McIlvenna v. Insurance Corp. of British Columbia, 2008 BCCA 289

• Judge: Huddart, Kirkpatrick and Tysoe, JJ.A.
• Court: Court of Appeal (British Columbia)
• Case Date: Tuesday April 29, 2008
• Jurisdiction: British Columbia
• Citations: 2008 BCCA 289;(2008), 257 B.C.A.C. 205 (CA)

McIlvenna v. ICBC (2008), 257 B.C.A.C. 205 (CA);

    432 W.A.C. 205

MLB headnote and full text

Temp. Cite: [2008] B.C.A.C. TBEd. JL.026

Connor Allen McIlvenna, an infant, by his litigation guardian, Shawne McIlvenna (respondent/plaintiff) v. Insurance Corporation of British Columbia (appellant/defendant)

(CA034594; 2008 BCCA 289)

Indexed As: McIlvenna v. Insurance Corp. of British Columbia

British Columbia Court of Appeal

Huddart, Kirkpatrick and Tysoe, JJ.A.

July 7, 2008.

Summary:

McIlvenna, aged six, was hit by a car in 1995. He suffered injuries, including a head injury, but appeared to make a full recovery. The Insurance Corporation of British Columbia (ICBC) paid a small amount in benefits under Part 7 of Revised Regulation (1984) under the Insurance (Motor Vehicle) Act (now the Insurance (Vehicle) Regulation). As time passed, it became apparent that McIlvenna had suffered intellectual and learning impairments. In 2001, his mother began requesting rehabilitation assistance from ICBC. ICBC refused to provide any benefits because the two year limitation period set out in s. 103 of Part 7 of the Regulation had expired. McIlvenna sued ICBC. McIlvenna conceded that it was too late to claim Part 7 benefits as such, but asserted that McIlvenna's permanent deficits were made worse by ICBC's negligent handling of the initial claim. ICBC applied to dismiss the action on a point of law pursuant to rule 34 of the Rules of Court or, alternatively, that the statement of claim be struck out as disclosing no reasonable cause of action pursuant to rule 19(24)(a). The issues were: (1) was this an action "in respect of" Part 7 benefits and therefore barred by s. 103; and (2) if the limitation period did not apply, did the statement of claim disclose a reasonable cause of action in alleging that ICBC was negligent or acting in bad faith when it failed to advise McIlvenna's mother of the limitation period or to take other steps to deal with potential long-term effects of the injury.

The British Columbia Supreme Court, in a decision reported at [2006] B.C.T.C. Uned. D62, held that, inter alia, (1) s. 103 did not apply to McIlvenna's claim for damages for the worsening of his condition as a result of ICBC's alleged negligence. However, the statement of claim alleged both a loss of benefits and a loss of the opportunity for earlier intervention and a trial was required to determine the proper characterization of the action. As it was impossible to make a decision purely on a point of law that would substantially dispose of the action, the judge dismissed the application for a determination of a point of law as to the applicability of s. 103; and (2) it was not plain and obvious that ICBC did not owe a duty of care to advise McIlvenna (or his mother) of his entitlement to Part 7 benefits, including advice about the kind of therapy and treatment that could be funded and any limitations of his entitlement. Accordingly, the claim against ICBC for its alleged failure to provide such advice was able to proceed to trial for adjudication. ICBC appealed.

The British Columbia Court of Appeal dismissed the appeal.

