Executive Summary: Key Legal and Evidentiary Issues

• Interpretation of “reasonable expenses” under Section B – Accident Benefits of the New Brunswick Standard Automobile Policy and the Insurance Act, where no specific kilometric rate is prescribed.
• Dispute over whether a $0.30/km reimbursement rate for transportation to medical treatments is reasonable compared with higher government and previous court/arbitral benchmark rates.
• Scope of an insurer’s initial discretion to set a per-kilometre rate for accident-benefit travel versus the court’s role in reviewing that rate for reasonableness and good faith.
• Application of horizontal stare decisis and judicial comity, including whether the unreported Bradley v. TD Insurance decision bound other judges on the appropriate kilometric rate.
• Assessment of evidentiary sufficiency where the insured relied on government rates and prior decisions but provided no proof of actual vehicle operating and ownership costs.
• Appellate review of mixed fact and law findings on reasonableness of the rate and alleged legal errors in characterizing the insurer’s discretion and the nature of its contractual obligations.

Factual background and procedural history
Jaclyn Prestidge, a resident of Moncton, New Brunswick, was injured in a motor vehicle accident on 4 June 2024. As part of her recovery, she regularly drove her personal vehicle to attend treatment appointments: a round-trip of approximately two kilometres for physiotherapy and ten kilometres for massage therapy. These were short, in-city trips undertaken frequently as part of her post-accident medical care.
Definity Insurance Company had issued to Ms. Prestidge a New Brunswick Standard Automobile Policy which included the mandatory coverage set out in Section B – Accident Benefits and required by the Insurance Act, R.S.N.B. 1973, c. I-12. Under Subsection 1(1) of Section B, the insurer must pay “reasonable expenses” incurred as a result of bodily injury arising from an accident, for specified services such as necessary medical, surgical, dental, chiropractic, ambulance, hospital or professional nursing services. Although this provision clearly covers reasonable expenses for necessary medical services, it does not expressly mention transportation, fix a per-kilometre rate, or prescribe any formula for calculating that rate.
Following the accident, Definity reimbursed Ms. Prestidge’s transportation costs for travel to and from her medical appointments at a flat rate of $0.30 per kilometre. Ms. Prestidge, however, believed that this rate was too low. Relying on an earlier unreported New Brunswick Court of King’s Bench decision, Hilary Bradley v. TD Insurance, in which a judge had accepted $0.57 per kilometre as reasonable in the circumstances of that case, she applied to the Court of King’s Bench for an order requiring Definity to reimburse her accident-related transportation at $0.57/km for the entire benefit period, including arrears and costs.
In support of her position, Ms. Prestidge submitted evidence that the Government of Canada reimbursed employees at $0.575 per kilometre (later increased to $0.60/km) and that the Government of New Brunswick paid between $0.46 and $0.58 per kilometre, depending on annual distance travelled. She also swore that she personally bore all the usual costs of owning and operating her vehicle, including insurance, fuel, registration, inspection, maintenance and repairs. However, she did not provide any detailed documentary or numerical evidence of her actual vehicle expenses.
Definity, through a claims representative, acknowledged that it made what it described as a “discretionary payment” under Section B – Accident Benefits for transportation costs at $0.30/km and asserted that it had exercised and continued to exercise that discretion in a reasonable manner and in good faith. Importantly, Definity did not dispute that transportation costs were payable in principle; instead, it maintained that setting the specific rate fell to it in the first instance, and that $0.30/km was a reasonable figure in the circumstances.

