Case Overview:

• Issue: Whether Ontario’s loss transfer provisions under section 275 of the Ontario Insurance Act apply to an out-of-province accident.
• Background: Aviva insured a vehicle involved in a collision in Alberta, while Echelon insured the injured Ontario resident. Echelon paid Ontario statutory accident benefits to the injured party and sought indemnification from Aviva under Ontario’s loss transfer rules.

Key Legal Arguments:

• Aviva’s Position: Claimed that the decision in Primmum Insurance Co. v. Allstate Insurance Co., which supported Echelon’s indemnification right, was effectively overturned by Travelers Insurance Co. of Canada v. CAA Insurance Co.. They argued that applying Ontario law to an out-of-province accident was an overreach.
• Echelon’s Position: Relied on Primmum, asserting that Ontario insurers, regardless of where the accident occurred, are bound by Ontario’s loss transfer provisions if both insurers conduct business in Ontario.

Court’s Analysis:

1. Precedent Validity: The court upheld Primmum as binding, noting that Travelers addressed priority provisions, not loss transfer. Thus, Primmum remains the controlling authority for loss transfer disputes.
2. Extra-Territorial Jurisdiction: Confirmed that since both insurers are licensed in Ontario, Ontario’s loss transfer provisions apply despite the accident’s location.
3. Outcome: Appeal dismissed, with the court finding no error in the Arbitrator’s adherence to Primmum.

Conclusion: The Ontario Superior Court reaffirmed that Ontario’s loss transfer provisions apply to Ontario-licensed insurers in cross-border accidents if both insurers are authorized to operate in Ontario, even where the incident occurred outside Ontario.