The Court of Appeal confirmed that it was an error to appoint an arbitrator to determine whether the underinsured motorist protection scheme of the Insurance (Motor Vehicle) Act applied where there had been no determination of liability nor proof of inability to satisfy the judgment

21. October 2005 0

Beauchamp v. Insurance Corporation of British Columbia, [2005] B.C.J. No. 2218, British Columbia Court of Appeal

Beauchamp was a passenger in a stolen motor vehicle when it was involved in an accident. Beauchamp brought an action against the driver of the stolen motor vehicle but this had not yet been determined before the Court. Beauchamp applied to a master of the court seeking an Order appointing an arbitrator to determine whether he was entitled to claim under the underinsured motorist protection scheme of the Insurance (Motor Vehicle) Act, R.S.B.C. 1996, c. 231. The master allowed this application, finding that although there was an inadequate factual basis for an arbitration, it was appropriate that an arbitration proceed on the assumption that Beauchamp had obtained judgment and was unable to satisfy the judgment. ICBC appealed this decision and the chambers judge allowed the appeal holding that it was wrong to order an arbitration based on hypothetical or assumed facts which may never come into existence. Beauchamp then appealed the decision of the chambers judge.

The British Columbia Court of Appeal dismissed Beauchamp’s appeal agreeing with the chambers judge that the tort claim had to proceed before there could be a consideration of whether the underinsured motorist protection scheme applied. Since there had been no determination as to whether the driver was legally liable for Beauchamp’s injuries or had the ability to pay any judgment that could be awarded, it was not permissible under the Act to appoint an arbitrator to determine whether Beauchamp was entitled to the claim under the underinsured motorist’s protection scheme.

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