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Umpire’s decision upheld on petition for Judicial Review

In Vandale v Wawanesa Mutual Insurance Company 2015 BCSC 766 the petitioners had a contract of insurance with Wawanesa for which there was coverage for 6 items of jewelry. Under certain circumstances the petitioners would receive indemnity for the replacement cost of the lost jewelry. Under other circumstances the indemnity would be limited to actual cash value. The 6 items of jewelry were stolen and the petitioners sought payment of $79,000 which was the initial appraised value when coverage was secured.

As there was a dispute between the petitioners and Wawanesa as to the value of the jewelry, Wawanesa triggered the dispute resolution procedure under the Insurance Act. An umpire was appointed to determine the value. The umpire ultimately accepted the values for replacement cost and actual cash value as determined by Wawanesa’s representative. The petitioners sought judicial review of the umpire’s decision on the basis it was unreasonable and not supported on the evidence presented.

In dismissing the petition the court reaffirmed the jurisdiction of an umpire and established the standard of review to be applied on judicial review. The court held that the jurisdiction of an umpire is to determine value, not to interpret the insurance policy. The court further held that the standard of review is stipulated in the Administrative Tribunals Act as being patently unreasonable. In this case the decision was a finding of fact. A patently unreasonable finding of fact is a finding that is not based on the evidence. It is a finding that is “openly, clearly, evidently unreasonable”.

This decision re-establishes the very high standard that must be met to have an umpire’s decision quashed. It gives effect to the clear wording in the Insurance Act of the Legislature’s intent to have issue of value determined outside the courtroom.

Case law summary by: Brian Hoffmann