Poulain v. Iannetti, 2015 NSSC 181

• Judge: Rosinski, J.
• Court: Supreme Court of Nova Scotia (Canada)
• Case Date: June 26, 2015
• Jurisdiction: Nova Scotia
• Citations: 2015 NSSC 181;(2015), 362 N.S.R.(2d) 225 (SC)

Poulain v. Iannetti (2015), 362 N.S.R.(2d) 225 (SC);

    1142 A.P.R. 225

MLB headnote and full text

Temp. Cite: [2015] N.S.R.(2d) TBEd. JN.043

George Poulain (plaintiff) v. David J. Iannetti (defendant)

(Hfx. No. 288814; 2015 NSSC 181)

Indexed As: Poulain v. Iannetti

Nova Scotia Supreme Court

Rosinski, J.

June 26, 2015.

Summary:

The plaintiff was injured in a 2001 motor vehicle accident for which liability was admitted. For the first two years, the plaintiff was entitled to Section B loss of income benefits of $140 per week because he was substantially unable to perform the duties of his "own occupation". After two years, the plaintiff would be entitled to indefinite loss of income benefits only if he were unable to perform the duties of "any occupation" for which he was reasonably suited by education, training or experience. The plaintiff retained the defendant lawyer to represent him on the motor vehicle claim. There was no written retainer, but the plaintiff argued that the lawyer was to handle all aspects of the claim. The lawyer argued that he was retained only for the Section A component. The insurer offered to settle the Section B claim for the full Section B benefits (including loss of income) over the two year "own occupation" period. After consulting with the lawyer, the plaintiff accepted the offer, thereby waiving any claim under the insurance policy to loss of income benefits for "any occupation" after the two years expired. The plaintiff, who remained unemployed, retained new counsel and sued the lawyer in contract and negligence for the loss of future Section B benefits. The plaintiff argued that he was given deficient legal advice before accepting the settlement offer, where the lawyer failed to advise him that he would be waiving any future claim to Section B benefits that he might be entitled to if he remained disabled from "any occupation" employment after the initial two year "own occupation" period expired.

The Nova Scotia Supreme Court held that while the lawyer was not retained to deal with Section B benefits, he was negligent in the advice he gave when asked about the Section B settlement. The lawyer had a duty to either advise the plaintiff to obtain legal advice on the issue from someone else or, if he chose to advise the plaintiff, he had a duty to obtain the necessary information and advise the plaintiff of the potential negative effects of accepting the settlement and waiving any future claim to Section B benefits. The court assessed damages accordingly.

Barristers and Solicitors - Topic 2587

Negligence - Particular negligent acts - Settlements - [See Barristers and Solicitors - Topic 2594 ].

Barristers and Solicitors - Topic 2594

Negligence - Particular negligent acts - Failure to inform or advise client - The plaintiff was injured in a 2001 accident - His insurance provided "own occupation" Section B benefits for loss of income for two years and, thereafter, loss of income benefits if the plaintiff was unable to perform the duties of "any occupation" for which he was reasonably suited by education, training or experience - When the insurer offered to settle the Section B claim by paying the full benefits for the two year period, the plaintiff asked the lawyer retained to deal with the Section A claim for advice - The insurer mistakenly led the plaintiff to believe that there was no possibility of benefits after year two expired - The plaintiff accepted the settlement offer and released the insurer from any future Section B benefits claim - The plaintiff sued the lawyer in contract and tort for giving him negligent advice - The Nova Scotia Supreme Court found the lawyer negligent - Expert evidence was not necessary to determine negligence and a lawyer's regulatory body's code of conduct or ethics was relevant to evaluating whether a lawyer failed to meet the required standard of care - The lawyer was retained to deal only with the Section A claim - Although the lawyer could have declined to advise the plaintiff on the Section B settlement offer and told him to seek independent legal advice, having chosen to advise the plaintiff on the settlement he could not do so negligently - It was negligent not to advise the plaintiff that if he settled Section B benefits and waived further claims, he could not claim future Section B "any occupation" benefits even if he would have been entitled to them - It was also negligent not to advise that the Section A insurer could claim that any future Section B benefits that the plaintiff waived, but would have been entitled to, would be offset against his claim for lost wages in the Section A claim - The lawyer's failure to properly advise the plaintiff constituted a marked departure from the conduct expected from a reasonably competent lawyer - See paragraphs 40 to 96.

