16-001976 v. Co-operators General Insurance Company, 2017 CanLII 39602

Safety, Licensing Appeals and Standards Tribunals Ontario Licence Appeal Tribunal Automobile Accident Benefits Service Mailing Address: 77 Wellesley St. W., Box 250, Toronto ON M7A 1N3 In-Person Service: 20 Dundas St. W., Suite 530, Toronto ON M5G 2C2 Tel.: 416-314-4260 1-800-255-2214 TTY: 416-916-0548 1-844-403-5906 Fax: 416-325-1060 1-844-618-2566 Website: www.slasto.gov.on.ca/en/AABS

Tribunaux de la sécurité, des appels en matière de permis et des normes Ontario Tribunal d'appel en matière de permis Service d'aide relative aux indemnités d'accident automobile Adresse postale : 77, rue Wellesley Ouest, Boîte n^o 250, Toronto ON M7A 1N3 Adresse municipale : 20, rue Dundas Ouest, Bureau 530, Toronto ON M5G 2C2 Tél. : 416 314-4260 1 800 255-2214 ATS : 416 916-0548 1 844 403-5906 Téléc. : 416 325-1060 1 844 618-2566 Site Web : www.slasto.gov.on.ca/fr/AABS

RECONSIDERATION DECISION

Before: Linda P. Lamoureux, Executive Chair

Date: June 7, 2017

File: 16-001976/AABS

Case Name: 16-001976 v. Co-operators General Insurance Company

Written Submissions By:

For the Applicant: Kevin So

For the Respondent: David Raposo

Overview

1. On March 27, 2017, the Licence Appeal Tribunal (the “Tribunal”) issued a decision on a preliminary question in this matter under the Statutory Accident Benefits Schedule – Effective after September 1, 2010¹ (the “Schedule”). The question: is the applicant’s claim barred by the general two-year limitation period in s. 56 of the Schedule? The Tribunal’s answer: yes.

2. On April 17, 2017, the applicant asked me to reconsider the Tribunal’s decision. He argues that the decision was based on multiple errors, discussed below. For the reasons that follow, I deny his request.

The Facts

The accident and benefit at issue

3. The applicant, G.A., was injured in a motor vehicle accident on June 7, 2013. Following the accident, he submitted an application for benefits to the respondent, the Co-operators General Insurance Company (“Co-operators”). Soon after, he elected to receive an income replacement benefit (“IRB”).

4. Co-operators paid the IRB for over the next year and half. However, following an insurer’s examination of G.A., Co-operators terminated the IRB. The parties agree that Co-operators notified G.A. of this change by letter dated January 10, 2014 as well as by Explanation of Benefits dated February 26, 2014. In arguing the hearing, both parties used this latter date as the date of denial.

G.A. applies for mediation

5. Almost two years passed. On January 21, 2016, G.A. filed an Application for Mediation with the Financial Services Commission of Ontario (“FSCO”). At that time, FSCO had the exclusive jurisdiction under the Insurance Act² to resolve Schedule-related disputes. Generally, that process required applicants to first apply for mediation, after which they could commence an arbitration or court proceeding to have any remaining dispute adjudicated. G.A.’s application indicated that part of his dispute with Co-operators involved his entitlement to the IRB. Additionally, the application also indicated that the parties disputed G.A.’s entitlement to orthopedic and mental health assessments included in two Treatment and Assessment Plans that Co-operators denied on May 11, 2015 (the “assessment claims”).

6. The next month, on February 10, 2016, FSCO scheduled the mediation for May 6, 2016.

The intervening amendments

7. Before the mediation, a key legislative development occurred: as of April 1, 2016, the Insurance Act and Schedule were amended. As a result, the exclusive jurisdiction to resolve Schedule-related disputes was transferred from FSCO to the Tribunal. FSCO would still mediate the parties’ dispute. However, the amendments introduced a procedural complication for those who, like G.A., had applied for mediation at FSCO in a timely fashion but whose claim was based on an insurer’s denial that occurred almost or over two years before:

• The old regime. Immediately before April 1, 2016, the Insurance Act and Schedule provided, in essence, that a proceeding to adjudicate a Schedule-related dispute must be commenced at FSCO within two years after the insurer’s refusal to pay the benefit claimed or, if one applied for mediation within that two-year period, within 90 days after the mediator reports to the parties. Under this regime, G.A. had applied for mediation well within time and, after mediation, would still have had 90 days to apply to FSCO to have any remaining dispute adjudicated.

• The new regime. As of April 1, 2016, the Tribunal now deals with all accident benefits disputes. As the Tribunal does not have separate mediation and adjudication steps in its process, as did FSCO, the post-mediation 90-day grace period was eliminated. This leaves only the requirement currently in s. 56 of the Schedule that a proceeding to adjudicate a Schedule-related dispute must be commenced with the Tribunal within two years after the insurer’s refusal to pay the benefit claimed. Thus, the net effect of the legislative change: G.A.’s claim, although initiated in time under the old regime, would now be mediated at a time when, under the new regime, the now applicable two-year limitation period had already lapsed.

