Great-West Life Assurance Participating Life Insurance Policies

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McKittrick v. The Great-West Life Assurance Company and Great West Lifeco Inc.

IMPORTANT ANNOUNCEMENT:

This action has been resolved to the final appeal. The Ontario Court of Appeal released its decision on February 3, 2014 respecting the remedy that will be provided to Class Members in the litigation. The Ontario Court of Appeal has ruled that the sum of $51.6 million dollars plus an applicable rate of interest will be payable to the participating accounts of London Life and Great-West Life.

The Class Representatives requested the opportunity for a hearing at the Supreme Court of Canada. That request was denied. As a result the decision of the Ontario Court of Appeal is final.

The parties will be attending before the Ontario Superior Court of Justice to request approval of a notice to be provided to Class Members. Class Counsel will also be making an application for payment of Class Counsel Fees. Further particulars will be added to this website once they are available.

Summary of the Litigation:

On August 19, 2005, Harrison Pensa LLP issued a Statement of Claim against The Great-West Life Assurance Company (“GWLAC”) and Great-West Lifeco Inc. (“Lifeco”). The action was brought on behalf of a class of people defined as follows: The action relates to a transaction whereby $40,000,000 was taken from the participating policyholders’ account of GWLAC and used towards the financing of the acquisition of London Insurance Group Inc. (the parent company of London Life Insurance Company) by GWLAC and Lifeco. It is alleged that the transaction violates the Insurance Companies Act and the common law. The action seeks the repayment of all amounts improperly removed from the participating policyholders’ account, appropriate interest or other compensation for the loss of the use of the removed funds, disgorgement of any benefits obtained by the Defendants from the use of the funds and an order compelling the payment of dividends, bonuses or other benefits to the class. The Representative Plaintiffs believe that the Par Account Transactions caused significant harm to the participating policyholders and that they were undertaken without regard to (or adequate protection of) the interests of participating policyholders. The defendants dispute the plaintiffs’ allegations.

Status of the Proceedings

The trial of this matter took place between September 28, 2009 and January 15, 2010. Prior to the trial, the case was the subject of extensive case management. The matter was certified on February 29, 2008. The certification decision was upheld on appeal to the Divisional Court by a decision dated September 3, 2008. The parties undertook extensive oral and documentary discovery in advance of the trial.

On October, 1, 2010, the trial judge released Reasons for Judgment. The plaintiffs and the class were successful and the court ordered the defendants to pay approximately $400 million dollars. The trial court also ordered that litigation trusts be formed in order to facilitate a distribution of benefits to class members. A copy of the decision can be accessed below.

The Trial Judge’s decision was appealed by the Defendants. The appeal was heard by the Ontario Court of Appeal on June 6, 7 and 8, 2011. On November 3, 2011, the Ontario Court of Appeal released its decision.  Please click for a copy of the Court of Appeal’s decision.

The Court of Appeal upheld the Trial Judge’s findings respecting the defendants’ breaches of the Insurance Companies Act but allowed the appeal in part on the issue of the remedy to be given for the breaches found.  The Court of Appeal established a formula for the calculation of that remedy and directed the parties to return to the Trial Judge so that the exact value of the remedy could be established. The plaintiffs sought leave to appeal to the Supreme Court of Canada from the decision of the Court of Appeal.  That request for leave was denied. The parties returned to the Trial Judge on January 7 and 8, 2013 to make arguments respecting the value of the remedy granted to the class under the formula established by the Court of Appeal.  On January 24, 2013, the Trial Judge released her decision which awarded $284.67 million dollars plus interest from December 31, 2011 as a consequence for the defendants’ breaches of the Insurance Companies Act.  The defendants have appealed the Trial Judge’s decision.  The appeal was heard on September 4, 2013.  

On February 3, 2014, the Ontario Court of Appeal released its decision. A copy of the decision can be accessed here.

The Court of Appeal has ruled that a sum of $51.6 million dollars plus an applicable rate of interest is payable to the participating accounts of London Life and Great-West Life.

The Class Representatives sought permission to appeal to the Supreme Court of Canada. That request for permission was refused. As a result the litigation is now resolved and there are no further appeals to be taken.

View Documents

Class Counsel

The law firms of Harrison Pensa LLP and Bates Barristers represent class members. Jon Foreman of Harrison Pensa can be reached at 519.661.6775 or by e-mail to Paul Bates of Bates Barristers can be reached at 416.869.9898 or by e-mail at