Counsel for the Plaintiff: Linda Ostry.
Counsel for the Defendant: Nevin Fishman.

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SCARTH J.:— The defendant applies under Rule 18A for an order dismissing the plaintiff's action. The basis of the application is a Release of Claims signed by the plaintiff on August 31, 1988, which, the defendant asserts, bars the plaintiff's claims. In response, the plaintiff says she was induced to sign the Release on the basis of misrepresentation. As well, she pleads non est factum and unconscionability.

The plaintiff commenced her action on May 4, 1989, against the defendant for damages pursuant to the Family Compensation Act, R.S.B.C. 1979, chap. 120, arising from the death of one Jeffrey Simmons Howes, on May 5, 1988, as the result of a motor vehicle accident. Following the close of pleadings, the defendant, by notice of motion filed January 18, 1990, brought this application under Rule 18A to have the action dismissed. When the matter came on for hearing on March 8th, the parties were given leave to cross examine the deponents of the affidavits filed in respect of the motion.

As a result, on April 30, 1990, the plaintiff and Mr. Frank Kusmer, a claims adjuster employed by the Insurance Corporation of British Columbia ("I.C.B.C."), which is the real defendant in this action, gave viva voce evidence before the Court. That evidence, as well as the evidence by way of affidavits, is before me.

The factual background to the signing of the Release is as follows.

Prior to his death on May 5, 1988, the late Mr. Howes and the plaintiff had lived in a common law relationship as husband and wife for approximately three and one-half years. They had met whilst at College in Ontario, and had moved to British Columbia in 1986, where they continued to live together until his untimely death. Accordingly, the plaintiff was the spouse of the late Mr. Howes within the meaning of the Family Compensation Act and, in view of the fact there was no personal representative of the deceased, was entitled to bring an action for damages as a result of his death for her own benefit under that Act. It was not until May 4, 1989, almost a year to the day following Mr. Howes' death, that the plaintiff's action under the Family Compensation Act was commenced.

The events surrounding the signing of the Release took place between May 5, 1988 and September 1st of that year. On May 9th Mr. Kusmer, who has been employed by I.C.B.C. as a claims adjuster since June, 1986, was assigned the file relating to the plaintiff`s claim. On May 16th, following Mr. Howes' funeral in Ontario, Mr. Kusmer received a telephone call from Mrs. Sharman Howes, the deceased's sister-in-law, who arranged a meeting with him, to take place during the afternoon of Wednesday, May 18, 1988.

On May 18th, the plaintiff and the deceased's brother, Gerrard Howes, attended upon Mr. Kusmer in his office in the I.C.B.C. Claims Centre in New Westminster. Mr. Howes gave Mr. Kusmer his business card, which indicates he is a sales representative for the Co-operators Insurance Services of Verona, Ontario.

The plaintiff's evidence is that she understood Mr. Kusmer was representing only the deceased's insurer, and not the insurer of the defendant, Mr. Linquist, who, it is alleged, was the driver of the other vehicle involved in the collision with the deceased's motorcycle. She assumed, notwithstanding she had lived in British Columbia for two years, that the system of motor vehicle insurance here was similar to that in Ontario, where there is no single common insurer for all drivers and each driver involved in a collision may be represented by a different insurance company. She owned no car in British Columbia and had had no previous dealings with I.C.B.C., she testified. In her affidavit she deposes it was her understanding that Mr. Kusmer represented the deceased's insurer, and not the defendant, Mr. Linquist, or his insurer. Mr. Kusmer, she states, did not at any time specifically advise her that he was acting on behalf of the defendant or his insurer.

Mr. Kusmer does not recall whether he told the plaintiff he was an I.C.B.C. adjuster. That, he testified, was obvious because the meeting was held at the I.C.B.C. office. He stated that in the ordinary course of events he would have given his card both to the plaintiff and to Mr. Gerrard Howes. Mr. Kusmer said he does not recall any discussion relating to whether he represented either the deceased's insurer or the insurer of Mr. Linquist. According to Mr. Kusmer, Mr. Howes knew that he, Kusmer, was there representing all aspects of the claim, and he believed Mr. Howes was advising the plaintiff.

I found Mr. Kusmer, in giving his evidence, to be a credible witness. Although the plaintiff, at the time of her meeting with Mr. Kusmer on May 18th, may have misunderstood his role as an adjuster employed by the common insurer for both the deceased and defendant, I am satisfied from the evidence, and so find, that Mr. Kusmer did not in any way misrepresent his role to the plaintiff or lead her to believe that he was representing only the deceased's insurer. Any misunderstanding on her part about Mr. Kusmer's role, I find, was attributable to her experience with the system of automobile insurance extant in Ontario, and her lack of experience with the scheme in place in British Columbia.

