Damages for Intentional Tort Survive Bankruptcy

The Court of Appeal recently released a decision that looks at the interplay of tort law and bankruptcy.

In Dickerson v. 1610396 Ont. Inc. (c.o.b. Casey's Pub & Grill), 2013 ONCA 4955 (C.A.), a jury awarded the plaintiff damages against the defendant in excess of $1 million arising out of an assault.  The defendant punched the plaintiff once in the head, causing the plaintiff to lose consciousness, fall to the ground and sustain brain damage.  As a result of the judgment, the defendant declared bankruptcy.  The plaintiff brought a motion for an order that the award of damages survived bankruptcy, based on s. 178(1)(a.1) of the Bankruptcy and Insolvency Act, which provides:

178(1) An order of discharge does not release the bankrupt from 

 (a.1) any award of damages by a court in civil proceedings in respect of 

(i) bodily harm intentionally inflicted, or sexual assault or 

(ii) wrongful death resulting therefrom.

The motions judge held that although the jury found the defendant "deliberately punched the plaintiff in the head", the verdict did not provide a framework to assess whether it was an "intentional infliction of bodily harm". She dismissed the motion and the plaintiff appealed.

The Court of Appeal allowed the appeal, holding that s. 178(1)(a.1) will apply where there is direct proof of intentional infliction of bodily harm or where it can be reasonably inferred.  As long as there is intent, the section will apply; there is no requirement to show the circumstances were sufficiently offensive to social mores to justify withholding the protection of bankruptcy.