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Ontario court upholds $1.5 million punitive damages award for worker denied LTD after stroke

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January 9, 2024
By Talent Canada

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The Ontario Court of Appeal has upheld punitive damages of $1.5 million against Blue Cross in a dispute over long-term disability (LTD) payments, according to law firm Thomson Rogers.

It said the amount, awarded by a jury in Toronto in Baker v. Blue Cross Life Insurance Company of Canada, is the “largest known” punitive damages ever awarded in an LTD case in Canada.

“The Court’s endorsement underscores the significance of holding insurance companies accountable for their actions,” said Stephen Birman, lawyer from Thomson Rogers who, along with Robert M. Ben and Lucy Jackson, represented Sara Baker, the plaintiff, at trial. “It sends a clear message that misconduct by an insurance company will not be tolerated.”

Worker suffered stroke

In 2013, Baker suffered a brain bleed/stroke and was denied LTD benefits after Blue Cross determined she could return to work in an alternate occupation that would pay her at least 60% of her pre-disability earnings, despite that her doctors stated otherwise.


“At trial, she was awarded an unprecedented amount in punitive damages because of the insurer’s misconduct in handling the LTD claim,” the law firm said in a press release.

“I’m just grateful this is behind me now,” said Baker, “and that the court recognized it wasn’t right for me to be treated this way.”

‘Reckless indifference’

The Court of Appeal found the insurance company “…at best, shows reckless indifference to its duty to consider the respondent’s claim in good faith…and at worst, demonstrates a deliberate strategy to wrongfully deny her benefits, regardless of the evidence that demonstrated an entitlement,” according to Thomson Rogers.

Emphasizing the severity of the situation, the Court of Appeal observed that “it is difficult to envision how an award of anything less than $1.5 million would even garner the attention of senior executives let alone deter future misconduct.”

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