I infer from the evidence Mr. Kusmer did not at any time tell the plaintiff what his role as an I.C.B.C. Claims adjuster was. I do not fault him for that. The subject, I find, was not raised during their discussions. Moreover, according to Mr. Kusmer, most people already understand those things. At the meeting on May 18th, the deceased's brother attended with the plaintiff. He represented to Mr. Kusmer that he was in the insurance business. Mr. Kusmer understood he was advising the plaintiff. Both the plaintiff and Mr. Howes spoke about retaining a lawyer, which left it up in the air, so far as Mr. Kusmer was concerned, whether he would be dealing further with the plaintiff.

During the meeting on May 18th Mr. Kusmer discussed with Mr. Howes and the plaintiff payment of the deceased's funeral expenses and the damage to his motorcycle. According to Mr. Kusmer the latter subject was foremost on Mr. Howes' mind; it was he who took the dominant role during the discussion.

Mr. Kusmer also took from the plaintiff a three and one- half page hand written statement, focusing on the relationship between her and the late Mr. Howes. Mr. Kusmer testified he asked the plaintiff questions, and wrote down the answers she gave, as closely as possible to what she said. The statement sets out how long the plaintiff and Mr. Howes had lived together, their education and employment histories, their financial arrangements in respect of each other's support and their future plans regarding education, employment, finances and marriage. The purpose of the statement, Mr. Kusmer testified, was to assess whether the plaintiff qualified for Part VII death benefits under the regulations to the Insurance (Motor Vehicle) Act and to assess her entitlement to recover under the Family Compensation Act. He told the plaintiff the statement was required for the evaluation of "the claim", but does not recall whether he defined for the plaintiff's benefit what he meant by "the claim" at the time he took the statement.

At the same meeting the plaintiff also completed and signed a "Fatal Accident Claim Form" for "benefits". Mr. Kusmer testified the benefits being claimed in that document were Part VII death benefits. He does not recall if he explained that to her at the time; probably he did, he said. The document, on its face, simply refers to a "claim for benefits".

Mr. Kusmer testified he told the plaintiff during their first meeting he would handle and assess her claim based on what she told him, but that he needed to investigate further the circumstances surrounding the accident. He was uncertain, whether he specifically discussed the plaintiff's claim against Mr. Linquist during that meeting. He thought it likely he had gone over the entire aspect of her claim because it was common practice to do so.

The plaintiff testified that on May 18th there was no discussion regarding Mr. Linquist or a claim directly against him. Mr. Kusmer, she stated, might have mentioned a "tort claim", but, she said, she has no idea what a "tort claim" is. The meeting, she said, lasted between thirty and forty-five minutes.

The plaintiff, in May, 1988, was twenty-nine years of age. She had attended College in Ontario, and planned to return to school at Simon Fraser University in the autumn to take a full-time course in geography. I found her to be an intelligent and articulate witness in giving her evidence; quite capable of understanding what was said to her.

Mr. Kusmer assumed she understood what was taking place at the meeting; in his words: "I had no reason to believe otherwise." His belief in that regard, however, was based in part on the fact Mr. Howes was there to explain matters to her. Nonetheless, Mr. Howes' primary concern, it seems, was with respect to recovering the deceased's funeral expenses and the loss of his motorcycle.

I find that insofar as the meeting of May 18th is concerned, the plaintiff's mind was not directed toward a potential claim under the Family Compensation Act against the defendant. I accept her evidence she understood Mr. Kusmer was attempting to determine the amount of death benefits payable to her as the result of the late Mr. Howes' death.

Between the meeting on May 18th and a meeting held on August 31st, the plaintiff received two cheques for death benefits, totalling $6,160.00. The first cheque was dated May 30, 1988, and was in the amount of $5,000.00; the second was dated June 22, 1988, and was in the amount of $1,160.00.

On May 30th, the day she received the first cheque, the plaintiff telephoned Mr. Kusmer, and arranged to meet with him at 1:30 in the afternoon. Although in his affidavit sworn to December 29, 1989, Mr. Kusmer deposes he and the plaintiff arranged to meet so that the plaintiff could pick up a $5,000.00 advance on her entitlement to death benefits, and that he "explained to the Plaintiff over the phone that this $5,000.00 lump sum was paid pending further information on her other potential claims", his evidence at the hearing was that all he could recall being discussed during the telephone call was the arrangement to meet later; he did not usually discuss over the telephone more than arranging a meeting, he said.

