Tribunal File Number: 17-006863/AABS
Case Name: 17-006863 v Aviva General Insurance Company
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:
P. F.
Applicant
and
Aviva General Insurance Company (formerly RBC Insurance)
Respondent
DECISION
ADJUDICATOR: Gemma Harmison
Written Submissions by:
For the Applicant: Maria Makarova, paralegal (Grillo Barristers P.C.)
For the Respondent: Shivani Mehta, counsel (Aviva Trial Lawyers)
HEARD in Writing on: June 4, 2018
OVERVIEW
1The applicant was involved in a motor vehicle accident on March 27, 20151 and sought benefits from the respondent pursuant to the Statutory Accident Benefits Schedule - Effective September 1, 2010 (“Schedule”).
2The applicant submitted an application to the Licence Appeal Tribunal - Automobile Accident Benefits Service (“Tribunal”) following the denial of certain benefits for which he had applied, including an income replacement benefit (“IRB”).
3The parties participated in a case conference on January 31, 2018. Unable to resolve the IRB dispute, the parties consented to having the matter decided at a written hearing.
4The case conference order identified a single substantive issue in dispute to be decided at this written hearing: whether the applicant is entitled to receive a weekly2 IRB for the period of April 3, 2015 to February 13, 2017.3
5In its submissions for the hearing the respondent raised, among other defences, a time limitation defence asserting that the applicant is barred from disputing his claim for IRBs before the Tribunal because he did not dispute the respondent’s refusal within 2 years as required by section 56(1) of the Schedule. The applicant addressed and responded to the time limitation issue in his reply submissions.
6The time limitation defence, if successful, would altogether bar the applicant’s claim to IRBs. As a result, I will address this issue first.
ISSUES IN DISPUTE
7Based on the case conference order and the written submissions received from the parties, I have determined the issues to be decided at this hearing are as follows:
(i) Is the applicant barred per section 56(1) of the Schedule from proceeding with his claim for IRBs at the Tribunal because he did not bring his dispute for IRBs within 2 years of the respondent’s refusal to pay that benefit?
(ii) If the answer to issue 1 above is no, is the applicant entitled to receive a weekly IRB during the period of April 3, 2015 to February 13, 2017?
(iii) If the answer to issue 2 above is yes:
(a) For what specific period and in what weekly amount (quantum) is the applicant entitled to receive IRBs?
(b) Is the applicant entitled to receive interest on any overdue payment of IRBs?
RESULT
8The applicant is time-barred from disputing his claim for IRBs.
9Since the answer to issue one is yes, the applicant is not entitled to IRBs and his application is dismissed.
BACKGROUND
10Based on the information provided in the applicant’s Application for Accident Benefits (“OCF-1”) and his initial Disability Certificate (the “first OCF-3”), the respondent paid non-earner benefits (“NEBs”) to the applicant for the period of September 27, 2015 to November 5, 2015. The respondent determined that the applicant was not entitled to NEBs beyond November 5, 2015 based on an Insurer’s Examination (IE) report which concluded that the applicant did not meet the disability test for NEBs.
11In October 2016, approximately 19 months post-accident, the applicant submitted a second Disability Certificate to the respondent (the “second OCF-3”), and shortly thereafter provided employment documentation to the respondent as well. Based on the information contained in those documents, the applicant sought IRBs from the respondent.
12Section 56(1) of the Schedule sets out a limitation period of two years for an applicant to dispute an insurer’s refusal to pay a benefit. In this case, the parties disagree on both whether and when the respondent issued a refusal in respect of the applicant’s claim for IRBs.
ANALYSIS AND REASONS
Issue 1 – Is the applicant time-barred from disputing his claim for IRBs?
(i) Positions of the Parties on the Time Limitation Issue
13It is the position of the respondent that the applicant is time-barred from disputing his claim for IRBs at the Tribunal because:
(a) The respondent’s letter to the applicant dated May 25, 2015 was a clear and unequivocal refusal to pay him IRBs;
(b) The respondent provided detailed reasons in its May 25, 2015 letter and also advised the applicant of his rights to dispute the respondent’s determination in accordance with established caselaw, citing Smith v. Co-operators4 (“Smith”) and Bonilla v. Preszler5 (“Bonilla”);
(c) The applicant commenced his application to the Tribunal on October 10, 2017, which is outside the 2 year time limitation period.
14It is the position of the applicant that his claim for IRBs is not time barred because:
(a) An insurer cannot deny a benefit before an injured person applies for that benefit: The applicant contends that he did not actually apply for IRBs until October 2016 when he submitted the second OCF-3 supporting his claim for IRBs;
(b) The respondent’s letters of May 25, 2015 and September 21, 2015 pre-date the applicant’s actual application for IRBs and should be deemed “blanket denials” which would not trigger the limitation period;
(c) The respondent’s letters of May 25, 2015 and September 21, 2015 were not a clear and unequivocal denial of his claim for IRBs: The applicant submits that the May 25, 2015 letter “simply indicated that the Respondent did not have information to support that the applicant may qualify for Income Replacement Benefit and invited the applicant to submit further supporting documentation, if any.” The applicant further submits that while the September 21, 2015 letter did mention that the respondent had no information to support that the applicant worked 26 weeks in the 52 weeks prior to the accident, he contends that this letter “essentially addresses the Respondent’s refusal to initiate payment of the Non-Earner Benefit.”
