CITATION: Hussein v. Intact Insurance Company, 2025 ONSC 842

DIVISIONAL COURT FILE NO.: 376/24

DATE: 20250207

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

Sachs, Backhouse, S.T. Bale JJ.

BETWEEN:

Jakupovic Hussein¹

Appellant

– and –

Intact Insurance Company

Respondent

Vanessa Liang, for the Appellant

Kevin R. Motley and Mahroze A. Khan, for the Respondent

HEARD at Toronto: January 20, 2025

H. sachs j.

Overview

1This appeal concerns a decision and a reconsideration decision by the Licence Appeal Tribunal (the “LAT”) to dismiss an application for benefits under the Statutory Accident Benefits Schedule – Effective September 1, 2010, O. Reg. 34/10 (the “SABS”) due to a failure to satisfy the applicable notice requirements.

2The Appellant, (the “Insured”), was involved in a motor vehicle accident, He notified his insurance company, Intact Insurance (the “Insurer”), one day later that he was in an accident in which his vehicle had sustained heavy damage. The Insured did not file his claim for accident benefits until seventeen months later. His explanation for the delay was that he was not aware that he was entitled to accident benefits until he spoke to a paralegal. The Insurer denied his claim on the basis that he did not give the insurance company notice of his claim for accident benefits within seven days as required by the SABS.

3The Insured applied to the LAT for a resolution of his dispute with the Insurer. In its decision dated December 22, 2023 (the “Decision”), the LAT denied his application for benefits on the basis that he failed to notify the Insurer of his claim within seven days and that his explanation for the 17-month delay in making his application was not credible. The Insured requested that the LAT reconsider its Decision. On May 21, 2024, that request was dismissed (the “Reconsideration Decision”).

4This is an appeal from both the Decision and the Reconsideration Decision. For the reasons that follow, I would allow the appeal, set aside both decisions and find that the Insured’s notification to the Insurer that he had been in an accident was sufficient notice to satisfy the seven-day deadline for notice under the legislation. Fundamental to my decision is the fact that the SABS is consumer protection legislation, which must be interpreted in a manner consistent with its objective - to reduce economic dislocation and hardship for victims of motor vehicle accidents.

Background

5The accident occurred on February 13, 2019. As a result of the accident, the Insured’s vehicle was considered a “write off”. The Insured notified the Insurer of the accident on February 14, 2019, at which time the Insurer noted that the vehicle had sustained “heavy damage.” The Insurer never questioned the Insured about whether he had suffered any personal injuries and never advised him of his entitlement to statutory accident benefits.

6Prior to the accident, the Insured had an unremarkable medical history. He rarely needed to seek medical attention and there is no evidence to suggest that he had ever reported any psychological or physical issues.

7After the accident, the Insured experienced back and hip issues such that his ability to walk was severely impaired. In February of 2022, at an examination arranged by the Insurer, a psychologist diagnosed the Insured with an adjustment disorder with mixed anxiety and depressed mood as a direct result of the accident.

8By December of 2023, doctors were agreeing that the Insured could have sustained a catastrophic impairment as a result of the accident. Since then, the Insured’s depression has worsened to the point that on January 31, 2024, he was hospitalized after a suicide attempt.

9Since the accident, the Insured has not been able to return to work. He applied to the Ontario Disability Support Program and his application for income support benefits was approved.

10The Insured sought treatment for his injuries. He paid for this treatment out of pocket until December 2020 when a licensed paralegal informed him of his entitlement to accident benefits. On December 2, 2020, that paralegal advised the Insurer that the Insured had been injured. The Insured then filed his application for accident benefits.

11Initially, the Insurer approved the Insured’s application for benefits and the Insured attended a few Insurer’s examinations. On April 12, 2022, the Insured received notice that the Insurer was terminating his benefits because of the delay in making his application.

12The Insured applied to the LAT, which held a hearing in writing to determine the preliminary issue of whether the Insured was barred from proceeding with his claim for accident benefits because he failed to notify the Insurer of his claim within the requisite seven-day period.

The LAT Decisions

The Decision

13In the Decision, the LAT determined that the Insured had not notified the Insurer of his intention to apply for accident benefits within the prescribed time period of seven days. Reporting to the Insurer that he was in an accident was not enough. He never advised the Insurer that he had suffered personal injuries and the Insurer had no obligation to inquire.

