1. Claim settlements finalized FOR the period january 1 to march 31, 2010
COMMITTEE RECOMMENDATION
That Council receive this report for information.
RECOMMANDATION
DU COMITÉ
Que le Conseil prenne connaissance du présent
rapport.
DOCUMENTATION
1. City Clerk and Solicitor’s report dated 22 April 2010 (ACS2010-CMR-LEG-0005).
2. Extract of Draft Minute, 4 May 2010.
3. Memo from the City Clerk and Solicitor as directed by Committee will be distributed prior to Council.
Corporate Services and Economic Development Committee
Comité des services organisationnels et du
développement économique
April 22, 2010 / le 22 avril 2010
Submitted by/Soumis par : M. Rick O’Connor
City Clerk and
Solicitor / Greffier et Chef du contentieux
Contact Person/Personne ressource : D. White,
Manager, Litigation and
Labour Relations /Gestionnaire litiges et
Relations de travail
(613) 580-2424 x21933, david.white@ottawa.ca
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Ref N°: ACS2010-CMR-LEG-0005 |
SUBJECT:
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Claim settlements finalized FOR the period january 1 to march 31, 2010 |
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OBJET :
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DEMANDES DE REMBOURSEMENT TRAITÉES
POUR LA PÉRIODE DU 1er JANVIER AU 31 MARS 2010
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That the Corporate Services and Economic Development Committee receive this report for information.
Que le Comite des services organisationnels et
du développement économique prend connaissance du present
rapport.
As a result of the three-phased corporate realignment that occurred between October 2008 and March 2009, the City Clerk’s Branch and the Legal Services Branch were merged into a single department. In response to these changes, and in keeping with the general principle enunciated in the City’s Accountability and Transparency Policy that, “every new delegation of power authority will have a corresponding accountability mechanism”, the Delegation of Authority By-Law was revised accordingly as part of the Mid-Term Governance Review in June 2009. Therefore, the purpose of this report is to provide a summary to the Corporate Services and Economic Development Committee of claim settlements made in the first quarter of 2010 pursuant to Section 44 of Schedule “A” of the revised Delegation of Authority By-law, No. 2009-231.
(a) Claim Settlements
This report summarizes the payments made by the City to settle claims that were finalized in Q1 2010. The payments include all costs borne by the City in finalizing a settlement, including court fees, legal costs, investigative costs, etc. Furthermore, claim settlement payments include payments made pursuant to negotiated settlements as well as court-ordered payments.
The criteria used to assess
claims made against the City are: (a) whether there is legal liability on the
part of the City, and, if so; (b) whether the amount claimed is supported at
law. In general, legal liability will be found where there exists an obligation,
arising either under the applicable statute law or the common law, to
compensate a claimant for damages suffered. The “legal liability” payment
criteria for claims is consistent with the provisions
of the City's insurance policies and reflects the same considerations that
would inform a legal assessment in the court system.
It should also be noted that there are various instances where there can be
liability on the part of the City even where the City is not "at
fault" in the traditional sense. The most obvious example of this
type of situation is the payment of no-fault benefits payable for personal
injuries arising out of accidents involving City vehicles. Furthermore,
consideration of settling a claim without formal proceedings will be influenced
by two additional factors. The first, applicable to all parties involved
in litigation, is the emphasis Ontario courts place on settling most
claims. Taken from the original “Litigation Record” report received by
Council on April 9th, 2009, (Ref. ACS2009-CMR-LEG-0008), the
following observations accurately characterize the rationale as to why the
courts favour settlements between the parties:
As noted above, the support for negotiated settlements is founded in the view that a resolution mutually achieved by the parties is preferable than one imposed by an external, third party. In addition, settlement serves to minimize the cost of litigation for parties, as well as preserving scarce judicial resources.
The second factor that will influence the settlement of claims is the legal concept of joint and several liability, as set out in the Negligence Act. Also known as the “1% Rule”, the legislation provides that a claimant can recover all of his or her compensation from any party found even partially liable for the damage suffered, even if this level of liability is as little as “1%”. In a practical sense, this means that the City may find itself included in litigation where there exists a risk that other potentially responsible parties have little or no means to pay compensation. The City may thus find itself in a position where it faces the risk of having to pay the entire amount of compensation awarded, even if it is only minimally liable for the incident. In such circumstances, the City must properly manage this risk by negotiating a settlement that may be in excess of its actual liability but is still less than the total potential damage award. An initiative sponsored by the Association of Municipalities of Ontario (AMO) to lobby for legislative reform of the issue of joint and several liability is discussed in more detail below.
