Immaculate Confection Ltd. et al v. ICBC Date:, 2011 BCPC 427

Citation: Immaculate Confection Ltd. et al v. ICBC Date: 20111129 2011 BCPC 0427 File No: 10-22007 Registry: North Vancouver IN THE PROVINCIAL COURT OF BRITISH COLUMBIA BETWEEN: IMMACULATE CONFECTION LTD., BRIAN KERZNER and JUSTIN KERZNER CLAIMANT AND: INSURANCE CORPORATION OF BRITISH COLUMBIA DEFENDANT RULING ON APPLICATION OF THE HONOURABLE JUDGE C. BAIRD ELLAN Counsel for the Claimant: T. Voosogha, Articled Student Counsel for the Defendant: Gregory Sexton Place of Hearing: North Vancouver, B.C.

Date of Hearing: October 14, 2011 Date of Judgment: November 29, 2011 [ 1 ] This is a preliminary motion regarding the Court’s jurisdiction to hear a claim. The claimants have sued ICBC, seeking among other things a refund of any payment or increased premiums resulting from the loss of a safe driving discount.

They challenge ICBC’s decision attributing fault to the claimant driver, Justin Kerzner, in relation to damage incurred to his Mini Cooper when he hit a pothole while driving in San Diego. [ 2 ] ICBC covered the damage but was unsuccessful in recovering any damages from the City of San Diego, and therefore assessed the damages as a chargeable claim. A chargeable claim is defined in the Basic Insurance Tariff,

Schedule D, found at http://www.icbc.com/about-ICBC/Corporate-governance/basic-tarr.pdf , as a claim where 75% or more is not “recoverable” from another party. The characterization of the claim as chargeable detrimentally affects the calculation of the insured’s future insurance rates. [ 3 ] The case is set for trial on February 26, 2012. The settlement conference Judge directed that the issue of jurisdiction be dealt with in advance of the trial. The hearing of the issue came before me on October 14, 2011.

There was no time in Court for the matter to be heard that day, and I asked counsel to file their submissions in writing. The written submissions were completed on October 28, 2011. Submissions [ 4 ] The defendant ICBC takes the position that the Court does not have jurisdiction to hear the claimants’ case, because they are claiming declaratory relief, and because the proper defendant has not been named.

ICBC also submitted an argument regarding the claimants’ allegations of bad faith, but it is an argument on the merits does not pertain to the jurisdictional issue. [ 5 ] In relation to the issue of declaratory relief and the proper parties, the defendant relies on the cases of Stenerson v . ICBC , [1992] BCJ No 1911 ; Tilbert v . Jack , [1995] B.C.J. No. 938 ; and Om v . ICBC , [1999] B.C.J. No. 3077 . [ 6 ] In response the claimants rely on the case of Kalineiko v . ICBC , 2003 BCPC 151 , in which a driver successfully sued ICBC for a refund of premiums after being assessed by an adjuster as at fault.

Judge Romilly found that the adjuster had wrongly applied a policy of requiring fault to be assigned even in a case where no negligence was established. He declined to consider the effect of the chargeable

claim definition primarily because of the adjuster’s evidence that it was in ICBC’s discretion not to assign fault to a driver, and hence not to assess the damage as a chargeable claim, if negligence was not established. The claimants submit that Kalineiko was decided more recently than those relied upon by the defendant, and should prevail over the earlier authorities. [ 7 ] ICBC’s reply to that is that the issue of jurisdiction was not raised or discussed by Judge Romilly.

It also submits that the definition of chargeable claim is not dependent on a finding of negligence on the part of the insured, only a finding that no other party is liable. Analysis and Conclusion [ 8 ] For several reasons, I find that the defendant has not established that this Court is without jurisdiction to hear this case. I put my conclusion that way because of the

summary nature of the application, in which, in my view, it must be shown definitively that the Court lacks jurisdiction in order for the claimant to be deprived of a remedy without having a trial. [ 9 ] Firstly, I agree with the claimants that Kalineiko is authority for this Court’s having jurisdiction in a case where the claimant is challenging ICBC’s decision that a claim is a chargeable claim.

Although it was not characterized specifically in the decision, the case appears to have been grounded in contract, as Judge Romilly awarded a refund of premiums and of a fee charged for the accident; remedies in the nature of damages. [ 10 ] I note that although ICBC was a party to that case, it appears to have neither challenged jurisdiction, nor appealed the result. That may arguably create a form of estoppel against the defendant, although of course the parties were not the same as here.

