J.R. v. CAA Insurance, 2018 CanLII 115722

Date: 2018-08-13

Tribunal File No: 17-008693/AABS

Case Name: 17-008693 v CAA Insurance

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:

J.R.

Applicant (Responding Party)

and

CAA Insurance

Respondent (Moving Party)

ORDER – MOTION ON SETTLEMENT

BEFORE: D. Gregory Flude, Vice-Chair

APPEARANCES:

For the Applicant: J.R., personally (Responding Party): Sharon Mackay, counsel

For the Respondent: (Moving Party): Abby J. Brass, counsel

Heard in Writing: July 3, 2018

REASONS FOR DECISION AND ORDER

PROCEDURAL NOTE

1This motion was originally scheduled to be heard by teleconference with written submissions. The teleconference part of the motion was to permit cross-examination on affidavits. The parties chose not to submit affidavit evidence, relying instead on the exchange of correspondence between them and other documentary evidence, and their written submissions. On consent of both parties, the hearing was converted to a written hearing.

OVERVIEW

2The applicant was injured in two automobile accidents; one on July 17, 2012 and one on July 15, 2016. The respondent was the insurer in both accidents. On August 2, 2017 the applicant submitted an application to this Tribunal to resolve a dispute over her entitlement to benefits as a result of impairments suffered in the July 15, 2016 accident under the Statutory Accident Benefits Schedule – Effective September 1, 2010 (the “Schedule). It was assigned file # 17-005016/AABS.

3Through the fall of 2017, the parties entered into settlement discussions that resulted in a settlement executed by the applicant on November 3, 2017. The applicant withdrew her application to the Tribunal in file # 17-005016/AABS effective November 6, 2017 and the Tribunal closed its file.

4One of the issues in file # 17-005016/AABS was payment of the amount of $3,222.80 to a service provider, Accelerated Health & Wellness (“Accelerated”). Accelerated had submitted a request for approval of this treatment plan and the respondent denied it. Accelerated then provided the treatment so the applicant is liable for payment of the $3,222.80. A dispute has arisen between the parties over whether the terms of the settlement included an amount for this treatment or whether the respondent undertook to pay for it over and above the agreed settlement amount.

5The applicant has filed a second application with the Tribunal seeking payment of the $3,222.80 directly to the service provider. The respondent has brought this motion to strike the second application on the grounds of the full and final settlement of all outstanding claims under the Schedule for both accidents, that the applicant has executed a full and final release and a statutory disclosure notice as required by the settlement provisions in s. 9.1 of Ontario Regulation 664, R.R.O. 1990 (the “Regulation), and that the time for rescinding the settlement expired two business days after the statutory disclosure notice was executed by the applicant.

6For reasons more fully set out herein, I find that there was a full and final settlement of all the issues in dispute in Tribunal file # 17-005016/AABS and that the applicant is barred by that settlement from proceeding to seek the same relief in this application. This application is dismissed.

THE ISSUE AND RESULT

7The preliminary issue as set out in the case conference order is:

a. Did the applicant enter into a valid, full and final settlement of this matter with the respondent; and is the applicant precluded from proceeding with this application/claim(s)?

8As stated above, the answer to each part of this two part question is yes: the applicant did enter into a full and final settlement and is precluded from proceeding with this application.

FACTS AND ANALYSIS

9It would not be unfair to say that there are a number of clerical errors that mark the respondent’s handling of the applicant’s file. Early settlement letters sent by the respondent to applicant’s counsel cite the wrong file information. After the settlement the respondent overpaid the settlement funds by the amount of the YWCA gym membership that it had already paid directly. I do not find that these errors impacted the formation of the agreement to settle the file in any manner or were misleading. The first two errors, citing the wrong file information, were corrected before the final settlement and the parties were in no doubt about which file they were dealing with. The error involving the gym membership occurred after the settlement had been concluded in an atmosphere where the applicant was trying to rescind the agreement and the respondent was rushing to comply with its payment obligations. Other than these points, there is little disagreement on the facts.

10Through October 2017, counsel for the applicant and counsel for the respondent exchanged correspondence looking to settle the applicant’s Schedule benefits with respect to both the 2012 accident and the 2016 accident. The respondent offered to settle for: “$15, 000.00 plus payment of the declined TX plan [the plan in dispute] and YMCA gym membership." Counsel for the applicant replied to this offer stating that she would recommend a settlement in the amount of $28,000.00.

11There were further exchanges of correspondence until on October 25, 2017 the applicant’s counsel forwarded an offer in the following terms:

I am prepared to recommend settlement on a full and final basis as follows:

1. $20,000.00 Med/Rehab

2. $2,795.00 payment to Accelerated for incurred treatment expenses from date of denial to current

3. $3,222.00 payment of previously denied treatment plan from Accelerated.

