Strategy considerations for Part 7 claims
Every case is different and it is hard to state general rules regarding strategy for litigating Part 7 claims. Certainly, litigation involving Part 7 of the Insurance (Vehicle) Regulation can be complicated and it will often be advisable to obtain legal advice.
The following general rules may be relevant to strategy considerations.
Part 7 and tort claims need not be settled at the same time
It is common for tort and Part 7 claims to be settled at the same time. However, there is no requirement to settle both claims at the same time. See, for example, Slater Vecchio LLP v. Cashman, 2012 BCSC 830 at para. 25 where it was noted that the tort action was settled before the Part 7 claim. Indeed, the tort and Part 7 claims can be settled in any order.
Part 7 claims should generally not be settled until tort claim resolved
Although there is no rule against settling a Part 7 claim before a tort claim arising from the same accident, it is generally not advisable to do so. This is because a release of Part 7 benefits given by a plaintiff does not prevent a deduction from the judgment:
If Mr. Wong did in fact release his entitlement to benefits, they are still benefits to which he “would have been entitled” and as such the legislation requires them to be deducted from the award.
(Wong v. Luong et al, 2005 BCSC 617 at para. 18).
Therefore, if the tort claim proceeds to trial and the issue of deduction of Part 7 benefits from the tort judgment is considered, the tort defendant may argue for deductions of all kind of benefits from the tort judgment even if those exceed the amount of benefits actually obtained by the claimant in settlement of the Part 7 claim.
It might be possible to secure agreement as to what Part 7 benefits will be deducted from the tort judgment awarded at trial, but keep in mind that although ICBC may be the insurer of the defendant in the tort action, it is the tort defendant and not ICBC who is theoretically entitled to deduction of Part 7 benefits from the tort judgment. Claimants should avoid settling Part 7 claims prior to resolution of tort claims without proper legal advice.
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