K.W. v. Unifund Assurance Company, 2017 CanLII 148400

Licence Appeal Tribunal

Tribunal File Number: 17-001606/AABS

In the matter of an Application pursuant to subsection 280(2) of the Insurance Act, RSO 1990, c I.8., in relation to statutory accident benefits.

Between:

K.W.

Applicant

and

Unifund Assurance Company

Respondent

DECISION

ADJUDICATOR: Cezary Paluch, Member

Held in Person: June 19, 2017

APPEARANCES:

Applicant: K.W.

For the Applicant: Frank E. Van Dyke, Counsel

For the Respondent: Lora Castellucci, Counsel

OVERVIEW

1. The applicant, KW, was injured in an automotive accident on November 19, 2014, and sought benefits pursuant to the Statutory Accident Benefits Schedule - Effective September 1, 2010 [the "Schedule"] from the respondent, Unifund Assurance Company ["Unifund"].

2. On or about May 16, 2016, the applicant submitted an application for dispute resolution services to the Licence Appeal Tribunal-Automobile Accident Benefits Services [the "Tribunal"] regarding her entitlement to an income replacement benefit ["IRB"] in the amount of $400.00 per week [the "First Application"].

3. On June 29, 2016, the applicant provided Unifund with an Election of Income Replacement, Non-Earner or Caregiver Benefit form [OCF-10] electing a Non-Earner Benefit [the "Election Form"].

4. On July 14, 2016, the applicant withdrew the First Application to the tribunal by filing a Notice of Withdrawal. On March 17, 2017, the applicant submitted another application for dispute resolution to the Tribunal this time regarding her entitlement to a non-earner benefit ["NEB"] in the amount of $185.00 per week and medical benefits [the "Second Application"].

5. Subsequently, on May 15, 2017, the applicant submitted an amended application for dispute resolution to the Tribunal changing her claim from an NEB back to an IRB [the "Amended Application"].

6. At the case conference held on May 17, 2017, the Tribunal ordered a preliminary hearing to resolve the issue of whether the applicant is entitled to re-elect her weekly benefits at this stage and pursue her dispute over IRB notwithstanding that she had previously elected NEB and signed an Election Form.

ISSUES

7. Having previously elected the non-earner benefit, is the applicant entitled to re- elect and pursue her appeal at LAT on the income replacement benefit [IRB] in the amount of $400.00 per week for the period November 26, 2014, to date and ongoing?

8. Is the respondent entitled to recover costs pursuant to Rule 19.1 of the Rules?

RESULT

9. For the reasons that follow, the applicant is precluded from electing income replacement benefit because she has already made a valid election and chose a non- earner benefit and there is no right to change that election under the Schedule unless she is determined to be catastrophic.

10. The respondent's request for costs is denied.

ANALYSIS

11. In an accident benefits claim, an applicant may elect one of the following benefits:

• Income replacement benefits

• Non-earner benefits

• Caregiver benefits

12. An applicant may qualify for two or more of these benefits and will therefore face a choice. The applicant must elect to receive only one of these weekly benefits and in most circumstances cannot re-elect. An issue in this hearing is whether the applicant is entitled to re-elect and pursue her income replacement benefit claim.

13. The respondent's position is that the applicant made a clear and proper election of NEB by completing and signing her Election Form and she must be held to that election under s. 35(3) of the Schedule, regardless of any change in circumstances.

14. The applicant advanced two arguments. First, in her written Reply Submissions¹ she submitted that her election was made when the First Application was filed with the Tribunal (claiming IRB) on May 16, 2016 before she completed the Election Form (OCF-10) claiming NEB dated June 29, 2016.

15. The applicant's second position is that the Election Form (OCF-10), electing NEB, is not valid on its face because the applicant qualified for an IRB and any election towards NEB was invalid as the applicant was not allowed to make that election in any event.

16. The applicant also relied upon the doctrine of promissory estoppel to argue that she was advised by the respondent's insurance adjuster to proceed with electing NEB even though she was fully employed prior to the accident and the respondent should therefore be estopped from maintaining that the applicant should not be allowed to re- elect.

(i) Section 35 of the Schedule

17. Pursuant to section 35 of the Schedule where an application indicates that an applicant may quality for two or more of the IRB, the NEB and the caregiver benefit, the insurer shall give notice to the applicant advising her that she must elect the benefit she wishes to receive. Once the insured makes an election, s. 35 (3) provides that it is final regardless of any change in circumstances unless the insured has sustained catastrophic injuries. The applicant, in this case, has not sustained catastrophic injuries and so the exception does not apply.

