Luciano Branco, et al. v. Zurich Life Insurance Company Limited, et al.

(Saskatchewan) (Civil) (By Leave)


Insurance - Damages, Appeals.


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Insurance – Damages – Appeal – Whether there is an unofficial million dollar cap on punitive damages against insurers – Whether there can be a cap on aggravated damages in breach of insurance contract cases – In the face of egregious conduct, is the full indemnification of a wronged party’s costs to be considered after compensatory and punitive damages have been assessed – Appropriateness of an appellate court reviewing a trial judge’s reasons for awarding punitive damages and then substituting its own quantum of damages.

Mr. Branco was injured while employed by Kumtor Operating Company. He was covered by two workplace insurance policies issued by American Home Assurance Company and Zurich Life Insurance Company Limited. Mr. Branco commenced an action against the respondents in part to secure punitive damages, damages for mental distress, and benefits. The trial judge in part awarded $1,500,000 in punitive damages and $150,000 in aggravated damages against American Home Assurance Company. He awarded $3,000,000 in punitive damages and $300,000 in aggravated damages against Zurich Life Insurance Company Limited. He awarded costs to Mr. Branco but denied full solicitor and client costs. The Court of Appeal allowed an appeal in part. It reduced the awards for punitive damages to $675,000 in total and for aggravated damages to $45,000 in total. It dismissed a cross-appeal from the costs award.