8. The mediation occurred as scheduled. G.A. and Co-operators were unable to resolve their differences. For that reason, the mediator who heard the matter issued his report that same day, May 6, 2016, indicating that the IRB and assessment claims issues remained in dispute. The mediator’s report also informed G.A. that, as of April 1, 2016, the Tribunal “assumed all new applications for dispute resolution services” and that FSCO no longer accepted applications to adjudicate Schedule-related disputes, regardless of whether a mediator’s report was issued before or after April 1, 2016.

G.A. applies to the Tribunal

9. Unable to have his claims adjudicated by FSCO, G.A. eventually turned to the Tribunal. On August 11, 2016 – 97 days after the failed mediation – he filed this application. Like his Application for Mediation to FSCO, G.A.’s application to the Tribunal indicated that the parties disputed G.A.’s entitlement to an IRB along with the assessment claims. In its response, Co-operators raised the limitation period in s. 56 of the Schedule and, on that basis, requested that G.A.’s IRB claim be dismissed without a hearing.

10. As it does in the usual course, the Tribunal held a case conference in the matter. At the case conference, held on November 8, 2016, the parties settled their differences with the exception of the IRB claim. Accordingly, the Tribunal scheduled a written hearing for February 13, 2017 to determine as a preliminary issue whether the two-year limitation period in s. 56 of the Schedule barred this part of G.A.’s application.

11. In his written submissions on the issue, G.A. argued that s. 56 of the Schedule should not apply. Further, and as described in more detail below, he argued that Co-operators failed to provide him adequate notice of his right to dispute the denial of his IRB, and that it was estopped from relying on the limitation period given its post-denial conduct. The Tribunal rejected all of these arguments and held that G.A.’s claim was barred.

12. G.A. now asks that I reconsider the Tribunal’s decision.

Discussion and Reasons

13. The Tribunal has recognized the unfairness of the circumstances in which those like G.A. have found themselves as a result of the April 1, 2016 amendments. For that reason, in P.C. v. State Farm Insurance Company, 16-000588/AABS the Tribunal held that s. 56 of the Schedule is subject to the same 90-day grace period applicable under the old regime in order to accommodate those who, like G.A., applied for mediation at FSCO within the required time but would nonetheless lose their claims as a result of the 90-day period’s removal on April 1, 2016. Of course, that extension does not assist G.A., who, after receiving the mediator’s report, applied to the Tribunal 97 days later.

14. At any rate, G.A.’s arguments in this request for reconsideration do not focus on the two-year limitation period per se, nor do they suggest that his claim should be governed by a different limitation period other than the one provided explicitly in s. 56 of the Schedule. In this respect, he accepts the Tribunal’s refusal to relax the limitation period in order to accommodate his circumstances. Rather, they attempt to avoid the limitation period’s applicability by, again, focusing on the validity of Co-operators’ notice of his right to dispute the denial of his IRB, and on Co-operators’ post-denial conduct that he argues gives rise to an estoppel. These are addressed in turn.

The notice argument

15. First, G.A. argues that Co-operators failed to provide him notice of the applicable dispute resolution process when it denied his IRB. Although he never mentions it explicitly, it seems clear that G.A. is referring to the requirement in s. 54 of the Schedule:

If an insurer refuses to pay a benefit or reduces the amount of a benefit that a person is receiving, the insurer shall provide the person with a written notice advising the person of his or her right to dispute the refusal or reduction

16. In his submissions before the written hearing, G.A. based this argument on his assertion that, as of May 11, 2015, Co-operators had “only advised [him] of his right to mediate and commence a lawsuit in court,” not of his right to apply to the Tribunal.³ Thus, he argued, his claim was not yet barred.

17. Here, his argument has shifted. He now argues that Co-operators’ letter of January 10, 2014 failed to include the applicable dispute resolution process and that, while he received the Explanation of Benefits dated February 26, 2014, he did not receive the accompanying letter that the Explanation of Benefits referenced. This, he suggests, constituted inadequate notice and, thus, the limitation period never began to run.

18. I disagree. Co-operators’ affidavit evidence filed before the written hearing provides that, indeed, it sent G.A. both a letter and Explanation of Benefits dated February 26, 2014. G.A. has never filed an affidavit to suggest otherwise. Instead, his argument is based entirely on a bald assertion included in his written request for reconsideration. This type of unsupported allegation does not offer an appropriate basis for reconsideration.

