The insurer appealed the LAT’s decision which found that it was not permitted to deduct an LTD litigation settlement from the claimant’s ongoing IRBs. The Divisional Court rejected the appeal. The Court noted that the Tribunal made a finding of fact that the LTD settlement did not provide appropriate details to allow the insurer to deduct it from IRBs, because the settlement was not confined to payment for the LTD claim alone; it also included claims for punitive damages, costs, and interest. The release did not specify how much of the settlement was attributed to each head of damages in the LTD litigation. The Court rejected the analogy between IRB deductions and section 267.8 of the Insurance Act, which provided a separate basis for deduction of collateral benefits in the tort context.
