Fund cannot litigate after initiating statutory priority arbitration and missing arbitration time limit.
The Motor Vehicle Accident Claims Fund commenced an action against an insurer seeking reimbursement of accident benefits after serving a Notice of Dispute under the inter‑insurer arbitration regime created by Ontario Regulation 283/95 under the Insurance Act.
The insurer moved for summary judgment arguing that once the Fund initiated the statutory arbitration process it could not abandon that process and instead pursue restitution through litigation.
The court held that the Fund had sufficient information to commence arbitration within the one‑year time limit but failed to follow up and allowed the limitation period to expire.
The “proper case” exception permitting a restitution action outside the arbitration regime did not apply where the Fund’s inability to arbitrate arose from its own inaction.
Summary judgment was therefore granted dismissing the action.
Her Majesty the Queen in Right of Ontario as Represented by the Minister of Finance v. Zurich Insurance Company Ltd. and Fahmeeda Begum, 2012 ONSC 5381