CITATION: Francis v. Dominion of Canada General Insurance Company, 2016 ONSC 6566
COURT FILE NO.: 491/15
DATE: 20161103
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
swinton, nordheimer and baltman JJ.
B E T W E E N:
ANTHONY FRANCIS
Applicant
- and -
DOMINION OF CANADA GENERAL INSURANCE COPMANY and FINANCIAL SERVICES COMMISSION OF ONTARIO
Respondents
Bryan D. Rumble and Dina D’Andrea, for the Applicant
Joyce Tam, for the Respondent Dominion of Canada General Insurance Company
HEARD AT TORONTO: October 20, 2016
Swinton J.:
Overview
[1] Anthony Francis (“the Applicant”) applies for judicial review of a decision of Director’s Delegate Evans of the Financial Services Commission of Ontario dated August 31, 2015. The Director’s Delegate upheld an arbitration decision that held the Applicant was not entitled to Loss of Earning Capacity Benefits (“LECBs”) under the Statutory Benefits Schedule – Accidents After December 31, 1993 and Before November 1, 1996, O. Reg. 776/93 (“the 1994 SABS”), as he did not meet two of three conditions in s. 20.1. He also held that s. 20.1 does not violate s. 15 of the Canadian Charter of Rights and Freedoms.
[2] For the reasons that follow, I would dismiss the application for judicial review.
The Standard of Review
[3] The Director’s Delegate was interpreting the SABS, a home statute. Numerous cases have held that the standard of review with respect to interpretation of such a regulation is reasonableness (see, for example, Pastore v. Aviva Canada, 2012 ONCA 642 at para. 22 and Simser v. Aviva Canada Inc. 2015 ONSC 2363 (Div. Ct.) at paras. 20-35). While the Applicant relies on MacDonald v. Chicago Title Insurance Co. of Canada, 2015 ONCA 842 in support of his argument for a correctness standard, that is a decision dealing with the standard of review in an appeal of a judge’s order. It is not applicable to judicial review of a decision of the Director’s Delegate, an administrative decision-maker with specialized expertise.
[4] The standard of review is correctness with respect to the Charter issue (Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190 at para. 58).
The Statutory Interpretation Issue
[5] Subsection 20(1) of the 1994 SABS provides that an insurer shall pay an insured person weekly Loss of Earning Capacity Benefits (“LECBs”) if the payment is authorized by Part VI of the regulation. The provision, found in Part VI, states:
An insurer shall pay an insured person weekly loss of earning capacity benefits instead of weekly income replacement benefits under Part II, weekly education disability benefits under section 15, weekly caregiver benefits under Part IV or weekly disability benefits under Part V if the payment of loss of earning capacity benefits is authorized by this Part.
[6] The key words for purpose of this application for judicial review are “authorized by this Part”. Subsection 21(1) sets out the circumstances in which payment of LECBs is authorized, while ss. 21-25 set out the mechanism for claiming LECBs. Subsection 21(1) provides that an insurer must make an offer of LECBs if an insured meets the circumstances set out in the subsection. To be eligible for LECBs, an insured must first qualify for at least one of the weekly benefits set out in s. 20(1): income replacement benefits, education disability benefits or caregiver benefits.
[7] Section 20.1 was added to the 1994 SABS by O. Reg. 26/06. It provides that ss. 21 to 25 only apply if, before March 1, 2006, three conditions are met:
(a) the insurer has refused to pay weekly income replacement benefits under Part II, weekly education disability benefits under s. 15, weekly caregiver benefits under Part IV or weekly disability benefits under Part V;
(b) the insurer has not made an offer with respect to the payment of weekly loss of earning capacity benefits under s. 21 and there is no agreement under ss. 24 or 25; and
(c) an arbitration proceeding under s. 282 of the Act or under the Arbitration Act, 1991 or a court proceeding has been commenced in accordance with s. 279 (1) of the Act in respect of the insured person’s entitlement to a benefit referred to in clause (a).
[8] The Applicant was born in December 1991. He was injured in a motor vehicle accident in June 1996. At the time of the amendment to the 1994 SABS, he was 14 years of age. Dominion had not refused to pay him weekly education disability benefits before March 1, 2006, as no such benefits were payable until he turned 16.
[9] The Director’s Delegate held that the Applicant is not entitled to LECBs because he did not meet two of the three additional conditions set out in s. 20.1. Dominion had not made an offer to pay weekly LECBs under s. 21 of the regulation, nor was there any agreement under ss. 24 or 25. Further, there was no arbitration proceeding or court proceeding commenced with respect to entitlement to weekly education disability benefits prior to March 1, 2006.
[10] The Applicant argues that the Director’s Delegate’s interpretation of the regulation is unreasonable. He argues that the Director’s Delegate erred in failing to recognize the contractual nature of the SABS benefits. He also challenges the application of the principles of statutory interpretation respecting vested rights and retrospectivity.
