Matthew C. Whelan v. Dominion of Canada General Insurance Company, 1996 ONICDRG 58

Ontario Insurance Commission

Neutral Citation: 1996 ONICDRG 58

File No.: A-006448

Between:

Matthew C. Whelan Applicant

and

Dominion of Canada General Insurance Company Insurer

Decision on Preliminary Issue

Issues:

The Applicant, Matthew C. Whelan, was injured in a motor vehicle accident on October 25, 1991. He applied for statutory accident benefits from the Insurer, payable under Ontario Regulation 672.¹ Dominion of Canada General Insurance Company ("Dominion") refused to pay accident benefits on the basis that Mr. Whelan was not a resident of Ontario at the time of the accident. The parties were unable to resolve their disputes through mediation and the Applicant applied for arbitration under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The issue before me is:

1. Is Mr. Whelan's place of residence determinative of his entitlement to benefits under the Schedule?

The Applicant also claims interest on any amounts owing, and his expenses incurred in the hearing.

Result:

1. Mr. Whelan's place of residence is not determinative to his entitlement for benefits under the Schedule.

Hearing:

A hearing was held in Ottawa, Ontario, on November 6 and 21, 1995, before me, Joyce Miller, arbitrator. The partied also filed written submissions. Submissions from the Insurer were received on March 8, 1996. The response from the Applicant was received on March 22, 1996. The reply from the Insurer was received on March 29, 1996.

Present at the Hearing:

Applicant Matthew C. Whelan

Applicant's Representative: Douglas E. Faulkner Barrister and Solicitor

Insurer's Representative: Pat Santini Barrister and Solicitor

Background:

Mr. Whelan was involved in a motor vehicle accident near Renfrew, Ontario on October 25, 1991. At the time of the accident, Mr.Whelan was driving his wife's car. At that time his wife was a resident of Campbell's Bay, Quebec.

Mr. Whelan applied to the Société de l'Assurance Automobile du Québec (SAAQ) for accident benefits on the basis that he was a permanent resident of Quebec.

Mr. Whelan was awarded accident benefits from SAAQ. He received $70.80 for travel expenses, and $1,144.50 was indemnified to La Commission de la Santé de la Sécurité du Travail (CSST) of Quebec.² Mr. Whelan appealed this decision. His appeal was denied.

On September 23, 1993 Mr. Whelan applied for accident benefits in Ontario. In his application he stated that he lived in Quebec, but at the time of the accident he had been in Ottawa from June 1991 to February 1992.

Accident benefits were denied by Dominion on the basis that Mr. Whelan was not a resident of Ontario at the time of the accident. After mediation failed, Mr. Whelan applied for arbitration. A pre-hearing was held on May 31, 1995. At the pre-hearing a preliminary issue arose as to whether Mr. Whelan was a resident of Quebec when the accident occurred. Dominion's position was that if Mr. Whelan was a resident of Quebec at the time of the accident, then it was not liable to pay statutory accident benefits under the Schedule.

I presided at the hearing of this preliminary issue on November 6 and 21, 1995. After reviewing all the evidence presented, I determined that the issue of residency was not relevant to the determination of entitlement. I informed counsel that my jurisdiction as an arbitrator, pursuant to section 279 of the Insurance Act, is limited to determining issues and making orders "in respect of any insured person's entitlement to no-fault benefits or in respect of the amount of no-fault benefits to which an insured person is entitled." Accordingly, I had no jurisdiction to make a factual determination on a person's place of residence, unless such a determination was relevant to the question of the entitlement to benefits and the amount of such benefits.

Counsel agreed to provide further written submissions on whether or not an applicant's place of residence is relevant to a determination of his or her entitlement to accident benefits.

Submissions

Mr. Santini, on behalf of Dominion, submitted that the issue of Mr. Whelan's residence is determinative of his entitlement to benefits under the Ontario legislation.

Mr. Santini submitted that the contract of insurance between Mr. Whelan and Dominion is a Quebec standard policy of insurance which does not contain any accident benefits. He pointed out that standard automobile policies in Quebec do not contain any payments for accident benefits because section 7 of the Automobile Insurance Act of Quebec provides that accident benefits are to be provided by the SAAQ to "[e]very victim resident in Québec and his dependants ... whether the accident occurs in Québec or outside Québec."

Mr. Santini submitted that since the accident involved a Quebec registered vehicle with a Quebec insurance policy, then pursuant to section 7 of the Automobile Insurance Act of Quebec, if Mr. Whelan was a Quebec resident, any accident benefits owing are to be paid by SAAQ under the Quebec Insurance Act.

To shore up his conclusion that if Mr. Whelan is a Quebec resident he must look to SAAQ for benefits, Mr. Santini referred to an Ontario and Quebec Memorandum of Agreement dated December 27, 1978 where it states in section 2.24 that "Any resident of Québec who suffers bodily injury in an accident shall be compensated by the Régie in accordance with the provisions of the Automobile Insurance Act (L.Q. 1977, C.68) and the Regulations made thereunder as may be amended from time to time regardless who is at fault."

Mr. Santini also submitted that it is a general practise of insurers in Ontario to inform a Quebec resident that they should make their accident benefit claim to SAAQ. Without referring to any legislation to support this position, Mr. Santini submitted that SAAQ is "...first responsible for payment of benefits..." and that "[t]his is the practise that has always been followed by insurers...".

