In Alberta the crown cannot recover health care costs incurred on behalf of city employees
This was a summary trial regarding the Crown’s right to recover the costs of health services provided to persons injured in a motor vehicle accident involving a city employee. The Court held that the Crown was not able to recover these costs as the City of Edmonton fell under an exemption outlined in s. 62(3) of the Hospitals Act.
Alberta v. Edmonton (City) 2009
Five individuals were injured when the vehicle driven by one of them was in collision with a vehicleowned by the City of Edmonton (“the City”), and operated by one of its employees. The employee was negligent. The costs of the health services provided to the five injured persons were paid by the Province of Alberta pursuant to the Alberta Health Care Insurance Plan.
Section 62(1) of the Hospitals Act, R.S.A. 2000, c. H-12, gives the Crown a right to recover health care costs from a wrongdoer whose wrong caused the injuries for which the health care was required. Section 62(3) of the Hospitals Act creates an exception that the Crown cannot recover where the wrongdoer caused the personal injury in the use or operation of an automobile, and if the wrongdoer was insured under a motor vehicle liability policy.
Pursuant to the recovery scheme set out in ss. 82-93 of the Hospitals Act, the Minister is to estimate the total cost of health services provided to persons in motor vehicle accidents in a year. It requires motor vehicle insurers to contribute proportionately to that cost according to the premiums that they received for third party liability insurance in a given year. This estimate is referred to as the “aggregate assessment”. The aggregate assessment represents the total cost of treating persons injured in motor vehicle accidents, including the cost of treating those injured by insured drivers. Motor vehicle insurers are obliged to report the amount of premiums they collect in a given year for third party liability insurance to the Minister of Finance.
The City argued that they fell within the exception in s. 62(3). It is partly self-insured and had excess liability insurance pursuant to a comprehensive liability policy issued by the Commonwealth Insurance Company. Commonwealth paid a majority of the amount contributed on behalf of the City of Edmonton to resolve the claims made by persons injured in the accident.
The City and Commonwealth Insurance admitted that they did not report any third party liability automobile insurance premiums to Alberta Finance in the year that the accident occurred, nor did they contribute to the aggregate assessment. The City submitted that they did not have to contribute to the aggregate assessment calculated in the Hospitals Act in order to rely on the exception in s. 62(3).
The Province cited Rizzo & Rizzo Shoes Ltd., [1998] 1 S.C.R. 27, and argued that the Hospitals Act should be given a "large and liberal" interpretation. They submitted that the provisions be construed as creating an exemption from claim-by-claim recovery only where the wrongdoer's insurer has contributed to the aggregate assessment.
The Court determined that the Commonwealth policy was a "motor vehicle liability policy”. It fit the definition of the term in both the Hospitals Act and the Insurance Act. The Court held that the Crown did not have the right to recover the costs for health care services from the City. The principles of statutory interpretation do not require or justify reading s. 62(3) as creating an exemption only where the wrongdoer's insurer has contributed to the aggregate assessment.
This case was originally summarized by Kim Yee and originally edited by David Pilley.
