Insurance Act Does Not Remove Employer’s Right Of Subrogation

On February 26, 2014, the Court of Appeal unanimously allowed the appeal of an employer seeking to recover the income benefits paid to an employee, from a third party tortfeasor (Hammond v DeWolfe, 2014 ABCA 81).

The employer, Syncrude, issued $38,668 in income benefits to its employee who missed time from work as a result of injuries sustained in a motor vehicle accident with the respondent tortfeasor. The payments were made pursuant to a temporary disability plan which formed part of the employment contract. The plan explicitly provided Syncrude with a right of subrogation against third parties responsible for causing the employee's illness. To this end, Syncrude and the employee brought an action against the respondent.