14The Decision also found that the Insured’s explanation that he did not know he could apply for accident benefits was not credible. First, he knew enough to claim property damage. Second, his policy set out that he was eligible for accident benefits.

The Reconsideration Decision

15In the Reconsideration Decision, the LAT rejected the Insured’s argument that the Decision’s interpretation of the notice requirement in the SABS was “narrow, incorrect, did not take into account decisions of the Tribunal, and was inconsistent with the consumer protection nature of the legislation.”

16In coming to this conclusion, the LAT found that the Insurer had no obligation to advise the Insured of the availability of accident benefits. As put by the LAT, “there is no such obligation in the Schedule.”

17With respect to the finding in the Decision that the Insured’s explanation for his delay in applying for benefits was not worthy of belief, the Reconsideration Decision concluded that this was a finding of fact that the Tribunal was entitled to make.

Jurisdiction and Standard of Review

18Section 11(1) of the Licence Appeal Tribunal Act, S.O. 1999, c. 12, Sched. G, allows parties the right to appeal the LAT’s decisions to the Divisional Court.

19Section 11(6) of the same act makes it clear that the appeal must be based on a question of law alone.

20As set out by the Supreme Court of Canada in Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, [2019] 4 S.C.R. 653, questions of law in an appeal are to be determined on a standard of correctness.

Analysis

21The Insurer submits that this appeal does not raise of question of law and, therefore, this court has no jurisdiction. I disagree. The issue of notice raises a matter of statutory interpretation, which is a question of law.

22Section 32 of the SABS reads as follows:

32 (1) A person who intends to apply for one or more benefits described in the Regulation shall notify the insurer of his or her intention no later than the seventh day after the circumstances arose that give rise to the entitlement to the benefit, or as soon as practicable after that day.

(2) The insurer shall promptly provide the person with,

(a) the appropriate application forms;

(b) a written explanation of the benefits available;

(c) information to assist the person in applying for benefits; and

(d) information on the election relating to income replacement, non-earner and caregiver benefits, if applicable.

23According to the decisions under appeal, the seven-day notice requirement in s. 32(1) required the Insured to notify the Insurer that he intended to apply for accident benefits. It was not sufficient to notify the Insurer that he had been in an accident. However, the Insured submits that the notice requirement under s. 32(1) was satisfied when he notified the Insurer that he had been in an accident.

24In Tomec v. Economical Mutual Insurance Co., 2019 ONCA 882, 148 O.R. (3d) 438, the Court of Appeal set out the overriding principles to be applied in interpreting the SABS. In doing so the Court adopted the articulation of those principles set out in Arts (Litigation Guardian of) v. State Farm Insurance Co. (2008), 2008 25055 (ON SC), 91 O.R. (3d) 394 (S.C.J.), at para. 16, where the Court states:

The SABS are remedial and constitute consumer protection legislation. As such, it is to be read in its entire context and in their ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of the legislature. The goal of the legislation is to reduce the economic dislocation and hardship of motor vehicle accident victims and, as such, assumes an importance which is both pressing and substantial.

25Tomec also states that faced with a choice between an interpretation of the statute “that furthers the public policy objectives underlying the SABS and one that undermines it, the only reasonable decision is to side with the former”: para. 45.

26The Insured submitted three LAT cases in support of his position as to the correct interpretation of s. 32(1).

27In Ilangeswaran v. Sonnet Insurance Company, 2021 55200 (Ont. LAT), the insured made a call to the insurer to report her accident within the seven-day period, but the call was disconnected before the insured reported any injuries. The LAT found that the insured had notified the insurer of her claim for accident benefits. If the insurer wanted to clarify with the insured as to whether she had been injured, it should have called her back.

28In M.O. v. Jevco Insurance Company, 2020 63561 (Ont. LAT), the LAT found that when the insurer received notice of the insured’s tort claim, this was sufficient to constitute notice under the SABS of an accident benefits claim. The Tribunal found that at that point the insurer would have been alive to the potential of an accident benefits claim and should have reached out to the insured’s guardians to advise them of their rights to make a claim. The Tribunal found at para. 12 that “considering the Schedule is consumer-protection legislation, Jevco’s actions are alarming.”

