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LAW TIMES 12 COVERING ONTARIO'S LEGAL SCENE | APRIL 8, 2019 www.lawtimesnews.com "Some cases are inherently complex, and it gets difficult to keep things moving in the sim- plified procedure," he says. "Because there are no case management masters or judges involved, it's left to counsel to move things along, but things tend to get set aside and the whole process slows down. "A bit more case manage- ment involvement from the court could be helpful for more complex cases, regardless of the amount," Wallrap adds. In addition, he says, the sim- plified procedure would benefit from a stricter application of the cost consequences baked into the process. Under Rule 76.13, plaintiffs who launch an action under the normal procedure but are awarded an amount within the jurisdiction of the simplified procedure are supposed to be barred from recovering costs unless they can show the choice to proceed under the regular procedure was a reasonable one. "I'm not sure courts have gone that far," Wallrap says. "But if they start imposing those costs consequences, people will be more inclined to use the simpli- fied procedure, and it will help to reduce the backlog." LT Insurers put in 'difficult position' to resolve the claim, and Gray's decision says industry filings showed it had closed the file by mid-September, indicating nothing was owed on the claim. Subsequently, the insurer sought examinations under oath by Demetriou, his father and his wife — despite her ad- mitted total lack of knowledge of the theft — all before finally informing the insured of the claim's denial, on the basis that there was "insufficient in- formation to substantiate the claim," in February 2016. Demetriou launched his ac- tion soon after, and following the delivery of pleadings, filed a request for particulars designed to elicit the extent to which AIG would be relying on allegations of fraud. In response, the in- surer confirmed that it did not intend to rely on the exclusions for intentional or dishonest acts by the insured but reserved its right to do so if further infor- mation revealed itself. By the time the summary judgment motion reached a hearing, the insurer resisted the claim on the basis that Deme- triou had not proven that the theft had occurred at all and that he had failed to co-operate with the insurer's investiga- tion in the investigation of the claim. If that required the firm to plead fraud, the insurer's counsel argued that it should be allowed to amend its pleadings accordingly. But Gray found it was "much too late" for that. "In these circumstances, it is not now open to AIG to con- duct the case as if it had actu- ally made an allegation of fraud when it specifically disclaimed such a position," Gray wrote. "The only remaining ques- tion is whether the plaintiff has failed to sufficiently cooperate or provide sufficient informa- tion and documentation. Based on the entire record, I am per- suaded that Mr. Demetriou has complied with his obligations." According to Kyle Magee, a senior associate with global insurance law boutique Clyde and Co., the judge's ruling puts insurers in a difficult position by forcing them to come out with allegations of fraud and their reliance on exclusions for dishonest or intentional acts by the insured at an earlier stage in proceedings. "It introduces a bit of murk- iness to the case law," he says. As Magee explains, insur- ers have typically adopted a more circumspect stance on fraud allegations since the Supreme Court's Whiten de- cision, for fear of attracting a "bad faith" claim from plain- tiffs that could result in the award of punitive damages in the event a court ultimately rules against the defendant. "They're usually reluctant to allege fraud unless it's a slam dunk case, but most cas- es aren't," he says. "But in this case, the strategy appears to have backfired to some extent because the judge is critical of the way the insurer tried to hedge its bets and awards pu- nitive damages anyway." LT FOCUS Will 'reduce backlog' Continued from page 10 Continued from page 11 Kyle Magee says insurers have typically adopted a more circumspect stance on fraud allegations since the Supreme Court's Whiten decision. CanadianLawyerMag.com Fresh Canadian legal news and analysis available on any device. Get More Online © 2019 Thomson Reuters Canada Limited 00256ME-95197-NP Find fast answers on tort law issues and practice Available risk-free for 30 days Online: store.thomsonreuters.ca | Call Toll-Free: 1-800-387-5164 In Toronto: 416-609-3800 Order # L7798-8909-65203 $116 Softcover February 2019 approx. 160 pages 978-0-7798-8909-9 Shipping and handling are extra. 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