As previously discussed, BC’s Financial Institutions Act requires out of Province vehicle insurers to sign a “Power of Attorney Undertaking” in essence promising to provide the minimum insurance coverage available in BC when their insured vehicles are travelling in this Province and further not to raise any defences which are not available to BC insurers. As many North American jurisdictions have insurance limits well below those required in BC this often creates excess exposure for foreign insurers. Reasons for judgement were released recently by the BC Supreme Court, New Westminster Registry, stripping a PAU signatory of a defence they otherwise would be entitled to.
In the recent case (McCord v. Insurance Corporation of British Columbia) the Plaintiff was injured as a pedestrian in a BC collision. He was insured for no-fault benefits both with ICBC and a private insurer from Ontario. He received benefits from ICBC and subsequently sought coverage with the Ontario provider. The Ontario insurer denied payment relying on an Ontario regulation which limited payments “if the person receives benefits under the law of the jurisdiction in which the accident occurred“.
The Plaintiff sued arguing the Ontario insurer could not rely on this section as they signed the PAU. Mr. Justice Saunders agreed and provided the following reasons:
 Western Assurance says that there has been no violation on its part of the PAU; it has not set up a defence as to coverage, but has simply taken a position as to the amount of coverage available….
 The PAU sets out two provisions. One is an undertaking not to raise defences. The other is an undertaking to pay limits as set out in (a) and (b) of the PAU. A “position” taken by a foreign insurer that only the minimum amount is payable, and not the full amounts otherwise payable under the foreign insurer’s policy, is, in every sense of the word, a defence. The position being taken here by Western Assurance is one of the types of conduct which the PAU is designed to prevent…
 In my view, the raising of the provisions of the Regulation by Western Assurance is a defence within the meaning of the PAU, and reliance on those provisions as a defence would constitute a breach of the undertaking under the PAU.
 The application is therefore allowed, and s. 57(1.1) of the Regulation will have no application to Mr. McCord’s claim for benefits.
Reasons for judgement were released today by the BC Court of Appeal addressing the ability of foreign insurers to rely on the s.103 limitation defence for no-fault accident benefits.
By way of background, BC’s Financial Institutions Act requires out of Province vehicle insurers to sign a “Power of Attorney Undertaking” in essence promising to provide the minimum insurance coverage available in BC when their insured vehicles are travelling in this Province. As many North American jurisdictions have insurance limits well below those required in BC this often creates excess exposure for foreign insurers.
The Court of Appeal confirmed PAU signatories can take advantage of the limitation contained in s. 103 of BC’s Insurance (Vehicle) Regulation. The Court further discussed the common sense approach BC law imposes in adding a defendant to an existing lawsuit despite the availability of a limitation defence.
In today’s case (Moldovan v . Republic Western Insurance Company) the Plaintiff was injured while travelling as a passenger in a rented U-Haul vehicle. The vehicle was insured by the Republic Western Insurance Company. The Plaintiff sought no fault benefits and sued ICBC. When he realized he sued the wrong insurer the limitation period under s.103 of the Insurance (Vehicle) Regulation had passed.
He sought to add RWIC to the existing lawsuit which the Court of Appeal ultimately permitted. In doing so the Court explained that while a foreign insurer PAU signatory can take advantage of the s. 103 limitation period the Court retains a discretion to add a Defendant to an existing lawsuit even beyond the limitation period due to section 4(1)(d) of BC’s Limitation Act and further due to the former Rule 15(5)(a) which is reproduced as the new Supreme Court Rule 6-2(7). The Court provided the following reasons:
 As will be seen below, I am of the opinion that while s. 103 would normally be available to RWIC to assert in defence of the plaintiff’s claim, s. 4(1)(d) of the Limitation Act nevertheless does permit the court to join RWIC as an additional defendant. I also conclude that RWIC should be so joined in the circumstances of this case…
 I conclude that the chambers judge erred in declining to apply s. 103 on the basis that the PAU does not constitute an agreement to incorporate into RWIC’s insurance policy all the terms that are required to be incorporated in a policy issued by ICBC. The fact that s. 103 was not incorporated into U-Haul’s rental contract did not make it somehow inapplicable to Mr. Moldovan, any more than the silence of a British Columbia policy on the question of limitation would make it inapplicable to a claim against ICBC. As a person claiming benefits under Part 7 in a British Columbia action, the plaintiff is subject to the statutory limitation in s. 103. No breach of the principle of extraterritoriality arises…
 I set out below the material provisions of s. 4 again for convenience:
4(1) If an action to which this or any other Act applies has been commenced, the lapse of time limited for bringing an action is no bar to
(a) proceedings by counterclaim, including the adding of a new party as a defendant by counterclaim,
(b) third party proceedings,
(c) claims by way of set off, or
(d) adding or substituting a new party as plaintiff or defendant,
under any applicable law, with respect to any claims relating to or connected with the subject matter of the original action…
 The circumstances surrounding the plaintiff’s claim, which need not be rehearsed here, were reviewed by the Master. Most important, he found that the plaintiff’s delay “resulted not from any tactical decision designed to gain an advantage for the plaintiff but from solicitor inadvertence or an honest error in judgment.” As against this, RWIC has not alleged any particular prejudice. A helpful summary of the law on the weighing of relative prejudice in this context is found in the analysis of Martinson, J. in Wadsworth v. McLeod, supra:
Regard must be had for the presence or absences of prejudice. There must be a balancing of prejudices: Teal at p. 299. Prejudice can be assumed, or actual.