In any event, I do not believe that ICBC is in a position to argue in good faith that a remedy it apparently accepted as available in one case cannot apply in another. [ 11 ] Another reason that I find against the defendant is that in relation to the case it primarily relies on, Tilbert v . Jack , the judge who decided that case, Judge de Villiers, said this about it in the subsequent case of Bumra v . Petty , [1995] B.C.J. No. 2866 : 11 Although Mr.

Bumra complains that I.C.B.C. has not apportioned liability fairly between himself and the other driver, and his safe driver discount will therefore ultimately be affected, he has not led any evidence to show that I.C.B.C. has failed to follow the statutory review procedure, set out in s. 13 of B.C. Reg. 447/83 . Had he established a breach by I.C.B.C. of its statutory duties in that respect I would have considered making an order for specific performance, a possible remedy that I had overlooked in my decision in Tilbert et al v. Comis et al, 100 Mile House Registry No. 94-2233.

However, in view of the apportionment of liability that I have made, the issue is academic. The claim against I.C.B.C. is dismissed without costs. [ 12 ] I note that in Tilbert , the claimant appears not to have been represented by counsel and the issue of jurisdiction was not raised by the parties.

In light of the above passage, I do not believe the case can stand as authority for the proposition that no case lies against ICBC where an insured differs with the assessment of fault. [ 13 ] While the defendant takes the position that fault on the part of the insured is not a prerequisite to characterizing damage as a chargeable claim, Judge Romilly specifically addressed that issue in Kalineiko , and found that the evidence of the adjuster that ICBC had a discretion not to apply the definition made it unnecessary for him to consider its application.

That case is therefore inconsistent with the defendant’s argument that the claimant here is precluded from disputing the characterization of his claim, in the absence of a finding of negligence on the part of another person. [ 14 ] The case of Stenerson v . ICBC relied upon by ICBC in relation to the issue of declaratory relief predates Tilbert and Kalineiko . In any event it supports the claimants’ position.

Although the claimant in Stenerson had said she was seeking a declaration, Judge de Villiers entertained her case because he found that she was actually seeking specific enforcement of the contract of insurance.

As pointed out in the claimants’ submissions, Judge de Villiers said, at page 3: While this court must not arrogate to itself a jurisdiction which it does not possess it behooves the court to look at the substance of a claim rather than the form in which it has been pleaded, and where the court concludes that the true relief claimed is within its jurisdiction, the settlement conference judge ought to define the true issues within the court's jurisdiction before the matter proceeds to trial. [ 15 ] The defendant says that specific performance is not a remedy sought in this action; however, the remedy sought is very little different from that sought in Stenerson or Tilbert , apart from the fact that there is no other driver.

Whether the action here is considered to be one for specific performance, enforcement of the insurance contract, or damages for a breach of its terms, I agree with the claimants’ submissions that it is an action that falls within the court’s jurisdiction as defined in

section 3 of the Small Claims Act , R.S.B.C.1996, c.430. [ 16 ] The case of Om v . ICBC referred to by ICBC also does not assist it. In that case it was clear that the claimant was actually seeking a declaration and not damages. He was not contesting an assessment of fault, he was challenging ICBC’s refusal to exercise its discretion to grant him relief from forfeiture arising from his own breach by driving without a licence. Judge Mondin specifically found that there was no breach of the contract or statutory obligations of the defendant. Order [ 17 ] The motion, which is essentially an application for

summary dismissal of the claim, is dismissed. The trial will proceed as scheduled. Costs

[ 18 ] As to costs, it is not clear whether the issue of jurisdiction was raised by ICBC or the Judge at the settlement conference. I note that an amended Reply was filed that same day. The motion was set down by the settlement conference Judge without the need for ICBC to make a formal application. [ 19 ] My view would be that if the issue was raised by the defendant, costs should be awarded to the claimant. If it was raised by the Court, I would make no award of costs. [ 20 ] Costs in this Court are of course restricted to out of pocket expenses related to the motion: photocopying, postage, and the like.

I have on occasion expressed the view that they are often so negligible as to not be worth the time it takes to argue about them. I will leave it to counsel to sort out whether, if the issue was raised by ICBC, the claimants have any costs of the limited kind that may qualify for reimbursement. __________________________________ The Honourable Judge C. Baird Ellan Provincial Court of British Columbia