Proposed Privacy Breach Class Action Against The Personal Insurance Company

A proposed privacy breach class action lawsuit has been launched by the law firm Waddell Phillips Professional Corporation against The Personal Insurance Company and its parent, Desjardins General Insurance Group Inc.

The plaintiff, Kalevi Haikola, commenced this claim against his motor vehicle insurer after it accessed his credit score when it was adjusting a simple accident benefits claim.  The lawsuit alleges that credit score information is wholly irrelevant when an insurer is resolving accident benefit claims, and therefore the defendants could only be using this information for improper purposes, and against the interests of their customers.

In fact, Mr. Haikola complained to the Office of the Privacy Commissioner of Canada, alleging that the demand for credit score information was improper.  The Privacy Commissioner agreed, holding that The Personal collected and used credit information from Mr. Haikola without obtaining meaningful consent, and in a manner that a reasonable person would consider inappropriate. The Office of the Privacy Commissioner of Canada concluded that The Personal violated the Personal Information Protection and Electronic Documents Act (“PIPEDA“).

In February 2018, The Personal told the Privacy Commissioner that it had stopped the practice of collecting and using credit score information during its claims assessment process. Despite this representation to the Privacy Commissioner, after Mr. Haikola was involved in a rear-end collision in March 2018, The Personal asked Mr. Haikola, not only for his consent to access his credit score (the very thing that it had said it was no longer doing, and which was found to be a PIPEDA breach), but it also asked for much more intrusive financial disclosure.

The claim asserts that the foremost obligation of an insurer is to act with utmost good faith toward its insureds. This obligation includes the duty to respect the privacy interests of insureds. Intrusive prodding into personal financial affairs, including credit scores, of insureds is inappropriate and unlawful under Canadian privacy legislation. The claim alleges that persons involved in motor vehicle accidents are particularly vulnerable in the hands of their insurance companies, and can reasonably expect their insurers to treat them fairly. This includes a reasonable expectation that they will not be given differential treatment based upon their personal financial circumstances.

In this action, Mr. Haikola seeks damages for defendants’ breach of the privacy rights of Canadians embodied in PIPEDA, and for the defendants’ alleged bad faith based upon continuing the practice of collecting personal financial information after they told the Privacy Commissioner that they had stopped the practice.  Mr. Haikola seeks damages on behalf of all class members for the alleged unreasonable breach of their privacy and the insurer’s alleged breach of the duty of utmost good faith.

Additional information about this case, and a private portal for class members to communicate with class counsel is available at: www.personalprivacyclassaction.com.

SOURCE Waddell Phillips Professional Corporation

Canadian tourist facing jail time in Cuba suing Sunwing for damages

By Sidhartha Banerjee

THE CANADIAN PRESS

MONTREAL _ A Quebec man facing four years in a Cuban jail after a boating accident killed a fellow Canadian tourist last July is suing travel company Sunwing for damages.

Lawyers representing Toufik Benhamiche of Mascouche filed the application last week, seeking more than $340,000 for himself and his wife.

The Quebec man was driving a small boat as part of a tourist excursion in July 2017 in Cayo Coco when it veered out of control and fatally struck a woman from Ontario.

In the lawsuit filed in Joliette, Que., his lawyers allege Benhamiche, 47, was given little instruction on how to operate the craft and was assured it was easy to use and by no means dangerous.

It also claims he was not briefed on safety or legal obligations.

“Neither the defendant nor its subcontractors offered any liability insurance to the plaintiffs before placing them in a clearly dangerous situation,” the application reads. “They did not even inform the claimants this activity could potentially incur their civil and/or criminal liability in the event of an accident.”

The travel operator commented by email Tuesday, noting it had provided assistance to all parties involved in the incident.

“We do not see merit in the legal action, as Sunwing Vacations does not own, manage or operate local excursions in Cuba,” the company said.

It noted the fatal accident took place during an adventure tour offered by local partner Gaviota Tours, which subcontracted the boat portion to another company, Marlin SA.

The travel company said it suspended selling the tour pending an investigation.