Insurance - Topic 1852

The insurance contract - Interpretation of contract - Intent of the parties - McIlvenna, aged six, was hit by a car - The Insurance Corporation of British Columbia (ICBC) paid a small amount in benefits under Part 7 of Revised Regulation (1984) under the Insurance (Motor Vehicle) Act - As time passed, it became apparent that McIlvenna had suffered intellectual and learning impairments - His mother sought rehabilitation assistance from ICBC - ICBC denied benefits because the limitation period under s. 103 of Part 7 had expired - McIlvenna sued ICBC, asserting that McIlvenna's permanent deficits were made worse by ICBC's negligent handling of the initial claim - ICBC applied to dismiss the action as being barred by s. 103 - The British Columbia Court of Appeal stated that Part 7 of the Regulation was a contract under which an insured was entitled to certain insurance benefits from ICBC - Section 103 was a limitation on the insured's right to enforce that contractual right by way of action - Section 103 had to be interpreted in that context and was not to be construed broadly to apply to all causes of actions that an insured might have against ICBC - The court had to impose a commercially realistic and viable arrangement on the assumption that this was what the parties would have intended had they addressed the issue - Absent a clear expression to the contrary, parties could be presumed to intend that limitations in the contract applied to claims on the contract but not to non-contractual claims such as tort claims - The court concluded that s. 103 did not apply to a non-contractual claim against ICBC provided that it was not an indirect attempt to enforce the contractual right to benefits - Here, McIlvenna was not seeking Part 7 benefits, but damages for his worsened condition as a result of his failure to obtain Part 7 benefits - Accordingly, s. 103 did not apply - See paragraphs 17 to 28.

Insurance - Topic 1859

The insurance contract - Interpretation of contract - Construction - Sensible commercial result - [See Insurance - Topic 1852].

Insurance - Topic 1871

The insurance contract - Interpretation of contract - Limitation period - [See Insurance - Topic 1852].

Insurance - Topic 5076

Automobile insurance, compulsory government schemes - Bodily injury and death benefits - Limitation period - [See Insurance - Topic 1852].

Insurance - Topic 5221

Automobile insurance, compulsory government schemes - Rights and duties of insurer - General - McIlvenna, aged six, was hit by a car - The Insurance Corporation of British Columbia (ICBC) paid a small amount in benefits under Part 7 of Revised Regulation (1984) under the Insurance (Motor Vehicle) Act - As time passed, it became apparent that McIlvenna had suffered intellectual and learning impairments - His mother sought rehabilitation assistance from ICBC - ICBC denied benefits because the limitation period under s. 103 of Part 7 had expired - McIlvenna sued ICBC, asserting that McIlvenna's permanent deficits were made worse by ICBC's negligent handling of the initial claim - ICBC applied to dismiss all or part of the statement of claim for failing to disclose a reasonable cause of action - ICBC asserted that it was plain and obvious that it did not owe a duty of care to McIlvenna to advise him or his mother regarding the coverage available to them under Part 7 of the Regulation - The British Columbia Court of Appeal affirmed the dismissal of the application where it was not plain and obvious that no cause of action was disclosed - See paragraphs 29 to 51.

Practice - Topic 2230

Pleadings - Striking out pleadings - Grounds - Failure to disclose a cause of action or defence - [See Insurance - Topic 5221].

Cases Noticed:

Nowegijick v. Minister of National Revenue et al., [1983] 1 S.C.R. 29; 46 N.R. 41; 144 D.L.R.(3d) 193, refd to. [para. 18].

Arsenault v. Dumfries Mutual Insurance Co. (2002), 152 O.A.C. 224; 57 O.R.(3d) 625 (C.A.), refd to. [para. 19].

Young v. Insurance Corp. of British Columbia et al., [2006] B.C.T.C. 211; 35 C.C.L.I.(4th) 131; 2006 BCSC 211, refd to. [para. 20].

Baluk v. Swiderski et al. (1996), 83 B.C.A.C. 1; 136 W.A.C. 1; 38 C.C.L.I.(2d) 1 (C.A.), refd to. [para. 22].

Fredrickson v. Insurance Corp. of British Columbia, [1985] 5 W.W.R. 342; 64 B.C.L.R. 301 (S.C.), refd to. [para. 22].

Kraeker Estate v. Insurance Corp. of British Columbia and Schaefer (1992), 14 B.C.A.C. 299; 26 W.A.C. 299; 93 D.L.R.(4th) 431; 69 B.C.L.R.(2d) 145 (C.A.), refd to. [para. 22].

