding that the plaintiff was totally disabled.

The Manitoba Court of Appeal dismissed the appeal, with the limited exception of reducing damages for mental distress from $45,000 to $25,000.

Courts - Topic 583

Judges - Duties - Re reasons for decisions - [See Insurance - Topic 3570 ].

Damages - Topic 5706

Contracts - Breach of contract - Injured feelings or emotional upset - The trial judge awarded the plaintiff $45,000 damages for mental distress resulting from his disability insurer's failure to pay him the long term disability benefits to which he was entitled - It was within the reasonable contemplation of the parties at the time that the "peace of mind" contract was made that mental distress would likely flow from a failure to pay the required benefits - The court noted that over several years the insurer refused the plaintiff's claim six times - The plaintiff's marriage suffered, he lost his home because of the financial hardship and he lived out of his suitcase for two years (stayed with friends) - The plaintiff was disabled as a result of several medical disorders and depression and his difficulties were exacerbated by the multiple denials of his claim - The Manitoba Court of Appeal affirmed the entitlement to damages, but found that $45,000 was not "sensible" and "realistic" - Applying the sensible and realistic approach, and rejecting any notion that damages for mental distress were automatically to be modest in nature, the court substituted an award of $25,000 - See paragraphs 63 to 75.

Insurance - Topic 3570

Accident and sickness insurance - The contract - Interpretation of terms - Total disability - Defined - On November 5, 2002, the plaintiff left his job as a physiotherapy aide and never returned - The plaintiff suffered from a constellation of medical problems that rendered him unable to sustain regular, consistent attendance and performance at his own occupation, or any other occupation for which he was reasonably suited by experience or training - The plaintiff suffered from Raynaud's Disease, depression, chronic back pain, sleep apnea, fibromyalgia and myofascial pain - The trial judge held that the plaintiff was "totally disabled" since January 10, 2003, and continued to be totally disabled from carrying out the duties of his own occupation or any other occupation - The Manitoba Court of Appeal affirmed the decision, as the trial judge made no palpable and overriding error in his assessment of the evidence - The experienced trial judge thoroughly reviewed all of the evidence and did not ignore or overlook relevant evidence - The court rejected the argument that the reasons for judgment were inadequate - The reasons explained the result, why the plaintiff succeeded and were sufficient to provide for an informed consideration of the grounds of appeal - The court rejected the submission that the plaintiff's subjective view of his own disability, by itself, could never be sufficient to prove total disability - A subjective belief, if consistent with the surrounding circumstances, may be sufficient - In any event, the finding of total disability was not based solely on the plaintiff's subjective belief - See paragraphs 40 to 62.

Insurance - Topic 3571

Accident and sickness insurance - The contract - Interpretation of terms - Total disability - Onus of proof - The trial judge stated that "when a Long Term Disability Income Plan provides for a change in coverage from disability respecting one's own occupation to disability respecting any occupation, the effect at law is as though the insurer had issued two separate policies with two separate coverages. ...  This 'own occupation' 'any occupation' distinction requires the plaintiff to establish, on a balance of probabilities, that she or he was totally disabled under the terms of the policy from performing his or her own occupation for the initial period provided for and any occupation thereafter. In order to succeed, the plaintiff must establish that the defendant is in breach of the contract of insurance by failing to pay disability benefits. The plaintiff must therefore establish that he comes within the provisions of the Plan. In Manitoba, the onus of proof in such cases was established in Campbell v. Canada Life Assurance Co. The plaintiff must establish a prima facie case that he is disabled, following which the evidentiary onus shifts to the defendant to establish that there is some occupation for which the plaintiff is, or may become, reasonably suited by reason of education, training or experience." - The Manitoba Court of Appeal agreed with this onus of proof - See paragraphs 50 to 51.

Insurance - Topic 3688

Accident and sickness insurance - Evidence and proof - Burden of proof - Entitlement - [See Insurance - Topic 3571 ].