I do not accept Mr. Santini's arguments. I agree with Mr. Faulkner that section 7 of the Automobile Insurance Act of Quebec only deals with SAAQ's statutory authority to provide no-fault benefits to Quebec residents and their dependants and that section 2.24 in the Memorandum of Agreement only deals with the situation of accidents which occur in Quebec.³ No statutory authority was given to support the premise that a Quebec resident who is involved in a motor vehicle accident in Ontario is required to first apply to SAAQ for accident benefits. Moreover, I find that in presenting his submissions Mr. Santini completely ignores the Ontario legislation. For the following reasons I agree with Mr. Faulkner that residency is not an issue in this arbitration.

Analysis and Findings

An "insured person" is defined in part in Part I of the Schedule as follows:

"insured person", in respect of a particular motor vehicle liability policy, means,

(a) In respect of accidents in Ontario, an occupant of the insured automobile

Section 45(1) of the Insurance Act states:

45.--(1) A licence to carry on automobile insurance in Ontario is subject to the following conditions:

1. In any action in Ontario against the licensed insurer or its insured arising out of an automobile accident in Ontario, the insurer shall appear and shall not set up any defence to a claim under a contract made outside Ontario, including any defence as to the limit or limits of liability under the contract, that might not be set up if the contract were evidenced by a motor vehicle liability policy issued in Ontario and such contract made outside Ontario shall be deemed to include the statutory accident benefits referred to in subsection 268(1).⁴ [Emphasis added]

Section 45 of the Insurance Act is part of a "reciprocal scheme for the enforcement of motor vehicle liability insurance policies in Canadian provinces and territories."⁵

In Succar⁶ Arbitrator Blackman notes that : "Section 45(1)(1) speaks to extra-provincial insurers who are defending claims in the Province of Ontario. Ontario mandates that "no fault benefits will attach to contracts made outside Ontario,"⁷ by insurers licensed to carry on automobile insurance in Ontario." [emphasis added] I agree with these comments.

Succinctly, the Insurance Act and the Schedule allow for an insured person who is not a resident of Ontario but who is involved in an accident in Ontario to make a claim for statutory accident benefits in Ontario.

In this case, whether Mr. Whelan is or is not a resident of Quebec is irrelevant. Since the accident occurred in Ontario, nothing precludes Mr. Whelan from applying for accident benefits in Ontario. There is nothing barring Mr. Whelan from making a claim even if he had applied and received benefits from Quebec. Pursuant to sections 12(4)⁸ and 13(3)⁹ of the Schedule, if Mr. Whelan was paid or awarded weekly benefits by SAAQ any monies paid out by SAAQ could be deducted as collateral benefits in respect of any benefits that may be awarded under the Ontario legislation.

For all of the above reasons, I find that determining Mr. Whelan's place of residence at the time of the accident is not relevant to his claim for entitlement to accident benefits.

Expenses:

I decline to make an award of expenses at this time. I believe that the issue of expenses should be reserved for the arbitration hearing. However, if this matter does not proceed to arbitration, then the parties may apply for assessment of the expenses.

Order:

1. Mr. Whelan is entitled to proceed to arbitration without the issue of his residency being determined.

April 23, 1996

Joyce Miller Arbitrator

Date

2.1.1 "Accident" means an event occurring in Quebec resulting in damage caused by automobile, or by the use of an automobile or by the load of an automobile, including damage caused by a trailer. [emphasis added]

The reciprocal scheme provides a uniform basis for the enforcement of motor vehicle insurance claims in Canada. This ensures that a person who has entered into a motor vehicle insurance contract in one province is recognized as insured in other provinces. In the event of an accident, the insurer agrees to be bound by the law of the province or territory where the action is brought and not the province where the policy is issued. The insurer also accepts liability to the limits prescribed in its policy or, at least, to the minimum limits established in the province or territory where the action is brought. [emphasis added]

(a) $600 plus, if Optional Benefit 2 has been purchased, the amount of the benefit chosen; and (b) 20 per cent of the insured person's gross weekly income from his or her occupation or employment, less any payments for loss of income, except Unemployment Insurance benefits, (i) received by or available to the insured person under the laws of any jurisdiction or under any income continuation benefit plan, or (ii) received under any sick leave plan.

(a) received by or available to the insured person under the laws of any jurisdiction or under any income continuation benefit plan; or (b) received under any sick leave plan.

Footnotes

1. 1Prior to January 1, 1994, Ontario Regulation 672 was called the No-Fault Benefits Schedule. After that date it became the Statutory Accident Benefits Schedule — Accidents Before January 1, 1994. In this decision, the term "Schedule' will be used to refer to Regulation 672.
2. 2This Commission is similar to Workers' Compensation in Ontario.
3. 3The definition of accident in Section II of the Memorandum of Agreement is restricted to accidents which occur in Quebec. The definition provides as follows:
4. 4268.--(1) 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.
5. 5Potts v. Gluckstein, (1992), 1992 CanLII 7623 (ON CA), 14 C.C.L.I. (2d) 175 (Ont. C.A.), leave to appeal to S.C.C. refused (1993), 149 N.R. 399n (S.C.C). This case notes that:
6. 6Tony Succar and Wawanesa Mutual Insurance Company and Zurich Insurance Company, March 20, 1996, OIC File Nos. A-012273 and A-014717.
7. 7Explanatory Notes, Bill 208 (1st reading), S.O. 1973, c. 124
8. 812(4) Subject to subsection (5), the weekly benefit under subsection (1) will be the lesser of,
9. 913(3) The weekly benefit under subsection (1) will be $125 less any payments for loss of income, except Unemployment Insurance benefits,