IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20100506

Docket:
S54189

Registry: Nanaimo

Between:

Insurance
Corporation of British Columbia

Plaintiff

And:

Todd
William Mechalchuk
Tarrah Mechalchuk

Defendants

Before: The Honourable Mr. Justice Wong

Oral Reasons for Judgment

Introduction and Background

[1]            
THE COURT: The
plaintiff Insurance Corporation of British Columbia seeks damages in respect of
insurance claims made by the defendant Todd Mechalchuk, on the basis that such
claims were fraudulent.  His wife, Tarrah Mechalchuk, is also sued as a party
who aided her husband.

[2]            
This action relates to a single vehicle accident
on November 6, 2002, that occurred on McLachlin Street in Courtenay.  The
registered owner of a 1989 Toyota Supra, Todd Mechalchuk, his wife, Tarrah
Mechalchuk, and two other passengers, Shannon Mann and Casey McCreesh, the latter
now deceased, were in the vehicle at the time.  The accident occurred when the
driver of the vehicle lost control and collided with a light pole.  The car
sustained major damage and was regarded as a write-off.  At the time, no one
was apparently injured.  All occupants of the vehicle had come from a local
drinking establishment called the Whistle Stop Pub in Courtenay. 

[3]            
The defendant Todd Mechalchuk submitted a
vehicle damage claim to ICBC alleging he was a restrained front-seat passenger
at the time of the accident.  Ms. Mechalchuk reported to the police and
signed a statement for ICBC alleging she was the driver.  Initially, ICBC
accepted the claim and paid out, as cost of vehicle replacement, an amount of
$8,761.13.

[4]            
Subsequently, independent witness evidence was
collected indicating a male was the driver of the vehicle on the date in
question, not Ms. Mechalchuk.  Three months after the accident,
Mr. Mechalchuk also submitted a personal injury claim allegedly from the
accident.  ICBC refused the personal injury claim for lack of causal connection
evidence.  ICBC then issued an action alleging that the defendants provided wilfully
false statements with respect to the operator of the vehicle in question, and
that Mr. Mechalchuk made a false claim for bodily injury.

[5]            
Damages sought by the plaintiff ICBC include
recovery of damages paid to the defendant Todd Mechalchuk for the total loss of
the vehicle, associated internal and external costs for the administration and
investigation on the file, punitive damages, court order interest, and costs.

[6]            
At trial, ICBC called two independent witnesses,
aside from the adjuster handling the defendant Todd Mechalchuk’s claim, to the
accident and its aftermath.  Basically, these two witnesses testified that,
having witnessed the collision, they approached the defendant Mechalchuk’s
vehicle and the person behind the driver’s wheel was a large male with the
physical description and hairstyle fitting Todd Mechalchuk.

[7]            
Both defendants gave evidence and called in turn
Shannon Mann, who was also in the Mechalchuk vehicle at the time of the
accident.  Tanya Mechalchuk, Todd’s sister, and her husband, Dave LeBarron, who
were in another car at the time of the accident, also testified.  They gave
evidence that Tarrah was in fact driving the car when it collided with the
pole. 

[8]            
The issue is a factual finding.  Who in fact was
driving at the time of the collision, Todd or Tarrah Mechalchuk?  If Todd was
driving, a material false representation in the loss claim was made by both
defendants.  I have concluded that in fact happened here. 

Analysis

[9]            
The plaintiff ICBC has the legal onus and
persuasive burden to establish, on a balance of probabilities, i.e., more
probable than not, that Todd Mechalchuk was the driver.  The defence witnesses,
other than the defendants, are all relatives, friends or work colleagues with
conscious or unconscious bias favouring the defendants.  Although they were
adamant that the driver was Tarrah, I found their overall manner and demeanour
in giving their evidence to be guarded or selective in memory.

[10]        
The abrupt leaving of the accident scene and
belligerent behaviour displayed by Tarrah to neighbours, who were solicitous
about her physical wellbeing and urging her to remain for the police, is puzzling. 
Although she had at the time a novice driver licence classification with a
prohibition of drink condition, the potential consequences for her on police
attendance regarding her driver’s licence violation would be considerably less
than it would be for her husband Todd. 

[11]        
Todd Mechalchuk had an abysmal driving record of
speeding and two prior 24‑hour drinking driving suspensions.  He had also
been drinking alcohol prior to the accident.  One independent witness suggested
that just before the Mechalchuk vehicle went out of control, that vehicle may
have been road racing at high speeds with the LeBarron vehicle.  If police
investigation at the accident scene determined that Todd was in fact the
driver, he might be facing potential criminal charges, plus consequences of
being in contractual breach of his motor vehicle insurance policy.

[12]        
A hypothesis of Todd under these circumstances
instructing Tarrah to leave the accident scene and return home, while he dealt
with the attending police officers as a passenger, is a reasonable surmise. 

[13]        
The lynchpin evidence in this case is the
evidence of the two independent witnesses who, coming from different
directions, both put circumstantially the driver of the Mechalchuk vehicle at
the end of the collision to be a male person.  The physical description given
by both of the male driver fits only Todd Mechalchuk.  One simply corroborates
the other in that regard.  Accordingly, there is an irresistible inference that
the driver was in fact Todd Mechalchuk, and I so find.

[14]        
From the evidence, the external and internal
expenses total $14,568.84.  Punitive damages are appropriate in this case. 
This was a considered act to deceive ICBC, and a further attempt to obtain
personal injury compensation with bogus injuries.  No criminal charges were
laid, but dishonest economic deprivation action took place.  There is a need
for denunciation, specific and general deterrence in this case to demonstrate
that this type of conduct is unacceptable and deserving of judicial
condemnation, especially when the conduct pertains to a fraud on a public
agency.

[15]        
A proportionate penalty as to culpability in the
context of this case is $10,000 levied against both defendants on a joint and
several basis.

Conclusion

[16]        
Damages are therefore fixed as follows:

(i) external and internal expense
recovery, $14,568.84;

(ii) punitive damages on a joint and
several basis, $10,000. 

Total damages, $24,568.84. 

[17]        
There will be court order interest on the
expense recovery portion and costs.

[18]        
I commend both counsel for their assistance and
expedition in the conduct of this case.

 [SUBMISSIONS RE
COSTS]

[19]        
THE COURT:  This is a case having already
awarded punitive damages in the context of this case, was also deserving under
the old rules of special costs, and prior to the recent Supreme Court Rule
amendment, the court had no discretion in this regard on an offer to settle to
grant double costs.  Having considered the required enumerated aspects of
judicial discretion, and exercising my discretion, this is an appropriate case
for double costs and I so order.

[20]        
MS. CEDERBERG:  And that is single costs up
until March, and including March 17th, 2010, and double costs thereafter?

[21]        
THE COURT:  That is correct.

[22]        
MS. CEDERBERG:  Thank you, My Lord.

“Wong J.”