The Court awarded costs against the insureds on a substantial indemnity basis. The Court also held that the Ministry, which had withdrawn its subrogated claim during trial just before the Defendants opened their case, was not jointly and severally liable for costs.

DiBattista v. Wawanesa Mutual Insurance Co., [2005] O.J. No. 4865, Ontario Superior Court of Justice

The insureds sued the defendants, which included Wawanesa Mutual Insurance Company (“Wawanesa”), for personal injuries arising from the alleged incomplete or negligent restoration of the insureds’ home. The insureds’ claim included a claim by the Ministry of Health and Long-Term Care (the “Ministry”), on a subrogated basis, for the cost of insured services received by the insureds. The Ministry’s claim was withdrawn just prior to the Defendants’ openings at trial.

After approximately 70 days of trial, the jury found no liability on the part of the defendants and further assessed the insureds’ damages at zero.

The Court held that the defendants were entitled to costs on a substantial indemnity basis. With respect to Wawanesa, the Court noted that the insureds claims against Wawanesa included allegations that Wawanesa’s claims handling tactics had been dilatory, high-handed and callous, that Wawanesa had spuriously delayed and denied the insureds’ claims. The Court further noted that the insureds alleged that Wawanesa had been dishonest and not forthright. The insureds had also disseminated their allegations against Wawanesa through the Toronto Star and by television. Wawanesa was awarded costs in the amount of $564,998.73.

The Court held that the Ministry was not jointly and severally liable for costs. Section 39(6) of Regulation 552 of the Health Insurance Act did not apply. There was no indication that the Ministry was active in the proceeding. The subrogated claims occupied very little trial time. The Ministry did not take any steps to prolong the dispute and did not complicate the proceeding.

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