Merino et al. v. Klue et al.

[Indexed as: Merino v. Klue]

Ontario Reports

Court of Appeal for Ontario,

Blair, MacFarland and Rouleau JJ.A.

February 21, 2013

114 O.R. (3d) 673 | 2013 ONCA 114

Case Summary

Insurance — Automobile insurance — Underinsured automobile coverage — "Non-pecuniary damage indemnity" received by plaintiff under Société de L'Assurance Automobile du Québec being deductible from uninsured limits available to her under her mother's Ontario automobile insurance policy.

The plaintiff appealed a decision that a "non-pecuniary damage indemnity" received by the plaintiff (a permanent resident of Quebec) was deductible from the uninsured limits available to her under her mother's Ontario automobile policy. [page674]

Held, the appeal should be dismissed.

Section 267.8 of the Insurance Act, R.S.O. 1990, c. I.8, which provides that damages in respect of non-pecuniary loss shall not be reduced because of any payments or benefits received, is not inconsistent with s. 2(1)(b) of R.R.O. 1990, Reg. 676 under the Insurance Act, under which payments received by an insured and not otherwise deducted will reduce the uninsured limit.

Cases referred to

Kosanovic v. Wawanesa Mutual Insurance Co. (2004), 2004 18689 (ON CA), 70 O.R. (3d) 161, [2004] O.J. No. 1234, 184 O.A.C. 269, 8 C.C.L.I. (4th) 225, 49 M.V.R. (4th) 165, 237 D.L.R. (4th) 441, 129 A.C.W.S. (3d) 1206 (C.A.)

Statutes referred to

Insurance Act, R.S.O. 1990, c. I.8, ss. 265 [as am.], 267.8(7)

Rules and regulations referred to

R.R.O. 1990, Reg. 676 (Insurance Act), s. 2(1)(b) [rev. by O. Reg. 276/03]

APPEAL by the plaintiff from the decision of S.K. Campbell J. of the Superior Court of Justice dated July 28, 2011 on the deductibility of a benefit.

Dena Varah, for appellants Merino, Charles and Garay.

Bruce R. Mitchell, for respondent Allianz Insurance Company of Canada.

No one appearing for respondents Timothy J. Klue and Asmahane Abou-Khalil.

[1] Endorsement BY THE COURT: -- The appellants appeal the decision of Campbell J., wherein he concluded that a payment of $181,107 as a "non-pecuniary benefit" under the SAAQ (Société de L'Assurance Automobile du Québec) was deductible from the uninsured limits available to the appellant under her mother's automobile policy of insurance.

[2] The appellant Karla Merino was catastrophically injured in a motor vehicle accident in Windsor, Ontario on September 12, 2002, while she was a university student. At the time, she was a pedestrian struck by an uninsured automobile. Because she was a permanent resident of Quebec, she had available to her certain benefits under the SAAQ as well as the uninsured limits of her mother's policy of insurance of $200,000. She was paid a total of $343,911.84 under the SAAQ and of that amount $181,107 was on account of "non-pecuniary damage indemnity".

[3] The appellants say that this amount should not be deducted from her entitlement to the $200,000 uninsured motorist limit and in this regard relies principally on subsection (7) of s. 267.8 of the Insurance Act, R.S.O. 1990, c. I.8, which reads: [page675]

267.8(7) In an action for loss or damage from bodily injury or death arising directly or indirectly, from the use or operation of an automobile, the damages in respect of non-pecuniary loss to which a plaintiff is entitled shall not be reduced because of any payments or benefits that the plaintiff has received or is entitled to receive.

In the appellants' view, this provision of the Act is in conflict with and overrides the regulation relied on by the respondent.

[4] The respondent argues that R.R.O. 1990, Reg. 676 ("Insurance Act"), s. 2(1)(b) passed pursuant to s. 265 of the Insurance Act, which deals with uninsured auto coverage, and reads:

2(1) The insurer shall not be liable to make any payment,

(b) where a person insured under a contract is entitled to recover money under any valid policy of insurance other than money payable on death, except for the difference between such entitlement and the relevant minimum limits determined by the clause (a).

permits it to reduce the uninsured limit of $200,000 by the amount paid to the appellant as "non-pecuniary damage indemnity". In our view, this court's decision in Kosanovic v. Wawanesa Mutual Insurance Co. (2004), 2004 18689 (ON CA), 70 O.R. (3d) 161, [2004] O.J. No. 1234 (C.A.) is dispositive of the issue raised. Subsection 7 of s. 267.8 deals with the deductibility of collateral benefits from damage awards and provides that the damages in respect of non-pecuniary loss shall not be reduced because of any payments or benefits received.

[5] Section 2(1)(b) of Reg. 676 deals with something different, namely, the party's entitlement to the $200,000 uninsured limits available under the Insurance Act. Under that regulation, payments received by an insured, and not otherwise deducted, will reduce the maximum statutory entitlement. The purpose of this section is to avoid double recovery by an injured plaintiff as here, where the appellants have already received some $181,107 as a non-pecuniary benefit payment. Hence, in our view, there is no conflict between the sections.

[6] Unfortunate as this result is for the appellants, that is the legal result of the statutory scheme in place at the time.

[7] The appellants did not resist the motion for fresh evidence but, in any event, in our view, it makes no difference.

[8] The appeal is dismissed. Costs to the respondent fixed in the amount of $10,000, all inclusive as agreed.

Appeal dismissed.

End of Document