ICBC has beaten an income replacement benefits claim after a BC tribunal attributed his corporation's business income to a self-employed claimant who paid himself nothing.
In Shehata v. ICBC, 2026 BCCRT 799, the Civil Resolution Tribunal dismissed Medhat Shehata's bid for income replacement benefits following a June 29, 2023 motor vehicle accident in Richmond. The decision, released on May 22, 2026, sets out a shifting burden of proof that bears directly on how insurers handle incorporated self-employed claimants.
Shehata held two jobs before the crash. He had worked since 2013 as a mechanical engineer at the Mount Milligan mine on a rotating two-week schedule that alternated 12-hour days on site with a week off. He also ran a concrete construction company, Core Coating Ltd., which he started in 2017 and incorporated in 2020. He took medical leave from the mine in late March 2023 because of stress, anxiety, depression, and high blood pressure. Canada Life paid him short-term disability until July 14, 2024.
After the accident, his family doctor diagnosed a WAD II whiplash injury and soft tissue damage. A later MRI showed a torn radial collateral ligament in his right hand. The medical evidence showed he could no longer do physical construction work, but he continued to manage Core Coating, supervising and working at a computer.
ICBC refused income replacement benefits. The insurer argued his pre-existing medical condition - not the accident - kept him out of the mine job, and that Core Coating's earnings disqualified him from benefits tied to his self-employment.
Shehata pushed back, arguing Core Coating was a separate legal entity and its revenue was not his personal income. His 2022 and 2023 personal tax returns showed only mine income.
Tribunal Member Jeffrey Drozdiak sided with Shehata on classification, finding he was a full-time earner rather than a temporary earner as ICBC had argued. But that win did not save the claim.
The key question was how to value his self-employment income under section 18 of the Income Replacement and Retirement Benefits and Benefits for Students and Minors Regulation. The Tribunal held that business income includes not only what an insured received, but what the insured was entitled to receive as a significant influence shareholder - even unpaid dividends or salary.
To operationalize that reading, Drozdiak set out a shifting burden of proof. ICBC must first establish a prima facie case for entitlement using corporate tax returns and the insured's role and ownership. The insured must then prove, on a balance of probabilities, why they are not entitled to that income, with evidence on company size, governance, retained earnings history, and future plans.
Core Coating's numbers did the rest. In the year after the accident, net revenue hit $346,126; the next year, $360,241. Retained earnings climbed from $256,730 before the crash to $858,041 two years later, with $1,000,000 deposited in banks. As a 50% shareholder, Shehata's attributed gross yearly employment income reached $173,063 and $180,120.50 - both well above the maximum insurable income, which topped out at $119,000 on April 1, 2025.
A letter from the company accountant claiming retained earnings were being saved for "a small unit and flooring equipment" did not move the Tribunal. The claim was dismissed.
