Mandatory dispute resolution process under Insurance Act is mandatory

Insurance law – Property insurance – Proof of loss – Duties and liabilities of insurer – Practice – Breach of contract – Notice – Appeal – Standard of review

Westland Insurance Co. v. Pounden, [2021] B.C.J. No. 783, 2021 BCCA 156, British Columbia Court of Appeal, April 16, 2021, M.E. Saunders, S.D. Frankel and J. DeWitt-Van Oosten JJ.A.

The insured’s property sustained damage when a tree fell onto their home. The insured submitted a claim to the insurer. After considerable back and forth the insurer sent the insured a final proof of loss for signature. The insured did not respond and, approximately one year later, the insurer learned the insured had filed a notice of civil claim.

The insurer issued a demand for dispute resolution under s. 12(3) of the Insurance Act. The insured refused to participate. The insurer filed a petition seeking the appointment of a representative on the insured’s behalf. A chambers judge granted the order sought.

The Court of Appeal dismissed the appeal finding that a “dispute” under the Act is a disagreement that arises in respect of a Statutory Condition 11 matter for which, acting in good faith, the parties have been unable to informally reach a resolution and their impasse realistically prevents them from settling the claim; an insurer’s obligation to notify the insured of the dispute resolution process is triggered only once the insurer becomes aware that a dispute of that nature exists; and a failure to provide notice does not disqualify the insurer from invoking the dispute resolution process. The Court of Appeal also held that it was open to the chambers judge to appoint a representative on behalf of the insured.

This case was digested by Cameron B. Elder, and first published in the LexisNexis® Harper Grey Insurance Law Netletter and the Harper Grey Insurance Law Newsletter. If you would like to discuss this case further, please contact Cameron B. Elder at

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