Is there any breach of fiduciary duty in the context of a personal injury relationship?

The respondents submit that the claims against them cannot be made out as breaches of fiduciary duty. They contend the advice complained of was not given in the context of a fiduciary relationship. The hallmarks of the fiduciary relationship were summarized by Wilson J. in the well known passage from Frame v. Smith, 1987 CanLII 74 (SCC), [1987] 2 S.C.R. 99 (p. 136) as follows: Relationships in which a fiduciary obligation have been imposed seem to possess three general characteristics: (1) The fiduciary has scope for the exercise of some discretion or power. (2) The fiduciary can unilaterally exercise that power or discretion so as to affect the beneficiary’s legal or practical interests. (3) The beneficiary is peculiarly vulnerable to or at the mercy of the fiduciary holding the discretion or power.

The respondents submit that the parties had a sophisticated business relationship, and that the respondents were not exercising any unilateral power or discretion with respect to the appellants’ affairs. I agree that the duty breached by the respondents in this case was not a fiduciary one. Specifically, the relationship does not satisfy the second Frame v. Smith criterion. There was no delegated power that could be unilaterally exercised by the respondents, nor was there a conflict of interest that impacted on the appellants’ interests. The decisions on insurance coverage were made by the appellants. The respondents simply failed to advise the appellants with due care. That failure was a breach of their duties in tort and contract, but it was not a breach of any duty of a fiduciary nature.