Punitive damage awards are commonplace in sexual abuse claims. However, theOntario Court of Appeal has recently confirmed that a trier of fact cannot award punitivedamages against a defendant based solely on that defendant’s failure to admit liability ina timely fashion.
In McCabe v. The Roman Catholic Episcopal Corporation for the Diocese of Toronto, the majority of the Court of Appeal overturned a jury’s award of$15,000.00 for punitive damages against the Diocese of Toronto. The award was basedsolely on the failure to admit vicarious liability for historical sexual abuse, committed byone of its priest, until the first day of trial.
The Diocese of Toronto had employed Father Alphonse Robert as a Parish Priest. In1963, Father Robert invited Robert McCabe, who at the time was 11 years old, on a tripto Montreal to visit the Basilica of Notre Dame. During that trip the two spent the nighttogether in a hotel room and Father Robert sexually assaulted McCabe by fondlinghim sexually and performing oral sex on him.
McCabe brought an action for damages against the Diocese of Toronto inDecember of 2014. By then, Father Robert was deceased.
The Diocese denied vicarious liability for the abuse throughout the litigation, but thenadmitted liability on the first day of the trial. The trial therefore proceeded as anassessment of damages only. Following the evidence and after hearing the chargefrom the trial Judge, the jury awarded general and aggravated damages of $250,000,loss of income of $280,000, treatment expenses of $5,000 and punitive damagesof $15,000. The Diocese appealed on various grounds.
The Court of Appeal was unanimous in rejecting three of the four grounds of appeal. Ofsignificance, the court confirmed that the award of $250,000 in general damageswas well within the reasonable range for serious sexual assault, noting the court’srecent statements from Zando v. Ali (2018 ONCA 680), where a range of up to$290,000 can be appropriate in sexual assault cases.
The court was split however on the issue of punitive damages. Benotto, J.A. wouldhave dismissed this ground of appeal as well finding that the Diocese’s strategicdecision not to admit responsibility to a vulnerable victim of abuse, given the circumstances, was uniquely egregious and was deserving of condemnation. For thisfinding, Benotto, J.A relied on a number of decisions where punitive damages wereawarded due to the conduct of the litigation, where that conduct was egregious enoughto be considered an independent actionable wrong.
Benotto, J.A relied on evidence from McCabe’s expert psychologist, who hadexplained during the trial that the trauma suffered by McCabe was made worse bythe fact that liability was denied and by the fact that he would have to prove that theevents of the sexual assault occurred. In that doctor’s opinion, this re-victimized McCabe and caused him to be fragile, stressed and anxious.
Roberts, J.A., for the majority, disagreed on the issue of punitive damages. Themajority found that the trial Judge had erred in leaving the issue of punitive damages tothe jury for determination, as neither the pleadings nor the facts in the case supportedsuch an award. The majority found that in essence, the trial Judge had created “a newand unprecedented category of punitive damages arising out of the timing of theappellant’s admission of liability.” There was no basis in law for such an award.
Roberts, J.A. noted that in all of the cases relied on by Benotto, J.A., there were findingsthat the misconduct in the litigation was a continuation of the misconduct which gaverise to, and was the subject of, the action in the first place.
Here however, the Diocese did not deliberately inflict pain on the respondent (nor did itabuse him). The delay in the admitting of liability, alone, could not be characterized asegregious misconduct justifying an award of punitive damages. The Diocese of Torontowas perfectly entitled to not admit liability until the opening of the trial:
"Punitive damages cannot be awarded solely for the failure or delay ofa defendant to admit liability. To create such a category of punitivedamages would completely undermine the foundation of the litigationprocess. A defendant is under no obligation to admit liability and,subject to attracting the elevated costs consequences I refer tobelow, may put the plaintiff to the strict proof of his or herallegations, no matter how painful the litigation process proves to befor the plaintiff, without fear of invoking a punitive damage award.Unfortunately, that is the nature of the litigation process."
Further, it was also procedurally unfair to the Diocese of Toronto to allow therespondent to put forward a new basis for punitive damages that has not been pleaded. McCabe had alleged the Diocese was vicariously liable for the punitive damagesclaimed against Father Robert.
This allegation was rejected by the trial Judge, as there can be no foundation forpunitive damages on the basis of vicarious liability for the misconduct of another. McCabe should not have then been able to raise a new theory for punitive damagesbased on the appellant’s delay in admitting liability.
The final issue was that of costs. The majority noted that while the Diocese’s denial ofliability, without more, does not attract an award of punitive damages, it may or may notgive rise to a cost sanction. That is the issue the trial Judge rightly should haveconsidered, rather than putting the issue of punitive damages to the jury.
This is an important decision, notably in the context of sexual abuse litigation, but alsofor all claims. The Ontario Court of Appeal has confirmed that the standard for anaward of punitive damages is very high. There must be egregious conduct and anindependent actionable wrong. Requiring a plaintiff to prove their case, in and of itself,does not rise to that standard.Because the Court of Appeal’s decision was not unanimous, there does remain thepossibility that leave will be sought to the Supreme Court of Canada. Until then,however, the law in Ontario stands that a defendant should not fear an award of punitivedamages for not admitting liability no matter how obvious a finding of liability may be.
For more information see:
• McCabe v. The Roman Catholic Episcopal Corporation for the Diocese of Toronto, 2019 ONCA 213 (Ont. C.A.).
• Zando v. Ali, 2018 ONCA 680 (Ont. C.A.).
David M. Rogers is a partner with Rogers Partners LLP in Toronto, practicing civil litigation covering almost all aspects of insurance related litigation, including Municipal Liability, Occupiers’ Liability, Commercial Host, Sports & Entertainment Facilities, Education law and Events Related Liability as well as professional negligence, and automobile claims litigation. He can be reached at (416) 594-4519 or email@example.com.