Sunwing said the fatality is the only major incident on record since the tour began operating in 1997.

Some of the tour-excursion employees were arrested at the time, but only Benhamiche ultimately stood trial.

He was found guilty of criminal negligence causing death and sentenced to four years in prison.

Benhamiche. who has appealed the conviction and is awaiting a ruling, insists the death was an accident.

He told Montreal La Presse on Tuesday his life has been turned upside down and that his goal is to rehabilitate his reputation.

Benhamiche has been forced to rent a home in Cuba pending the legal proceedings.

He has lost his engineering job near Montreal and his wife has been forced to care for their two daughters on her own for the past 10 months. She has frequently had to travel to Cuba to attend her husband’s court dates.

His Montreal-based lawyer, Julius Grey, has been critical of what he describes as Canadian government inaction in Benhamiche’s case.

Grey said the Cuban government is also in a conflict of interest because of the state-run nature of the country’s economy.

Waters rising in flood ravaged southern B.C. as residents brace for ’round two’

GRAND FORKS, B.C. _ There is a feeling of “calm apprehension” in the southern British Columbia city of Grand Forks as officials warn of a coming second wave of flood waters, says Brett Swope.

The pastor at the Grand Forks Baptist Church said he noticed the flood waters returned on Tuesday when he drove down a local road covered in 15 centimetres of water. It had been dry on Monday, he said in an interview as he travelled around assessing the flood situation.

The residents of Grand Forks were unsure what water levels to expect in the coming days, Swope said.

“Some forecasts are calling for it to be higher, others are calling for it to be just lower than we had recently, but everybody’s just sort of bracing for the impact and trying to do everything they can to be prepared,” he said.

At least 1,500 homes in the Kootenay Boundary regional district, which includes Grand Forks, remained evacuated Tuesday following flooding over the last several days. Provincial officials say evacuation orders covered another 500 homes around the province, while more than 2,600 homes were on evacuation alert.

Swope said he’s been amazed at the community’s tireless labour.

“When I think of the sense of how our community is feeling, I think that they’re, you know, kind of approaching everything with a calm apprehension.”

He said “hundreds upon hundreds” of volunteers have prepared tens of thousands of sandbags in advance of potential flooding this week and residents are working from sun up to sun down.

Jessica Mace of the Kettle River Watershed Authority said temperatures higher than 30 C and exhausting work is wearing on the thousand plus volunteers in Grand Forks.

“People have been working really long hours,” said Mace, “they’re so thirsty and tired and worn out.”

Heavy rains and spring runoff combined to push floodwaters to levels not seen in 70 years in and around Grand Forks last week.

Gordy Shaw moved to Grand Forks with his wife eight years ago from Richmond because he said he was worried about dykes bursting in the Metro Vancouver city.

“I worked all the sawmills along the Fraser River, and I never anticipated this little Kettle River (in Grand Forks) would ever flow like it did today.”

Shaw said he had about 30 centimetres of water seep into his garage and learned over coffee with his neighbours on Tuesday that he was lucky compared with the damage experienced by others.

“They just talked to their insurance company, and the insurance company just said ‘No, I’m sorry sir, it’s overland flooding and you have no insurance,’ ‘” said Shaw.

Chris Marsh of the Regional District of Kootenay Boundary said water levels were rising again along the Granby and Kettle rivers, which meet in Grand Forks.

“The forecast from the River Forecast Centre is for levels that are possibly equivalent to or higher than the peaks we saw last year, which are record peaks,” added Marsh.

Emergency Management BC said the Boundary region and Similkameen Valley have already seen significant flooding, while risks are also high across the Okanagan and Shuswap regions.

Officials from the regional district said the rapid snowmelt is pushing river levels higher and there was a forecast of rain for the region by Wednesday.

An evacuation alert was also issued Tuesday by the township of Langley for part of Glen Valley, as well as Brae and McMillan islands, after the Fraser River was measured at 5.5 metres in Mission, about 70 kilometres east of Vancouver.

It was the first evacuation alert of the 2018 flood season for any community near Metro Vancouver.