In summary, this report sets out aggregate information for claim settlements in Q1 2010 where the claim settlement amount was less than $100,000.00, including the number of claim settlements finalized in Q1 2010 grouped by operational department, the number of claims associated with each operational department and the average value of those claims (see Document 1). Where the claim settlement payment exceeded $100,000.00, the specifics of each claim settlement have been provided separately (see Document 2).
For comparative purposes and in an effort to offer some historical context for the Q1 2010 figures, similarly-formatted, figures for 2009 claims less than and over $100,000.00, are included in Documents 3 and 4, respectively.
AMO’s Joint and Several Liability Initiative
It is worth noting that the Association of Municipalities of Ontario (AMO) is leading an initiative to lobby for legislative change to the so-called “1% Rule”, so that the liability borne by each party in a claim will be more proportionate to the liability of that party. In the fall of 2009, AMO sought feedback on a draft paper entitled, “The Case for Joint and Several Liability Reform in Ontario”, and this paper was finalized earlier in April 2010. In this paper, the authors made the following observations with respect to reforming Ontario’s joint and several liability regime:
This paper has demonstrated the effects of joint and several liability on municipalities in some key areas – 1) building inspections, 2) the scaling back of services in response to “liability chill”, 3) the slow pace of redeveloping brownfield sites, and 4) motor vehicle and road safety.
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Many common law jurisdictions around the world have adopted legal reforms to limit the exposure and restore balance… It is time for Ontario to do the same.
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Ontario municipalities call on the Government to review joint and several liability as it exists today, with a particular regard for the impact it has on “deep pocket” property taxpayers and their communities. Ontario municipalities ought not to be insurers of last resort, targeted deliberately in some instances because of joint and several liability. If this situation is allowed to continue, the scaling back on public services in order to limit liability exposure and insurance costs will only continue. Regrettably it will be at the expense of local communities across the province.
A copy of the final report appeared under the “Communications” heading in the April 14th, 2010 City Council agenda and a copy is on file with the City Clerk and Solicitor’s Office.
CONSULTATION
As this is an information report, public consultation was not required.
LEGAL/RISK MANAGEMENT IMPLICATIONS:
There are no significant Legal/Risk Management concerns arising from this report. Some settlements are subject to the confidentiality requirements that commonly form part of a claim resolution and, as such, further details on those matters would require in camera discussion.
“Insurable claims” are funded from the City’s Self-Insurance Fund whereas “non-insurable” claims are funded from various departmental budgets.
Document 1 - Claims Concluded in Q1 2010 With Payments Less Than $100,000
Document 2 - Claims Concluded in Q1 2010 With Payments Over $100,000
Document 3 - Claims Concluded in 2009 With Payments Less Than $100,000
Document 4 – Claims Concluded in 2009 With Payments Over $100,000
Legal and Risk Management staff will undertake a more comprehensive review of AMO’s joint and several liability initiative with a view to providing the Corporate Services and Economic Development Committee and Council with a more detailed report in the near future.
Subject to any direction by the Corporate Services and Economic Development Committee otherwise, the City Clerk and Solicitor to continue to produce the City’s record for all claim settlements on a quarterly basis.
Document - 1
The following chart sets out the claim settlements payments finalized in 2010 for claims settlements less than $100,000.00 grouped by City Department, including the number of claim settlements and the average value of claim settlements.
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Claims Concluded In First Quarter of 2010 With Payments Less Than $100,000.00 |
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Department |
Category |
# |
Paid |
Average |
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Deputy City Managers Office (Infrastructure Services and Community Sustainability) |
Property Damage or Loss |
1 |
$ 1,820.35 |
$ 1,820.35 |
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Emergency & Protective Services |
Property Damage or Loss |
3 |
$ 4,687.25 |
$ 1,562.42 |
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Environmental Services |
Property Damage or Loss |
45 |
$ 76,648.98 |
$ 1,703.31 |
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Infrastructure Services |
Property Damage or Loss |
1 |
$ 141.25 |
$ 141.25 |
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Parks, Recreation & Cultural Service |
Bodily/Personal Injury |
1 |
$ 183.75 |
$ 183.75 |
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Parks, Recreation & Cultural Service |
Property Damage or Loss |
1 |
$ 189.00 |
$ 189.00 |
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Planning & Growth Management |
Property Damage or Loss |
1 |
$ 21,049.98 |
$ 21,049.98 |
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Police Services Board |
Bodily/Personal Injury |
2 |
$ 45,127.00 |
$ 22,563.50 |
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Police Services Board |
Property Damage or Loss |
1 |
$ 3,056.54 |
$ 3,056.54 |
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Public Works |
Bodily/Personal Injury |
6 |
$ 52,063.96 |
$ 8,677.33 |
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Public Works |
Property Damage or Loss |
29 |
$ 73,847.14 |
$ 2,546.45 |
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Transit Services |
Bodily/Personal Injury |
11 |
$ 125,546.53 |
$ 11,413.32 |
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Transit Services |
Property Damage or Loss |
9 |
$ 194,696.84 |
$ 21,632.98 |
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TOTALS |
111 |
$ 599,058.57 |
$ 5,396.92 |
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Document - 2
The following is the specific information with respect to those claims settlements finalized in 2010 where the total cost to the City was in excess of $100,000.00.
