Third-party drivers injured in an accident attributable to the prison motion of a suicidal driver can’t declare greater than the minimal $200,000 liability limit in the suicidal driver’s policy due to a public policy rule enshrined in the New Brunswick Insurance coverage Act, the province’s attraction courtroom has dominated.
The general public policy rule is meant to stop an insured from having the ability to gather insurance coverage for an illegal act. Whereas the general public policy rule doesn’t cease injured third events from suing the insured for damages, the attraction courtroom discovered it may be used to limit the insured’s liability to the authorized minimal outlined in the auto policy, which in New Brunswick is $200,000.
In Cooperators Normal Insurance coverage Firm et al. v. Martin et al., launched in the present day, Pierrette Landry got down to commit suicide by intentionally crossing the centre line of a freeway and colliding with two oncoming autos on Dec. 1, 2014. The oncoming autos have been occupied by Bernadette Martin and Donald Rose, who have been injured in the crash.
Cooperators Normal Insurance coverage Firm insured Martin on the time of the accident, whereas Unifund Assurance Firm insured Rose. A 3rd claimant, Jacqueline Blanchard, is insured by Economical Insurance coverage, however they didn’t participate in the case.
Landry’s suicide try failed and he or she was convicted of impaired driving inflicting bodily hurt. She handed away in 2019. The decrease courtroom decide dominated there was little doubt the collision resulted from Landry’s actions, and the injury flowing from her deliberate act “can’t be stated to be surprising or uncommon.” Nobody disputed this account.
Martin, Rose and Blanchard have pending actions in opposition to the Landry Property looking for to get well damages for his or her losses and accidents. The overall quantity of their claims isn’t but identified, however anticipated to exceed $200,000. All three claimants are coated by commonplace auto insurance policies, which embrace a third-party liability limit of $1 million, and NBEF 44 Household Safety Endorsements every that includes $1-million limits.
Pembridge, the auto insurer for Landry, denied protection to Landry’s Property, arguing that on the time of the collision, Landry was committing a prison offence with the intent to result in loss or injury. Below a public policy regulation in Part 2 of the Insurance coverage Act, insurers aren’t required to insure prison acts, on the precept that insureds shouldn’t be allowed to revenue from their unlawful deeds.
Pembridge argued the identical public policy regulation meant it was not obligated to pay out greater than the $200,000 policy minimal for the entire of the three third-party claims made in opposition to the Landry property.
Cooperators and Unifund appealed all the way in which to the New Brunswick Enchantment Court docket. They argued the general public policy rule in Part 2 of the Insurance coverage Act didn’t limit Pembridge’s liability to $200,000. Additionally they argued the rule didn’t apply to their third-party claims.
New Brunswick’s Enchantment Court docket upheld the decrease courtroom choices in favour of Pembridge.
The general public policy rule underneath s. 2 of the Insurance coverage Act reads: “Except the contract in any other case supplies, a violation of any prison or different regulation in pressure in the province or elsewhere doesn’t, ipso facto, render unenforceable a declare for indemnity underneath a contract of insurance coverage besides the place the violation is dedicated by the insured, or by one other particular person with the consent of the insured, with intent to result in loss or injury.”
As everybody agreed, Landry’s actions have been supposed to trigger injury.
That stated, Cooperators and Unifund argued Part 250(4) of the Insurance coverage Act doesn’t preclude third events from suing for injury or accidents attributable to an insured driver, even when the driving force brought about the accidents primarily based on a prison act.
True, the Enchantment Court docket agreed, including the evaluation doesn’t cease there.
Part 250(11) of the Insurance coverage Act states: “The place a number of contracts present for protection in extra of the bounds talked about in Part 243 [of the auto policy, i.e. $200,000], the insurer could…avail itself of any defence that it’s entitled to arrange in opposition to the insured, however subsection (4).”
The general public policy rule, s. 2 of the Insurance coverage Act, is one such defence, the Court docket of Enchantment dominated.
“As in opposition to the claimant [Landry’s estate], these defences aren’t restricted to those set out in s. 250(4) however embody any defence,” the courtroom ruling states. “This contains the defence established by s. 2, which, as soon as once more, isn’t disputed by [Cooperators and Unifund] as being accessible to Pembridge in opposition to its insured, Ms. Landry.”
Function picture courtesy of iStcok.com/RichLegg