By Spencer Harwood in Vancouver

Founder of Chinese company with billions in B.C. assets gets 18 years for fraud

SHANGHAI _ A court in Shanghai sentenced the founder of the Chinese insurance company that owns New York City’s Waldorf Hotel to 18 years in prison on Thursday after he pleaded guilty to fraudulently raising billions of dollars from investors, state media reported.

Shanghai’s No. 1 Intermediate People’s Court also ordered the confiscation of 10.5 billion yuan ($1.6 billion) in assets from Wu Xiaohui, the former chairman of Anbang Insurance Group, which had gained a reputation for ambitiously expanding into hotels, real estate and insurance from Canada to South Korea.

Wu, who founded privately owned Anbang in 2004, has been accused of misleading investors and diverting money for his own use. He was detained last year and regulators seized control of Anbang in February. He was shown on state TV in March admitting guilt.

Wu initially had denied his guilt at his one-day trial, according to an earlier court statement.

According to Xinhua, Wu concealed his ownership of shares in companies controlled by Anbang, filed false statements with financial authorities and lured investors by offering rates of return above that offered elsewhere. Much of the business relied on selling insurance products to raise investment capital.

It said he used more than 100 companies under his control to manage funds and authorities later recovered bank savings, real estate and other assets. Wu used his position to misappropriate 10 billion yuan ($1.5 billion) in Anbang’s deposits, according to Xinhua’s lengthy report.

Xinhua said the court determined the length of the sentence according to the facts of the case, the severity of the crime, and its “degree of social harm.” It said more than 50 people were present at the sentencing, including Wu’s relatives and journalists.

Anbang last month said it was receiving a $9.6 billion bailout from a government-run fund. That would mean the government fund owns 98 per cent of the company, wiping out most of the equity stake once held by Wu and other shareholders.

The company had engaged in a global asset-buying spree in recent years, raising questions about its stability. Anbang discussed possibly investing in a Manhattan skyscraper owned by the family of U.S. President Donald Trump’s son-in-law and adviser, Jared Kushner. Those talks ended last year with no deal.

The negotiations with Kushner Cos. about 666 Fifth Ave. prompted members of the U.S. Congress to raise ethics concerns.

The Anbang case is one of a string of scandals in what had been a stodgy Chinese insurance industry long-dominated by state-owned insurers. The industry’s former top regulator was charged in September with taking bribes and other insurers have been accused of reckless speculation in stocks and real estate.

The Communist Party has made reducing financial risk a priority this year after a surge in debt prompted rating agencies last year to cut Beijing’s credit rating for government borrowing.

Anbang is being run by a committee of officials from China’s insurance regulator, central bank and other agencies. They have said its obligations to policyholders and creditors are unaffected.

Over the years, Anbang grew to more than 30,000 employees with 35 million clients. It diversified into life insurance, banking, asset management, leasing and brokerage services.

Speculation is rife over possible sales of Anbang’s assets, which, in addition to the iconic Waldorf purchased for almost $2 billion include Dutch insurer Vivat NV, the San Francisco Westin St. Francis and hotels, real estate and insurance holdings in Canada, Belgium and South Korea.

Sask: Family loses home after fire destroys Habitat for Humanity built house

Family helped build the house before moving in about nine years ago

Cory Coleman · CBC News

A family in Yorkton, Sask. is without a home after a fire gutted their house.

The blaze happened Tuesday morning in a house built by Habitat for Humanity about nine years ago, says the homeowner.

A family of four, who also helped build the house, moved in shortly after it was built.

Corey Anderson, the homeowner and mother of three, says her 12-year-old son called her at work because he noticed a grassfire in the backyard.

By the time Anderson got home, an entire side of the house was ablaze.

“You can’t even process that it’s happening,” said Anderson.

“It’s probably the worst feeling in the entire world. I can’t imagine much more that would be worse.”

Despite losing nearly all of their possessions, Anderson says she’s grateful none of her kids were hurt in the blaze.

More bad news

Shortly after the fire, Anderson learned her insurance lapsed without her knowledge.

“That makes things quite a bit different, more difficult,” she said.

