Luciano Branco sued Zurich and AIG in 2001 and has been fighting for compensation ever since. A Court of Queen's Bench judge in Saskatoon recently awarded him nearly $5 million in damages.
Justice Murray Acton called the actions of the insurers "cruel and malicious" and said they establish "a pattern of abuse of an individual suffering from financial and emotional vulnerability."
Branco's lawyer, Alex Kotkas, says he's not sure if the companies will appeal.
"Part of me wants to hope that they don't appeal, of course, because we would like Mr. Branco to receive the money that is due to him, but thus far the behaviour of the insurance companies in this case tells me that's a very faint hope and that almost certainly they will appeal," Kotkas said Tuesday in a phone interview from Calgary.
The claim started in the remote mountains of Kyrgyzstan on Christmas Day 1999. Branco, a Canadian citizen who emigrated from Portugal, was working at a mine operated by Kumtor Operating Co., a subsidiary of Saskatoon-based Cameco Corp. (TSX:CCO), when he dropped a steel plate on his foot.
He packed his foot with snow to relieve the pain and take down the swelling, but kept working.
Branco reinjured his foot when he stepped on a piece of steel the following March. He couldn't go back to work.
Court documents show Branco went to doctors in Portugal, where he was living at the time, and in Canada, as demanded by the insurance companies. He took medication, did physiotherapy and had surgery, but nothing helped. Branco remains with chronic pain and "significantly reduced function" of his right leg, say the documents.
The judge's ruling notes that Branco lost his ability to support his family, his marriage broke down, and his daughter had to buy him clothes. She also moved to a smaller home so she could have enough money to help her father.
Branco, 62, was ashamed and became depressed, the ruling said.
Some benefits initially flowed, but were soon suspended.
Kotkas said the insurance companies kept finding different reasons to deny Branco benefits.
"But eventually it turned and it actually became something far more than that," he said.
"They actually knew that they were hurting him and that he was having these mental consequences, that he developed severe depression and even in the face of that — and even though their own internal claims department was telling them that the claim had to be paid — the insurance company still didn't pay.
"That goes beyond the runaround. That's actually an intentional effort to hurt somebody."
Acton was scathing in his ruling.
"Had AIG made the monthly payments on a regular and timely basis as required under the policy there would in all likelihood not have been the significant amount of mental distress which has virtually destroyed Branco’s life over the last 13 years," he wrote.
The judge said the evidence showed Zurich's actions were an attempt at "starving Branco into submission."
"This court cannot imagine more protracted and reprehensible behaviour than that of Zurich in blatantly refusing to pay what had been owed in monthly payments for almost eight years (10 years from the date of the accident). This failure to pay and continual court applications instigated by Zurich with no reasonable justification were nothing short of torturous on Branco."
The ruling is dated March 21. The insurance companies have 30 days from that date to appeal.
— By Jennifer Graham in Regina