18. The language of s. 35(3) is clear: an election to receive any of the income replacement, non-earner or caregiver benefit is "final". I note that under the previous version of the Schedule (O.Reg 403/96) an insured's initial election between IRB, NEB and caregiver benefits was not "final" and could be changed at a later date upon a change in circumstances. On December 11, 2013, the government passed a change to s. 35 of the SABS (Ontario Regulation 347/13), which came into force on February 1, 2014. This significant change in the law indicates the legislature's clear intention to prevent re-election. The legislature chose this wording and, in my view, recognized the overall purpose of the Schedule to determine claims promptly and specifically narrowed down the circumstances that would qualify for an exception to catastrophic injuries.

19. One of the main objectives of the statutory accident benefits regime is the need for timely submission, adjusting, and resolution of accident benefit disputes.² The applicant's attempt to now pursue IRB, after making an election of NEB, appears to effectively undermine the statutory principle of finality and certainty embraced by s. 35(3).

20. If I accept the applicant's argument, it would mean that the election provision in s. 35 would be essentially of no force or effect as any claimant could merely re-elect benefits as her circumstances change, at any time. This would certainly defeat one of the primary purposes of accidents benefits outlined above.

(ii) Election of NEB by the applicant

21. On June 29, 2016, the applicant completed the OCF-10 Election Form in her own hand writing and signed it. This document was then forwarded by her lawyer to the respondent via mail with an enclosure letter on the lawyer's letterhead. In other words, she chose the election she wished at that time by ticking off the appropriate box and signing the form. The enclosure letter from her lawyer addressed to the insurance adjuster stated in the body: "Please find attached an executed (OCF-10) for your records in relation to the above matter" and referenced KW (the applicant), her correct claim number, date of birth and date of accident. This is important as it clearly indicated two things. First, that the applicant had legal advice at the time she completed the Election Form. Second that the OCF-10 form was executed properly and signed by the applicant.

22. At the hearing, the applicant testified that she received erroneous advice or was somehow misled by the insurance adjuster, Ms. I.R., into signing the Election Form and checking off the NEB box when she spoke with her over the telephone. She explained in her testimony: "I was told to sign it" and "I probably check wrong box" and "she just said check that box." I do not accept the applicant's explanation on this issue for three reasons.

23. First, when she signed the Election Form she was represented by a lawyer and signed the form with the benefit of legal advice. This was confirmed by the applicant in cross examination. It appeared to me that the applicant signed the form freely and voluntarily with the advice and instruction of her lawyer. It was her lawyer who forwarded the form to Unifund indicating to me that he had the opportunity to review the form before it was sent and if there was an error or mistake he could have asked his client to change it or not submitted it at all.

24. Even if I was to accept that somehow the applicant received erroneous advice by the insurance adjuster (which I do not accept on the evidence before me), I found that the applicant had great difficulty remembering much what information she had received from the adjuster and for the most part, I found her recollection of the events related to the signing of the Election Form to be very disjointed, evasive and unreliable. As examples, to numerous questions asked in cross examination she responded over and over: "I'm not saying yes or no", "I can't remember" or "I don't know."

25. The second reason why I do not accept the applicant's explanation is that she testified that she had email correspondence between the adjuster and herself to evidence the apparent wrong and misleading advice that she relied on but did not bring this evidence to the hearing or make it available to support her case. She explained: "I did not think I needed them." Here, the onus of proof rests on the applicant to prove on a balance of probabilities that she is entitled to the relied sought and it was incumbent on her to make available any relevant documentation, indeed what appears to be critical written correspondence on the very issue in dispute, to support her case.

26. Finally, regardless of the alleged advice, the Election Form explained the claimant's rights in bold letters at the top of the form as follows:

Please note that your choice of benefits cannot be changed after this form has been submitted to the insurance company unless the injury is determined to be catastrophic.

27. Even more compelling evidence in support of the proposition of that the applicant knew that she was electing NEB when she signed the Election Form is that at the bottom of the page, under the heading, Part 3 Signature, she certified that "the information provided is true and correct."

28. For the reasons above, I find that the applicant unequivocally elected the benefit she wished to receive at that time. This was an informed choice made by the applicant and her lawyer. I find that in these circumstances, the election was valid. Once the claimant elects one weekly benefit, she becomes ineligible to receive the other benefits. In my view, the plain language of s. 35(3) makes it clear that the applicant must be held to that election, regardless of any change in circumstances (with the exception of catastrophic impairment).

(iii) Time of Election

29. I also do not accept the applicant's submission that her election was made when her First Application was filed with the Tribunal claiming IRB on May 16, 2016 before she completed the Election Form (OCF-10) claiming NEB dated June 29, 2016.

