Vindictive ICBC Law Struck Down as Unconstitutional

The BC Supreme Court has once again struck down as unconstitutional one of David Eby’s vindictive ICBC laws. This time around it was his scheme to prevent accident victims from fully recovering the expenses they have to incur to prove their claim. These expenses are known as disbursements.  

Disbursements can include things such as the cost of obtaining medical records from a person’s doctor and therapists, expert reports necessary to prove a person’s injuries and limitations, and various administrative costs. It would be virtually impossible for an injured person to fully prove their claim for damages without incurring these disbursements. As such, historically, injured people have been able to recover these disbursements from ICBC providing they were reasonable and necessary. This is an important point: if ICBC ever felt that a person’s disbursements were unreasonable or unnecessary, they could always challenge them in Court and, if the Court agreed with them, have those disbursements reduced.

Unfortunately, this imminently fair and reasonable process wasn’t good enough for David Eby and the BC NDP Government. They proceeded to enact a law that capped what injured people could recover as disbursements. This cap was set at the incredibly low rate of 6% of the amount the person was awarded at trial or settled for. Not only was it subject to few exceptions, it applied retroactively so as to catch disbursements that people with active claims had incurred before the law came into effect. Moreover, the law gave the Court absolutely no discretion to relieve accident victims from the punitive effects of the law.

Several accident victims along with the Trial Lawyers Association of BC challenged the law on the basis that it was unconstitutional. In Reasons for Judgment indexed as Le v. British Columbia (Attorney General), 2022 BCSC 1146 the Court pronounced judgment.

The Court described the various ways in which the law unfairly operated against accident victims:

[17] There is no necessary or direct relationship between the amount of a damages award and the amount of disbursements that had to be incurred to obtain it. I can and do take judicial notice that an obviously severe or catastrophic injury and the resulting large damages may be easier to prove than a relatively less serious but more subtle injury. In the latter type of cases, defendants rarely ignore an opportunity to argue that some portion of a plaintiff’s claim cannot be allowed because the plaintiff has failed to call the appropriate expert.

[33] The final amount of a settlement or judgment is not easily predictable at the time the costs for expert reports and/or testimony are incurred. Plaintiffs and their counsel therefore will not know what amount can be spent without risk of exceeding the 6% limit. The Attorney General acknowledges that this may require plaintiffs to make decisions about what part of their case they wish to pursue or abandon.

[34] The impugned regulation applies a fixed limit only on the recovery of disbursements by plaintiffs and gives the court no discretion to permit exceptions in the circumstances of individual cases. But where a defendant is entirely successful, such as when the plaintiff fails to prove liability, the disbursements recoverable by the defendant are, of necessity, left entirely to the court’s discretion.

[81] Where a plaintiff has incurred disbursements that exceed the 6% maximum, the disbursements will have to paid out of the damage award, reducing the amount the court has found to be necessary to replace lost income or provide necessary future care.

[90] The impact of the impugned regulation on individual plaintiffs will obviously vary depending on the circumstances of each plaintiff and the issues in each case. But I am satisfied, on the basis of the evidence and on those aspects of the civil litigation system of which I am entitled to take judicial notice, that the impugned regulation, in its present form, will prevent or discourage some plaintiffs from accessing the court for a decision of their case on its merits. Some plaintiffs will be unable to marshal all of the evidence necessary to prove all aspects of their case without sacrificing other reasonable expenses or necessary portions of their compensatory damages. Others may have the evidence in the form of the necessary expert reports, but will be unable to proceed to trial because of the additional costs and risks associated with having those experts testify.

The Court also stated it could not ignore the reality that the law operated to the immediate and primary financial benefit of ICBC (which is, of course, the only reason it was enacted).

In the end, the absence of any provision to preserve judicial discretion to relieve accident victims from the consequences of the law was fatal. The Court found it to be unconstitutional and struck it down as having no force or effect. 

This decision represents yet another win for accident victims over the predations of ICBC and its servient provincial government.