1 No. Vancouver Registry IN THE SUPREME COURT OF BRITISH COLUMBIA BETWEEN: BENJAMIN TEPEI, ADRIAN TEPEI, ANGELICA TELESCU, CAMELIA COLCER, DAN TEPEI by his litigation guardian, Dina Tepei, and the said DINA TEPEI AND: THE INSURANCE CORPORATION OF BRITISH COLUMBIA, DANNY BURNETT and SANDRA FERRELL PLAINTIFFS DEFENDANTS NOTICE OF CIVIL CLAIM This action has been started by the Plaintiff for the relief set out in Part 2 below. If you intend to respond to this action, you or your lawyer must (a) (b) file a response to civil claim in Form 2 in the above-named registry of this court within the time for response to civil claim described below, and serve a copy of the filed response to civil claim on the plaintiff. If you intend to make a counterclaim, you or your lawyer must (a) (b) file a response to civil claim in Form 2 and a counterclaim in Form 3 in the abovenamed registry of this court within the time for response to civil claim described below, and serve a copy of the filed response to civil claim and counterclaim on the plaintiff and on any new parties named in the counterclaim. JUDGMENT MAY BE PRONOUNCED AGAINST YOU IF YOU FAIL to file the response to civil claim within the time for response to civil claim described below.
2 TIME FOR RESPONSE TO CIVIL CLAIM A response to civil claim must be filed and served on the Plaintiff, (a) (b) (c) (d) if you reside anywhere in Canada, within 21 days after the date on which a copy of the filed notice of civil claim was served on you, if you reside in the United States of America, within 35 days after the date on which a copy of the filed notice of civil claim was served on you, if you reside elsewhere, within 49 days after the date on which a copy of the filed notice of civil claim was served on you, or if the time for response to civil claim has been set by order of the court, within that time. CLAIM OF THE PLAINTIFFS PART 1: STATEMENT OF FACTS THE PARTIES 1. The Plaintiff Benjamin Tepei is a stone mason, presently residing at 1825 Laurier Avenue, Port Coquitlam, British Columbia. 2. The Plaintiff Adrian Tepei is a part-time roofer s assistant, presently residing on Austin Road, Coquitlam, British Columbia. 3. The Plaintiff Angelica Telescu, is a homemaker, presently residing at rd Avenue, in Fort St. John, British Columbia. 4. The Plaintiff Camelia Colcer is a care aide, presently residing on St. Anne Street, Port Coquitlam, British Columbia. 5. The Plaintiff Dina Tepei is a homemaker, presently residing at 1825 Laurier Avenue, Port Coquitlam, British Columbia. Dina Tepei is the mother of the other four Plaintiffs and Plaintiff Dan Tepei and has been appointed committee over Dan Tepei s person and estate. 6. The Defendant Insurance Corporation of British Columbia ( ICBC ) is a Crown corporation registered pursuant to the laws of the province of British Columbia, with
3 its principal place of business at 151 West Esplanade, North Vancouver, British Columbia. 7. The Defendants Danny Burnett ( Burnett ) and Sandra Ferrell ( Ferrell ) are Senior Claims Representatives and employees of the Defendant ICBC, and have addresses unknown to the Plaintiffs. THE INCIDENT 8. On October 27, 1996, the Plaintiffs were involved in a motor vehicle accident on Interstate 5 in the vicinity of Onalaska, Lewis County, Washington, United States. 9. The vehicle in which the Plaintiffs were traveling as passengers at the time of the 1996 accident was a 1990 Toyota Previa van owned by the Plaintiffs father and husband, Petru Tepei. 10. On April 26, 2004, following a seven-week trial before a jury in Lewis County, Washington, the Plaintiffs were awarded US $9,103, in damages against Petru Tepei for injuries and losses sustained in the 1996 accident (hereinafter, the Washington Judgment ). 11. At the time of the 1996 accident, Petru Tepei possessed a valid British Columbia owner s certificate for the 1990 Toyota Previa, as well as third party automobile liability insurance coverage from the Defendant ICBC in the amount of CDN $200,000 per incident. 12. As a member of Petru Tepei s household at the time of the 1996 accident, the Plaintiffs qualified as insured s entitled to receive underinsured motorist protection ( UMP ) benefits through the owner s certificate held by their father and husband, pursuant to 148.1(1) of the Revised Regulations under the Insurance (Motor Vehicle) Act ( the Regulations ). 13. The damages awarded the Plaintiffs exceeded the limits of available insurance and/or assets available to satisfy the Plaintiffs judgment in the Washington state action. As a result, the Plaintiffs asserted a right to collect UMP benefits pursuant to of the Regulations.
