Manulife to pay accidental death benefits and double costs.

On March 19, 2002, the Alberta Court of Queen’s Bench ordered Manulife to pay benefits under an accidental death policy, and to pay double costs to the plaintiff in McCoy v Manulife, 2002 ABQB 298.

The plaintiff’s brother, Ward McCoy, was covered through his employment by a policy of life insurance and accidental death insurance provided by Manufacturers Life Insurance Company. The plaintiff, Keith McCoy, was the beneficiary of the policy.

The brother died on the 23rd of June, 1997. He had been drinking over a three-day period. Twelve hours after he stopped drinking he suffered cardiac arrest. Although resuscitated he developed brain death and was removed from life support on June 23rd. The autopsy report states that no ethanol was found in his blood at admission to hospital. The medical examiner gave the opinion that it was more likely than not that he died of acute ethanol withdrawal.

A claim was submitted under the policy of insurance. The life insurance portion was paid out on August 27th within five days of receipt of the claim but the Defendant denied liability on the accidental death benefit portion of the claim.

In concise reasons for judgment, the Court held:

[8] While the holistic approach would benefit the Plaintiff it is not necessary to consider it. The wording of the policy in this case clearly puts the case into the category of accidental result as opposed to accidental cause. The death in this situation was an accidental result of the deceased’s activities. The death was unexpected or unforeseen.

[9] The Defendant could easily have used different wording in the policy if the Defendant had wanted a different result. The cases distinguishing the two types of wording have been in existence for some time.

[10] There is no evidence that the coverage is excluded under the provisions that set out those losses not covered. In particular, the defendant has no basis to argue that the injury was self inflicted. The Defendant could have clearly excluded the situation found in this case when drafting its policy.

[11] Therefore, the Defendant is liable to the Plaintiff under the policy for a payment for the accidental death benefit in the amount of $70,000.00. The Plaintiff is also entitled to interest pursuant to the rates under the Judgment Interest Act in force from time to time from the date of the first denial of coverage.

[12] The Plaintiff has also requested punitive damages. While an insurer has a duty of good faith and fair dealing, the conduct of the Defendant was not such that punitive damages should be awarded. The basic claim was paid within five days of receipt. Although the pleadings might concern those without legal experience in civil cases, they were not unusual and no allegations of fraud were raised. There was some unreasonable delay but nothing that offends the court’s sense of decency and that cannot be compensated by extra costs.

[13] The Plaintiff is entitled to costs throughout on double column 2 of schedule C. The conduct of Defendant’s counsel does not call for solicitor and client costs.

Manulife was represented by in-house counsel, Blair Anderson. Although the plaintiff raised questions about Mr. Anderson’s conduct, solicitor and client costs were not ordered. A few years later Mr. Anderson was a witness in a case against Manulife which went to the Ontario Court of Appeal. The OCA discussed Mr. Anderson’s conduct at paragraph 46 of: Manulife v Ward, 2007 ONCA 881.