Kappei v Allianz Global Assistance Date:, 2013 BCPC 415

Citation: Kappei v Allianz Global Assistance Date: 20130925 2013 BCPC 0415 File No: 13-1224 Registry: Williams Lake IN THE PROVINCIAL COURT OF BRITISH COLUMBIA BETWEEN: ELKE ANNEMARIE KAPPEI CLAIMANT AND: ALLIANZ GLOBAL ASSISTANCE DEFENDANT RULING OF THE HONOURABLE JUDGE E. L. BAYLIFF Counsel for the Claimant: D. Dent Appearing for the Defendant: J. Becker Place of Hearing: 100 Mile House , B.C.

Date of Hearing: June 26, 2013 Date of Judgment: September 25, 2013 [ 1 ] This is my Ruling on a limitations issue following a Settlement Conference pursuant to Rule 7(14)(

b) of the Provincial Court (Small Claims)Rules. [ 2 ] For the reasons which follow I have decided that I must dismiss the claim of Dr. Kappei as I conclude it is barred by the 2 year limitation period set out in s. 104(3) of the Insurance Act , R.S.B.C. 2012, c. 1. Facts [ 3 ] Dr. Kappei travelled to the United Kingdom in the spring of 2010. Before leaving Canada she purchased travel insurance with the Defendant, Allianz Global Assistance, through her Bank of Montreal Master Card. While in the U.K. she suffered severe back pain and ultimately, underwent surgery. The out of pocket cost to Dr.

Kappei of these medical services was in the range of $15,000.00 CAD. When Dr. Kappei sought reimbursement from the Defendant her claim was rejected because the Defendant took the position that her back injury was pre-existing – a position which Dr. Kappei firmly disputes. The final decision rejecting Dr. Kappei’s claim was documented by the Defendant in a letter mailed on or about January 27 th , 2011. (The date on the letter is “2010” but the parties agree that this was a typing error). [ 4 ] Dr.

Kappei then sought re-imbursement through the Medical Services Plan of B.C. and was successful in recouping about $1,300 of her costs but not the remainder. Her dealings with the Medical Services Plan were concluded by March 27 th , 2011. [ 5 ] Dr. Kappei filed the current action against the Defendant, for her remaining costs of $13,700.00, on March 13 th , 2013, a little more than 2 years after the final rejection of her claim by the Defendant. Position of the Parties [ 6 ] The Defendant’s position is that Dr.

Kappei’s action is barred by one or more of the following limitation provisions: 1) A contractually imposed limitation of 1 year (found in the “BMO Total Travel and Medical Protection Certificate of Insurance” pamphlet at

Section 6 (General Provisions), sub-section 4 (Legal Actions)); 2) A 2 year limitation in the Limitations Act of B.C.; or 3) A 2 year limitation found at s. 104(3) of the Insurance Act of B.C. [ 7 ] Dr. Kappei’s position in respect of each of these points is as follows: 1) That the contractually imposed limitation of 1 year, buried at p. 40 of the pamphlet, is not binding because such a provision was neither discussed, nor was it within the “reasonable expectations” of the parties, at the time Dr.

Kappei entered into a contract for travel insurance with the Defendant by way of a brief telephone conversation with a call centre employee; 2) That it is the 6 year limitation under the former Limitations Act of B.C. which is applicable rather than a 2 year limitation period; and 3) That, if the applicable limitation period is 2 years, whether under the Limitations Act, or as set out in s. 104(3) of the Insurance Act , the common law principle of “discoverability” saves this claim. It is argued that Dr.

Kappei did not discover that she had a claim against the Defendant until after she had been denied full reimbursement by the Medical Services Plan on March 27 th , 2011. It was only then, it is argued, that she realized that she had a claim against the Defendant and therefore the limitation clock did not start ticking until that date. If this submission is accepted then her claim was filed in time – two weeks prior to the expiration of the limitation period on March 27 th , 2013. Analysis [ 8 ] I agree with counsel for Dr.

Kappei that as it concerns the first of these issues – the applicability of the 1 year contractual limitation period – this is not clear cut and would need to be determined following the hearing of evidence at a trial. [ 9 ] The second issue is whether the Limitation Act, R.S.B.C. 1996, c. 266 applies and if it does, whether it is the 2 year or the 6

year limitation set out in the former version of the Act that would have been applicable. I agree with counsel for Dr. Kappei that theLimitation Act does not apply.