4 FACTS RELEVANT TO FIRST CLAIM ICBC S DUTY TO TIMELY EVALUATE THE PLAINTIFFS FIRST PARTY CLAIMS 14. The Plaintiffs incurred more than $350,000 in litigation expenses pursuing their Washington Judgment, the financing for which they incurred continuing interest of 12% per annum. The Plaintiffs conveyed these figures to the Defendant ICBC on or before December 3, Following preliminary negotiations on January 11, 2005, the Defendant ICBC offered to settle the Plaintiffs first party UMP claims as follows: Adrian Tepei $102,500 Angelica Telescu $185,000 Ben Tepei $237,500 Camelia Colcer $ 18,750 Dan Tepei $112,500 Dina Tepei $ 25,000 Total: $681,250 The Defendant ICBC further offered $100,000 to the Plaintiffs collectively, as costs. 16. On February 17, 2005, the Plaintiffs offered to settle their claims collectively for the sum of $2,500,000 inclusive of costs. 17. It having become evident that a dispute existed between the parties as to the amount of compensation to which the Plaintiffs were entitled under the applicable UMP coverage, pursuant to 148.2(1) of the Regulations, the Plaintiffs were compelled to submit this dispute to arbitration under the Commercial Arbitration Act. 18. In the UMP case, the Defendant ICBC argued that the arbitrator could ignore the 2004 findings of the Washington court and force the Plaintiffs to reprove both causation and damages, at significant additional expense and delay for the Plaintiffs.
5 19. More than five years after its initial offers, beginning in or about March 2010, the Defendant ICBC offered to settle the Plaintiffs claims as follows: Adrian Tepei September, 2011 $590,000 Angelica Telescu March 8, 2010 $468,800 Ben Tepei August 11, 2010 $445,000, plus costs Camelia Colcer March 8, 2010 $40,000, plus costs Dan Tepei January 14, 2011 $500,000 plus costs Dina Tepei March 8, 2010 $ 50,000 TOTAL: $2,093,000, plus costs 20. After a hearing on the merits by Order dated May 13, 2010, Arbitrator J.J. Camp awarded certain Plaintiffs the following amounts of UMP compensation: Angelica Telescu $707, Camelia Colcer $46,200 Dina Tepei $84, The Defendant ICBC owed the Plaintiffs a duty of good faith and fair dealing which required them to fairly, reasonably, fully and properly investigate the Plaintiffs claims and to offer them a reasonable amount to settle their claims, keeping the Plaintiffs interests equal to the Defendant ICBC s interest, which they failed to do. FACTS RELEVANT TO SECOND CLAIM ICBC S DUTY TO DISCLOSE CONFLICT OF INTEREST 21. On December 1, 2004, the Defendant ICBC proposed the names of three lawyers as potential arbitrators for the adjudication of the UMP dispute. 22. At the time of proposing these three candidates, the Defendant and its agents knew, or in the exercise of reasonable care should have known, that all three of the lawyers proposed as potential arbitrators were members of law firms which provided legal
6 services to the Defendant and/or its insureds, and which had entered into contracts with the Defendant for the provision of the same. 23. At the time of proposing these three candidates, the Defendant and its agents knew, or in the exercise of reasonable care should have known, that as a condition of providing legal services to the Defendant and/or its insureds, all three of the proposed arbitrators and their firms were signatories to a Strategic Alliance Agreement between themselves, their firms and the Defendant which, among other provisions: (a) (b) prohibits signatory lawyers and their firms from counseling or assisting parties in advancing actions against the Defendant alleging claims of punitive, aggravated or exemplary damages, whether by direct or indirect conduct; and grants the Defendant at its discretion the right to terminate the contract for legal services between itself and a signatory lawyer or firm if any member of the signatory firm engages in any activity that was, is, or may be contrary to the Defendant s strategic business or financial direction or initiatives. 24. At no time did the Defendant ICBC disclose to the Plaintiffs that the lawyers proposed as arbitrators for the Plaintiffs dispute were members of law firms which had a prior and ongoing contractual agreement with the Defendant for the provision of legal services. 25. At no time did the Defendant disclose to the Plaintiffs that the lawyers proposed as arbitrators for the Plaintiffs dispute were bound, either individually or as members of signatory law firms, by the provisions of a Strategic Alliance Agreement between themselves and the Defendant, or the terms contained within that agreement. 26. Following negotiations between counsel, the Plaintiffs elected to proceed with their UMP arbitration before Joseph P. Boskovich of the law firm of DuMoulin & Boskovich. The Plaintiffs joined with Defendant in contracting with Mr. Boskovich to provide his services as an arbitrator of this matter, with the costs and expenses associated with those services to be borne between the parties as
