Whiten v. Pilot Insurance Co.

[2002] S.C.R. 595, 209 D.L.R. (4th) 257, 156 O.A.C. 201, 20 B.L.R. (3d) 165, 35 C.C.L.I. (3d).; This is the leading case in Canada on punitive damages awards against insurers for “bad faith”. After a jury made a record breaking award of $1 million in punitive damages against an insurer that raised an arson defence to a house fire claim, Lerners was retained and managed to persuade a majority of the Court of Appeal to reduce the award to $100,000. By a 7-1 majority, the Supreme Court of Canada restored the verdict, but set out guidelines that should keep such awards from becoming irrationally high.