Whiten v. Pilot Insurance Co.

Whiten v. Pilot Insurance Co.

A breach of an insurer’s contractual duty of good faith is an independent actionable wrong for purposes of punitive damages in exceptional cases; on the facts Pilot’s persistent, planned and exploitative bad faith conduct toward a vulnerable insured rationally warranted punitive damages and the jury’s $1,000,000 award was within the high end of a reasonable range and therefore restored.

Citation
2002 SCC 18
Parties
Appellant/respondent on Cross Appeal: Daphne Whiten; Respondent/appellant on Cross Appeal: Pilot Insurance Company; Intervener: Insurance Council of Canada; Intervener: Ontario Trial Lawyers Association
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
22 February 2002
Procedural Posture
Appeal Civil (insurance/tort) / Final Judgment of the Supreme Court of Canada on Appeal From Ontario Court of Appeal
Outcome
Appeal allowed; jury award of $1,000,000 in punitive damages restored; respondent's cross‑appeal dismissed
Legal Topics
Punitive Damages, Bad Faith Insurance Practices, Duty of Good Faith and Fair Dealing, Jury Instructions on Damages, Quantum and Proportionality of Punitive Awards
Source Language
English
Insurance Torts Contract Civil Procedure Damages Punitive Damages Bad Faith Insurance Practices Duty of Good Faith and Fair Dealing +2 more

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Parties

Daphne Whiten

Appellant/respondent on Cross Appeal

Pilot Insurance Company

Respondent/appellant on Cross Appeal

Insurance Council of Canada

Intervener

Ontario Trial Lawyers Association

Intervener

Procedural Posture

Appeal Civil (insurance/tort) / Final Judgment of the Supreme Court of Canada on Appeal From Ontario Court of Appeal

Legal Issues

  1. 1 Whether punitive damages are available for insurer bad faith in a contract action
  2. 2 Whether breach of an insurer’s duty of good faith constitutes an independent actionable wrong under Vorvis
  3. 3 Whether the plaintiff’s pleading was sufficient to support a punitive damages claim

Ratio Decidendi

A breach of an insurer’s contractual duty of good faith is an independent actionable wrong for purposes of punitive damages in exceptional cases; on the facts Pilot’s persistent, planned and exploitative bad faith conduct toward a vulnerable insured rationally warranted punitive damages and the jury’s $1,000,000 award was within the high end of a reasonable range and therefore restored.

Court Disposition

Appeal allowed; jury award of $1,000,000 in punitive damages restored; respondent's cross‑appeal dismissed

Orders

  • Restore jury award of $1,000,000 in punitive damages to the appellant
  • Dismiss respondent Pilot Insurance Company’s cross‑appeal against the award of punitive damages