Ontario Superior Court: Arruda v Micaelense Settlement Approval, Fees Reduced

• The Ontario Superior Court approved a $97,500 settlement in Arruda v. Micaelense et al., 2026 ONSC 4856, for the son of a man who died after a bar fall.
• The court approved a 20 percent contingency fee for counsel, acknowledging their efforts and the reasonable settlement achieved.
• Rule 7 settlement approval in this case did not focus on a disabled person's best interest, distinguishing it from typical applications.
• Settlement funds are to be paid into court because the son had not yet obtained a certificate of appointment of estate trustee.
• The case involved allegations of the bar operating in breach of COVID-19 lockdown rules, with counsel arguing a tenuous connection to the fall.

The court acknowledged that counsel had dedicated substantial time to the case, undertaking a risk of no financial return, and ultimately achieved a reasonable settlement for the plaintiff.

The Ontario Superior Court of Justice recently granted approval for a $97,500 settlement in the case of Arruda v. Micaelense et al., 2026 ONSC 4856. This decision concerns a claim brought by the son of a man who suffered severe, permanent injuries after a fall at a bar on April 2, 2021. The injured individual subsequently fell into a coma and passed away on October 11, 2024, without leaving a will, known estate trustee, or any assets.

The legal action involved the deceased man and his son as plaintiffs. The son, identified as the sole known heir, also acted as his father's litigation guardian and a claimant under Ontario's Family Law Act, 1990. The proposed $97,500 settlement was accepted by the son as reasonable, leading to a motion for its approval under Rule 7 of the Rules of Civil Procedure, RRO 1990, Reg 194.

A significant aspect of the case involved the bar's potential liability, as it was alleged to have been operating in violation of COVID-19 lockdown regulations at the time of the incident. Counsel argued that the settlement amount was fair, citing a tenuous connection between the lockdown rules and the man's fall, which ultimately contributed to the court's assessment of the Arruda v Micaelense settlement approval.

In its review, the Ontario Superior Court noted that the typical focus of Rule 7, which often centers on the best interests of a disabled person, was not a primary consideration in this particular case. This distinction highlights the court's adaptable approach to settlement approvals depending on the specific circumstances presented.

Furthermore, the court addressed the matter of legal fees, approving a 20 percent contingency fee for counsel. This was a reduction from the initially negotiated 33 percent rate. The court acknowledged that counsel had dedicated substantial time to the case, undertaking a risk of no financial return, and ultimately achieved a reasonable settlement for the plaintiff. This decision provides valuable insight into the court's criteria for approving personal injury contingency fee Ontario arrangements, particularly when counsel demonstrates diligence and a favorable outcome.

A crucial directive from the court concerned the disbursement of the settlement funds. The defendants were instructed to pay the $97,500 into court on behalf of the deceased. This measure was necessitated by the fact that the son had not yet secured a certificate of appointment of estate trustee. The court emphasized the requirement for proper estate administration before funds could be released directly to the heir.

The son informed the court of his intention to take the necessary steps to obtain the estate trustee certificate. This aspect of the ruling underscores the procedural importance of estate trustee certificate payment court requirements, ensuring that settlement funds are managed and distributed in accordance with legal protocols, especially when the deceased party lacks a formal estate plan.

This case offers important guidance on several fronts for personal injury litigation in Ontario. The court's acceptance of counsel's argument regarding the 'tenuous connection' between the bar's alleged breach of COVID-19 lockdown rules and the fall itself provides a precedent for assessing bar liability COVID lockdown Ontario in similar contexts. It suggests that while regulatory breaches might exist, their direct causal link to an injury must be clearly established for liability.

Beyond the specifics of Arruda v. Micaelense, the Superior Court has issued other relevant decisions in personal injury cases. For instance, a June 17 ruling in a trip-and-fall incident involving a Toronto Transit Commission bus found no issue with a contingency fee arrangement proposing 33 percent for tort claims or an alternative hourly rate of $900. Conversely, an August 15, 2025, decision stayed a trip-and-fall action due to a lack of real and substantial connection to Ontario, deeming Alberta a more convenient forum. Additionally, on April 19, 2024, a lawsuit against the Town of Ajax concerning a 2011 sidewalk defect that caused a plaintiff to trip and fall was dismissed. These varied outcomes illustrate the complexities and diverse considerations within Ontario's personal injury landscape.

This case provides guidance on the Ontario Superior Court's approach to Rule 7 settlement approvals where the 'disabled person's best interest' is not the primary factor, and offers precedent for contingency fee approval in personal injury cases. Lawyers should note the court's requirement for estate trustee appointment before settlement funds are released to heirs.

Source: Original reporting via Canadian Lawyer