Car Parts - Liberty Mutual Insurance Company
Failure to Compensate Insureds
Colin Stevenson and Harvin Pitch were lead counsel acting for the plaintiffs in an action against Liberty Mutual Insurance Company. The claim included the allegation that when a motor vehicle is damaged in an accident the insurers would not authorize replacement parts from the original equipment manufacturer (OEM) (e.g., Ford, DaimlerChrysler, etc.). Instead, as alleged in the claim, they require the use of cheaper, "imitation" parts which are often manufactured in Taiwan. The claim alleged these parts were not "of like kind and quality" to the OEM parts. This claim was similar to claims brought in the United States which recently resulted in a judgment in the U.S. against State Farm in the amount of approximately US$900,000,000.00. In August 2005, after a two year delay, a Court of Appeals reversed the judgment. The battle continues in the United States.
The Liberty Mutual case was certified by Justice Nordheimer of the Ontario Superior Court of Justice.
To access Justice Nordheimer's reasons follow the links below:
Reasons released June 14, 2004 (click here to access)
Reasons released November 22, 2004 (click here to access).
Justice Nordheimer's costs award in favour of the plaintiffs was made on January 5, 2005 (click here to access)
This action was settled and approved by the court on January 31, 2006. In summary, the settlement involved a claims administrator sending claims forms to persons specified on a list provided by Liberty Mutual as having sustained property damage to a vehicle insured by Liberty Mutual who had a claim paid between 1990 and 1999 based upon the last known address. Each qualifying person received $50 per person. Any residue remaining after deduction of certain legal fees was paid in equal proportions to Mothers Against Drunk Driving and to the Automobile Repair Research Centre. The last date for filing claims with the claims administrator was March 31, 2006.