09 Nov ICBC Argues WCB Benefits Should be Deductible from UMP Award

The matter of S.A. (Re), 2020 BCSC 1323, was a judicial review of an arbitrator’s decision. S.A. was injured in a car accident. He claimed against ICBC, seeking an award under his Underinsured Motorist Protection (“UMP”) coverage.

The arbitrator’s decision was restricted to one issue: Whether S.A.’s benefits under the Workers Compensation Act (WCB) were deductible from his UMP award.

At the time of the accident, ICBC was entitled to deduct the WCB benefits. However, between the date of the accident and the hearing of the arbitration, the applicable regulation was amended. The amended version was more generous to S.A.

The question for the arbitrator was whether the older or the newer version of the regulation applied to S.A.’s claim. The arbitrator found that the earlier version applied, but also found that applying it would lead to an “extremely inequitable” outcome. For that reason, the arbitrator interpreted the earlier version in light of the more generous amendment. The result was that ICBC was not entitled to deduct from the UMP award approximately $550,000 of benefits payable under the WCA.

ICBC argued that the arbitrator made an error in law by disallowing the deduction of WCB benefits. In response, S.A. argued that the arbitrator’s decision was not only reasonable, it was correct.

Taking into account public policy considerations as well as the context and purpose of the regulation, the court found that the arbitrator’s decision was within the realm of reasonable outcomes in respect of his finding that the WCB benefits were not deductible.

Since the arbitrator’s decision was reasonable and grounded in the proper principles of statutory interpretation, the court dismissed ICBC’s appeal and awarded costs on the appeal to SA.