(d) After receiving the second OCF-3 and employment records from applicant counsel’s office, the respondent in its letter of November 30, 2016 requested that the applicant attend an examination under oath (EUO) which, the applicant submits: (1) is evidence supporting that no determination had been made on the issue of IRBs, and by extension (2) the limitation period for IRBs “has never been triggered”
(e) In the alternative, the applicant submits that the limitation period would only start after he received the respondent’s letter of November 30, 2016 requesting that the applicant attend an EUO;
(f) The respondent’s refusal to pay IRBs was “legally and/or factually incorrect”: The only reason given by the respondent for not paying IRBs was that the applicant was not employed 26 weeks within 52 weeks before the accident. The applicant submits that the respondent has never provided the applicant with “a medical and any over [sic] valid reasons” for refusal to pay IRBs, and therefore failed to comply with section 36(4) of the Schedule.
(ii) Chronology
15The timeline in this matter, and in particular the communications between the parties when dealing with the applicant’s accident benefits claim, is important to understanding the parties’ positions on, and the ultimate determination of, the time limitation issue.
16The accident happened on March 27, 2015.
17An OCF-1, signed by the applicant and dated May 6, 2015, was faxed to the respondent on May 11, 2015 by applicant counsel’s office. Under Part 5 of the OCF-1, the applicant was asked to describe his status at the time of the accident by selecting from a number of different options. Those options included, among others, unemployed but having worked 26 weeks in the past 52 weeks, receiving Employment Insurance (EI) benefits, and student or recent graduate. The applicant checked off the box titled student or recent graduate, and thereafter under Part 6 provided particulars of the school and program that he was attending. Under Part 8 of the OCF-1, when asked to provide details of his employment in the previous 52 weeks, the applicant listed a single employer, Atlas Van Lines Canada, and indicated that he had worked there from the years 1989 to 2014 as a programmer/analyst. Below that information, when asked whether his injuries prevented him from working and, if so, from what date, the applicant answered “yes” and provided the date of August 30, 2014 (a date that is seven months prior to the accident).
18On May 25, 2015, the respondent sent a letter to the applicant, copied to his counsel’s office, acknowledging receipt of his OCF-1 and explaining the types of benefits available to the applicant, subject to eligibility. With respect to IRBs, the letter referenced section 5 of the Schedule and went on to outline the eligibility criteria for IRBs for unemployed persons (including the requirement of having worked 26 weeks in the 52 weeks pre-accident or receiving EI benefits at the time of the accident). The respondent advised that based upon its review of the information provided in the applicant’s OCF-1 it did not appear that he had worked 26 weeks out of 52 weeks, or that he was receiving EI at the time of the accident. The respondent advised the applicant that based on the foregoing information “you do not qualify for Income Replacement Benefit.” The letter indicated that if any of the information the respondent had was incorrect, and if the applicant wished to claim an IRB, that “an election is warranted pursuant to section 35 of [the Schedule].” The letter went on to outline information regarding NEBs, including the disability test and 26 week waiting period for NEBs. Enclosed with the letter was a document titled “Applicant’s Rights to Dispute” which provided a step by step guide for the applicant if he wished to dispute the respondent’s determination and to have the claim addressed through mediation followed by arbitration, litigation or neutral evaluation. That document ended with the following statement: “*WARNING: TWO YEAR TIME LIMIT…You have TWO YEARS from the date of your insurer’s refusal to pay, or reduction of a benefit, to arbitrate or commence a lawsuit in court…” [emphasis in original]
19The first OCF-3 was signed by the applicant and dated April 14, 2015. However, according to the respondent (and not disputed by the applicant), the respondent did not receive the first OCF-3 until September 9, 2015. Dr. Jason Lemieux, chiropractor, completed the requisite health practitioner sections of the OCF-3. Part 1 indicated that the applicant was not working when the accident happened and that he was enrolled in an education program at the time of the accident. Under Part 6 (Disability Tests and Information), the following was indicated:
(a) Responded “N/A” [not applicable] when asked whether the applicant was substantially unable to perform the essential tasks of his employment at the time of the accident as a result of and within 104 weeks of the accident [commonly referred to as the pre-104 week IRB disability test].
(b) Responded “Yes” when asked whether the applicant suffers a complete inability to carry on a normal life [the disability test for NEBs].
