ICBC Law

In my continued efforts to create a searchable UMP Claims database, I summarize a 2009 UMP Decision addressing whether ICBC could re-litigate quantum of damages after the issue was already decided in an out of Province trial.  In short the Arbitrator held that trial verdicts addressing liability are binding for UMP coverage purposes but awards addressing quantum are not binding as these need to apply the law of British Columbia.

In the recent case (Undisclosed v. ICBC) the Claimants were badly injured in a 1996 collision in Washington State.  The at fault driver had only $200,000 of insurance coverage.  The injured parties were each insured with $1 million of Underinsured Motorist Protection with ICBC.  They sued the ICBC insured driver in Washington State and were awarded global damages of $9.1 million with 5 of the 6 Claimants’ individual awards exceeding $1 Million.

The Claimants and ICBC could not agree on the amount of UMP Benefits payable and submitted the issue to arbitration.  The arbitrator was asked to decide if the quantum award from Washington State was binding (less applicable deductions) or if the issue could be re-litigated.  In finding that the Washington State jury award addressing damages was not binding Arbitrator Camp provided the following reasons:

21.  On the facts of this case ICBC concedes the claimants have satisfied all of the prerequisite requirements laid down for UMP coverage.  Hence, it is conceded that the Washington jury verdict established liability on the underinsured motorist, resolved issues of contributory negligence and established that the damages attributable to the fault of the underinsured motorist exceeded the insurance limits and assets available to compensate the claimants.  Put another way, it is conceded that the Washington jury verdict determined that the claimants are “insureds” and (the at fault motorist) is an “underinsured motorist” for the purposes of the UMP scheme.

22.  In the majority of cases, in my experience, the parties (ICBC and the claimants) agree that the prerequisites for UMP coverage have been satisfied and the parties arrive at a settlement pertaining to UMP compensation.  Where the parties cannot agree, ICBC can follow one of two courses of action.  ICBC can either require that the claimant(s) proceed to a tort trial to determine the prerequisites necessary for UMP arbitration, or they can agree that those prerequisites have been met and proceed to an UMP arbitration by consent.

23.  In this case, the evidence satisfies me that ICBC required a tort trial to determine the prerequisites necessary for UMP arbitration.  The claimants chose Washington State as the most favourable jurisdiction to proceed with the tort trial, for good and valid reasons which are not germane to the arbitration issue before me…

28.  Section 148.2(6)(a) relating to the legal entitlement to UMP coverage is relatively straightforward.  It says that where an accident for which UMP compensation is being sought occurs in another jurisdiction, the law of the place where the injury or death was suffered shall be applied to determine whether the claimants are legally entitled to recover UMP compensation and if a difference arises as to that legal entitlement, that difference shall be arbitrated under the Commercial Arbitration Act of British Columbia.  It is section 148.2(6)(b) relating to the measure of any damages and the assessment of the amount of UMP compensation payable that is at the nub of this arbitration…

33.  Turning to my interpretation of s. 148.2(6), I find that the section is properly interpreted to mean that issues of legal entitlement shall be determined by Washington law in this case and that the issues pertinent to quantum of damages shall be determined by the law of British Columbia.  I am fortified in coming to this interpretation because of the linkage between s. 148.2(6) and s. 148.1(5).  Section 148.1(5) constitutes a limiting provision and the limitation only works or works much better if the interpretation of s. 148.2(6)(b) is interpreted such that the issues pertaining to the quantum of damages shall be determined by the law of British Columbia.

Tags: Arbitrator Camp, bc injury law, section 148 Insurance Vehicle Regulation, Section 148.1 Insurance (Vehicle) Regulation, section 148.2 insurance (Vehicle) Regulation, Undisclosed v. ICBC

This entry was posted on Friday, November 25th, 2011 at 9:18 am and is filed under ICBC UMP Cases, Uncategorized. You can leave a response, or trackback from your own site.