29In K.H. v. Northbridge General Insurance Company, 2019 101613 (Ont. LAT), the Tribunal articulates the insured’s obligation to give notice under s. 32(1) in the following manner, at para. 7:

Section 32(1) of the Schedule requires an insured person to inform an insurer of an accident within seven days, at which point the insurer will provide the insured with the application forms for accident benefits. (emphasis added).

30The Insurer referred us to two cases that it alleged took a different position than the cases cited by the Insured.

31In Abbany v. Pafco Insurance Company, 2012 ONFSCDRS 144, an insured reported a collision to his insurer on the date of the accident, but two days later advised the insurer that he was not injured. The insurer closed its claim. Approximately one year later, the insured advised the insurer that he would be making an accident benefits claim. The Financial Services Commission found that the insurer failed to comply with the notice timeline set out in s. 32 of the SABS and that he did not have a reasonable explanation for the delay.

32In Clements v. The Co-operators Group Limited, 2021 18911 (Ont. LAT), Mr. Clements was a witness to the aftermath of an accident involving his brother, his partner and his three children. Two years later, Mr. Clements contacted his brother’s insurer to submit a claim for accident benefits. The LAT upheld the insurer’s denial of Mr. Clements’s claim on the basis that he did not file a reasonable explanation for his delay in applying for benefits. It also found:

23There is no evidence that Jason Clements notified Co-operators at any time that he suffered an injury as a result of the accident, or that he was contemplating making a claim for accident benefits. Consequently, Co-operators is under no obligation to advise Jason Clements of his right to claim benefits. Further, Co-operators is not obligated to provide Jason Clements with forms in order to commence a claim for accident benefits.

33The LAT essentially found that since the Insured in this case did not advise the Insurer that he suffered injuries in the accident, the Insurer had no obligation to make further inquiries or to advise the Insured of his right to claim accident benefits.

34According to the Insurer, the wording of s. 32(1) is clear – the onus is on the Insured to give notice within seven days and that notice requires the Insured to be specific about the fact that the nature of his claim is one for accident benefits.

35This interpretation is neither consistent with the Tribunal’s case law, nor consistent with the consumer protection purpose of the SABS. In both Ilangeswaran and M.O v. Jevco, the Tribunal found that once the insurer became aware of an accident, notice had been given of the claim for accident benefits. If the insurer wished to clarify more, it was their obligation to make inquiries. In Abbany, that obligation was not imposed because the insured advised the insurer that he had not suffered any injuries. In Clements, Mr. Clements was making a claim for psychological injuries he incurred because he observed the aftermath of the accident. This is not the type of claim that an insurer would reasonably anticipate once being advised that there had been an accident. Clements was also a case that turned on the issue of reasonable explanation, not on the issue of notice.

36In this case, the LAT found (based on the evidentiary record before it) that the Insured told the Insurer that he had been in an accident in which his vehicle has sustained “heavy damage.” The Insurer did not ask if the Insured had been injured in the accident and did not advise him that if he had, he could not only obtain coverage for the damage to his vehicle, but he could also claim accident benefits for his personal injuries. According to the Insurer and the LAT, to read s. 32(1) of the SABS in a way that requires any such action on the part of an insurer would run contrary to the wording of the SABS.

37The Insurer also submitted that any consumer protection concerns about the interpretation of s. 32(1) are answered by s. 34 of the SABS, which provides that if an insured has a reasonable explanation for failing to comply with a time limit under the SABS, they will not be disentitled from claiming the benefits provided. The problem with this submission is that, as the Insurer argued and the LAT accepted, the jurisprudence around the interpretation of “reasonable explanation” contains a number of guiding principles, one of which is that the onus is on an insured to establish a reasonable explanation and the other is that “ignorance of the law alone is not a reasonable explanation.” In this case, the Insured’s explanation is that he did not know that he had a legal claim to accident benefits, and he did not know that the law required him to notify his insurance company within seven days of his intention to apply for those accident benefits. Thus, according to the Insurer, even if the LAT had found it credible, the Insured’s explanation could not be a reasonable explanation because ignorance of the law is no excuse.