4. YMCA membership (payment has already been sent to YMCA) [the respondent had made this payment]

12Thus as of October 25, applicant’s counsel was seeking $26,017 plus payment for the YMCA membership that the respondent had already made. It is clear from this communication that the offer included the disputed treatment in the amount of $3,222.80 rounded out to $3,222.

13By letter date October 30, respondent’s counsel accepted the applicant’s offer to settle. The settlement terms were fully monetized to include the YMCA gym payment such that the final number was $27,041.91. It broke down into cash a payment of $26.017, $20,000 for future medical care, $2,795 for incurred expenses and $3,222 for the disputed treatment plan. Added to this was $1,024.91 paid directly by the respondent to the YMCA. The accompanying letter stated:

The above noted offer includes all past and future Medical and Rehabilitation Treatment including any incurred treatment and/or outstanding payments. Included in the Full and Final offer is the declined Treatment Plan (OCF18) in dispute dated May 17, 2017 and the approved YMCA Gym membership submitted on OCF18 dated August 15, 2017 for which we have issued payment already.

14The applicant signed a full and final release and a settlement disclosure notice on or about November 3, 2017. According to the Regulation, the applicant had two business days from signing the settlement disclosure notice to reject the settlement. She did not do so.

THE DISPUTE OVER WORDING

15In and around November 20 or 21, the applicant advised the respondent for the first time that she interpreted the settlement agreement to mean that the respondent was required to pay the $3.222 in addition to the $26,000 in cash plus the gym membership. The respondent takes the position that the settlement included the $3,222.

16The applicant points to the wording of a letter from the respondent dated October 30 enclosing the release and settlement disclosure notice. It states:

Included in the Full and Final offer is the declined Treatment Plan (OCF-18) in dispute, dated May 17, 2017 and the approved YMCA membership submitted on OCF18 dated August 15, 2017 for which we have issued payment already.

17The applicant takes the position the words “for which we have already issued payment” relate to both the declined treatment plan dated May 17, 2017 and the YMCA membership. My difficulty with the applicant’s position is twofold. The first point is that the letter dated October 30, 2018 is not the contract between the parties. The agreement between the parties is set out in the Full and Final Release (“Release”) executed on or about November 3, 2017. That document has no such qualifying language. It makes it clear that for a payment valued in the amount of $27,049.91 the applicant fully releases all present and future claims arising out of the 2012 and 2016 accidents. The applicant acknowledged in the Release:

1. That the above mentioned sum is the entire and only consideration for this release and that the said amount includes all Statutory Accident Benefit claims, interests, and costs with respect to the accident which occurred on the 17th day of July, 2012 & the 15th day of July, 2016.

18My second difficulty comes from the applicant’s attempt to pick one possibly ambiguous phrase out of a lengthy settlement discussion and argue that she was misled. By doing so, the applicant has invited me to look behind the wording of the signed documentation at the whole of the settlement discussion. A review of that discussion makes it abundantly clear that the amount of $27,049.91 included the payment of the $3,222.80 and that the respondent did not undertake to pay this amount separately from the balance of the settlement funds.

19As set out in the facts above, the final accepted offer to settle came from the applicant in the October 25 letter. It had four elements: $20,000 for future medical care; $2,795 for incurred treatment; $3,222 for the denied and disputed treatment plan and the value of the YMCA gym membership already paid by the respondent. In accepting that offer, the respondent added the monetary value of the gym membership, to come up with the total monetary value of the settlement offer. In light of the elements that made up the accepted offer, I cannot understand how the applicant would assume that the respondent was going to pay the $3,222.80 twice: once in the calculation of the cash settlement amount and again as a payment directly to the treatment facility.

20In early December the respondent tendered the settlement funds. In doing so it made another error of calculation: it provided a cheque for the full monetary value of the settlement, effectively paying for the gym membership twice. This was another of the clerical errors that marked the earlier handling of the file. The negotiated cash payment to the applicant was the sum of $27,049.91 minus the value of the gym membership. The applicant did not raise, and I do not find, that there was an intention to pay twice for the gym membership or that this payment supports the applicant’s position in any manner. I find it was a simple clerical error made when the respondent took immediate steps to fulfill its obligations under the settlement in the face of the applicant’s attempts to repudiate it.

CONCLUSION

21Having reviewed the documents and submissions of the parties, I find that:

a. The applicant entered into a full and final settlement with the respondent on or about November 3, 2017 that included the treatment and assessment plan dated May 17, 2017 in the amount of $3,222.80.

b. The applicant’s action to recover payment of the amount of $3,222.80 for a treatment plan dated May 17, 2017 is dismissed.