Cases Noticed:

Fidler v. Sun Life Assurance Co. of Canada, [2006] 2 S.C.R. 3; 350 N.R. 40; 227 B.C.A.C. 39; 374 W.A.C. 39; 2006 SCC 30, refd to. [para. 20].

Mathers v. Sun Life Assurance Co. of Canada, [1998] B.C.T.C. Uned. 275; 5 C.C.L.I.(3d) 201 (S.C.), refd to. [para. 25].

Verbong v. Great-West Life Assurance Co. et al. (2003), 171 Man.R.(2d) 161; 2003 MBQB 39, affd. (2004), 184 Man.R.(2d) 65; 318 W.A.C. 65; 2004 MBCA 40, refd to. [para. 25].

Rose v. Paul Revere Life Insurance Co. (1990), 45 C.C.L.I. 35 (B.C.S.C.), refd to. [para. 28].

Campbell v. Canada Life Assurance Co. (1990), 65 Man.R.(2d) 95 (C.A.), refd to. [para. 31].

Stutt v. Alberta (Provincial Treasurer) (1988), 92 A.R. 275; 34 C.C.L.I. 78 (Q.B.), refd to. [para. 32].

Kirkness (Committee) v. Imperial Life Assurance Co. of Canada (1993), 62 O.A.C. 114; 99 D.L.R.(4th) 391 (C.A.), refd to. [para. 36].

Cooper v. Miller (No. 1), [1994] 1 S.C.R. 359; 164 N.R. 81; 41 B.C.A.C. 1; 66 W.A.C. 1, refd to. [para. 38].

Cunningham v. Wheeler - see Cooper v. Miller (No. 1).

Saunders v. RBC Life Insurance Co. (2007), 267 Nfld. & P.E.I.R. 260; 811 A.P.R. 260; 48 C.C.L.I.(4th) 275; 2007 NLTD 104, refd to. [para. 39].

McCallum v. Manitoba (2006), 203 Man.R.(2d) 161; 2006 MBQB 114, refd to. [para. 39].

Asselstine v. Manufacturers Life Insurance Co. et al. (2005), 213 B.C.A.C. 102; 352 W.A.C. 102; 22 C.C.L.I.(4th) 169; 2005 BCCA 292, refd to. [para. 39].

Clarfield v. Crown Life Insurance Co., [2000] O.T.C. 757; 23 C.C.L.I.(3d) 266 (Sup. Ct.), refd to. [para. 39].

Fowler v. Maritime Life Insurance Co. (2002), 216 Nfld. & P.E.I.R. 132; 647 A.P.R. 132; 41 C.C.L.I.(3d) 182 (Nfld. T.D.), refd to. [para. 39].

Rowe v. Unum Life Insurance Co. of America, [2006] O.T.C. 435; 44 C.C.L.I.(4th) 303 (Sup. Ct.), refd to. [para. 39].

R. v. Sheppard (C.), [2002] 1 S.C.R. 869; 284 N.R. 342; 211 Nfld. & P.E.I.R. 50; 633 A.P.R. 50; 2002 SCC 26, refd to. [para. 40].

R. v. Walker (B.G.), [2008] 2 S.C.R. 245; 375 N.R. 228; 310 Sask.R. 305; 423 W.A.C. 305; 2008 SCC 34, refd to. [para. 40].

F.H. v. McDougall (2008), 380 N.R. 82; 260 B.C.A.C. 74; 439 W.A.C. 74; 297 D.L.R.(4th) 193; 2008 SCC 53, refd to. [para. 47].

R. v. R.E.M. (2008), 380 N.R. 47; 260 B.C.A.C. 40; 439 W.A.C. 40; 235 C.C.C.(3d) 290; 2008 SCC 51, refd to. [para. 47].

Herbert v. Manulife Financial (2002), 326 A.R. 128; 46 C.C.L.I.(3d) 54; 2002 ABQB 891, refd to. [para. 51].

Sucharov v. Paul Revere Life Insurance Co., [1983] 2 S.C.R. 541; 50 N.R. 144; 26 Man.R.(2d) 161, refd to. [para. 56].

