This Div is a JS Trigger
Issue 76 | July 2022

LIANSWERS

This newsletter includes information to help lawyers reduce the likelihood of being sued for malpractice. The material presented is not intended to establish, report, or create the standard of care for lawyers. The articles do not represent a complete analysis of the topics presented, and readers should conduct their own appropriate legal research.
The Importance of Notes: It’s Not Just for Lawyers, It's Good Business Practice

In the recent Manitoba decision of Funk et al. v. Aviva Insurance Company of Canada et al., 2022 MBQB 149, the Court granted the defendants’ summary judgment motion and dismissed the claim. The Court held that the defendants exercised the appropriate standard of care and as such there was no genuine issue for trial.

Essentially, the action was against the insurance broker for negligence. In granting summary judgment, the Court said this about the broker’s business practice:

[39]         First, I note that the [broker] maintained a contemporaneous log of discussions and correspondence with the plaintiffs as part of their regular business routine.  There was nothing special about these clients that caused these notes to be taken – it was simply a good business practice.  The plaintiffs did not keep notes.

Moreover, on an issue for which the broker did not have a specific note, there is this:

[42]         In reference to the Questionnaire, [the broker] deposed that she specifically asked about the heat sources in the outbuildings (at para. 10): 

...  Although my notes do not specifically refer to there being no woodstove in any of the outbuildings, it was, and is, my general practice to ask whether any of a client’s buildings contains a woodstove or any other source of heat.  I did that in my discussion with Mr. Funk.  He advised me that there was no heat in the garage.  He did not advise me that there was a woodstove in the garage.

We have often said that notes contemporaneously made during your handling of a file certainly help in defending a claim. But it is also true that that lack of notes will not make a matter indefensible. When there are no notes on specific issues, evidence of your regular practice is equally helpful.

In the end, the Court held that the broker met the standard of care by (i) asking the client appropriate questions to obtain material facts relevant to the matter, (ii) asking the client to read the insurance application to confirm its accuracy (similar to sending your client a retainer letter confirming what you will be doing and a reporting letter confirming what you did), and (iii) based upon the information and instructions received properly assessed the risk, gave appropriate advice and placed appropriate insurance.