Barristers and Solicitors - Topic 2663

Negligence - Damages - Measure of (incl. nominal damages) - The plaintiff, injured in a 2001 motor vehicle accident, accepted the insurer's offer to settle Section B benefits (including loss of income) - The plaintiff would receive "own occupation" benefits for the full two years, but waive any future entitlement to benefits if he remained disabled from undertaking "any occupation" for which he was suitable - The plaintiff's lawyer had negligently failed to advise the plaintiff on the negative effects of such a decision on future entitlement - At issue in this "trial within a trial" was damages - The Nova Scotia Supreme Court held that the plaintiff would have been entitled to "any occupation" Section B benefits upon termination of the two years of "own occupation" benefits - Loss of income benefits would have continued until the plaintiff's actuarially estimated death at age 84 (2035) - From that amount had to be deducted the CPP disability benefits received ($725 per month since 2002) - The court chose a discount rate of 2.5% - Nominal damages of $1,000 were awarded for the loss suffered by the plaintiff in arguably agreeing to a less provident Section A settlement due to the negligent advice in settling the Section B claim - See paragraphs 97 to 169.

Barristers and Solicitors - Topic 2676

Negligence - Damages - Re failure to inform - [See Barristers and Solicitors - Topic 2663 ].

Barristers and Solicitors - Topic 2679

Negligence - Damages - Loss of income - [See Barristers and Solicitors - Topic 2663 ].

Barristers and Solicitors - Topic 2965

Negligence - Evidence and proof - Expert evidence - [See Barristers and Solicitors - Topic 2594 ].

Damages - Topic 1761

Deductions for payments or assistance by third parties - By statute or government - Canada Pension Plan (incl. disability benefits) - [See Barristers and Solicitors - Topic 2663 ].

Cases Noticed:

Rondel v. Worsley, [1967] 3 All E.R. 993 (H.L.), refd to. [para. 2].

Wade v. Ball (1870), 20 U.C.C.P. 302 (C.A.), refd to. [para. 2].

Central Trust Co. v. Rafuse and Cordon, [1986] 2 S.C.R. 147; 69 N.R. 321; 75 N.S.R.(2d) 109; 186 A.P.R. 109, refd to. [para. 15].

Lacelles v. Rizzetto (1996), 158 N.S.R.(2d) 336; 466 A.P.R. 336 (S.C.), refd to. [para. 25].

Jeffrie v. Hendriksen (2015), 360 N.S.R.(2d) 65; 1135 A.P.R. 65; 2015 NSCA 49, refd to. [para. 30].

Queen (D.J.) v. Cognos Inc., [1993] 1 S.C.R. 87; 147 N.R. 169; 60 O.A.C. 1, refd to. [para. 41].

Fellowes, McNeil v. Kansa General International Insurance Co. et al. (2000), 138 O.A.C. 28 (C.A.), refd to. [para. 44].

Malton v. Attia et al. (2013), 573 A.R. 200; 2013 ABQB 642, refd to. [para. 50].

MacDonald v. Spears (2006), 240 N.S.R.(2d) 294; 763 A.P.R. 294; 2006 NSSC 31, refd to. [para. 53].

R. v. Clarke (B.E.) (2012), 323 N.S.R.(2d) 288; 1025 A.P.R. 288; 2012 NSSC 406, refd to. [para. 53].

Brogan et al. v. Bank of Montreal et al. (2013), 331 N.S.R.(2d) 169; 1051 A.P.R. 169; 2013 NSSC 76, refd to. [para. 53].

R. v. Hobbs (K.P.) (2009), 282 N.S.R.(2d) 14; 895 A.P.R. 14; 2009 NSCA 90, refd to. [para. 53].

Stewart McKelvey Stirling Scales v. Nova Scotia Barristers' Society et al. (2005), 238 N.S.R.(2d) 293; 757 A.P.R. 293; 2005 NSCA 149, refd to. [para. 53].