Gibbens v. Co-operators Life Insurance Co. (2008), 254 B.C.A.C. 120; 426 W.A.C. 120; 2008 BCCA 153, appld. [para. 25].

Hunt v. Carey Canada Inc. - see Hunt v. T & N plc et al.

Hunt v. T & N plc et al., [1990] 2 S.C.R. 959; 117 N.R. 321; 74 D.L.R.(4th) 321, refd to. [para. 29].

Fletcher v. Manitoba Public Insurance Co., [1990] 3 S.C.R. 191; 116 N.R. 1; 71 Man.R.(2d) 81; 44 O.A.C. 81, refd to. [para. 30].

Planidin v. Insurance Corp. of British Columbia et al. (2004), 204 B.C.A.C. 165; 333 W.A.C. 165; 36 B.C.L.R.(4th) 105; 2004 BCCA 498, dist. [para. 30].

Esau v. Co-operators Life Insurance Co. (2006), 229 B.C.A.C. 1; 379 W.A.C. 1; 55 B.C.L.R.(4th) 11; 2006 BCCA 249, dist. [para. 31].

Pekarek v. Manufacturers Life Insurance Co. (2006), 227 B.C.A.C. 75; 374 W.A.C. 75; 55 B.C.L.R.(4th) 1; 2006 BCCA 250, dist. [para. 31].

Hamilton v. Marion (Chris) Holdings Ltd., [1981] I.L.R. 1-1398 (H.C.), affd. [1982] O.J. No. 2034 (C.A.), dist. [para. 31].

Bullock v. Trafalgar Insurance Co. of Canada et al. (1996), 9 O.T.C. 245 (Gen. Div.), dist. [para. 31].

Elliott v. Insurance Crime Prevention Bureau et al. (2005), 236 N.S.R.(2d) 104; 749 W.A.C. 104; 256 D.L.R.(4th) 674; 2005 NSCA 115, dist. [para. 31].

Cooper v. Hobart - see Cooper v. Registrar of Mortgage Brokers (B.C.) et al.

Cooper v. Registrar of Mortgage Brokers (B.C.) et al., [2001] 3 S.C.R. 537; 277 N.R. 113; 160 B.C.A.C. 268; 261 W.A.C. 268; 2001 SCC 79, refd to. [para. 32].

Anns v. Merton London Borough Council, [1978] A.C. 728; [1977] 2 All E.R. 492 (H.L.), refd to. [para. 32].

Hill et al. v. Hamilton-Wentworth Regional Police Services Board et al., [2007] 3 S.C.R. 129; 368 N.R. 1; 230 O.A.C. 260; 2007 SCC 41, refd to. [para. 32].

Central Trust Co. v. Rafuse and Cordon, [1986] 2 S.C.R. 147; 69 N.R. 321; 75 N.S.R.(2d) 109; 186 A.P.R. 109; 31 D.L.R.(4th) 481, refd to. [para. 35].

Fine's Flowers Ltd. v. General Accident Assurance Co. of Canada (1977), 17 O.R.(2d) 529 (C.A.), refd to. [para. 36].

Statutes Noticed:

Insurance (Motor Vehicle) Act Regulations (B.C.), Revised Regulation (1984), Reg. 447/83, sect. 103 [para. 10].

Authors and Works Noticed:

Brown, Craig, Insurance Law in Canada (1999 Looseleaf Ed.), vol. 1, p. 8-8 [para. 26].

Counsel:

G.P. Brown, for the appellant;

S.E. Gibson and I. Kordic, for the respondent.

This appeal was heard at Vancouver, British Columbia, on April 29, 2008, by Huddart, Kirkpatrick and Tysoe, JJ.A., of the British Columbia Court of Appeal. The following decision of the court was delivered by Tysoe, J.A., on July 7, 2008.