An insurer may not be able to stop paying benefits to an insured, if the receipt of past benefits precludes the insured's ability to obtain compensation
The Automobile Injury Appeal Commission (the "Commission") of Saskatchewan determined that the automobile insurer was estopped from denying benefits to an Insured ("Pipchuk") even though the insured's injuries were not related to an autombile accident. SGI was estopped from denying benefits because their insured would be unable to claim workers compensation benefits because SGI had intiially paid benefits. The decision of the appeal commission was overtunred by the Saskatchewan Court of Appeal on the basis that it was mere speculation that the insured would be deprived of the ability to obtain WCB benefits..
Saskatchewan Government Insurance v. Pipchuk,
[2008] S.J. No. 380, Saskatchewn Court of Appeal, R.G. Richards, D.C. Hunter and Y.G.K. Wilkinson JJ.A., June 19, 2008
Pipchuk was injured in a motor vehicle accident and began receiving income replacement benefits from SGI. Her benefits were ultimately terminated by SGI on the basis that her ongoing back problem was not the result of the accident. Pipchuk appealed this decision to the Commission. The Commission found that Pipchuk's back injury occurred while she was involved in a return to work program. However, the Commission also concluded that by paying the benefits to Pipchuk, SGI had created the situation where Pipchuk had become precluded from claiming workers compensation benefits for her back injury. On the basis of estoppel, the Commission set aside SGI's decision to terminate Pipchuk's benefits. SGI appealed the decision of the Commission.
The Court of Appeal held that the Commission erred in addressing the question of whether the prerequisites for estoppel had been made out. There was no evidence that Pipchuk had been deprived of workers compensation benefits. Unless Pipchuk applied to the Workers Compensation Board, any attempt to assess prejudice or detriment was nothing more than speculation. The Court held that the Commission was wrong to proceed on the basis that the benefit regimes in the Automobile Accident Insurance Act and the Workers Compensation Act were mutually exclusive such that the receipt of benefits under the AAIA precluded Pipchuk from applying for benefits under the Workers Compensation Act. The Court found that the Commission was correct in its conclusion that the obligation to pay benefits under the AAIA was not engaged by any and every injury suffered during the course of an authorized return to work program. On the facts as found by the Commission, there was no causal connection between the accident and Pipchuk's back injury.
In the result, SGI's appeal was allowed.
This case was originally summarized by jmeadows@harpergrey.com and originally edited by dpilley@harpergrey.com
