Deductions of ICBC Part 7 Benefits in BC Tort Claims

Reasons for judgement were released today addressing the deductions of ICBC Part 7 benefits from a tort award.
If you are injured in a BC car crash and are insured with ICBC you have the right to apply for your ICBC No-Fault Benefits.  These include certain rehabilitation and wage loss benefits.   Whether or not you are at fault for the collision you should apply for these part 7 benefits.
In your tort claim (your claim for compensation against the at fault motorist) the defendant can argue that any amount he/she needs to pay you in damages should be reduced by the amount of Part 7 benefits you are entitled to. Whether or not you actually received these benefits is irrelevant!
In today’s case the trial judge awarded various damages including $10,000 for the cost of future medical care.  The defendant argued that the $10,000 award should be deducted because the Plaintiff could receive payment from ICBC directly for those future medical expenses.
The court dismissed this defence argument finding as follows:

[22]            In this case, I am persuaded that there is an issue about whether the plaintiff’s medication is covered by Part 7 at all, given that it not only provides benefits incurred by the insured as a result of the injury but also from conditions exacerbated by the accident.

[23]            I find that the amount awarded for the cost of future care, particularly medication, is not to be deducted from the judgment.

This case summarizecd the law of Part 7 benefit decutions very well, particularly the court held that:

1.         When considering a s. 25 deduction, the central question is whether the plaintiff is a person who is or would have been entitled to Part 7 benefits.  If the answer to that question is affirmative, the court must estimate the value of further payments that the Corporation is authorized or required to make under the Regulation, and deduct that amount from the judgment: Sovani v. Jin, 2005 BCSC 1285, 47 B.C.L.R. (4th) 97.

2.         Issues between the plaintiff and ICBC over delivery of Part 7 benefits are not relevant considerations in determining a s. 25 deduction: Sovani.

3.         The court has no discretion to reduce an estimate of future s. 88(1) benefits for the purposes of a s. 25 deduction: Ayles (Guardian of) v. Talastasin, 2000 BCCA 87, 73 B.C.L.R. (3d) 60.

4.         Medication is an expense that falls under the mandatory or non-discretionary provision of s.88(1) of the RegulationAyles.

5.         Section 88(1) requires the Corporation to pay benefits for all reasonable expenses incurred by the insured as a result of the injury.

6.         The plaintiff may have had a pre-accident underlying “disease” entitling the Corporation to invoke an exemption from liability contained in s. 96(f) of the RegulationMawji v. Insurance Corporation of British Columbia, 2001 BCSC 1610.

7.         Trial judges must be cautious in estimating s. 25 deductions and any uncertainty as to entitlement must be resolved in favour of the plaintiff: Schmitt v. Thomson, 18 B.C.L.R. (3d) 153, 132 D.L.R. (4th) 310 (C.A.); Lynne v. Pearson, 55 B.C.L.R. (3d) 401, 111 B.C.A.C. 139.

If you are insured with ICBC and are injured by another in a BC car crash make sure you apply for your Part 7 Benefits.  If you don’t it can take money right out of your pocket in your tort claim and cases such as this one are a stark reminder that ICBC often makes such an argument in tort claims.

ICBC Can Do That!?!? What You Need to Know About Part 7 Benefits

OK, imagine this:
You are injured in a car accident that is not your fault. You incur medical expenses and send ICBC (your own insurer) the bill. Your ICBC adjuster does not to pay.
You sue the driver that injured you (who also happens to be insured by ICBC). The same ICBC adjuster hires the lawyer to defend the driver and tells that lawyer what to do (that’s the way it often works).
At trial you claim the medical expenses as special damages (special damages are expenses related to the other person’s wrong-doing). The Judge agrees these are reasonable special damages and awards you compensation.
(Thanks for bearing with me, here’s where it gets interesting)….The ICBC hired lawyer then says, “Your Honour, the Plaintiff should have been reimbursed this expense by ICBC so you should not award this money to the Plaintiff” The Judge, in his most eloquant voice responds, “you’re right counsel, I have no choice but to make this deduction”.
That’s exactly what can happen! ICBC can refuse to pay for an expense then the lawyer hired by ICBC in the ‘tort trial’ can argue that the court should not award reimbursement of the expense because you should have had ICBC pay for the expense.
When you sue someone for car accident related injuries in BC, the defendant (most often times insured by ICBC) can argue that due to the operation of s. 83 of the Insurance (Vehicle) Act,he should not have to pay any money covering benefits you could have received from ICBC as your own insurer. (Whether or not you received the benefits is an entirely irrelevant consideration… the deduction can be used even if you applied for these benefits and ICBC refused to pay…click here to read Sovani v. Jin, a case where almost $100,000 in damages were deducted from the jury’s verdict).
Section 83 reads as follows:
83 (1) In this section and in section 84, ‘benefits” means benefits

(a) within the definition of section 1.1, or

(b) that are similar to those within the definition of section 1.1, provided under vehicle insurance wherever issued and in effect,

but does not include a payment made pursuant to third party liability insurance coverage.

(2) A person who has a claim for damages and who receives or is entitled to receive benefits respecting the loss on which the claim is based, is deemed to have released the claim to the extent of the benefits.

(3) Nothing in this section precludes the insurer from demanding from the person referred to in subsection (2), as a condition precedent to payment, a release to the extent of the payment.

(4) In an action in respect of bodily injury or death caused by a vehicle or the use or operation of a vehicle, the amount of benefits paid, or to which the person referred to in subsection (2) is or would have been entitled, must not be referred to or disclosed to the court or jury until the court has assessed the award of damages.

(5) After assessing the award of damages under subsection (4), the amount of benefits referred to in that subsection must be disclosed to the court, and taken into account, or, if the amount of benefits has not been ascertained, the court must estimate it and take the estimate into account, and the person referred to in subsection (2) is entitled to enter judgment for the balance only.

(6) If, for the purpose of this section or section 84, it is necessary to estimate the value of future payments that the corporation or the insurer is authorized or required to make under the plan or an optional insurance contract, the value must be estimated according to the value on the date of the estimate of a deferred benefit, calculated for the period for which the future payments are authorized or required to be made.

This may seem like boring stuff but it could cost you well over $100,000 in your ICBC claim.
In another example of the s. 83 argument in action, reasons for judgment were released today that are well worth reading for anyone advancing an ICBC claim. After trial the Jury awarded damages including $32,000 for cost of future medical care. The defence lawyer then argued that a portion of the $32,000 should be reduced because of section 83. This argument is often made by ICBC defence lawyers after trial. In this case the deduction was not made but depending on the facts of any given ICBC claim such a deduction very well could be made.
The bottom line is that if you are advancing an ICBC ‘tort’ claim you must apply and follow up for all of the ‘no-fault’ benefits you may be entitled to. Failure to do so can result in a significant reduction of your award of damages.

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If you would like further information or require assistance, please get in touch.

ERIK
MAGRAKEN

Personal Injury Lawyer

When not writing the BC Injury Law Blog, Erik is the managing partner at MacIsaac & Company, based in Victoria, B.C. He is also involved with combative sports regulatory issues and authors the Combat Sports Law Blog.

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