38Consumers who have motor vehicle accidents are in a vulnerable position, particularly in the period immediately following an accident. Seven days is a very short notice period. Insurance contracts are complicated documents that the average consumer is unlikely to read. If they do read the document, they are unlikely to remember its contents if they have an accident, which could be many years later. The entitlement to damages for motor vehicle accidents in Ontario and the role of the SABS in that regime is not something that it is fair to assume the average consumer would be familiar with. Insurance adjusters and agents, on the other hand, can be presumed to know that if one of their insureds has an accident and is injured in that accident, they will want to make a claim for accident benefits. An interpretation of s. 32(1) that recognizes these realities is one that fosters the consumer protection purpose of the SABS. An interpretation that ignores these realities does the opposite.

39The interpretation of s. 32(1) in the decisions under appeal ignores these realities. As such, it undermines the consumer protection purpose of the SABS.

40In my view the notice requirement under the LAT was met when the Insured advised the Insurer one day after the accident that he had been in an accident. A reasonable insurer would assume that an insured who has been in an accident intends to access all the benefits available to them under their policy. If the insured has been injured in the accident, this will include accident benefits. If the Insurer in this case wished to clarify which specific benefits the Insured intended to access, the Insurer could have asked the Insured whether he sustained any injuries. As the Insurer chose not to ask any more questions, it should have acted on the assumption that the Insured would want to apply for accident benefits. At that point, the Insurer should have complied with its obligations under s. 32(2) of the SABS, which included sending out the necessary application forms and an explanation of the benefits available. This is an interpretation that fosters the consumer protection purpose of the SABS.

41I do not accept the Insurer’s submission that this would put an unfair financial burden on insurers and would precipitate an increase in the number of claims, many of which could be illegitimate. First, I do not accept that requiring an insurer to send out paperwork to explain to insureds, who have paid them significant premiums, what benefits they are entitled to claim now that they have had an accident, imposes an unfair financial burden. Furthermore, if the insurer is concerned about the expense of sending out unnecessary forms, its agents or adjusters can simply confirm beforehand that the insured was not, in fact, injured in the accident. Second, I do not accept that if you tell an insured they have the right to claim a benefit this will entice them to make a claim for a benefit they are not entitled to.

42The Insurer also relied on a previous version of the notice requirement to support its interpretation of s. 32(1). That version read:

32 (1) A person who wants to apply for a benefit under this Regulation shall notify the insurer within 30 days after the circumstances arose that give rise to the entitlement to the benefit, or as soon as practicable thereafter.

43According to the Insurer, the “Legislature deliberately changed the wording of s. 32(1) in 2003 to place an onus on the claimant to notify the insurer of their specific intention to bring a claim, rather than imply that they must only report that an accident occurred.” I disagree. While the precise words used in s. 32(1) may have changed, the changes make no substantive difference to the meaning of the section, except to reduce the notice period from thirty days to seven days.

44The Insurer’s argument is, in effect, that in 2003 the Legislature changed the wording of s. 32(1) not only to facilitate an insurer’s ability to investigate and assess the circumstances of a claim expeditiously by shortening the period of notice, but also to increase the requirements for notice so that it would be harder for an insured to give proper notice. Implied in this argument is that the Legislature wanted to make it easier for insurance companies to deny claims and harder for insureds to make claims. In the absence of any evidence that this was the case or any rationale as to why this would be the case, I am not prepared to find that this was the Legislature’s intention.

45The Insured also made a submission that the LAT erred in law in its analysis on the reasonable explanation issue. In view of my finding that the Insured did give the required notice under s. 32(1) there is no need to deal with this issue.

Disposition

46For these reasons the appeal is allowed, the Decision and the Reconsideration Decision are set aside and the Insured’s application for accident benefits is referred back to the LAT to be disposed of in accordance with these reasons: i.e., that the Insured did satisfy his obligation to give notice under s. 32(1) of the SABS. As agreed by the parties, the Insured is entitled to his costs of the appeal, fixed in the amount of $6,000.00.

Footnotes

1. 1The reversal of the Appellant’s name in the title of proceeding appears to have been introduced in the Licence Appeal Tribunal’s Reconsideration Decision.