Mathers v. Sun Life Assurance Co. of Canada (1999), 126 B.C.A.C. 141; 206 W.A.C. 141; 9 C.C.L.I.(3d) 151; 1999 BCCA 292, refd to. [para. 57].

Eddie v. Unum Life Insurance Co. of America (1999), 128 B.C.A.C. 257; 208 W.A.C. 257; 13 C.C.L.I.(3d) 1; 1999 BCCA 507, refd to. [para. 58].

Materi v. Confederation Life Insurance Co. et al. (2001), 277 A.R. 142; 242 W.A.C. 142; 26 C.C.L.I.(3d) 32; 2001 ABCA 33, refd to. [para. 60].

Keays v. Honda Canada Inc., [2008] 2 S.C.R. 362; 376 N.R. 196; 239 O.A.C. 299; 2008 SCC 39, refd to. [para. 64].

Mustapha v. Culligan of Canada Ltd., [2008] 2 S.C.R. 114; 375 N.R. 81; 238 O.A.C. 130; 2008 SCC 27, refd to. [para. 64].

Warrington v. Great-West Life Assurance Co. (1996), 81 B.C.A.C. 164; 132 W.A.C. 164; 39 C.C.L.I.(2d) 116 (C.A.), refd to. [para. 65].

McIsaac v. Sun Life Assurance Co. of Canada et al., [1997] B.C.T.C. Uned. E17; 48 C.C.L.I.(2d) 299 (S.C.), refd to. [para. 66].

Fidler v. Sun Life Assurance Co. of Canada (2004), 196 B.C.A.C. 130; 322 W.A.C. 130; 239 D.L.R.(4th) 547; 2004 BCCA 273, refd to. [para. 66].

Wharton v. Harris (Tom) Chevrolet Oldsmobile Cadillac Ltd., [2002] 3 W.W.R. 629; 163 B.C.A.C. 122; 267 W.A.C. 122; 2002 BCCA 78, refd to. [para. 66].

Mason v. Westside Cemeteries Ltd. et al. (1996), 135 D.L.R.(4th) 361 (Ont. Gen. Div.), refd to. [para. 66].

Farley v. Skinner, [2001] 4 All E.R. 801; 278 N.R. 47 (H.L.), refd to. [para. 66].

Hadley v. Baxendale (1854), 9 Exch. 341; 156 E.R. 145, refd to. [para. 67].

Vorvis v. Insurance Corp. of British Columbia, [1989] 1 S.C.R. 1085; 94 N.R. 321, refd to. [para. 67].

Chaplin v. Hicks, [1911] 2 K.B. 786 (C.A.), refd to. [para. 68].

Fink v. Fink (1946), 74 C.L.R. 127 (Aust. C.A.), refd to. [para. 68].

Leblanc et al. v. London Life Insurance Co. (1999), 102 O.T.C. 1 (Sup. Ct.), refd to. [para. 74].

Gerber v. Telus Corp. et al., [2004] 6 W.W.R. 201; 346 A.R. 386; 320 W.A.C. 386; 2004 ABCA 118, refd to. [para. 74].

Authors and Works Noticed:

Burrows, A.S., Mental Distress Damages in Contract - A Decade of Change, [1994] L.M.C.L.Q. 119, p. 133 [para. 68].

Couch on Insurance (2nd Rev. Ed. 1983), vol. 15, p. 546, para. 53:118 [para. 56].

Enonchong, Nelson, Breach of Contract and Damages for Mental Distress (1996), 16 Oxford J. Legal Stud. 617, p. 629 [para. 68].

Norwood, David, and Weir, John P., Life Insurance Law in Canada (3rd Ed. 2002), pp. 378 [para. 54]; 476 [para. 51].

Counsel:

W.G. McFetridge and B.T. Jones, for the appellant;

N.A. Cuddy, for the respondent.

This appeal was heard on September 25, 2008, before Scott, C.J.M., Freedman and MacInnes, JJ.A., of the Manitoba Court of Appeal.

On February 17, 2009, Scott, C.J.M., delivered the following judgment for the Court of Appeal.