The appellant received long-term disability benefits from the respondent insurer.
Unaware that the appellant had retired and was receiving superannuation benefits, the respondent failed to deduct those benefits and overpaid the appellant by approximately $114,000 over five years.
To recoup the overpayment, the respondent reduced the appellant's monthly disability payments by 50 per cent.
The appellant sued, arguing the policy did not permit the reduction and that the insurer breached its fiduciary duty and duty of good faith.
The motion judge dismissed the action on summary judgment.
The Court of Appeal dismissed the appeal, finding that the policy permitted the insurer to reduce current benefits to recover past overpayments and that no ad hoc fiduciary duty existed.
