Multiple Claimants in ICBC Hit and Run Injury Claims; Sharing a Limited Pool


If you are the victim of a hit and run collision in British Columbia you can sue ICBC directly in certain circumstances to seek damages in tort.  This is so because of Section 24 of the Insurance (Vehicle) Act which creates certain compensation rights for victims of hit and runs.

ICBC’s monetary liability under Section 24 arising our of the same accident is $200,000 all inclusive.  What happens when multiple people are injured in a hit and run claim and their claims exceed $200,000?  How does ICBC distribute the funds from this fixed pool?  Reasons for judgement were released today by the BC Supreme Court dealing with this narrow but important issue.

In today’s case (Thoreson v. ICBC) the Plaintiff and his passenger were injured in a 2002 motorcycle accident near Vernon, BC.  Their motorcycle was run off the road by an unidentified driver.    ICBC was sued under s. 24 and after trial the Unidentified driver was found 85% responsible for the crash and the Plaintiff driver was found 15% responsible.

Both the Plaintiff and his passenger settled the value of the claims.  The Plaintiff’s claim was settled for $125,000 and the passenger’s claim for $935,521.  To satisfy the damages both the Plaintiff and the passenger claimed damages from ICBC under section 24.  Mr. Justice Cole of the BC Supreme Court was asked determine how much of the $200,000 available in the section 24 ‘pool’ the Plaintiff was entitled to.

Ultimately the Court noted that this pool of money needs to be shared proportionately to their claims leaving the Plaintiff with only 11% of the pool or some $23,000.  In reaching this conclusion Mr. Justice Cole provide the following reasons:

[16] Having found that (the passenger) made a claim under s. 24 of the Act, I am also satisfied that ICBC made a payment pursuant to that section. ICBC did not blur the distinction between the coverages. Even if she wrote a demand letter to Excellent Adventures Ltd., what (the Plaintiff) does in terms of trying to collect her money cannot, in my view, affect the rights and obligations of ICBC. ICBC’s involvement with respect to the 85% liability of the unidentified driver was statutory; as a nominal defendant pursuant to the statute, not as a real defendant. Therefore, their obligations to pay are determined pursuant to the statute. Pursuant to s. 24(8), ICBC was expressly required to satisfy the judgement within the authorized limits and ICBC did so.

[17] The plaintiff also argues that s. 24 is a “social welfare” type of section and therefore should only come into play after (the passenger) has exhausted all the other available avenues of compensation. However, there is nothing in the wording of s. 24 to suggest that payment under s. 24 is secondary or excessive coverage only.

[18] The purpose of s. 24 has been set out in two cases:  Alfonso v. Insurance Corp. of British Columbia (1992), 63 B.C.L.R. (2d) 378, 88 D.L.R. (4th) 689 (C.A.) at 698, where Madam Justice Rowles commented in respect to s. 23 [now s. 24]:

The purpose of the statutory scheme created by ss. 23 and 46 of the Insurance (Motor Vehicle) Act is to provide some measure of compensation to those who have suffered injury caused by “hit and run” collisions where no common [sic] law remedy is available…

[19] In Fundytus v. Insurance Corporation of British Columbia (1989), 59 D.L.R. (4th) 131, Mr. Justice Gow states as follows, at 139:

The intent does not embrace the monetary succour provided by the “safety net” of s. 23 of the Insurance (Motor Vehicle) Act. I.C.B.C. the nominal defendant is not “the party liable” within the meaning of s. 10(2), (6) and (10) but the agency through which the person who has a cause of action as defined by s. 23 may as a matter of social welfare policy obtain some measure of monetary solace…

[20] While this is a correct statement of the policy considerations underlying s. 24, the legislation makes it very clear that ICBC must pay pursuant to s. 24(8). There is no discretion in my view. The only deductions available are for an insured claim, pursuant to s. 106 of the Regulations. This does not include a deduction for payment or amounts that could be recovered from a liable defendant or insurance payable to a liable defendant, due to vicarious liability as indemnity accrues to the tortfeasor not the claimant.

[21] Because ICBC was required to pay (the passenger) under s. 24(8) and because those payments were made, the entirety of the fund does not remain untouched and the plaintiff must share in the distribution of those funds. Pro-rata distribution is the norm, save for exceptional circumstances: I.C.B.C. v. Pozzi, 2004 BCCA 440 at para. 22, 244 D.L.R. (4th) 641. Exceptional circumstances have been found to include when an insurer makes voluntary payments under the policy: Stobbe v. Allwood Estate (1983), 81 B.C.L.R. (2d) 117, 15 C.C.L.I. (2d) 305 (S.C.). However, in the present case (the passenger) had already obtained a judgment at the time of payment. Payment on a judgment does not qualify as a voluntary payment: Henry v. Zurich Insurance Co. (1998), 49 B.C.L.R. (3d) 195, 50 C.C.L.I. (2d) 35 (S.C.). This is not a case for the discretion, to deviate from the normal distribution of funds, to be exercised.

[22] Having found that (the passenger) made a claim under s.24 of the Act and received payment pursuant to that section, this then limits the plaintiff’s recovery from ICBC pursuant to section 24 of the Act, to his pro-rata share of the $200,000 fund…

[24] The plaintiff Thoreson settled his claim for the amount of $125,000 net of his 15% liability assessment, and (the passenger) obtained judgement in the amount of $935,521.79 including costs. The following is the calculus for a pro-rata distribution of the fund:

Claimant

Settlement or Judgment sum

Proportion

Pro Rata Portion of s. 24 Funds

(the passenger)

$935,521.79

88.213%

$176,426.70

Mr. Thoreson

$125,000.00

11.786%

$23,573.30

[25] In conclusion, Mr. Thoreson is entitled to recover $23,573.30 from ICBC pursuant to s. 24 of the Act.

I should point out to my readers that there are special limitation periods and defences available in Section 24 lawsuits and these are worth reviewing when advancing such a claim.   If you are the victim of a hit and run in BC and are not familiar with these specific issues you should seek legal advice immediately to ensure your rights are protected due to the technical nature and limitations of section 24 compensation claims.

ICBC Hit and Run Claims, Mr. Justice Cole, Pro-Rata Distribution, section 24 Insurance (Vehicle) Act, Thoreson v. ICBC

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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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