17 Dec Lessons from 2025: Case Law, Procedural Shifts, and What It All Means for Mediation in 2026

As we close out 2025, one theme stands out across Ontario’s legal landscape: adaptation. Over the past year, lawyers, insurers, and mediators have all navigated shifting case law, evolving procedures, and new pressures on claims handling. Looking ahead to 2026, the question is not whether change is coming — but how we respond to it.

Notable Cases in 2025:

I would guess that all the cases, below, likely had opportunities for resolution – at mediation, at a pre-trial, or informally along the way. That said, parties are entitled to take their cases to verdict or judgment. When they do, the courts declare winners and losers, and the rest of us are left with law that may shape how we negotiate going forward.

The following is a practical look at how these decisions could affect the way people negotiate at mediation.

Sharma v. Bublyk (2025 ONSC 6245): Rethinking Simplified Procedure Exposure

Proceeding under Rule 76 (Simplified Procedure), the male plaintiff proved damages in excess of $700,000. The court awarded $200,000 against the defendant driver and an additional $200,000 against the defendant owner, who was vicariously liable under the Highway Traffic Act. In doing so, the plaintiff left over $300,000 “on the table” above the Simplified cap.

For years, there has been a common assumption (particularly on the defence side) that Simplified Procedure caps exposure at $200,000 total, regardless of the number of defendants. Sharma challenges that assumption in a meaningful way, especially in multi-defendant motor vehicle cases involving vicarious liability.

Mediation Takeaway

If this matter was decided by a jury (in ordinary procedure with no cap), would the quantum have been this high? Simplified Procedure continues to offer real advantages: faster timelines, fewer procedural steps, and no jury.

This decision complicates the valuation exercise for plaintiff lawyers deciding where to issue claims. Assuming there is only one defendant, if realistic damages are $200k–$250k, is Simplified the right forum? How about $250k–$300k?

Plaintiff lawyers may also want to consider how realistic it is to move out of Simplified later, given courts’ reluctance to allow late procedural shifts (Boniferro v. Jolicoeur 2024 ONSC 2601).

Barry v. Anantharajah (2025 ONCA 603): Winning on Damages, Losing on Costs

In Barry, a pedestrian MVA went to a jury. The jury awarded modest special damages. The defence had taken a no monetary offer approach, advancing a Rule 49 offer of dismissal without costs. The trial judge found the plaintiff did not meet the statutory threshold and reduced damages further for contributory negligence.

The plaintiff’s net recovery was approximately $16,000 yet the defence was ordered to pay $300,000 in costs. The Court of Appeal upheld the result and explicitly criticized the defence’s litigation strategy.

Mediation Takeaway

This decision is a reminder that litigation conduct is itself a risk factor. A rigid, zero dollar offer strategy can be more expensive than losing outright.

For plaintiffs, Barry underscores the danger of a threshold shut-out. Even a technical “win” may leave little net recovery for a plaintiff after legal fees and disbursements. The question becomes whether the juice is worth the squeeze.

For insurers and defence counsel, the lesson is equally clear: refusing to make meaningful offers can backfire. Cost exposure is not always proportional to damages.

For everyone, you are entitled to take hard-line positions but both sides assume risk in doing so. The mediator’s job is to create an environment where people can make informed, strategic decisions. Mediation remains the safest place to explore settlement, but mediation can also be the right platform to test the waters with an extreme position.

McFee v. Sutram (2025 ONSC 5526): “Not at Fault” Is Not the Same as “0% Liability”

This catastrophic three-vehicle collision produced a result that unsettled many liability assumptions. Driver 1 was travelling lawfully. Driver 2 (who was following driver 1) executed an illegal passing manoeuvre over a centre double yellow line near the crest of a hill. The jury nevertheless apportioned fault 7% / 93% as between Drivers 1 and 2, respectively.

