Judge orders $5-million damages payout for welder in warning to ‘abhorrent’ insurance companies
Judge orders $5-million damages payout for welder in warning to ‘abhorrent’ insurance companies | Canada | News | National Post
A Saskatchewan judge says he hopes awarding nearly $5 million in damages to a man who was treated in an “abhorrent” manner by insurance companies after getting injured on the job will get the industry’s attention.
Luciano Branco, now 62, was working as a welder for a Cameco subsidiary in Kyrgyzstan when his foot was injured in two incidents in December 1999 and March 2000.
His workers’ compensation benefits were covered by an American Home Assurance Company (AIG) policy, based on benefits payable under the Workers’ Compensation Board in Saskatchewan. After doctors found him to be permanently disabled, Branco’s long-term disability benefits were covered by a Zurich Life Insurance policy.
However, Justice Murray Acton found both companies acted in a “cruel and malicious” manner toward Branco for a decade, offering him “ridiculously low” settlements and intermittent payments, hoping he would crack under the pressure.
“The actions of AIG and Zurich establish a pattern of abuse of an individual suffering from financial and emotional vulnerability,” Acton said in a written decision issued in March in Saskatoon Court of Queen’s Bench.
Acton awarded Branco punitive damages of $3 million against Zurich and $1.5 million against AIG. He also awarded Branco aggravated damages of $450,000 against the two companies and ordered them to continue regularly paying his benefits under their policies.
“The court is cognizant of the fact that a punitive damages award of $3 million (against Zurich) may not be particularly significant to the financial bottom line of a successful worldwide insurance company,” Acton wrote. “It is hoped that this award will gain the attention of the insurance industry. The industry must recognize the destruction and devastation that their actions cause in failing to honour their contractual policy commitments to the individuals insured.”
Saskatoon judge orders insurance companies to pay man $5 million in damages
Before his injury, Branco was “a proud, athletic and hard-working individual,” Acton wrote. One of the many specialists who examined him said Branco was “an overachiever, sincere and genuine ... a warm, friendly, sensitive person.”
Born in Portugal, Branco immigrated to Canada when he was 24 and obtained his welding certificate in Halifax. He continued to advance his skills and eventually obtained his red seal. He worked throughout western and northern Canada before moving back to Portugal in 1994.
He began work in 1997 with Kumtor, a Cameco subsidiary, in Kyrgyzstan and was considered an “excellent employee.”
On Christmas Day, 1999, Branco dropped a steel plate on his foot and even though he thought he may have chopped off his toes, he continued to work until the end of his 12-hour shift. He washed his foot, found it still intact and packed it in snow. He finished his 28-day rotation and went home to Portugal to recuperate.
Near the end of his next rotation in March, he stepped on a piece of steel, reinjuring his foot. He didn’t return for his next rotation in April, seeking medical help in Portugal. However, his injury hadn’t improved by the time of his next rotation in June so he travelled to Kyrgyzstan, going directly to the company doctor and reporting his work injury.
Kumtor paid Branco until the end of his contract in March 2001, but he was never able to return to work. Thus began his saga with the insurance companies.
Three months after Branco began receiving workers’ compensation benefits from AIG in March 2001, AIG offered him the first cash settlement: $22,500 US.
He refused, triggering an AIG memo that gave some insight into what Acton termed “malicious” delays designed to get Branco to accept a small settlement. AIG adjuster Patti Schibler wrote in an August 2001 memo: “I hope he reconsiders because he lives in Portugal and he will have to go back to Canada to get an attorney and this whole process is going to take years to settle. Here we go CANADA!!!!!”
The following month, AIG requested further examinations by specialists in Saskatchewan, to where Branco travelled and where three specialists all confirmed his disability. Despite the medical reports, there were no ongoing payments and AIG demanded Branco pay out-of-pocket for rehabilitation in Portugal.
In October 2001, Branco launched court action against AIG and Zurich. Zurich approved Branco’s original long-term disability claim in March 2002, documents showed, but never informed Branco, who didn’t receive any funds from Zurich until May 2009 — nine years after the first payment was due. An independent audit that Zurich requested in 2007 also recommended accepting his claim, but Branco was never told.
What Zurich did was offer a cash settlement in April 2003 of $62,900 minus $9,000 in legal costs, even though there was already a court order in place for Zurich to pay Branco’s legal costs. Branco refused.
As the case wound its way through the court system, Branco travelled to Calgary for more medical examinations in the fall of 2007 at the request of the insurance companies and Kumtor. Seven of 10 specialists agreed Branco had “reflex sympathetic dystrophy,” or complex regional pain syndrome — confirming his long-term disability.
Following that, AIG, Zurich and Kumtor made a joint settlement offer of $238,000 in April 2008. Branco refused.
