Prestidge v. Definity Insurance Company, 2026 NBCA 49
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By: Sarah Richard
This case is an appeal of the New Brunswick Court of King’s Bench’s 2025 decision, which we previously covered in our October 2025 newsletter (see here).
At the Court of King’s Bench, an application was filed seeking $0.57 per kilometer. The insured relied on Hilary Bradley v. TD Insurance (unreported) and government rates to seek reimbursement of $0.57 per kilometer. The insurer stated that rates are case-specific and that the decision was not meant to be used as a precedent, refusing to increase the rate. The court dismissed the claimant’s application, stating that a kilometric allowance of $0.30 per kilometer was reasonable and that the insurer’s discretion had not been exercised arbitrarily, capriciously or in bad faith.
Following the recent appeal hearing, the Court concluded that the application judge was not bound by the decision in Bradley. In Bradley, when asked if he was willing to recognize the federal and provincial rates as guidelines for Section B insurers going forward, the judge had stated that he was not creating a precedent, and that every case should be decided on its own facts.
The Court confirmed that horizontal stare decisis does not require judges to follow decisions that were rendered without full consideration of the issues. The Court found that Bradley was not binding because it proceeded undefended, contained limited legal analysis, and offered little factual context to support its conclusions.
The Court also clarified that entitlement to transportation expenses was not in dispute, as the insurer had accepted coverage under Section B. As a result, comments made by the application judge regarding entitlement were characterized as obiter and did not influence the assessment of whether the reimbursement rate was reasonable.
On the issue of reimbursement, the Court held that the reasonableness of a $0.30 per kilometer rate is a question of mixed fact and law and is therefore reviewable only for palpable and overriding error. The insured bore the burden of establishing that the rate was unreasonable but did not provide evidence of actual vehicle operating costs, instead relying primarily on government reimbursement rates and prior decisions.
The Court noted that government policies and tort authorities were not determinative in the no-fault statutory and contractual context and emphasized that reasonableness permits a range of acceptable outcomes rather than a single correct rate. The Court found no palpable and overriding error in concluding that $0.30 per kilometer was reasonable.
The appeal was dismissed and the court awarded $1,500 in costs to the respondent.
Link: 2026 NBCA 49 (CanLII) | Prestidge v. Definity Insurance Company | CanLII
