Ontario’s Ministry of the Attorney General has been anticipating a potential rush to litigation by parties seeking damages for injuries suffered as a result of COVID-19. In order to combat this, the Attorney General proposed a new piece of legislation, called the Supporting Ontario’s Recovery Act (the “Act”), which received royal assent on November 20th. The Act addresses several issues aimed at helping businesses recover from the financial fallout of the pandemic, one of the purposes of the Act is to limit the liability of corporations and individuals with respect to claims tied to the transmission of COVID-19 infections.
The goal of the new legislation appears to be to allow such actions to proceed but only where they meet certain requirements. The legislation will allow plaintiffs to pursue these claims only where the defendants have been “bad actors” in complying with the pandemic restrictions put in place by public health authorities. A “bad actor” is a party that has been grossly negligent or has intentionally ignored the health restrictions, contributing to the spread of the virus. The Act applies to all individuals, companies and the Crown (with certain contextual exemptions, as discussed below).
How Does the Supporting Ontario’s Recovery Act Shield Companies and Individuals From COVID-19 Liability?
The Act sets out the restrictions at section 2(1) as follows:
[N]o cause of action arises against any person as a direct or indirect result of an individual being or potentially being infected with or exposed to coronavirus (COVID-19) on or after March 17, 2020 as a direct or indirect result of an act or omission of the person if,
- at the relevant time, the person acted or made a good faith effort to act in accordance with,
- public health guidance relating to coronavirus (COVID-19) that applied to the person, and
- any federal, provincial or municipal law relating to coronavirus (COVID-19) that applied to the person; and
- the act or omission of the person does not constitute gross negligence.
“Gross Negligence” and the Supporting Ontario’s Recovery Act
Unfortunately, there is no definition of what is meant by “gross negligence” set out in the Act. There are few precise definitions elsewhere so what does it mean in this context? The breach of the standard of care must be more than merely negligent, it must be grossly negligent. It appears to be an instance of “we will know when we see it”, as the courts interpret this term, however it should not require any element of malice or intention.
The legislation provides a very sweeping and powerful defense to civil liability for COVID-19 infections. If a defendant can prove that the Act was intended to protect them from liability, they can move to have the action dismissed. Further, any such proceedings commenced before the Act comes into force are to be deemed to be dismissed without costs.
This is a very narrow window for such actions by plaintiffs, and leaves them with little in the way of recourse unless the plaintiff is found to have exhibited “gross negligence” or was otherwise a “bad actor”. In particular, legislation is expected to have a significant impact on those looking to seek damages from long-term care facilities for the deaths of loves ones who became infected in outbreaks. There are already a number of class actions in progress across the country with respect to these claims.
“Public Health Guidance” Under the Supporting Ontario’s Recovery Act
What is meant by the term “public health guidance”? What of arguments that the advice was confusing, contradictory or inconsistent? The Act deals with this by stating that the protections available under section 2(1) still apply despite any such confusion, conflict or inconsistency. What is required is a good faith effort by the defendant to comply with the public health guidelines that applied at the relevant time. “Good faith” is defined in the Act as an honest effort to comply with the reasonable guidelines in place at the applicable time, even if those efforts would now be perceived as unreasonable.
Exceptions to the Liability Limitations
The Act and its defences would not apply to acts or omissions committed by so-called ‘bad actors’, which would include situations where a business or function was operating in contravention of the law. For example, if a person became infected while shopping in a store that was operating during a government-imposed lockdown, the Act would not protect the store owner from liability.
There are other exceptions, and the most notable are in the employment context. Despite the fact that business owners are shielded from liability in most cases, workers keep the right to commence an action where they have suffered from a COVID-19 exposure or infection that occurred as a result of their employment. Their rights to proceed under the Workplace Safety and Insurance Act for occupational injury will remain in place.
If you or your business are facing litigation relating to COVID-19 or expect to be, the exceptionally skilled corporate litigation lawyers at Milosevic Fiske LLP in Toronto can help. Over the years, our team of lawyers has successfully fought for our clients’ rights and our impressive track record speaks for itself. Please contact us by calling 416-916-1387 or connect online for a consultation.