Prejudice means prejudice associated with the delay itself. The fact that an opposing party is affected negatively by such an amendment does not mean that he is prejudiced. The prejudice must affect the ability to respond to the amended claim: Bel Mar Developments Inc. v. North Shore Credit Union,  B.C.J. No. 512, 2001 BCSC 388 at para. 9.
I agree with the following comments of Master Bolton in Takenaka v. Stanley,  B.C.J. No. 288, 2000 BCSC 242 at paras. 41 and 42:
Putting aside any issues of actual prejudice in addition to the prejudice resulting from the loss of the cause of action or of the limitation defence, I am satisfied that the prejudice to a plaintiff in the former event will usually be greater than the prejudice to a defendant in the latter. In the former case the plaintiff loses the opportunity to ask a court to consider a claim that the defendant has done something the law of the land considers to be actionable. In the latter, the defendant loses a windfall opportunity to avoid the issue altogether. Their respective situations may be precisely balanced in purposely financial terms, but not, I conclude, as a matter of justice. A right to seek justice cannot fairly be equated with a right to cut short the search without an answer.
I believe that his analysis provides a firmer foundation for the conclusion I reached at paragraph 68 of the Mah decision ( B.C.J. No. 44), that if all else is equal the balance of prejudice should be resolved in favour of the plaintiff.” [At paras. 22-4.]
 In the circumstances of this case, it seems to me that the balance of prejudice is clearly in the plaintiff’s favour, and that it is just and convenient that RWIC was added as a defendant notwithstanding the time limitation in s. 103 of the Regulation. I would therefore dismiss the appeal and confirm the order of the chambers judge below, although for different reasons than those she expressed.
Reasons for judgement were released today deciding the extent of no-fault benefits the Manitoba Public Insurance Company (MPIC) has to pay when a driver insured by them injures a person in British Columbia.
In today’s case (Schuk v. York Fire & Casualty Insurance Company) the Plaintiff was considered a pedestrian and was struck by a tractor trailer driven by an individual insured with MPIC. The collision occurred in British Columbia. The Plaintiff was severely injured but ICBC and MPIC did not agree as to who had to provide coverage.
Ultimately a lawsuit was brought and Mr. Justice Meyers ordered that both MPIC and ICBC had to provide the Plaintiff with benefits with MPIC being the primary insurer. (You can click here to read my former post summarizing this previous decision)
Unfortunately the legal positioning did not end there. Manitoba is a true no-fault jurisdiction meaning that people injured in Manitoba motor vehicle collisions have had their rights to sue for damages severely restricted. As a trade off they have a relatively generous scheme of no-fault insurance benefits. In today’s case the Plaintiff argued that MPIC had to provide the Plaintiff with the more robust MPIC benefits. MPIC disagreed arguing that their obligation to pay no-fault benefits is governed by the lesser BC limits. Ultimately Madam Justice Brown sided with MPIC and ruled that a British Columbian injured in BC by an MPIC insured driver is not entitled to claim the more generous MPIC no-fault benefits. Madam Justice Brown provided the following reasons:
 The issue before me turns on the proper interpretation of the Power of Attorney and Undertaking filed by the Manitoba Public Insurance Corporation. In this case, the relevant provisions of the undertaking provide that the Manitoba Public Insurance Corporation undertakes to:
A. … appear in any action … against it or its insured …
C. … not to set up any defence to any claim … which might not be set up if the contract had been entered into in accordance with the laws relating to motor vehicle liability insurance contracts or plan of automobile insurance in the Province … and to satisfy in a final judgment rendered against it or its insured by a court … in respect of any kind or class of coverage … up to the greater of
(a) the amounts and limits for that kind or class of coverage … provided in the contract or plan, or
(b) the minimum for that kind or class of coverage … required by law in such province ….
 There is no issue that the coverage for the kind or class of insurance, being no-fault benefits is greater in Manitoba. The question is whether its undertaking makes MPIC liable to pay that amount to Ms. Schuk. In my view, it does not. The undertaking provides that MPIC will satisfy any final judgment rendered against it “in respect of any kind or class of coverage provided under the contract or plan”, and “in respect of any kind or class of coverage required by law to be provided under a plan” in British Columbia.
 In this case, there is no coverage provided under the contract or plan to Ms. Schuk for no-fault benefits under Part 2 of the Manitoba Act. To qualify for that coverage, a person must be a Manitoba resident or injured in an accident in Manitoba (s. 74). As MPIC argues, the Manitoba standard automobile policy does not incorporate PIPP benefits. PIPP benefits are available based upon statutory entitlement.
 Here, Section B of the contract provided accident benefits “as required by law”. The Manitoba legislation provides PIPP benefits only to those resident in or injured in Manitoba. Those benefits are not “required by law” for one, like Ms. Schuk, who is not a resident of Manitoba and not injured in Manitoba. The driver of a Manitoba licensed vehicle is not required to carry PIPP coverage. The Section B endorsement carried a charge of $950 for “accident benefits coverage for those drivers not eligible for Personal Injury Protection Plan (PIPP)”. I accept the submissions of Manitoba Public Insurance that this would be drivers who were not Manitoba residents and were not injured in Manitoba.
 Ms. Schuk did not have PIPP benefits coverage under either the contract or the plan.
 The other portion of MPIC’s undertaking, that is not to set up any defence which might not be set up if the contract had been entered into in the Province of British Columbia, also does not assist the plaintiff. ICBC could certainly have set up the defence that it does not provide benefits under the Manitoba legislation; that Ms. Schuk does not qualify for PIPP benefits.