Part 7 Benefits Deductions and the "Two Hats" of ICBC
When a Plaintiff is awarded damages following a negligence claim from a BC motor vehicle collision, a Defendant can reduce the amount of damages they have to pay by the amount of no-fault benefits a Plaintiff can claim under their own policy of insurance from ICBC. As recently discussed, this can result in a very harsh reduction.
The purpose for this deduction is so an accident victim doesn’t ‘double dip’. That is, a person should not be paid twice for the same accident related expenses. The reality, however, is that in most BC personal injury trials both the Plaintiff and Defendant are insured by ICBC. This leads to a built-in conflict of interest. At trial defence counsel appointed by ICBC will often argue that a Plaintiff’s claimed future medical care needs are not reasonable. If the Plaintiff is awarded damages for future care the same counsel will then often argue that the award should be reduced as ICBC will pay for these damages under the Plaintiff’s own policy of insurance.
It is difficult to reconcile these two positions. In 2009 the BC Court of Appeal found that trial judges can consider defence counsel’s trial submissions as a reflection of ICBC’s views with respect to the likelihood of payment of future insurance benefits. Further reasons for judgement were recently brought to my attention demonstrating this practical approach by trial judges in face of ICBC’s arguments.
In today’s case (Van Den Hemel v. Kugathasan) the Plaintiff was injured in two seperate collisions. At trial the Plaintiff was awarded damages including $8,000 for cost of future medical care. The Defendants then argued that all of this should be deducted as ICBC would likely pay these expenses under the Plaintiff’s policy of insurance.
Mr. Justice Stewart disagreed with this submission and in doing so acknowledged the reality that ICBC’s views were likely expressed through counsel at trial and the Court would be “naive” to ignore these. Mr. Justice Stewart reduced the award by only $100 and in doing so provided the following helpful reasons:
 … whether the kinds of treatment at the cost accepted in my judgement would be paid in their entirety by ICBC is problematic, and the position taken in the tort case by the defendants, – effectively ICBC – with respect to the nature, extent, and source of the plaintiff’s problems. ICBC is stuck with having to wear two hats – defend the tort action versus administer Part 7 – but I would be naive if I ignored the significance of the position taken in the trial simply because ICBC has no choice but to wear two hats. The need to be realistic in assessing the ‘uncertainties’ lies at the heart of what the Court of Appeal had to say in Schmitt v. Thomas and in Boota v. Dhaliwal.
As of today’s date Mr. Justice Stewart’s recent judgement remains unpublished but I would be happy to share a copy with anyone who contacts me and requests one.