In BC no-fault Part 7 benefits are distinct from compensation awarded on the basis of fault or liability in tort

10. January 2017 0

Part 7 benefits under the Insurance (Motor Vehicle) Act and its Regulations are not compensation from a person whose acts have caused or are alleged to have caused disability.

Brugger v. IWA – Forest Industry Long Term Disability Plan (Trustees of)[2016] B.C.J. No. 2353, 2016 BCCA 445, British Columbia Court of Appeal, November 15, 2016, M.E. Saunders, H. Groberman and P.M. Willcock JJ.A.

The British Columbia Court of Appeal allowed an appeal from a summary trial.  The dispute arose from the administration of a long-term disability plan.  The insured was disabled in an automobile accident following which he received disability benefits from ICBC under Part 7, a settlement in satisfaction of his tort claim, and additional underinsured motorist protection benefits.  Payments under the insured’s long term disability plan were conditional upon a reimbursement agreement in the event of an eventual settlement.  The insurer had deducted the Part 7 benefits received by the insured.

The British Columbia Court of Appeal allowed the appeal on the basis that Part 7 benefits flow from a statutory scheme of universal compulsory insurance rather than compensation from a tortfeasor and therefore does not amount to “compensation from…a person whose acts have caused or are alleged to have caused the Disability” which was the operative term of the reimbursement agreement.

This case was digested by Cameron B. Elder and edited by David W. Pilley of Harper Grey LLP.  If you would like to discuss this case further, please feel free to contact them directly at celder@harpergrey.com or dpilley@harpergrey.com review their biographies at http://www.harpergrey.com.