Barkley v Sloan, 2025 ONSC 6057 offers a clear illustration of how incorrect legal advice can cross the threshold into professional negligence.
Navigating claims under the Statutory Accident Benefits Schedule (SABS) requires specialized legal guidance, and when that guidance is flawed, the consequences for clients can be severe. For this reason, a lawyer practicing in this area of law is held to a high standard. Nonetheless, this case also demonstrates why not every mistake a lawyer makes leads to professional negligence.
The plaintiff, A.B., sued her former lawyer, P.S., alleging negligent advice that led her to settle her SABS claim for $25,000. P.S. incorrectly advised A.B. that she was likely ineligible for IRBs because her post-accident income was too high. This advice stemmed from his misunderstanding that post-accident income was deducted dollar for dollar rather than as a 70% deduction from A.B.’s IRBs entitlement according to s. 7(3)(b) of the SABS. This misunderstanding led A.B. to abandon her IRB claim entirely.
P.S. also failed to properly advise A.B. about her right to pursue a catastrophic (CAT) determination or that Belair, her insurer, could fund the necessary assessments. A.B. settled her claim only 18 months after the accident. At the time of settlement, her physical and psychological symptoms, including diagnoses of Chronic Regional Pain Syndrome (CRPS), PTSD, and anxiety, were worsening, and her future prognosis was unknown. The court held that a prudent lawyer would have advised her not to enter a full and final settlement until her prognosis was clearer. This was critical as settling meant eliminating A.B.’s claim to significantly enhanced CAT impairment benefits. The court found that there was no reason to seek a full and final settlement at that time.
Finally, the court noted that a lawyer breaches the standard of care by failing to clearly document and communicate crucial advice, especially when the client is considering a settlement that may be adverse to their long-term interests. P.S. admitted he did not specifically respond in writing to the plaintiff’s inquiries about CAT impairment potential. He also failed to document his verbal advice. The failure to document advice in writing was deemed insufficient to meet the appropriate standard of care.
Justice Nightingale found that P.S.’s advice and failure to document said advice in writing fell below the standard of care expected of a reasonably competent personal injury lawyer, but that no damages flowed from the negligence. A.B. could not prove that her lawyer’s advice caused her loss as she likely would have settled anyway given her financial situation. She also later hired new counsel who could have attempted to undo the settlement but did not. The court also noted that her subsequent $1.5 million tort settlement compensated her for similar losses. Further, medical evidence showed she was not catastrophically impaired. The court ultimately dismissed the claim despite a finding of negligence as there were no proven damages.
Without causation or quantifiable damages, the negligence finding was more cautionary than anything. Even when the standard of care is breached, damages depend on whether the outcome would have changed.
Key Takeaways for Lawyers
- Know the SABS: Misstating a core provision like the IRB calculation can amount to negligence.
- Advise thoroughly: Always explain the implications of early settlements, particularly before medical stability or potential CAT determinations.
- Document advice in writing: Courts expect to see written confirmation of critical discussions and decisions.
Barkley v Sloan reminds AB counsel that even simple statutory missteps can breach the standard of care, but it also reinforces that not every error translates into damages. The best protection remains clear advice, careful documentation, and a deep understanding of the SABS framework.
Elisa Prezzano is the author of this blog and an articling student at the firm. If you have a question about this decision or a similar file, please contact Elisa at [email protected]