Section s. 3(5) reads: “Any other action not specifically provided for in this Act or in any other Act may not be brought after the expiration of 6 years after thedate on which the right to do so arose.” [10] Specific provision for a limitation of 2 years in this sort of action is made in the Insurance Act, R.S.B.C. 2012, c. 1, s. 104(3).

Therefore, that is the limitation period which applies, rather than the 6 years set out in s. 3(5) of the Limitation Act (above). [11] Section 104(3) of the Insurance Act reads as follows: “…an action or proceeding against an insurer for the recovery of insurance money…must be commenced not later than 2 years after thedate the claimant knew or ought to have known of the first instance of the loss or occurrence giving rise to the claim for insurancemoney.” [emphasis added] [12] This leads into the third issue which is central to my ruling. [13] On what date did Dr.

Kappei know, or ought she to have known, of the “loss or occurrence giving rise to the claim for insurance money”? Put another way, was the loss or occurrence giving rise to her claim “discoverable” on or about January 27th, 2011 when she got the final letter from the Defendant rejecting her claim?

Or, was her claim not “discoverable” until on or about March 27th, 2011when she found out that the Medical Services Plan were rejecting her claim for all but a small portion of her costs and therefore that heronly hope of recovery was to sue the Defendant? [14] The common law “discoverability rule” is that a limitation period starts to run when the claimant “actually discovers, or withreasonable diligence should have discovered” his or her loss. See K.L.B. v. British Columbia, 1999 BCCA 210 at paragraph 18. Thisconcept entered Canadian law in the case of Kamloops v. Nielsen, (SCC), [1984] 2 S.C.R. 2.

In that case the plaintiffhad suffered damage to the foundation of his house as a result of negligence by the municipality of Kamloops. The Municipal Actrequired that legal action be commenced within 6 months of when the damage was done, but Nielsen did not discover the damage to hishouse until some 4 years afterwards. It was held that the limitation period did not start to run until Nielsen discovered the damage andhis claim against the City of Kamloops was allowed to proceed. [15] The “discoverability rule” has also been applied in civil actions arising out of child abuse – both sexual and physical.

It hasbeen recognized that the claimants in such matters are often not capable of “discovering” their loss – that is, of understanding that theyhave suffered loss or damage, and of attributing responsibility for that loss to the perpetrator - until many years after the actual events,and often not until they have undergone extensive counseling. See K.L.B. v. British Columbia, supra. [16] The “discoverability rule” is an “interpretive tool” rather than a legal rule per se.

When the limitation provision – s. 104(3) ofthe Insurance Act in this case – “runs from an event which clearly occurs without regard to the injured party’s knowledge, the judge-made discoverability rule does not extend the period the legislature has prescribed.” See reference to Fehr v. Jacob (1993), (MB CA), 14 C.C.L.T. (2d) 200 (Man. C.A.) at paragraph 42 of K.L.B. v. British Columbia. [17] Section 104(3) does hinge on the injured party’s knowledge “of the first instance of the loss or occurrence giving rise to theclaim for insurance money”.

So, it would appear that the “discoverability rule” does have application to this particular limitationprovision. [18] However, that does not assist the claimant in this matter. In my view, the claimant clearly knew or ought to have known on or about January 27th, 2011 that the Defendant was denying coverage of her claim. That is why she turned to the Medical Services Plan inhopes of obtaining reimbursement for her expenses from that source instead.

Thus, the final denial contained in the letter from the Defendant of January 27th, 2011 was the triggering event under s. 104(3) – the “loss or occurrence” giving rise to her claim for insurancemoney. Certainly the claimant hoped not to have to sue the Defendant and, as a result, sought recompense elsewhere. But, making adecision to pursue other options, if at all possible, does not change the fact that the claimant knew as soon as she received the Defendant’s letter of January 27th, 2011 that she was being denied coverage.

That was the date her cause of action against the Defendantwas “discovered” because it was clear to the Claimant at that point that the only option to successfully claim insurance money from theDefendant, was by launching a claim through court. Section 104(3) required that any such action be commenced within 2 years, by January 27th, 2013, or perhaps a few days after that, to allow time for delivery of the letter by mail.

Summary [19] The 2 year limitation set out in s. 104(3) of the Insurance Act applies. The claim against the Defendant in this case was “discoverable” on or about January 27th, 2011. That is why the Claimant turned to the Medical Services Plan hoping for assistance from that quarter. The 2 year limitation expired on or about January 27th, 2013. The Notice of Claim in this case was filed about a month anda half too late and it is for that reason dismissed pursuant to Rule 7(14)(b).

________________________ E. L. Bayliff Provincial Court Judge