She doesn’t know the details of what will be covered, but said she wants this incident to serve as a warning for other people to make sure their possessions are insured and their insurance is up to date.

In the meantime, Anderson says she’s trying to stay active and focus on the little things.

“Until you kind of sit down and go through everything and find out what you have, it’s an overwhelming process. It’s huge,” she said.

“I went to brush my hair yesterday morning and realized I don’t even own a brush.”

Despite the overwhelming amount of work ahead of her, Anderson says the reality of losing her home and possessions still hasn’t sunk in.

“I have not cracked yet. I’m sure it’s coming. It’s probably not going to be pretty when it does ” she said.

“I still haven’t gone past the house. I can’t do it”

A GoFundMe page has been set up to help the family.

The Yorkton fire department confirms they received a report of a grassfire on Tuesday morning, but the cause is yet to be determined.

 

Your Client’s House Burned Down More Than A Year Ago. Can Her Insurer Rely On The One-Year Limitation Period In Her Home Insurance Policy?

Article by Gord McGuire

Imagine an Ontario homeowner walks into your office asking whether she has a case against her insurance company relating to a fire that destroyed her home. After taking just over a year to investigate the cause of the fire and catalogue the home’s contents, the insurer has denied the claim. Your client is in a panic after reading this provision in her policy under a heading called “Statutory Conditions”:

14. Action
Every action or proceeding against the Insurer for the recovery of a claim under or by virtue of this contract is absolutely barred unless commenced within one year next after the loss or damage occurs.

Is it too late to commence the action?

To the client, and even to many lawyers, the answer would seem to be an obvious yes. This view would only be strengthened upon learning that the above words are indeed one of the Statutory Conditions found in Part IV (“Fire Insurance”) of the Insurance Act, which Part states that these conditions “shall be deemed to be part of every contract in force in Ontario”.

So should the insured simply walk away from her claim? Fortunately for both of you, no.

In fact, the actual limitation period is likely that prescribed by the Limitations Act, 2002i.e. two years from the date the claim was or ought to have been discovered, meaning the limitation period would be two years, not one, and would start with the denial, not the fire. Incredibly, this issue remains undecided in Ontario law, but the better argument in the author’s view is that the one-year limitation period is unenforceable.

As it happens, Part IV of the Insurance Act despite being called “Fire Insurance” and despite purporting to apply to policies of fire insurance is not likely to apply to home insurance policies. The Part was enacted when fire insurance was sold as a standalone product, and recent lower court decisions have held the Part has no application to modern multi-peril policies such as those for home insurance.1

As such, the limitation period in Statutory Condition 14 likely has no application by operation of statute. But what of the insurer’s attempt to import this limitation into the insurance policy? Does it have effect by way of contract?

Fortunately for your client, no. While s. 22 of the Limitations Act, 2002 does allow parties to shorten the two-year limitation period by agreement, such arrangements are only permissible in the case of a “business agreement”, which is defined as “an agreement made by parties none of whom is a consumer as defined in the Consumer Protection Act, 2002“. As homeowners purchasing home insurance are considered consumers under the latter act, a home insurance policy is not a business agreement, and thus the parties cannot agree to shorten the limitation period.2 There is thus a good argument the limitation period in the insurance policy is unenforceable despite its clear terms.

This confusing state of affairs is to put it mildly less than ideal, particularly given these policies are marketed to and relied upon by unsophisticated members of the public, and are intended to offer “peace of mind”. A number of other jurisdictions in Canada have modernized their property insurance statutes and one can only hope Ontario will follow suit in the near future.

Footnotes

1. See e.g. Dumitrascu v. State Farm Fire and Casualty Co., 2014 ONSC 2224, para. 9. See also KP Pacific Holdings Ltd v. Guardian Insurance Co. of Canada, 2003 SCC 25. Note, however, the Ontario Court of Appeal recently noted in obiter comments that it had yet to decide this question one way or the other: Douglas v. Stan Fergusson Fuels Ltd., 2018 ONCA 192.

2. Boyce v. Co-operators General Insurance Co., [2013] O.J. No. 2568 (C.A.)).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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