Lienaux v. Nova Scotia Barristers' Society (2009), 274 N.S.R.(2d) 235; 874 A.P.R. 235; 2009 NSCA 11, refd to. [para. 53].

Cunningham v. Lilles et al. (2010), 399 N.R. 326; 283 B.C.A.C. 280; 480 W.A.C. 280; 2010 SCC 10, refd to. [para. 61].

Wallace v. Canadian Pacific Railway et al. (2013), 446 N.R. 1; 423 Sask.R. 1; 588 W.A.C. 1; 2013 SCC 39, refd to. [para. 61].

Canadian National Railway Co. v. McKercher LLP - see Wallace v. Canadian Pacific Railway et al.

Rice v. Condran (2012), 314 N.S.R.(2d) 226; 994 A.P.R. 226; 2012 NSSC 95, refd to. [para. 63].

Russell v. Goswell (2013), 337 N.S.R.(2d) 351; 1067 A.P.R. 351; 2013 NSSC 383, refd to. [para. 97].

Adeshina v. Litwiniuk & Co. et al. (2010), 483 A.R. 81; 2010 ABQB 80, refd to. [para. 98].

Hollett v. Yeager (2014), 346 N.S.R.(2d) 275; 1095 A.P.R. 275; 2014 NSSC 207, refd to. [para. 105].

Logan v. Pafco Insurance Co. (2000), 184 N.S.R.(2d) 184; 573 A.P.R. 184; 2000 NSCA 58, refd to. [para. 105].

Rose v. Mitton (1994), 128 N.S.R.(2d) 99; 359 A.P.R. 99 (C.A.), leave to appeal dismissed (1984), 178 N.R. 392; 136 N.S.R.(2d) 80; 359 A.P.R. 80 (S.C.C.), refd to. [para. 108].

Paese v. United States Fidelity & Guaranty Co. (1985), 54 O.R.(2d) 43 (Dist. Ct.), refd to. [para. 139].

Dugas-Mattattal v. General Accident Assurance Co. of Canada (1994), 128 N.S.R.(2d) 1; 359 A.P.R. 1 (S.C.), affd. (1994), 132 N.S.R.(2d) 379; 376 A.P.R. 379 (C.A.), refd to. [para. 139].

Kirk v. Singh (1994), 135 N.S.R.(2d) 34; 386 A.P.R. 34 (C.A.), refd to. [para. 141].

Dillon v. Kelly (1996), 150 N.S.R.(2d) 102; 436 A.P.R. 102; 1996 NSCA 79, refd to. [para. 141].

Humphrey v. Portage La Prairie Mutual Insurance Co. (2009), 277 N.S.R.(2d) 39; 882 A.P.R. 39; 2009 NSSC 153, refd to. [para. 141].

Fraser v. Hunter Estate (2000), 184 N.S.R.(2d) 217; 573 A.P.R. 217; 2000 NSCA 63, refd to. [para. 141].

Sabean et al. v. Portage LaPrairie Mutual Insurance Co. (2015), 359 N.S.R.(2d) 392; 1133 A.P.R. 392; 2015 NSCA 53, refd to. [para. 141].

MacPhail v. Desrosiers et al. (1998), 170 N.S.R.(2d) 145; 515 A.P.R. 145 (C.A.), refd to. [para. 157].

Campbell-MacIsaac et al. v. Deveaux et al. (2004), 224 N.S.R.(2d) 315; 708 A.P.R. 315; 2004 NSCA 87, refd to. [para. 158].

Salman v. Al-Sheikh Ali et al. (2010), 299 N.S.R.(2d) 15; 947 A.P.R. 15; 2010 NSSC 450, refd to. [para. 164].

Authors and Works Noticed:

Franks, Aaron, A Brief History of Barristers' Liability (2012), 30 Advocates' J. No. 4, pp. 11 to 15 [para. 2].

MacGregor, H., MacGregor on Damages (17th Ed. 2003), p. 362 [para. 164].

Counsel:

Janus Siebrits, for the plaintiff;

Ralph W. Ripley, for the defendant.

This action was heard on January 5-7, 2015, at Halifax, N.S., before Rosinski, J., of the Nova Scotia Supreme Court, who delivered the following judgment on June 26, 2015.