Hart v. Allstate Insurance Company of Canada, 2023 NBKB 38
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By: Alexandre Doucet (Articled Clerk)
Shawn Hart (the Plaintiff) held a valid Standard Automobile Policy through Allstate Insurance Company of Canada (the Defendant). On August 22, 2019, the Plaintiff reported to the Defendant that he had been involved in a motor vehicle accident on August 15, 2019, and submitted a claim for coverage of property damage incurred in the accident. He had been drinking during the accident and was charged under s. 320.14 of the Criminal Code, RSC 1985, c. C-34, with offences related to impaired driving. The third-party motorist sadly passed away from the injuries he received in the collision.
While the Plaintiff had a valid insurance policy, the Defendant initially denied coverage, citing exclusions related to driving under the influence of alcohol. The Plaintiff filed his Notice of Action on December 17, 2021, and a motion for summary judgement was brought by the Defendant alleging that the Plaintiff’s claim was statue-barred as the limitation period had passed.
The Defendant argued that the limitation period began on August 15, 2019, when the Plaintiff knew that his car had been damaged due to the accident. In the alternative, it argued that the limitation period began when the Plaintiff received the denial letter on September 13, 2019. The Plaintiff opposed the motion, contending that the limitation period only began when the Defendant finished its investigation of his claim and denied him his property damage coverage and that the issues should be heard on merits at trial.
Discovery timelines are set out in section 8 of the Limitations of Actions Act, SNS 2014, c 35, which stipulates that a claim may not be brought after “(a) two years from the day on which the claim is discovered; and (b) fifteen years from the day on which the act or omission on which the claim is based occurred”, whichever occurs earlier [para 74].
Guided by this section of the Act, the court stated that a claim is discovered on the date the claimant first knew or ought to reasonably have known the injury or loss occurred, that the defendant caused it, and that it is sufficiently serious to justify legal action. The court clarified that the knowledge of the claim does not need to include whether or not it would succeed, just that the claim exists, and stated that the Plaintiff could not circumvent or extend the limitation period by characterizing the denial as a breach of duty of good faith. The court found that the Plaintiff had discovered or ought to have discovered that he had a claim for damages to his insured vehicle on August 19, 2019, when his counsel reached out to the insurance adjuster; stated differently, August 19, 2019, was the date the Plaintiff knew he had a claim. The court found that the claim was statue-barred because it had been initiated after the limitation period had ended.