7 required by the rules of the British Columbia International Commercial Arbitration Centre ( BCICAC ). 27. Upon accepting appointment as arbitrator in the Plaintiffs matter, Mr. Boskovich executed on December 13, 2004 a one page Statement of Independence and Impartiality as required by the BCICAC for all domestic arbitrations conducted under its aegis. In his statement, Mr. Boskovich asserted, among other provisions: (a) that he had no interest, directly or indirectly, in the outcome of the dispute between the Plaintiffs and Defendant; and (b) that he was unaware of any circumstances that could give rise to justifiable doubts as to his independence or impartiality, or which could raise a likelihood of perceived bias in the conduct of the Plaintiff s arbitration. 28. In the face of arbitrator Boskovich s Statement of Independence and Impartiality, the Defendant ICBC stood silent, despite knowing that the assertions contained therein were misleading and/or inaccurate. 29. Subsequent to the commencement of the UMP arbitration process, and following significant expenditures of time and effort on the part of Plaintiffs, the Plaintiffs learned of the existence of the previously undisclosed business relationship between the Defendant and arbitrator Boskovich and his firm. 30. The Defendant owed the Plaintiffs a duty of good faith and fair dealing, grounded in both contract and in tort, to fully disclose all information in its possession bearing on the qualifications, impartiality and independence of an arbitrator proposed to resolve disputes arising under the Regulations, including but not limited to: (a) (b) the existence, nature and extent of the ongoing financial relationship between the Defendant and a proposed and/or selected arbitrator or his firm, if any; and the existence, nature and extent of any contractual obligations running between the Defendant and a proposed and/or selected arbitrator or his firm, whether contained in the Strategic Alliance Agreement or otherwise.
8 31. The Defendant breached this duty of good faith and fair dealing to the Plaintiffs by the conduct alleged herein. 32. Further, and in the alternative, the Defendant s conduct constitutes a negligent misrepresentation regarding the fairness and impartiality of the arbitration process in which the Plaintiffs are statutorily compelled to participate. 33. The Defendant had a duty to refrain from making misrepresentations of fact regarding the fairness and impartiality of arbitrators proposed or chosen by the parties, which included a duty to fully disclose all information in its possession bearing on the qualifications, impartiality and independence of an arbitrator proposed to resolve disputes arising under the Regulations. The Plaintiffs assert the Defendant negligently breached this duty based on the facts alleged herein. 34. The Plaintiffs reasonably relied upon the Defendant s negligent misrepresentations to their detriment, resulting in damage to the Plaintiffs. CAUSATION AND DAMAGES 35. As a result of the Defendant s conduct alleged herein, the Plaintiffs have sustained a range of general and special damages. Without in any way limiting or restricting the scope and extent of damages the Plaintiffs may seek to prove at trial, the Plaintiffs have suffered delay in the payment of monetary benefits, continued interest on financed litigation expenses, the actual costs expended in the furtherance of an arbitration procedure which has been made worthless by the impermissible taint of bias, and nominal or other damages for the inconvenience, frustration and delay occasioned by the Defendant s conduct. AGGRAVTED DAMAGES 36. Defendants, well knowing the Plaintiffs mental, emotional and financial situation, have continued to wrongfully deny the Plaintiffs benefits, in consequence of which the Plaintiffs have sustained additional mental and emotional stress, anxiety, worry, upset, economic hardship and additional pecuniary loss, in having to retain Legal