The following are the abbreviations used in this table: AB = Accident Benefits; BI = Bodily Injury; E&O = Errors and Omissions; MVA = Motor Vehicle Accident; PD = Property Damage; T/P = Third Party
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Claims Concluded In First Quarter of 2010 With Payments Over $100,000.00 |
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Department |
Category |
Claim Type |
Gross City Cost |
Net City Cost* |
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Transit Services |
Property Damage or Loss |
MVA, City and Third Party Vehicle - No AB |
$ 171,778.28 |
$ 171,778.28 |
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Transit Services |
Property Damage or Loss |
Fire (however caused) Veh./Equip. |
$ 229,510.63 |
$ 229,510.63 |
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TOTALS |
$ 401,288.91 |
$ 401,288.91 |
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Document - 3
The following chart sets out the claim settlements payments finalized in 2009 for claims settlements less than $100,000.00 grouped by City Department, including the number of claim settlements and the average value of claim settlements.
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Claims Concluded in 2009 With Payments Less Than $100,000 |
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Department |
Category |
# |
Paid |
Average |
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Community & Social Services |
Property Damage or Loss |
1 |
$ 1,736.70 |
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Emergency & Protective Services |
Bodily/Personal Injury |
1 |
$ 940.00 |
$ 940.00 |
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Emergency & Protective Services |
Property Damage or Loss |
14 |
$ 124,685.55 |
$ 8,906.11 |
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Environmental Services |
Property Damage or Loss |
191 |
$ 365,039.37 |
$ 1,911.20 |
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Infrastructure Services |
Property Damage or Loss |
8 |
$ 8,547.91 |
$ 1,068.49 |
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Infrastructure Services |
Bodily/Personal Injury |
1 |
$ 100.28 |
$ 100.28 |
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Library Services |
Bodily/Personal Injury |
1 |
$ 63,209.54 |
$ 63,209.54 |
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Library Services |
Property Damage or Loss |
1 |
$ 1,281.03 |
$ 1,281.03 |
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Parks, Recreation & Cultural Service |
Bodily/Personal Injury |
3 |
$ 122,630.12 |
$ 40,876.71 |
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Parks, Recreation & Cultural Service |
Property Damage or Loss |
4 |
$ 30,557.76 |
$ 7,639.44 |
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Pineview Golf Course |
Property Damage or Loss |
1 |
$ 11,027.37 |
$ 11,027.37 |
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Planning & Growth Management |
Bodily/Personal Injury |
2 |
$ 505.69 |
$ 252.85 |
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Planning & Growth Management |
4 |
$ 31,975.03 |
$ 7,993.76 |
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Public Works |
Property Damage or Loss |
148 |
$ 267,443.28 |
$ 1,807.05 |
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Public Works |
Bodily/Personal Injury |
39 |
$ 625,556.24 |
$ 16,039.90 |
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Transit Services |
Bodily/Personal Injury |
86 |
$ 841,117.17 |
$ 9,780.43 |
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Transit Services |
Property Damage or Loss |
21 |
$ 65,696.76 |
$ 3,128.42 |
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TOTALS
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294 |
$1,799,813.45 |
$30,755.80 |
Document - 4
The following is the specific information with respect to those claims settlements finalized in 2009 where the total cost to the City was in excess of $100,000.00.
