The Court of Queen's Bench has recently considered the issue
of pre-trial advance payments to claimants under the Fair
Practice Regulation, AR 129/2012
("Regulation") and the Insurance Act,
RSA 2000 c I-3. Stewart v Insurance Corporation of British Columbia, 2014
ABQB 578 ("Stewart") is the most recent of
only two cases in Alberta to have addressed the issue of an insurer
making an advance payment to a claimant.
Section 5.6(3) of the Regulation allows for a claimant
to apply to the Court under section 581 of the Insurance Act for an
advance payment from the defendant's insurer. The claimant is
required to show that such payment is necessary to pay for the
necessities of life or for other circumstances that are deemed to
be appropriate. Bexson v Williams, 2014 CarswellAlta 1134
("Bexson") is the only other case in Alberta
that has addressed and applied advance payment legislation.
The Applicant in Stewart was involved in a motor
vehicle collision where a vehicle crossed the centre line and
collided with the Applicant's vehicle.
Master Schlosser commented there seemed little doubt about
liability resting with the Defendant/Respondent. The Applicant was
a successful oilfield consultant with a positive net worth who was
injured in the Accident and assessed with a 16% partial whole
person impairment. He argued he would not be eligible for
promotions as a result of his injuries. There was no question
regarding his ability to pay for the necessities of life and as
such, the Applicant's claim was limited to section 5.6(3)(b),
where other circumstances may deem an advance payment appropriate.
The Applicant sought $1,000,0000 in pre-judgment damages for the
exploration of vocational opportunities in an effort to mitigate
his potential future loss of income claim which experts had
suggested might be over $2 million.
Although the Applicant in Stewart was denied his
application for advance payment to be used for exploration of
vocational options, this denial appears to have been the result of
inadequately laying out general damages and his potential loss of
income claim and not as a result of the inability to claim for such
payment. Master Schlosser, considering Bexson as well as
cases from other jurisdictions, laid out the test for advance
payment by a claimant as requiring:
That the applicant be a 'claimant' as defined in
section 5.6(1) of the regulation;
That liability be admitted, or;
That the applicant has demonstrated that it is
probable that liability will be established on a balance
That the advance sought will be less than the total
That the applicant is unable to pay for the necessities of
The advance is otherwise appropriate.
Besides indicating that the advance payments requested must fall
beneath or within the final damage assessment as determined at
trial, what was considered to be "otherwise appropriate"
was not specifically referenced in Master Schlosser's decision.
The Court did note that such payments should only be applied in
circumstances that are considered 'exceptional'. In
referring to the Applicant as a 'legal pioneer', Master
Schlosser has paved the way for the allowance of a wider breadth of
advance payments than otherwise would have been expected under the
legislation. The category of "otherwise appropriate" has
been stretched to potentially include pre-trial payments for
vocational training and other such special damages provided the
need for such an advance has been properly presented to the
As a result, insurers should be aware of the potential for a
claimant's advance payment claim to include other requests
besides just the necessities of life or continuing treatment for
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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