The court drew an important distinction between duty of care (owed by all drivers at all times) and standard of care (what a reasonably prudent driver would have done in the circumstances). Even lawful driving does not guarantee zero liability. Could Driver 1 have slowed down to allow Driver 2 to re-enter the lane?

Mediation Takeaway

This case could be a powerful impasse-breaker. Moving a party from 0% to even 5–10% exposure could help break through impasse. It opens the door to more nuanced liability arguments in cases often treated as automatic: rear-end collisions, and some left-turn and pedestrian or cyclist claims. Mediation is a good opportunity to explore the strength of the parties’ evidence and to perform a more refined risk analysis, rather than argue in absolutes.

Cadieux v. Cadieux (2024 ONSC; 2025 ONCA): Partial Settlements as Risk Management

In Cadieux, a defendant with modest exposure but deep pockets entered into a Pierringer Agreement to avoid joint-and-several risk. One non-settling defendant argued prejudice. Both the trial court and the Court of Appeal approved the agreement.

Mediation Takeaway

Courts continue to encourage creative resolution structures that promote settlement, protect vulnerable plaintiffs, and streamline complex litigation. Partial settlements are legitimate risk-management tools.

This logic applies beyond multi-party cases. Even in two-party disputes, parties can agree on damages and litigate liability, or vice versa. The only limit to partial settlement agreements is the creativity of the parties assisted by the mediator.

Looking Ahead to 2026: Why These Shifts Matter

1. Prejudgment interest was potentially meaningful in MVA cases at mediation this year –  particularly from late 2022 onwards (CJA). Let’s see what 2026 brings.

In non-MVA cases, interest can stray from the standard 5% when there is evidence to support it (Aubin v Synagogue and Jewish Community Centre of Ottawa (Soloway Jewish Community Centre), 2024 ONCA 615)

2. Inflation continues to affect general damages.

The deductible continues to climb, the point at which the deductible vanishes continues to climb and the cap on general damages continues to climb.

Mediation takeaway

The deductible only applies post-judgment, yet most mediations occur years away from a trial. Treating the deductible as a risk factor rather than a certainty can help parties negotiate (i.e. applying 50% to the deductible).

3. Changes to the Rules of Civil Procedure – we’ll cross that bridge when we get there! Rumors of province-wide mandatory mediation.

4. Expansion of Simplified Procedure – possibility of increasing from $200,000 to as much as $500,000.

5. Small Claims expansion in October 2025 to $50,000 – we may see more cases being issued in this forum.

6. Optional Accident Benefits model beginning in summer 2026 – medical, rehabilitation and attendant care benefits will remain mandatory, while all other accident benefits coverage will be optional allowing consumers more flexibility to choose coverage that fits their needs and budgets. This may increase the assessment of a bodily injury claim to an insurer.

Final Thought

This year at Cooper Mediation, we tried to encourage the parties to think about process design, including: when mediation should take place in the lifespan of a file, the duration of the mediation, the need to engage in or dispose of a joint session and/or fulsome openings, the style and tone of openings and the use of traditional or modern bargaining.

Mediation is not the only opportunity to resolve a case but it remains one of the most important stages in the lifespan of a file. Not because every case should settle, but because mediation allows parties to make strategic decisions grounded in facts, evidence, law, risk, and reality.

No one can predict the future but those who stay curious, adaptable, and open to new tools will be ready for whatever 2026 brings.

ABOUT THE AUTHOR

Logan Cooper joined the Cooper Mediation team in November 2017 and devotes 100% of her professional time to mediating at roster-like rates. She has mediated over 600 cases in the areas of personal injury, long-term disability, employment, and other insurance-related disputes. She has handled global mediations, cases with multiple parties, self-represented litigants and cases with complicated technical and interpersonal challenges. Logan has been inducted into the International Academy of Mediators (IAM). The IAM is an invitation-only organization.

Logan can be reached at logan@coopermediation.ca or (416) 726-1344.

To schedule a mediation with Logan, visit: https://coopermediation.ca/logan-cooper-online-calendar/.