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Collision Coverage and Denial by ICBC

When can ICBC deny your collision coverage? ICBC must prove a breach of the policy terms to justify denial.

In last week’s decision of  Venkataya v. ICBC (2015 BCSC 1583), the plaintiff’s vehicle had been “totalled” in an unusual single-vehicle crash. He had optional collision/own damage insurance with ICBC, and they denied coverage on the basis of the following policy breaches:

  1. He breached the conditions of his insurance by consuming a traditional Fijian root drink (Kava) which rendered him incapable of proper control of his vehicle; or
  2. He provided a willfully false statement to ICBC about his claim, stating that he had not taken drugs or alcohol in the 12 hours preceding the collision.

Kava is a South Pacific plant used in a tea-like drink. It is not regulated in Canada or in Fiji. The plaintiff’s evidence was that he did not consider it to be a drug, and that he had consumed it at a friend’s home on the evening in question. However, he remembers only the first portion of his attempted drive home, which ended when drove his vehicle up onto a median and crossed oncoming lanes before striking several poles, signs, trees, a light standard and a fire hydrant. His symptoms suggested to the police that he had been drinking alcohol, but the breathalyzer test was negative. The plaintiff was also violently ill, and did not demonstrate the drowsiness expected of a large consumption of Kava.

In concluding that ICBC had failed to establish that drug or alcohol consumption rendered him incapable of proper control of his vehicle, Mr. Justice Voth made the following remarks:

[105]     I recognize that both the events surrounding the Accident and Mr. Venkataya’s conduct in relation to those events are highly unusual and without any ready explanation. The burden lies on the defendant, however, to establish that Mr. Venkataya was incapable of operating a motor vehicle as a result of his having consumed “a drug or intoxicating substance”. The whole of the evidence does not, on a balance of probabilities, satisfy that burden.

Mr. Justice Voth also rejected ICBC’s allegation that the plaintiff had voided his coverage by making a willfully false statement, finding as follows.

[113]     I do not consider that Mr. Venkataya made a willfully false statement. Mr. Venkataya has never denied that he took either Tylenol or Benadryl at some point in the afternoon or early evening of October 11, 2008. He told the police he took Tylenol. He told the persons who attended to him at the Surrey Memorial Hospital that he had taken Benadryl, and he said the same thing to Dr. Choo when he met with him a few days after the Accident. It is unlikely that he would have unhesitatingly told the various individuals that he had taken some off-the-shelf medication a number of hours before the Accident, and then willfully or intentionally sought to mislead the defendant with respect to the same issue.

[114]     This conclusion is reinforced by the fact that Mr. Venkataya told Mr. Lundell that he had been initially charged with respect to the Accident. Again, there appears to have been no intention, on the part of Mr. Venkataya, to misstate or understate the nature or consequences of his conduct.

[115]     These conclusions confirm that s. 75(c) of the Insurance (Vehicle) Act is not relevant in the present circumstances. I would add, as a separate matter, that it is not at all clear that Mr. Venkataya’s misstatement was material. It is hard to imagine that an insurer would view an insured’s use of an off-the-shelf allergy medication, within normal or recommended dosages, some 8 to 12 hours before an accident, as material to the claim being advanced by that insured.

[116]     In all of the circumstances, I am satisfied that s. 75(c) of the Insurance (Vehicle) Act is not engaged, and does not enable the defendant to treat the plaintiff’s claim as “forfeited”.

[117]     The plaintiff is to have judgment in the amount of the replacement cost of his vehicle. The plaintiff is also to have costs of this action.