The Saskatchewan Court of Appeal released its decision in the monumental case of Branco v. American Home Assurance Company et al., 2015 SKCA 71, on June 19, 2015. At trial, the Saskatchewan Court of Queen’s Bench awarded Mr. Branco $4.5 million in punitive damages and $450,000 in aggravated damages as a result of a disability insurance claim and allegations of bad faith against the workers compensation and long-term disability insurers. The Trial Judge also found Mr. Branco’s employer responsible for paying medical, dental, and vision benefits. On appeal, the Saskatchewan Court of Appeal upheld the findings of aggravated and punitive damages against the insurers, but drastically reduced the quantum of damages awarded. The Court of Appeal found the punitive damages awards were “unwarrantedly high” and reduced them from $1.5 million and $3 million to $175,000 and $500,000, respectively. The Court of Appeal noted in particular that the $3 million punitive damages award against the long-term disability insurer was so “dramatically high as to be irrational”. Similarly, the Court of Appeal found the aggravated damages awards of $150,000 and $300,000 were “too extravagant to be sustained” and reduced the same to $15,000 and $30,000, respectively. The Court specifically noted the global aggravated damages award “far exceeds the much more modest awards which have been made to other insured who have suffered extended periods of financial insecurity with similar-type consequences to those experienced by Mr. Branco.” The employer was also partially successful on appeal with respect to a change in the medical benefits to be paid, and, additionally, the costs award was significantly reduced as the Court noted there was no basis for an enhanced costs award against the employer.

About the author: Brittnee is an associate in the Regina office where she has specific interests in insurance law, health law, civil litigation, administrative law, labour and employment law, and professional discipline.

About McKercher LLP: McKercher LLP is one of Saskatchewan’s oldest, largest law firms with offices in Saskatoon and Regina. Our deep roots and client-first philosophy have made us a top ranked firm by Canadian Lawyer magazine (2011, 2013). Expertise, experience and capacity provide innovative solutions for our clients’ diverse legal issues and complex business transactions. This post is for information purposes only and should not be taken as legal opinions on any specific facts or circumstances. Counsel should be consulted concerning your own situation and any specific legal questions you may have.