Mr. Kusmer's note to file in connection with that telephone discussion records the following:

• Best to pay $5000. lump sum until get more info on Tort & can pay $145/wk for now.

That note indicates to me not something which Mr. Kusmer communicated to the plaintiff, but rather something he put in his note as a reminder to himself.

I find Mr. Kusmer did not, during that telephone discussion with the plaintiff, communicate to her in any meaningful way the concept of a claim against Mr. Linquist under the Family Compensation Act.

The meeting on May 30th, according to the plaintiff, lasted between ten and fifteen minutes; Mr. Kusmer thought probably ten minutes. Before it took place, Mr. Kusmer had, as recorded in his notes for May 19, 1988, evaluated the plaintiff's claim for Part VII death benefits and her potential tort claim. He indicates a reserve of $20,080.00 in respect of the former and, after noting more wage information is required and that an award of damages must, by statute, be reduced by the amount of death benefits paid to the plaintiff, concludes $2,500.00 is sufficient in respect of her potential tort claim.

Mr. Kusmer's evidence is that when the plaintiff came in he discussed with her her entitlement to death benefits and the possibility of a tort claim. He deposes in his affidavit:

9. ... I explained how contingencies (such as never marrying or a marriage break-up) can reduce a tort claim and how paid Death Benefits would be subtracted from any tort entitlement. I gave the Plaintiff a $5,000.00 cheque and said that I.C.B.C. would forward $145.00 per week in Death Benefits until our investigation was completed. The Plaintiff told me that she would call me back to discuss her possible tort claim. She told me that she had no lawyer yet.

At the hearing Mr. Kusmer said the penultimate sentence of that paragraph in his affidavit should read: "The Plaintiff told me that she wanted me to call her back to discuss her possible tort claim."

Mr. Kusmer testified at the hearing the discussion was a general one, and not detailed. He said he probably used the words: "claim under the Family Compensation Act," and told the plaintiff that it was a claim against Mr. Linquist, that it was different from a claim under Part VII and that there was a little more detail with respect to the calculation of such a claim.

Mr. Kusmer testified he gave the plaintiff her cheque for $5,000.00 explained it was a lump sum death benefit and that she would receive more - $145.00 weekly - until investigation of the claim was completed, that contingencies could reduce a tort claim, and that any tort entitlement would be reduced by the amount of he death benefits. He said he "would have" explained her entitlement to `no fault' death benefits- which were calculated using the Regulations and were clearly payable, and that the other aspect was against Mr. Linquist and was calculated on the basis of economic loss.

Mr. Kusmer's note to file for May 30, 1988, records the following:

• Susan in. I explained Death Ben. & discussed poss. of Tort, contingencies, deductibility of Part 7 etc.
• Gave $5,000. lump sum for now & said will forward $145/wk until investig. completed.
• She wants me to call to discuss poss. Tort & has no lawyer yet. She has 1 1/2 yrs Univ. completed & 2 1/2 remaining - works summers.

In cross examination Mr. Kusmer acknowledged he does not refer to the Family Compensation Act in his notes, but stated he explained death benefits and tort to the plaintiff. With reference to the plaintiff's request that he call her, he testified he was to continue investigating her claim, and get back to her to advise what was happening. The notes, he said, do not contain every word "spoken; they are general in nature, made for his future benefit or the benefit of a new adjuster.

Mr. Kusmer agreed in cross examination the concepts of entitlement to death benefits and a claim under the Family Compensation Act are complex. That, he said, is why he explained them so she would understand how he arrived at the figures. He stated he wanted her to understand both parts of her claim, and to realize that for the present I.C.B.C. was paying death benefits, and looking to see if she was entitled to a claim under the Family Compensation Act.

The plaintiff testified that during the meeting on May 30th, she and Mr. Kusmer talked about her entitlement to death benefits. She stated he showed her by reference to a book how the amount of that entitlement was determined, and that when he gave her the $5,000.00 cheque he told her the amount of benefits to which she was entitled could be adjusted, depending upon his investigation. here was no discussion about a claim directly against Mr. Linquist, or about loss of financial support as the result of Mr. Howes' death; they went over her entitlement to death benefits, she said.

Following payment by I.C.B.C. in June of the second cheque, amounting to $1,160.00 and representing a further eight weeks in death benefits, the plaintiff, on August 16, 1988, arranged to meet with Mr. Kusmer at his office on August 31st. Prior to their meeting Mr. Kusmer again evaluated the plaintiff`s entitlement to death benefits and her potential tort claim. According to Mr. Kusmer, the plaintiff would be entitled to death benefits totalling $20,080.00, but her tort claim, based upon dependency income, would not exceed $16,000.00.

