Deduction of Part VII Benefits From Tort Award
In GIGNAC V. ROZYLO, 2011 BCSC 237 (“GIGNAC”), a judgment released on February 25, 2011, the Court considered an application for an order:
“For an estimate of the statutory deductions the plaintiff may be entitled to receive under Part 7 of the Regulations to the INSURANCE (MOTOR VEHICLE) ACT and that a deduction be made pursuant to s. 25 of the INSURANCE (MOTOR VEHICLE) ACT from the damages award for special damages and future costs of care.”
The Court acknowledged the need for caution in deducting an estimate of future Part 7 benefit entitlements from an award of damages given the inherent uncertainty in such a process. In determining whether deductions from a costs of future care award should be made, the party applying for deductions to be made has to establish future entitlement to the statutory benefits on a balance of probabilities (at para. 13):
“In my view, the issue for determination on this application is – has the applicant established, to the civil standard, that the plaintiff is a person entitled to receive benefits, under the plan, which the corporation (Insurance Corporation of British Columbia) is authorized or required to make under the plan? And, if so, then what is the estimated present value of those benefits.”
The Plaintiff, who had been awarded damages for costs of future care in the amount of $115,975, argued that it was inappropriate to make deductions for certain Part 7 benefits because Pacific Blue Cross was the primary insurer for benefits including physiotherapy, orthopaedic therapy, massage therapy, psychological support, and medications. The Court found that Blue Cross was indeed the primary insurer for these items, but that the Blue Cross plan would not cover 100% of the expenses. Accordingly, the Court held that it was appropriate to make a deduction from the awarded damages of the portion of these benefits not covered by Blue Cross and that would likely be covered by the secondary insurer, ICBC, in order to prevent double recovery.
Also at issue was whether the portion of the damages awarded to cover certain future care costs should be reduced to account for the possibility of entitlement under s. 88(2)(f) of Part 7 of the Regulations to the INSURANCE (VEHICLE) ACT, R.S.B.C. 1996, c. 231. There was evidence before the Court that “rehabilitation expenses” would fit within this section’s reference to “other costs”. Section 88(2)(f) states that:
“Where, in the opinion of the corporation’s medical advisor, provision of any one or more of the following is likely to promote the rehabilitation of an insured who is injured in an accident for which benefits are provided under this Part, the corporation may provide any one or more of the following:
(f) funds for any other costs the corporation in its sole discretion agrees to pay.”
However, the Court found that given the highly discretionary nature of such benefits, the applicant had not established that “it is more likely than not that this plaintiff is entitled to the benefits in controversy” (at para. 29).
Alternatively, the Court found that rehabilitation costs were unlikely to be paid under Part 7 given the nature of the Plaintiff’s injuries and the meaning of the word “rehabilitation” (at para. 28):
“ Rehabilitation means restoration. This plaintiff’s debilitating condition is chronic pain. Current medical science has no cure for this condition. I find it improbable that a medical advisor would opine that any of the goods and services contained in the assessment of future care costs, would promote the rehabilitation of this plaintiff. Those goods are services were recommended by the occupational therapist as necessary to enable this plaintiff to maintain an optimum level of functioning, now and in the future, and to maximize independence and prevention of further disability.”
This holding suggests that where there is a need for future care services so that a plaintiff can maintain an existing level of disability and prevent degeneration rather than improve his or her condition, determining future entitlement to “rehabilitation” benefits under Part 7 will be difficult. In GIGNAC, the Plaintiff’s chronic pain required treatment reflected in the costs of future care award, but entitlement to rehabilitation benefits under Part 7 was ruled out given the Court’s finding that “science has no cure for this condition”.
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