As the late singer Prince said, eternity is a very long time. While his 1984 track “Let’s Go Crazy” does not deal with tort claims, a Supreme Court of Canada decision released on Friday should reiterate the importance of the word “forever” in release agreements settling lawsuits. amicably.
“A general release, if interpreted literally, could prevent the author of the release from prosecuting the released person for any reason, forever,” Justice Malcolm Rowe wrote for the Supreme Court of Canada in Corner Brook (Town) v. Bailey.
the Local stream The case arose when city worker David Temple was struck by a vehicle on March 3, 2009 in Corner Brook, Newfoundland. At the time, Temple was doing roadworks. The vehicle was driven by Mary Bailey and was owned by her husband, Gerald Bailey.
Mary Bailey filed a lawsuit against the town of Corner Brook for injuries she sustained in the 2009 accident. Bailey settled her lawsuit with the town out of court in 2011 for $ 7,500. In exchange for the $ 7,500, Mary Bailey signed a press release of nearly 600 words; this prevented him from filing claims “of any kind” against the city.
Meanwhile, Temple filed a lawsuit against the Baileys. Claims that a party is at fault have not been proven in court.
In 2016, the Baileys’ insurer issued a third party notice against the Town of Corner Brook. The insurer maintains that the city is responsible for the damage caused to Temple. In the alternative, the Bailey’s insurer claims that if the Bailey’s were responsible, they are entitled to a contribution from the city.
For its part, the city argued that the release – which settled Mary Bailey’s personal injury claim against the city for $ 7,500 – prevented the Baileys from filing their third party claim against the city. The Supreme Court of Canada ruled in favor of the municipality in its decision rendered on July 23, 2021.
“The disclaimer takes the risk of forfeiting the value of any claims it might have had, and the disclaimer pays for the guarantee that none of these claims will be presented.” The uncertainty or risk that is attributed to the liberator is precisely what the released person pays, ”Justice Rowe wrote of the release agreements for the Supreme Court of Canada in Local stream.
The High Court decision reinstates a 2018 decision of the Supreme Court of Newfoundland and Labrador and overturns a 2020 decision of the Court of Appeal of Newfoundland and Labrador.
The press release Bailey signed with the city includes “all actions, lawsuits, causes of action.” . . planned or unplanned. . . and claims of any kind arising out of or relating to the accident which occurred on or about March 3, 2009, ”Judge Rowe wrote for the court in his unanimous decision.
“If this formulation [of the release] is considered insufficient to include a claim resulting from the accident, it is difficult to imagine which wording would be sufficient, apart from listing each conceivable type of claim one by one (third party claims, cross claims, counterclaims, subrogated claims, equity and common law claims, statutory claims, etc.). There is no policy reason to require the parties to clarify the scope of release in this manner. “
Initially in 2018, Justice George Murphy of the Supreme Court of Newfoundland and Labrador dismissed the third party claim filed by the Baileys’ insurer against the town of Corner Brook. The move stems from the 2011 liberation agreement between the city and Mary Bailey.
Justice Murphy’s decision was overturned by the Newfoundland and Labrador Court of Appeal in a decision released on February 4, 2020. Had the appeal court’s decision been upheld, it would have paved the way for the insurer’s claim against the city.
Writing in 2020 for the Newfoundland and Labrador Court of Appeal, Justice Gillian Butler explained that the 2011 release agreement focused on the Bailey’s own claims against the town of Corner Brook; he does not contemplate the losses unrelated to the damage suffered by the Baileys. The appellate court concluded that Murphy J. erred in concluding that the city, in drafting the release agreement, was contemplating something “not determinative of mutual intent.”
But the appeal court’s finding is a distortion of what Justice Murphy originally wrote in 2018 for the Supreme Court of Newfoundland and Labrador, Justice Rowe wrote for the Supreme Court of Canada. Instead, Judge Murphy “explicitly examines what was contemplated by both parties,” Judge Rowe wrote.
Judge Murphy “explains that the Baileys could have negotiated the terms of release, but they chose not to,” Judge Rowe wrote.
Instead, Judge Murphy concluded that what Mary Bailey and the city envisaged, in agreeing to the settlement, was that Bailey “could no longer bring any claims or claims against the city relating to the accident.”
Judge Murphy therefore rendered his decision based on his review of the circumstances surrounding the release agreement, the Supreme Court of Canada argued.
“Even if [the Baileys and the city] may not have explicitly considered the possibility of a particular third party claim, it was their mutual and objective intention to cover such a claim as part of the discharge. This decision is a factual application of the principles of contractual interpretation, and it was [by a hi9gher court]Wrote Justice Rowe.
Bailey’s release with the city reads:
“Renunciators, in their name and in the name of their heirs, dependents, executors, administrators, successors, assigns and legal and personal representatives, release and discharge forever the waivers their servants, agents, officers, administrators, directors , employees, their partners, affiliated and subsidiary legal entities and their legal successors and beneficiaries both jointly and individually, of all actions, lawsuits, causes of action, debts, contributions, accounts, benefits, obligations, commitments, contracts, costs, claims and demands whatever they may be, including all claims for compensation, loss of use, loss of time, loss of wages, expenses, disability, past, present or future, and any aggravation, foreseen or unforeseen, as well as for currently undisclosed injuries and all claims and claims of any kind or nature whatsoever arising out of or related to the accident which occurred on or around March 3, 2009, and without limiting the generality of the foregoing, of all the claims raised or which could have been raised in the action entitled 2011 04G 0062, between MARY BAILEY, as first plaintiff, GERALD BAILEY, as second plaintiff, and THE CORNER BROOK CITY COUNCIL as defendant, which was brought in the Supreme Court of Newfoundland and Labrador, Trial Division (General) (the “Action”), including, but not limited to, claims for:
- special damages to be proved at trial, including material damage to the motor vehicle of the first claimant and the second claimant;
- general damages to be proved at trial;
- the costs of this action, including the cost of the discoveries;
- interest before and after judgment;
- any other remedy that this Honorable Court may deem just.
AND for the aforementioned consideration, the renunciators on their behalf and on behalf of their heirs, dependents, executors, administrators, successors, assigns and legal and personal representatives hereby undertake, agree and undertake to indemnify and to release from any liability and to keep indemnified the renunciators, their servants, agents, officers, directors, managers, employees, their associates, affiliates and legal entities and their legal successors and assigns, jointly and individually, from any other claim, claim, action or suit that may be brought by or on behalf of or on behalf of the Releasees against the Releasees, their servants, agents, officers, directors, managers, employees, their associated, affiliated and legal entities and their legal successors, jointly or individually , for and with respect to any of the matters or things set out above ;
AND for the aforementioned consideration, the Releasees further agree not to make any claim or take legal action against any other person, company or entity that may claim a contribution, indemnity or other compensation against the Releasees, their servants, agents. , officers, directors, managers, employees, their associated, affiliated and legal entities and their legal successors and assigns, jointly or individually, under the provisions of any applicable law or in equity with respect to any causes, matters or things disclosed by virtue of the present ;
AND the waivers hereby declare that at all times in relation to these presents, they have been represented by a legal advisor of their choice who has advised them regarding this waiver and that they fully understand the terms of this waiver, and that by executing this waiver they have done so in full knowledge of all the rights they may have against the waivers and the issues raised in the action, and that the aforementioned consideration is voluntarily accepted by them in order to make a compromise, full and final adjustment and resolution of all claims, causes, issues and things posted below.
Feature image via iStock.com/David Purchase