9 Counsel and incur Legal expense to obtain benefits lawfully due to the Plaintiffs all in consequence of the Defendants' Bad Faith and Wrongful Conduct, which conduct has materially aggravated the Plaintiffs circumstances and condition. PARTICULARS OF BAD FAITH 37. The Defendants have acted in Bad Faith, and acted wantonly toward the Plaintiffs PARTICULARS OF WHICH ARE AS FOLLOWS.: (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) (m) (n) (o) (p) Failing to thoroughly investigate their insureds claims and to fully inquire into all possible bases that might support their insureds claims; Failing to objectively evaluate the insureds claims; Failing to contact the insured's treating physicians, where any clarification may have been required; Construing the Policy in a manner more onerous than written; Failing to fairly, reasonably, fully, and properly investigate the Plaintiffs matter; Failing to treat the Plaintiffs interests with equal regard to its own interests; Failing to act fairly and reasonably; Failing to pay benefits in a timely manner; Failing to properly evaluate material provided; Discounting a claim due supposedly to lack of information, when the Defendant had a duty to assist the Plaintiffs with the claim, and collect medical information; Failing to assist the Plaintiffs with their claims; Failing to pay benefits in a timely manner; Failing to properly evaluate material provided; Denying and delaying the Plaintiffs claims so as to increase Defendant Company's profitability; Failing to provide any reasonable explanation for denying and delaying the Plaintiffs claims; Selectively accepting medical information supporting the Defendant s position,
10 (q) (r) and ignoring evidence supporting the Plaintiffs injuries and disabilities; Failing to properly hire, train or monitor its claims adjudicators, including Defendants Burnett and Ferrell; Such further particulars as Counsel may advise. INTENTIONAL INDUCEMENT OF BREACH OF CONTRACT & INTENTIONAL INTERFERENCE WITH CONTRACT 38. The Defendants Burnett and Ferrell intentionally induced the Defendant, ICBC to breach the owner s certificate of UMP insurance and intentionally interfered with the performance of the contract, thus breaching the duty of good faith and fair dealing to the Plaintiffs, which conduct represents an independent actionable wrong irrespective of any statutory or contractual entitlement to benefits. CONFLICT OF INTEREST 39. At all relevant times, the Claims Examiners had the responsibility of administering the Plan of Insurance, and paying benefits from their employer s funds; at all relevant times, the Defendant s ICBC, Claims Examiners productivity, promotions and consequential compensation amounted to an inherent conflict of interest, particulars of which are solely and entirely within the knowledge of the Defendants. PUNITIVE & EXEMPLARY DAMAGES 40. The Defendant ICBC had conducted itself reprehensibly and in a willful and conscious disregard for the Plaintiffs contractual rights, subjecting the Plaintiffs to cruel and unjust hardship, intentionally depriving the Plaintiffs of benefits, acting in BAD FAITH toward the Plaintiffs, which conduct was willful, wanton, and
11 conduct designed to make an economic benefits for the Defendant, ICBC which conduct necessitates reproval. 41. The Plaintiffs will seek Punitive Damages commensurate to the Defendant s, ICBC s, net worth. PART 2: RELIEF SOUGHT the Plaintiffs claim against the Defendants as follows: (a) general damages; (b) special damages; (c) punitive damages; (d) aggravated damages; (e) pre- and post-judgment interest, as applicable; (f) costs of maintaining this action, as applicable; and (g) such other and further relief as this Court may deem just and proper. PART 3: LEGAL BASIS BAD FAITH The Defendants owed the Plaintiffs a duty of good faith and fair dealing, pursuant to the Insurance (Vehicle) Act R.S.B.C c. 318, the Insurance (Motor Vehicle) Act R.S.B.C c. 231, and the Regulations promulgated thereto, which they breached. Plaintiffs address for service: CROSS BORDER LAW CORPORATION West 2 nd Avenue Vancouver, BC V6J 1H6 Fax number for service: address for service:
12 Place of Trial: 800 Smithe Street, Vancouver, BC The address of the registry: Vancouver Law Court 800 Smithe Street Vancouver, B.C. V6Z 2E1 Dated: March, Greg Samuels Barrister and Solicitor Lawyer for Plaintiffs
13 Rule 7-1(1) of the Supreme Court Civil Rules states: (1) Unless all parties of record consent or the court otherwise orders, each party of record to an action must, within 35 days after the end of the pleading period, (a) prepare a list of documents in Form 22 that lists (i) all documents that are or have been in the party s possession or control and that could, if available, be used by any party at trial to prove or disprove a material fact, and (ii) all other documents to which the party intends to refer at trial, and (b) serve the list on all parties of record.
14 APPENDIX (The following information is provided for data collection purposes only and is of no legal effect) PART 1: CONCISE SUMMARY OF NATURE OF CLAIM: PART 2: THIS CLAIM ARISES FROM THE FOLLOWING: A matter not listed here. PART 3: THIS CLAIM INVOLVES: None of the above PART 4: ENACTMENTS RELIED ON 1. Insurance (Vehicle) Act, R.S.B.C c. 318, c Negligence Act, R.S.B.C c. 333; and 3. Court Order Interest Act, R.S.B.C c Insurance (Motor Vehicle) Act R.S.B.C c. 231