The appellant insurer appealed an arbitral decision finding it was the priority insurer for accident benefits claimed by an Alberta resident whose mother was killed in an Ontario motor vehicle accident.
The claimant had applied to the respondent insurer, who denied the claim and paid no benefits, but initiated a priority dispute against the appellant.
The Superior Court allowed the appeal, holding that the appellant, an extraterritorial insurer, was not bound by the Ontario priority rules despite being a signatory to the Power of Attorney and Undertaking (PAU).
Furthermore, the court ruled that the respondent insurer could not pursue a priority dispute because it had not first paid benefits to the claimant, violating the 'pay first and dispute later' principle.
