The appellant was injured in a car accident and received income replacement benefits (IRBs) from the respondent insurer.
Years later, an accountant discovered the insurer had underpaid the IRBs by failing to apply the statutory minimum.
The appellant amended his claim to seek the shortfall, but the trial judge found the claim was statute-barred, holding that the insurer's Statement of Defence constituted a refusal to pay.
The Court of Appeal reversed, finding that since neither party was aware of the calculation error, the pleading could not constitute a clear refusal to pay under the SABS.
The Court also held that the mandatory interest rate under s. 68 of the SABS applies to post-judgment interest, ousting the Courts of Justice Act rate.
The appeal was allowed and the insurer's cross-appeal regarding the loss of earning capacity benefits claim was dismissed.