19. At any rate, the document that provided G.A. the requisite notice was the Explanation of Benefits, not any of the Co-operators’ cover letters. As it was required to, the Explanation of Benefits outlined the salient points of the then-applicable dispute resolution process, including the fact that G.A. must pursue mediation before resorting to arbitration or litigation, along with the relevant time limits governing the process.⁴ Indeed, and as mentioned above, G.A.’s position at the written hearing was that Co-operators advised him of the dispute resolution process “only” insofar as FSCO was concerned, information that was not included in any of the Co-operators’ cover letters but, again, was outlined in its Explanation of Benefits. It was precisely this document and notice that the Tribunal held was sufficient.⁵ I see no error in the Tribunal’s decision. As the Tribunal noted, there was no other existing dispute resolution process that, at the time of denial, Co-operators could have explained to G.A. After all, at that point in time when Co-operators sent the applicant the Explanation of Benefits, the bill that introduced the April 1, 2016 changes to the Insurance Act had not even been introduced to the Ontario legislature.

The estoppel argument

20. G.A. also argues that Co-operators should be estopped from relying on s. 56 of the Schedule. More specifically, G.A. underscores the fact that the Co-operators’ Notice of Examination of May 11, 2015, which related to a scheduled psychiatric assessment, explained the purpose of the examination as follows:

To further understand the nature of Mr. [G.A.’s] impairments as a result from [sic] the subject auto accident and how his functional complaints relate to (or impact on) his ability to perform the essential tasks of his employment activities and provide a second opinion in regards to an entitlement to the Income Replacement Benefits (IRB).

21. Before the written hearing, G.A. argued that this wording “suggested that there had not yet been a clear and unequivocal termination of the [IRB]”.⁶ He adds to this now by arguing that, together with its accompanying letter, this wording “would have led a reasonable person to believe [Co-operators] was not relying on any previous refusal with respect to [the IRB].”⁷ For the first time, he also raises FSCO’s decision in Garmider v. Co-operators General Insurance Co.,⁸ arguing that the Tribunal failed to apply what in his view is the correct law.

22. I agree with the Tribunal that the wording of the May 11, 2015 notice of examination “certainly does not rise to the level of an estoppel”: see para. 22. To begin, the notice should be viewed in context. In particular, it was issued more than one year after Co-operators denied the IRB, and after it received two Treatment and Assessment Plans, both of which raised a multitude of injuries. Upon receipt of this new information, Co-operators had an obligation to adjust the file. As the Tribunal read it, the notice simply communicated that, if G.A.’s condition had worsened, he may be entitled to an IRB despite having been denied in the past: see para. 21. This same message is apparent when the notice is read alongside the accompanying letter. Co-operators’ letter of May 11, 2015 explained that the health professional who would conduct the examination will “determine the nature and causation of your impairment(s),” something that in turn “will assist us [i.e., Co-operators] in determining what benefits are appropriate in your case.” I agree with the Tribunal’s interpretation. I also agree with the respondent’s suggestion that effecting G.A.’s argument would “essentially mean the limitation period would be reset every time an insurer in Ontario fulfilled its obligation to review new medical documentation.”

23. Further to the May 11, 2015 notice, the examination took place. After the examination, Co-operators wrote to G.A. by letter dated June 16, 2015, enclosing the psychiatric examination report and notifying him that, among other things, Co-operators maintained its February 26, 2014 denial of the IRB. G.A. suggests that this letter is, in essence, a new denial after which the limitation period should start to run. This argument overlooks the law that the denial of subsequent applications for benefits, as the two Treatment and Assessment Plans submitted to Co-operators in May 2015, does not re-start the limitation clock.⁹

24. Moreover, I find no merit in G.A.’s submissions concerning FSCO’s decision in Garmider. As it has made clear on a number of occasions, the Tribunal is not, strictly speaking, bound by FSCO jurisprudence.¹⁰ FSCO jurisprudence may be, and in fact is often, persuasive. However, its decision in Garmider is distinguishable in a number of fundamental respects.

Conclusion

1. I therefore deny the applicant’s request for reconsideration.

Linda P. Lamoureux

Executive Chair

Safety, Licensing Appeals and Standards Tribunals Ontario

Released: June 7, 2017

Footnotes

1. 1O. Reg. 34/10.
2. 2R.S.O. 1990, c I.8.
3. 3See paras. 18-20 of the Submissions of the Applicant, dated February 3, 2017.
4. 4Smith v. Co-operators General Insurance Company, 2002 SCC 30 at para. 14.
5. 5See para. 15 of the Tribunal’s reasons.
6. 6See para. 39 of the Submissions of the Applicant, dated February 3, 2017.
7. 7See p. 6 of G.A.’s request for reconsideration, dated April 17, 2017.
8. 82013 CarswellOnt 15086.
9. 9Blake v. Dominion of Canada General Insurance Company, 2015 ONCA 165 at para. 30.
10. 10See, e.g., P. B. v RBC Insurance Company, 2017 CanLII 9816 at para. 10; G.P. v Northbridge Personal Insurance Corporation, 2017 CanLII 12601 at para. 14; J. V. v Wawanesa Mutual Insurance Corporation, 2017 CanLII 9800 at para. 24; L.W. v Co-operators General Insurance Company, 2016 CanLII 93133 at para. 14.