The first-instance decision: application dismissed
The application judge in the Court of King’s Bench treated the dispute as a narrow one: the question was not whether transportation could be reimbursed at all, but whether the $0.30/km rate Definity paid was reasonable for Ms. Prestidge’s circumstances. Definity accepted that transportation fell within the expenses it would cover, so entitlement to transportation as such was not contested.
On the horizontal stare decisis issue, Ms. Prestidge argued that the judge was bound, under principles of judicial comity and horizontal stare decisis, to follow Bradley v. TD Insurance and adopt $0.57/km as the only reasonable rate, effectively treating $0.30/km as unreasonable. The judge, however, examined the very short transcript of Bradley and noted that it was an undefended, unopposed application with no analysis of the policy wording, the Insurance Act, or broader jurisprudence, and with very little factual context beyond the insurer’s existing rate and the government comparators. The Bradley judge had also expressly stated that he was not setting a precedent and that each case must be decided on its own facts. The application judge therefore concluded that Bradley, having been decided without full consideration, was not binding and did not fix a universal rate for all Section B transportation claims.
Turning to the reasonableness of the rate itself, the application judge evaluated the limited evidentiary record. On the one hand, she had government reimbursement rates and some judicial and arbitral rates from other jurisdictions to consider as benchmarks. On the other hand, she had no data on Ms. Prestidge’s actual vehicle operating and ownership costs. She also took into account that the distances travelled for treatment were quite short and within city limits. After weighing these factors, she found that a rate of $0.30/km, while at the low end of the various benchmarks, was nonetheless within a reasonable range for this particular insured and pattern of travel.
The judge also addressed Definity’s role in initially fixing the kilometric rate. She accepted that, in practice, where neither the Insurance Act nor the Standard Automobile Policy sets a rate, the insurer must in the first instance select a rate it believes is reasonable in order to make timely payments. She recognized that this choice is not absolute or unreviewable: if an insured disagrees, the court can intervene to determine (a) whether the rate is reasonable and (b) whether the insurer exercised its discretion arbitrarily, capriciously or in bad faith. On the evidence before her, she found no basis to conclude that Definity had acted in bad faith or in an arbitrary or capricious manner when setting the $0.30/km rate.
Accordingly, the Court of King’s Bench dismissed Ms. Prestidge’s application, upheld Definity’s $0.30/km rate as reasonable in the circumstances, and declined to order any increase to $0.57/km or any arrears at the higher rate.

Issues raised on appeal to the Court of Appeal
Ms. Prestidge appealed to the Court of Appeal of New Brunswick, advancing four principal grounds of appeal. First, she alleged that the application judge misinterpreted Rolfe v. AXA Insurance Company and the general principles of contractual interpretation of insurance policies, particularly in relation to the scope of “reasonable expenses” under Section B. Second, she argued that the judge erred in law by treating coverage of transportation costs and the kilometric rate as lying within the insurer’s discretion, subject only to intervention where that discretion was exercised arbitrarily, capriciously or in bad faith. Third, she challenged the finding that a reasonable kilometric allowance could vary depending on location and circumstances, and that $0.30/km was reasonable in her circumstances. Fourth, she submitted that the judge misapplied horizontal stare decisis in concluding that Bradley was not binding because it had not been fully considered.
The Court of Appeal, in reasons written by Justice LaVigne and concurred in by Justices Green and LeBlanc, re-framed the case around three substantive questions: (1) whether the application judge was bound by Bradley; (2) whether she erred in her application of contractual interpretation principles and in her treatment of entitlement to transportation costs; and (3) whether she erred in finding that $0.30/km was a reasonable rate on the evidence. The Court dealt first with the horizontal stare decisis issue, then the interpretive and entitlement questions together, and finally the core reasonableness finding.

Horizontal stare decisis and the status of Bradley
On the fourth ground, the Court of Appeal held that the application judge was correct: she was not bound by Bradley. Under the doctrine of horizontal stare decisis, a superior court judge should generally follow prior decisions of judges of the same court on questions of law, unless an exception applies, such as when the earlier decision is distinguishable, was made per incuriam, or was not fully considered. The Court emphasized that unconsidered or hastily decided cases, especially those decided without meaningful analysis or full adversarial argument, do not carry binding force.
In reviewing Bradley, the Court noted that the entire proceeding and oral decision spanned only three transcript pages; the case was undefended and contained no discussion of the policy wording, the Insurance Act, or relevant jurisprudence. Crucially, the judge in Bradley had explicitly declined to set a general precedent, insisting that rates should be determined on a case-by-case basis and that his ruling applied only to the parties before him. In the Court of Appeal’s view, Bradley was precisely the kind of “unconsidered” decision that does not trigger the strict operation of horizontal stare decisis, though it could be considered as one data point or reference. It was therefore open to the application judge to determine the appropriate rate independently on the record before her.

