Supreme Court upholds ruling allowing disabled no-fault Saskatchewan auto claimant to sue municipality

The Supreme Court of Canada has dismissed an application by a Saskatchewan municipality for leave to appeal a ruling that allows an auto claimant with no-fault insurance to sue the municipal government responsible for maintaining a road.

The highest court in the land ruled Monday against the Rural Municipality of Britannia No. 502, which had applied for leave to appeal a December 2012 decision by the Saskatchewan Court of Appeal.

The provincial appeal court had allowed John Acton, who was disabled in 2004 as a result of a single-vehicle rollover, to sue the Britannia municipal government for “economic” losses.

Ron Handel Farm Ltd., which was contracted to work on the road, was also a defendant. Acton’s accident occurred northeast of Lloydminster, which is on the Saskatchewan-Alberta border nearly 300 km northwest of Saskatoon.

As a result of the accident, which caused a spinal fracture, Acton cannot work and requires rehabilitation services and living assistance. He is now a C6 spastic quadriplegic, according to an agreed statement of facts.

Saskatchewan Government Insurance (SGI) offers both tort and no-fault coverage. Policyholders who do not choose tort coverage are automatically given no-fault coverage, which limits but does not eliminate their right to sue.

Acton was a no-fault policyholder but he had alleged that his SGI benefits “do not fully cover his actual costs for rehabilitation, living assistance and other cost-of-care items he reasonably requires.”

So Acton wanted to sue to make up the alleged shortfall in his benefits. But in March 2010, Mr. Justice G.N. Allbright of the Saskatchewan Court of Queen’s Bench ruled against Acton, finding that he could not pursue a claim for “economic loss” against the defendants. Acton appealed that decision and the Court of Appeal overturned Judge Allbright’s ruling.

The Court of Appeal ruled that the lower court had “erred in holding that an insured may not bring a tort action to recover damages for ‘economic loss'” under the provincial Automobile Accident Insurance Act, if the benefits paid or payable by the carrier will never the exceed SGI’s liability cap of $5 million.