Lori J. Sprott

Certas Home and Auto Insurance Company appealed an arbitration decision regarding loss transfer indemnification from Intact Insurance Company for statutory accident benefits paid to an insured.

The arbitrator found Certas had grossly mishandled the claim by failing to follow its own adjusting plan and continuing benefits despite medical opinions and the insured's completion of vocational training.

The Superior Court of Justice upheld the arbitrator's decision, finding no palpable and overriding error in the arbitrator's conclusion that Certas grossly mismanaged the claim, thereby limiting Intact's indemnification obligation.

Intact Insurance Company appealed an arbitrator's decision that found a motorcycle passenger and driver were spouses under the Insurance Act, obliging Intact to pay accident benefits.

The passenger was in a committed five-year relationship with the driver but maintained a separate residence and was still married to another individual.

The Superior Court of Justice allowed the appeal, finding the arbitrator committed an extricable error of law by applying family law principles to the definition of 'spouse' for insurance purposes and by failing to adhere to the bright-line test requiring parties to have lived together in the same residence for three years to be considered spouses under the Insurance Act.

The court applied a correctness standard of review.