At their meeting on August 31st the plaintiff signed the Release of Claims which is in issue here. It reads as follows:

• INSURANCE CORPORATION of British Columbia	Claims Division
  In consideration of the payment of, or the promise to pay, the sum of Twenty Thousand and Eighty and 00/100 dollars ($20,080.00) which is directed by the undersigned to be paid as follows:
  Susan Clancy: paid Aug. 31, 1988	$ 13,920.00
  Susan Clancy: paid May 30, 1988	$ 5,000.00
  Susan Clancy: paid June 21, 1988	$ 1,160.00
  The undersigned, for themselves, their heirs, executors, administrators, successors and assigns, hereby release and forever discharge John Eric Linquist of Port Moody. B.C. and the Insurance Corporation of British Columbia under Part 7 of the Regulations of the Insurance (M.V.) Act from any and all actions, causes of action, claims and demands for or by reason of any damage, loss or injury, to person and property which heretofore has been or hereafter may be sustained in consequence of a motor vehicle accident occurring at or near Ioco Rd. at April Rd., Port Moody, B.C. on or about the 05 day of May, 1988 And for the said consideration the undersigned agree not to make claim or take proceedings against any other person or corporation who might claim contribution to indemnity under the Provisions of any statute or otherwise. The undersigned agree that the said payment is not deemed to be an admission of liability on the part of John Eric Linquist or the Insurance Corporation of British Columbia under Part 7 And it is hereby declared that the terms of this settlement are fully understood; that the amount stated herein is the sole consideration of this release and that the said sum is accepted voluntarily for the purpose of making a full and final compromise, adjustment and settlement of all claims for injuries, losses and damages resulting or to result from the said accident.
  SIGNED AT New Westminster. B.C. this 31 day of August 1988 in the presence of "Frank Kusmer" x" Susan Clancy" Witness

Mr. Kusmer's evidence is that prior to having the plaintiff sign the Release he went over with her his notes of how he had evaluated her entitlement to death benefits and her tort claim. He testified that by reference to his notes and the Regulations, the relevant sections of which he read to her, he showed her how he calculated the claims under Part VII of the Regulations and under the Family Compensation Act. He did so, he stated, to ensure she understood the Release represented the end of all claims of any kind and under both headings. Asked in cross examination whether he told the plaintiff the effect of the Release was to prevent a claim against Mr. Linquist under the Family Compensation Act, Mr. Kusmer, according to my note of his evidence, replied: "Yes, I don't recall the language, but I went over all aspects (of the claims), and my impression was she knew."

Mr. Kusmer's understanding of the plaintiff's knowledge of the effect of the Release was based upon the fact that whilst going over his calculations they had discussed whether the deceased would support her after she completed University, a matter which is irrelevant to a claim for death benefits, and the fact she had attended University and is an intelligent Person. So far as Mr. Kusmer was concerned, it was obvious the plaintiff understood the effect of the Release was to bar her from making any further claims. Although he stopped short of saying to the Court he had read the Release to the plaintiff, something he usually did as a matter of practice, he stated, he did observe her read the Release before executing it. Had he thought she did not understand the document, he would not have had her sign it, he said.

Mr. Kusmer acknowledged in cross examination the plaintiff was relying on him with respect to Release; that is normal when dealing with an adjuster, he said. He did not advise her to get a lawyer. He assumed that if she had one she would not be speaking with him. He had no reason for believing she did not understand what she was signing, he testified, and saw no basis for sending her to a lawyer.

The meeting, he said, lasted about an hour. Following he signing of the Release, he gave her a cheque for $13,920.00 which, he states, the plaintiff accepted in full and final payment of all claims. He also recorded that impression in his note to file for August 31st.

The plaintiff's recollection is the meeting on August 31st took about fifteen minutes; long enough for Mr. Kusmer to go over his calculations and for her to receive her cheque.

Mr. Kusmer, she deposes in her affidavit, told her the purpose of the Release was to acknowledge that she had received the last of the payments to which she was entitled as death benefits. He did not tell her, she testified, that it barred her claim against Mr. Linquist. She understood the Release to be a receipt.

At their meeting, she stated, Mr. Kusmer went over how he calculated the death benefits. The calculations showed she was entitled to death benefits of $20,000.00, the maximum amount payable.