30. The Application by an Injured Person for Auto Insurance Dispute Resolution (Form 0457E) under the Insurance Act is for dispute resolution services to the Tribunal after an insurer has already denied or refused a benefit and is not an application for benefits or an election of weekly benefits. This is consistent with the information provided to the claimant throughout the form itself. For example, under the heading: "Issues in Dispute" requesting that the claimant "provide full description of the accident benefits that are in dispute." There is no language anywhere in the Application to the Tribunal allowing a claimant to choose a benefit electing IRB or NEB or signifying the right to make an election for benefits in accordance with s. 35 as in the election form. I also note that the First Application was not even signed by the applicant.³

31. If I accepted the applicant's argument, it would mean that the OCF-10 election form would essentially be irrelevant and create the unusual situation requiring an insurer to permit or deny benefits after the filing of an Application for dispute resolution (again the application is an appeal to the Tribunal and it is not application for benefits to the insurer). The Schedule dictates how one must apply for benefits and how an insurer must refuse/deny benefits.

(iv) Validity of the June 29, 2016 Election

32. The applicant's also argued that the Election Form is not valid on its face because the applicant qualified for an IRB and any election towards NEB was invalid. In other words, she was not allowed to make that election because she qualified for IRB based on a completed Disability Certificate.

33. The applicant's representative cited the case of Galdamez v. Allstate Insurance Company⁴ as support for his client's position. I do not read this case in the same way. Galdamez is distinguishable as it was decided under the provisions of the 1996 Schedule. The 2010 Schedule uses much stronger language regarding the finality of election of benefits. Specifically, as stated already, section 35(3) provides that an applicant's election of IRB, NEB or caregiver benefit is final, and can only be subsequently changed if permitted under subsection (2), which as discussed previously, does not apply to this case.

(v) Promissory Estoppel

34. The applicant also argued that it would be unfair and inequitable for the applicant to be prejudiced by the adjuster's erroneous advice and in turn allow the respondent to benefit from it. He referred me to the Supreme Court decision in Fort Frances v. Boise Cascade Canada Ltd.⁵ and Elliot v. Canadian Forces Housing Agency Kingston⁶, setting out the doctrine of promissory estoppel.

35. The principles of promissory estoppel are well settled. To rely on promissory estoppel, the respondent must prove: (i) the respondent, by words or conduct, made a promise or assurance which was intended to affect its legal relationship with the applicant, and intended the applicant to act upon it; and (ii) the applicant, relying on the insurer's representations, acted on it or in some way changed her position to her detriment.⁷

36. In this case, the applicant has not proven on a balance of probabilities that she did receive erroneous advice from the insurer adjuster or that the respondent waived reliance on s. 35(3) or agreed to allow her to re-elect benefits to come within the ambit of the requirements of promissory estoppel.

37. As I already noted above, there was no documentary evidence provided to substantiate her case and the only evidence was the applicant's own testimony which I did not accept because I found it to be unreliable. In any event, the equitable remedy requested by the respondent lies beyond the scope or authority of the Tribunal to award.⁸

(vi) Costs

38. The respondent requests that costs be payable by the applicant on a substantial indemnity basis because they allege the applicant has acted unreasonably and frivolously by bringing an incomplete and unsubstantiated hearing for the re-election of weekly benefits.

39. The respondent's request for cost is denied. Under Rule 19.1 of the Licence Appeal Tribunal Rules of Practice and Procedure costs are an exceptional remedy. I find the respondent has not provided sufficient evidence to show that the applicant acted unreasonably, frivolously, vexatiously, or in bad faith in the Tribunal's proceeding.

40. The claim for costs is dismissed.

CONCLUSION AND ORDER

41. It is ordered that:

i. the applicant is not entitled to re-elect and pursue her appeal at the Tribunal on the income replacement benefit; and

ii. the respondent is not entitled to costs.

Released: September 15, 2017

__________________

Cezary Paluch

Adjudicator

Footnotes

1. 1The applicant in her initial written Submissions at paragraph 28 relied on s. 36 of the Schedule to state that nothing prevents re-election. However, in her Reply submission she conceded that this was incorrect as s. 36 was the old section replaced in September 2010 by s. 35 which applied to this case.
2. 2Sietzema v. Economical Mutual Insurance Company, 2014 ONCA 111, [2015] O.J. No. 3704.
3. 3Page 5 of the First Application, the Claimant signature box is left blank and the application was signed by the claimant's representative.
4. 4Galdamez v. Allstate Insurance Company, 2012 ONCA 508.
5. 5Fort Frances v. Boise Cascade Canada Ltd. [1983] 1 S.C.R.
6. 6Elliot v. Canadian Forces Housing Agency Kingston e al. 2003 CanLII 6128 (ON CA), 68 O.R. (3d) 661 [2003].
7. 7Deloitte & Touche LLP v. Marino (2004), 2004 CanLII 4324 (ON CA), 72 O.R. (3d) 274, at para. 32.
8. 816-001810 v Aviva Insurance, 2017 CanLII 43883 (ON LAT), at para. 72.