Judge orders $5-million damages payout for welder in warning to ‘abhorrent’ insurance companies | Canada | News | National Post
A Saskatchewan judge says he hopes awarding nearly $5 million in damages to a man who was treated in an “abhorrent” manner by insurance companies after getting injured on the job will get the industry’s attention.
Luciano Branco, now 62, was working as a welder for a Cameco subsidiary in Kyrgyzstan when his foot was injured in two incidents in December 1999 and March 2000.
His workers’ compensation benefits were covered by an American Home Assurance Company (AIG) policy, based on benefits payable under the Workers’ Compensation Board in Saskatchewan. After doctors found him to be permanently disabled, Branco’s long-term disability benefits were covered by a Zurich Life Insurance policy.
However, Justice Murray Acton found both companies acted in a “cruel and malicious” manner toward Branco for a decade, offering him “ridiculously low” settlements and intermittent payments, hoping he would crack under the pressure.
“The actions of AIG and Zurich establish a pattern of abuse of an individual suffering from financial and emotional vulnerability,” Acton said in a written decision issued in March in Saskatoon Court of Queen’s Bench.
Acton awarded Branco punitive damages of $3 million against Zurich and $1.5 million against AIG. He also awarded Branco aggravated damages of $450,000 against the two companies and ordered them to continue regularly paying his benefits under their policies.
“The court is cognizant of the fact that a punitive damages award of $3 million (against Zurich) may not be particularly significant to the financial bottom line of a successful worldwide insurance company,” Acton wrote. “It is hoped that this award will gain the attention of the insurance industry. The industry must recognize the destruction and devastation that their actions cause in failing to honour their contractual policy commitments to the individuals insured.”
Saskatoon judge orders insurance companies to pay man $5 million in damages
Before his injury, Branco was “a proud, athletic and hard-working individual,” Acton wrote. One of the many specialists who examined him said Branco was “an overachiever, sincere and genuine ... a warm, friendly, sensitive person.”
Born in Portugal, Branco immigrated to Canada when he was 24 and obtained his welding certificate in Halifax. He continued to advance his skills and eventually obtained his red seal. He worked throughout western and northern Canada before moving back to Portugal in 1994.
He began work in 1997 with Kumtor, a Cameco subsidiary, in Kyrgyzstan and was considered an “excellent employee.”
On Christmas Day, 1999, Branco dropped a steel plate on his foot and even though he thought he may have chopped off his toes, he continued to work until the end of his 12-hour shift. He washed his foot, found it still intact and packed it in snow. He finished his 28-day rotation and went home to Portugal to recuperate.
Near the end of his next rotation in March, he stepped on a piece of steel, reinjuring his foot. He didn’t return for his next rotation in April, seeking medical help in Portugal. However, his injury hadn’t improved by the time of his next rotation in June so he travelled to Kyrgyzstan, going directly to the company doctor and reporting his work injury.
Kumtor paid Branco until the end of his contract in March 2001, but he was never able to return to work. Thus began his saga with the insurance companies.
Three months after Branco began receiving workers’ compensation benefits from AIG in March 2001, AIG offered him the first cash settlement: $22,500 US.
He refused, triggering an AIG memo that gave some insight into what Acton termed “malicious” delays designed to get Branco to accept a small settlement. AIG adjuster Patti Schibler wrote in an August 2001 memo: “I hope he reconsiders because he lives in Portugal and he will have to go back to Canada to get an attorney and this whole process is going to take years to settle. Here we go CANADA!!!!!”
The following month, AIG requested further examinations by specialists in Saskatchewan, to where Branco travelled and where three specialists all confirmed his disability. Despite the medical reports, there were no ongoing payments and AIG demanded Branco pay out-of-pocket for rehabilitation in Portugal.
In October 2001, Branco launched court action against AIG and Zurich. Zurich approved Branco’s original long-term disability claim in March 2002, documents showed, but never informed Branco, who didn’t receive any funds from Zurich until May 2009 — nine years after the first payment was due. An independent audit that Zurich requested in 2007 also recommended accepting his claim, but Branco was never told.
What Zurich did was offer a cash settlement in April 2003 of $62,900 minus $9,000 in legal costs, even though there was already a court order in place for Zurich to pay Branco’s legal costs. Branco refused.
As the case wound its way through the court system, Branco travelled to Calgary for more medical examinations in the fall of 2007 at the request of the insurance companies and Kumtor. Seven of 10 specialists agreed Branco had “reflex sympathetic dystrophy,” or complex regional pain syndrome — confirming his long-term disability.
Following that, AIG, Zurich and Kumtor made a joint settlement offer of $238,000 in April 2008. Branco refused.
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