He also showed her another series of calculations, she stated, which, I find, were Mr. Kusmer's calculation of her claim under the Family Compensation Act. In reaching his bottom line figure of $16,000.00 under that head, Mr. Kusmer's calculations indicate he made certain adjustments for income tax, rent and various other items to the amount of support the plaintiff could have anticipated receiving had Mr. Howes lived. Asked in cross examination if she inquired what paying rent and taxes had to do with the calculation of death benefits, she replied she does not know if she "factored" that in or not.

The plaintiff testified Mr. Kusmer did not explain the death benefit was deductible from the Family Compensation Act claim. If he did, she stated, she did not comprehend - not a word of it.

Mr. Kusmer did not read the Release to her, she testified. After he had gone over his calculations he left the room momentarily and then returned with the Release. He told her at that time she had received three cheques for death benefits, and could not come back and claim further death benefits. She skimmed he document, but did not read it carefully. In her mind all she was dealing with were the death benefits, she said. That was her only claim. She "knew nothing of any other claim", she testified, and so thought the Release referred only to the claim for death benefits.

The plaintiff admitted in cross examination she had seen a lawyer prior to May 30, 1988, and knew one avenue of claim was a suit against Mr. Linquist.

The critical issue on the evidence, in my view, is whether the plaintiff, at the time she signed the Release, honestly and reasonably believed the Release was one which only barred her from making a further claim for death benefits and not from pursuing any other claim which might be open to her as a result of the accident. Did the plaintiff, in other words, sign a document fundamentally different from the document she intended to sign? If the answer to that question is in the affirmative, the plea of non est factum may be available to her: Stearns v. Ratel et al. (1961), 29 D.L.R. (2d) 718 (B.C.C.A.), at p. 729 (per Tysoe, J.A.); Royal Bank of Canada v. Hale et al. (1961), 30 D.L.R. (2d) 138 (S.C.B.C.), at p. 150; Araki v. Wlodyka [1983] 5 W.W.R. 360 (S.C.B.C.), at p. 365; Martin v. Schneider et al. (1984), 6 C.C.L.I. 93 (B.C. Co. Ct.), at p. 100; Sewid v. Ocean Fisheries Ltd. (1987), 20 B.C.L.R. (2d) 201 (S.C.)

I find on the evidence Mr. Kusmer did not intentionally try to mislead the plaintiff into thinking she was signing a release only for death benefits, and not a general release of all claims. I accept his evidence that in reviewing with her his notes of how he evaluated both her entitlement to death benefits and her claim in tort under the Family Relations Act he did so for the purpose of ensuring she understood the Release was a release of all claims. I am not, however, satisfied that the plaintiff did in fact understand she was signing a general release of all claims.

Whilst it is clear that Mr. Kusmer and the plaintiff discussed Mr. Kusmer's calculations relating to her entitlement to death benefits and her claim in tort against Mr. Linquist, that discussion occurred in the context of their discussion concerning the notion that any recovery in tort would be reduced by the amount of death benefits paid and would result in no recovery under the former head. That notion, however, is antithetical to the concept of any claim in tort being foreclosed by acceptance of the death benefits and the signing of what the plaintiff perceived was a receipt for those death benefits.

Moreover, the discussions between Mr. Kusmer and the plaintiff on each occasion were set in the context of the payment by I.C.B.C. of death benefits. She received cheques in payment of those benefits on the occasion of her visits to Mr. Kusmer on May 30th and August 31st. It was to those benefits that her mind was drawn, particularly on August 31st when she signed the Release and received the final payment of death benefits in the amount of $13,920.00.

The Release which the plaintiff signed, whilst containing clauses providing for the release of Mr. Linquist and I.C.B.C. from "any and all actions, causes of action, claims and demands ..." arising from the accident, is preceded by a statement that the consideration for the Release is the three payments for death benefits made to the plaintiff, and the words: "The undersigned .... hereby release ... John Eric Linquist... and the Insurance Corporation of British Columbia under Part 7 of the Regulations of the Insurance (M.V.) Act." The document is not headed by the words "General Release". Unless read carefully, the format of the Release, in my judgment, does not create the impression it is a general release of all claims.

The plaintiff testified she merely skimmed the Release before signing it. In doing so I find she was not careless in executing it. Mr. Kusmer acknowledged the plaintiff was relying on him with respect to the Release. He did not, I find, read it to her or explain its contents.

The plaintiff testified Mr. Kusmer did not tell her the effect of the Release was to bar her claim against Mr. Linquist. Mr. Kusmer stated he did, but that he does not recall the language. He went over all aspects of the claims, he said,