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After Settling Your Claim, Can You Still Sue?

Case CommentWasyliuk v. Osipau (2009 Ontario Superior Court)

The plaintiff was rear-ended in a car accident and received some Accident Benefits afterwards.  His was not an active claim and approximately 20 months after the accident (before he retained a lawyer) he met with the opposing side’s tort insurance adjuster, signed a Full and Final Release settling his claim and accepted $4,657.92 as settlement of his claim.

By settling, the plaintiff presumably was giving up his right to sue for damages, before actually starting a lawsuit, in exchange for an early settlement.

After signing the settlement document, the plaintiff retained a lawyer and started a lawsuit.

The defendant tried to quickly end this lawsuit by bringing a summary judgment motion, pursuant to Rule 20 of Ontario’s Rules of Civil Procedure.  The defendant argued that by signing the settlement documents and receiving the settlement monies, that the plaintiff knowingly gave up his right to bring a lawsuit.

Mr. Justice MacDonnell found that the evidence on the summary judgment motion was that the plaintiff alleged that he knew nothing of the legal system and was told by the experienced insurance adjuster that if he did not settle for $4,657.92 that he would get nothing.  The plaintiff further alleges that the insurance adjuster did not mention that he could consult with a lawyer to obtain other advice.

Given the nature of summary judgment motions, requiring the Court to consider the evidence put forth at the motion, it was held that the defendant here did not establish that there was no genuine issue for Trial.

As a result, the plaintiff is allowed to proceed with his lawsuit.  The issue of the settlement (and credibility issues arising) remains a central part of the lawsuit and will be tested through the litigation and presumably at Trial.

Gregory Chang
Toronto Insurance Litigation Lawyer