Contractual interpretation, entitlement, and the scope of the insurer’s discretion
On the first and second grounds of appeal, the Court of Appeal drew a clear distinction between entitlement to transportation expenses and the specific rate dispute. The Court observed that the case did not actually require a definitive ruling on whether transportation costs are included as “reasonable expenses” under Section B for all cases. Definity had accepted that transportation was covered under Section B for Ms. Prestidge, and the parties agreed that entitlement to transportation as such was not in issue, even if transportation is not expressly listed among the enumerated medical services.
The Court referred to its earlier decision in AXA Insurance v. Rolfe, where massage therapy treatments, although not expressly mentioned, were found to constitute covered “medical” services when prescribed and reasonably required. In Rolfe, the Court had noted that courts in other jurisdictions had generally treated certain incidental costs—such as meals, lodging and transportation incurred in obtaining listed services—as falling within covered “reasonable expenses.” However, the Court stressed that Rolfe did not formally adjudicate entitlement to incidental expenses like meals, accommodation or transportation in a comprehensive way; the precise legal question of whether transportation is always part of Section B coverage therefore remained open.
In the present appeal, the Court of Appeal concluded that any comments the application judge made about entitlement to transportation expenses were obiter and did not drive her decision. Since both parties approached the case on the basis that transportation was covered, the only live issue was whether the particular rate being paid by Definity was reasonable. The Court declined to settle definitively, for all cases, whether transportation costs are necessarily included under Section B, expressly leaving that broader question “for another day.”
Regarding the insurer’s discretion, the Court accepted that, as a practical matter, where neither the statute nor the policy fixes a rate, the insurer must initially choose a figure it believes to be reasonable so that benefits can be paid promptly. However, this discretion is neither absolute nor unilateral in a legal sense. The obligation under Section B is to pay reasonable expenses; an insurer cannot by fiat convert an unreasonable rate into a binding term. If there is disagreement, either party may seek judicial review of what is reasonable, and the court may substitute its own view of the proper rate. The Court endorsed a two-step analytical framework: first, the court assesses whether the rate chosen is itself reasonable on the evidence; second, it considers whether the insurer exercised its discretion arbitrarily, capriciously, or in bad faith.
The Court also addressed the interaction with Crotty v. Aviva General Insurance Company from Newfoundland and Labrador, where the Court of Appeal had criticized characterizing the duty to pay “reasonable expenses” as discretionary. In line with that reasoning, the New Brunswick Court of Appeal emphasized that the duty to pay reasonable expenses is a contractual and statutory obligation, not a matter of grace. The insurer may select a rate in the first instance, but it cannot bind the insured to an unreasonable rate; the ultimate arbiter is the court applying the standard of reasonableness, informed by good-faith principles recognized in cases such as Bhasin v. Hrynew, Fidler v. Sun Life, and Whiten v. Pilot Insurance.

Reasonableness of the $0.30/km rate and evidentiary assessment
The most fact-intensive issue was whether the application judge had erred, on a palpable and overriding error standard, in finding that $0.30/km was a reasonable rate for Ms. Prestidge’s transportation costs. Both sides agreed that this was a mixed question of fact and law subject to deferential appellate review.
The Court of Appeal reviewed the evidentiary record, which included the government reimbursement rates, certain arbitral decisions under Ontario no-fault auto benefits, and various tort cases where courts fixed kilometric rates payable by tortfeasors to plaintiffs. In the Ontario arbitration decisions, rates in the $0.27–$0.30/km range had been accepted as reasonable for transportation expenses under accident benefits, often with more detailed cost evidence. In tort decisions from Alberta and British Columbia, courts had at different times used figures tied to government or court-rule rates, which gradually increased as fuel and vehicle costs rose.
The Court concluded that these authorities illustrated a range of potentially reasonable rates and that reasonableness is inherently contextual: it depends on evidence of actual costs, the distances travelled, the time frame, and the broader economic environment. Crucially, reasonableness does not equate to full indemnity for all actual costs; the Insurance Act and Section B elsewhere impose explicit caps on certain benefits, such as funeral costs and weekly income replacement, which underscores that “reasonable expenses” can be less than complete re-payment of every dollar spent.
In Ms. Prestidge’s case, the Court endorsed the application judge’s view that the evidence was thin on key points. There was no concrete documentation of her actual vehicle costs or annual mileage, and the only uncontested facts about her travel were that the distances were modest and local. Against that evidentiary backdrop, the Court accepted that more than one reasonable rate could exist and that the figure set by Definity fell within a defensible range. The statement that a “reasonable kilometric allowance” will vary by location and circumstances was interpreted as referring to total compensation (distance multiplied by rate) rather than as a legal conclusion that geography alone can dictate the per-kilometre rate. The Court found no misdirection or misunderstanding of the legal test in this nuance.

Outcome and implications
In the end, the Court of Appeal found no reversible error in the application judge’s handling of any of the four grounds of appeal. The judge was not bound by Bradley; she did not improperly treat entitlement to transportation as fully discretionary; she correctly focused on the reasonableness of the rate actually in dispute; and her conclusion that $0.30/km was reasonable on the limited record did not amount to a palpable and overriding error.
Accordingly, the Court of Appeal dismissed Ms. Prestidge’s appeal and left intact the original order refusing to increase the reimbursable rate above $0.30/km. As a result, Definity Insurance Company remained entitled to continue paying transportation expenses at that rate, and no retroactive uplift to $0.57/km was ordered. In disposing of the appeal, the Court ordered that costs of $1,500 be paid to the successful party, Definity Insurance Company, and there is no indication in the decision of any additional damages or monetary awards beyond this fixed costs amount.