The respondent, an Ontario insurer, paid statutory accident benefits to Ontario residents injured in a motor vehicle accident in British Columbia.
The respondent sought indemnification from the appellant, a British Columbia insurer, under section 275 of the Ontario Insurance Act.
The appellant argued the Ontario legislation could not constitutionally apply to it.
The Supreme Court of Canada held that the superior court, not an arbitrator, should determine the constitutional applicability of the statute.
The Court further held that the Ontario Insurance Act was constitutionally inapplicable to the out-of-province appellant because there was an insufficient connection between Ontario and the appellant to justify the extraterritorial application of the provincial regulatory scheme.