The following are the abbreviations used in this table: AB = Accident Benefits; BI = Bodily Injury; E&O = Errors and Omissions; MVA = Motor Vehicle Accident; PD = Property Damage; T/P = Third Party
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Claims Concluded in 2009 with Payments Over $100,000 |
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Department |
Category |
Claim Type |
Gross City Cost |
Net City Cost |
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Planning & Growth Management |
Property Damage or Loss |
Building Inspections - BI/PD |
$ 133,752.03 |
$ 133,752.03 |
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Planning & Growth Management |
Property Damage or Loss |
Building Inspections - E&O |
$ 130,064.65 |
$ 130,064.65 |
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Planning & Growth Management |
Property Damage or Loss |
Building Regs. & Permits - E&O |
$ 479,892.67 |
$ 270,321.52* |
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Public Works |
Bodily/Personal Injury |
City Vehicle Hitting Pedestrian/Cyclist - No AB |
$ 126,610.65 |
$ 126,610.65 |
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Public Works |
Bodily/Personal Injury |
MVA, City and Third Party Vehicle - No AB |
$ 117,666.84 |
$ 117,666.84 |
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Public Works |
Property Damage or Loss |
Building Inspections - E&O |
$ 244,112.03 |
$ 244,112.03 |
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Public Works |
Property Damage or Loss |
City Vehicle Hitting Pedestrian/Cyclist - AB |
$ 361,920.98 |
$ 361,920.98 |
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Public Works |
Property Damage or Loss |
Fire – Accidental |
$ 103,661.34 |
$ 103,661.34 |
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Public Works |
Property Damage or Loss |
MVA, City and Third Party Vehicle - No AB |
$ 164,200.00 |
$ 164,200.00 |
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Public Works |
Property Damage or Loss |
$ 212,521.99 |
$ 212,521.99 |
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Transit Services |
Bodily/Personal Injury |
Losses Onboard City Veh. - No AB (not MVA) |
$ 103,906.91 |
$ 103,906.91 |
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Transit Services |
Bodily/Personal Injury |
Losses Onboard City Veh. - No AB (not MVA) |
$ 136,959.61 |
$ 136,959.61 |
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Transit Services |
Bodily/Personal Injury |
Losses Onboard City Veh. (not MVA) - AB |
$ 101,011.08 |
$ 101,011.08 |
|
Transit Services |
Bodily/Personal Injury |
Losses Onboard City Veh. (not MVA) - AB |
$ 349,661.00 |
$ 349,661.00 |
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Transit Services |
Bodily/Personal Injury |
Losses Onboard City Veh. (not MVA) - AB |
$ 146,783.43 |
$ 146,783.43 |
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Infrastructure Services Department |
Contract |
Construction Costs |
$ 421,300.00 |
$ 421,300.00 |
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Infrastructure Services Department |
Contract |
Construction Costs |
$ 1,551,942.00 |
$1,551,942.00 |
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TOTALS |
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$ 4,885,967.21 |
$4,676,396.06 |
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|
|
|
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* this is the amount paid by the City after reimbursement from the insurer of any amounts in excess of the City’s deductible. |
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Claim settlements finalized FOR the period january 1 to march 31, 2010
David Gladstone, encouraged Committee to be inquisitive about the claims for losses and damages listed in the Transit Services category. He believed that the claims seemed fairly large and several of them did not seem related to vehicular accidents, more like falls incurred by passengers on city buses. He asked if there was a way to receive more information without divulging personal information. He also requested to hear from staff about measures that will be taken to reduce these types of damages and injuries suffered by passengers.
Chair Jellett asked staff to respond to the questions raised by the delegate. Carey Thomson, Deputy City Solicitor confirmed that there are some significant expenses with regard to passengers injuring themselves on a city bus and do not have auto insurance. As a result of the ‘no-fault’ scheme that has affected Ontario in the past ten years, the City is required under the legislation to pay for the statutory accident benefits for those injured on city buses, resulting in significant costs if someone.
With regard to reducing the number of incidents, Mr. Thomson noted that as a result of the risk masters software program that is currently in the City Solicitor and Clerk’s Department, reports are generated on a quarterly basis and provided to OC Transpo. These reports indicate the various areas where injuries have been sustained; therefore assisting OC Transpo to move forward and find ways to reducing/eliminate the number of accidents.
Regarding the claims paid out to Parks and Recreation for bodily harm, Councillor Monette asked if the majority of claims were related to head injuries and if so, was there data that would show this information. Mr. Thomson noted that he could provide this information to Committee offline.
With the enhanced risk management policy scheduled to be put in place, Councillor Monette asked if this would impact the number of claims. Mr. Thomson acknowledged that it is a primary goal to look at incidents and find ways of reducing the number of injuries. The Councillor then asked if the number of cost of claims in 2010 differs from 2009. Mr. Thomson did not have the information but would provide it offline.
Chair Jellett reiterated the delegate’s question relating to receiving more information on the claims outlined in the documents attached to the report. He believed it would be helpful to post the information on the website in order for the public to have access. Mr. Thomson offered to provide this information prior to the Council meeting.
That the Corporate Services and Economic Development Committee receive this report for information.
RECEIVED
DIRECTION TO STAFF:
Legal staff to provide information on claims paid out to Parks and Recreation for bodily harm (i.e. head injuries), an analysis on comparisons of the number of claims and cost from 2009, and more detailed information on the claims outlined in documents 1 to 4 in the report.