[11] The task of the Director’s Delegate was to interpret the regulation, not the contract of insurance. The insurance policy under which the Applicant was insured clearly stated that the details of the Accident Benefit Coverage are set out in the SABS Schedule of the Insurance Act, R.S.O. 1990, c. I. 8, and if there is a difference in interpretation of the wording in this section of the policy and the SABS, the SABS prevail. Section 268(1) of that Act makes it clear that the SABS govern the content of an insurance policy, providing:
Every contract evidenced by a motor vehicle liability policy, including every such contract in force when the Statutory Accident Benefits Schedule is made or amended, shall be deemed to provide for the statutory accident benefits set out in the Schedule and any amendments to the Schedule, subject to the terms, conditions, provisions, exclusions and limits set out in that Schedule.
[12] The Director’s Delegate’s interpretation of the regulation was reasonable. Indeed, in my view, the language of the regulation is clear, and it does not give rise to more than one reasonable interpretation. Section 20 requires the payment of LECBS if “authorized” by Part VI.
[13] The requirement in s. 21 that the insurer make an offer of LECBs contains certain preconditions. However, s. 20.1 clearly sets out the conditions to be met before ss. 21 to 25 can apply. It removes the right to LECBs from those who have not met those conditions prior to March 1, 2006. The Applicant had not met two of the three conditions in s. 20.1. Accordingly, ss. 21-25, the mechanism for the payment of LECBs, cannot apply in his case.
[14] Moreover, I see no error in the conclusion of the Director’s Delegate that the Applicant does not have a vested right to LECBs. At the time of the amendment to the regulation, his right to LECBs was not fixed and crystallized, a requirement set out in Dikranian v. Quebec (Attorney General), 2005 SCC 73 at para. 33. He had not applied for LECBs, nor had he met the test for entitlement to them before the 2006 amendment.
[15] Even if the Applicant’s right to LECBs was vested, the presumption against interference with vested rights can be rebutted by a clear legislative intention, as can the presumption that legislation does not have retrospective effect (Dikranian at para. 33). When one looks at the wording of s. 20.1, read in the context of Part VI as a whole, it is clear that the Lieutenant-Governor in Council turned its mind to the issue of vested rights. Section 27.1 preserved entitlement to LECBs for those receiving LECBs as of February 28, 2006. It also preserved entitlement for those who were in the process of seeking LECBs, as shown by the three conditions in s. 20.1.
[16] This is not a case like Davis (Litigation Guardian) v. Wawanesa Mutual Insurance Co., 2015 ONSC 6624, which dealt with a 2014 amendment to the amount of attendant care benefits. There the insured was already in receipt of the benefit prior to the amendment, and the Court held that the amendment was not written in such a way as to rebut the presumption against retrospective application (see paras. 14-36).
[17] In conclusion, this is a case where there are not multiple reasonable interpretations of the regulation. There is no basis for this Court to interfere with the Director’s Delegate’s interpretation of s. 20.1.
The Charter Argument
[18] In the alternative, the Applicant argues that s. 20.1 discriminates on the basis of age because those who were not 16 years old at the time of the 2006 amendment would be ineligible to claim LECBs.
[19] The Director’s Delegate set out the correct test to be applied to determine whether there has been a breach of the Charter equality degree (Withler v. Canada (Attorney General), 2011 SCC 12 at para. 30): does the law create a distinction based on an enumerated or analogous ground, and does the distinction create a disadvantage by perpetuating prejudice or stereotyping?
[20] He correctly held that s. 20.1 does not create a distinction based on the enumerated ground of age. The provision draws a distinction based on circumstances or events. It creates a distinction between those who had claimed LECBs before March 1, 2006, as well as those who had been prevented from claiming LECBs due to an existing dispute over weekly benefits prior to March 1, 2006, and those who had not.
[21] The Applicant argues that there is a distinction based on age because of the disparate impact on those under 16 at the time of the amendment. Even if that were the case, the Applicant has not demonstrated that the distinction perpetuates prejudice or stereotyping against young people. The Applicant is not able to claim LECBs, but he still has entitlement to education disability benefits if the eligibility test is met. He has not shown that the legislation is discriminatory.
[22] Accordingly, I see no error in the Director’s Delegate’s rejection of the Charter challenge.
Conclusion
[23] The application for judicial review is dismissed. Costs to the respondent Dominion are fixed at $7,500.00 all inclusive.
___________________________
Swinton J.
___________________________
Nordheimer J.
___________________________
Baltman J.
Released: November 3, 2016
CITATION: Francis v. Dominion of Canada General Insurance Company, 2016 ONSC 6566
COURT FILE NO.: 491/15
DATE: 20161103
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Swinton, Nordheimer and Baltman JJ.
B E T W E E N:
ANTHONY FRANCIS
Applicant
- and -
DOMINION OF CANADA GENERAL INSURANCE COPMANY and FINANCIAL SERVICES COMMISSION OF ONTARIO
Respondents
REASONS FOR JUDGMENT
_________________________________________
Swinton J.
Released: November 3, 2016