4.5.3 Where the MRCC takes over or institutes proceedings against a third party

Subsection 398(2) requires recovery of all compensation paid under the MRCA prior to the settlement (excluding any payments for MRCA Supplement under sections 221 and 245, bereavement payments under sections 242 and 255, and weekly compensation for eligible young persons under section 253).  The recovery provisions also include payments made under the DRCA before the payment in respect of the cause of action, as well as pension amounts paid in accordance with Part II or Part IV of the VEA. Costs incidental to the claim, such as the cost of arranging an independent medical assessment for the purpose of assessing liability or eligibility for compensation are also included. 

Subsection 398(3) operates in the same manner as subsection 388(6), insofar as it precludes a plaintiff from receiving any compensation, including treatment under Chapter 6, following receipt of common law damages or a settlement amount.  The significant difference is that (under subsection 398(3)) compensation becomes payable again when the amount of compensation that would have been payable under the MRCA, DRCA or Part II or Part IV of the VEA exceeds the amount of the settlement.  Hence, the plaintiff's entitlement to compensation, including treatment, will only cease during the period that the settlement amount exceeds the amount of compensation payable.