20On September 21, 2015, the respondent sent a letter to the applicant, copied to his counsel’s office, acknowledging receipt of his OCF-3. In the letter, with respect to IRBs, the respondent referred back to its letter of May 25, 2015, outlined again the reasons why it had determined the applicant did not qualify for IRBs, and advised that it had not received any information to change its position that the applicant did not qualify for IRBs. The letter went on to inform the applicant of the disability test and the 26 week waiting period for NEBs. It also advised that the respondent required the applicant to attend an assessment to determine his eligibility to NEBs and that a Notice of Examination would follow separately. Enclosed with the letter was the same document titled “Applicant’s Rights to Dispute”.
21The applicant subsequently attended an IE orthopaedic assessment with Dr. Esmat Dessouki on October 9, 2015, solely and specifically addressing the issue of NEBs.
22In a letter dated October 30, 2015, sent to the applicant and copied to his counsel’s office, the respondent enclosed a copy of the report of IE assessor Dr. Dessouki. The letter advised that, based on the IE report, the applicant did not suffer a complete inability to carry on a normal life as a result of the accident and that the applicant was no longer entitled to receive NEBs effective November 6, 2015.
23Applicant counsel’s office sent a letter to the respondent dated November 3, 2015 acknowledging receipt of the respondent’s October 30, 2015 letter and requesting that the respondent pay NEBs to the applicant for the period of September 27, 2015 (the 26 week waiting period mark) to November 5, 2015 (date of stoppage). The applicant acknowledges at paragraph 3 of his initial submissions that the respondent paid the applicant NEBs in the amount of $1,057.14 for that period.
24Approximately 19 months post-accident, the applicant submitted a second OCF-3 to the respondent. The second OCF-3 was signed by the applicant and dated October 21, 2016. The same health practitioner, chiropractor Dr. Jason Lemieux, completed the requisite health practitioner sections of the OCF-3. Some of the information contained in the second OCF-3 was the same as that provided in the applicant’s OCF-1 and the first OCF-3. For example, under Part 1 of the second OCF-3 it was again indicated that the applicant was not employed at the time of the accident and that he was not receiving Employment Insurance benefits at the time of the accident. However, the second OCF-3 also provided information that differed from the first OCF-3:
(a) Responded “No” when asked if the applicant was enrolled in an education program at the time of the accident;
(b) Responded “Yes” as to whether the applicant worked at least 26 weeks of the previous 52 weeks preceding the accident;
(c) Responded “Yes” as to whether the applicant was substantially unable to perform the essential tasks of his employment at the time of the accident as a result of and within 104 weeks of the accident.
25In a letter dated November 4, 2016, sent to the applicant and copied to his counsel’s office, the respondent acknowledged receipt of the applicant’s second OCF-3. With respect to IRBs, the respondent referred back to its May 25, 2015 letter and the reasons why it had determined he did not qualify for an IRB, and again stated that IRBs were not payable.
26Applicant counsel’s office sent a letter to the respondent dated November 10, 2016 advising that the applicant was employed for 26 weeks in the 52 weeks prior to the accident, and with the letter enclosed not only a record of employment (“ROE”) from Atlas Van Lines Canada (the single employer the applicant had identified in his OCF-1), but also a ROE from a second employer, Canada Post6. Based on that documentation, applicant counsel asserted that the applicant was eligible for IRBs and requested that the respondent calculate and issue payment of IRBs to the applicant.
27In a letter dated November 30, 2016, sent to the applicant and copied to his counsel’s office, the respondent acknowledged receipt of the November 10, 2016 letter and enclosures. The respondent’s November 30, 2016 letter listed, among other things, the respondent’s prior letters to the applicant of May 25, 2015 and September 21, 2015, the first OCF-3 dated April 14, 2015 which indicated that IRBs were not applicable to the applicant, the IE assessment that was undertaken to address NEBs, and that the respondent had paid NEBs to the applicant in the amount of $1,057.14 for the period of September 27, 2015 to November 5, 2015. The letter then stated: “At this point we require an examination under oath. Our counsel will be in contact with you shortly to arrange for the same”.
28In his initial submissions for the hearing, the applicant indicates that he attended the EUO on May 23, 2017 and alleges that the respondent has not provided the applicant with a “final response” with respect to his IRB claim.
(iii) Decision on time limitation issue
29Having considered the submissions and evidence before me, and for reasons outlined below, I find that the applicant is time barred from disputing his claim for IRBs.
30In Smith, the Supreme Court of Canada held that a limitation period cannot commence unless the insurer’s denial is in writing and is found to be clear and unequivocal. A clear and unequivocal denial must be straightforward and in clear language directed towards an unsophisticated person. The denial must also provide information about the different stages in the dispute resolution process and the relevant time limits that govern the process.
31I am satisfied that the respondent’s letter of May 25, 2015 was clear and unequivocal. It outlined reasons why the respondent determined the applicant was not eligible for IRBs and thereafter indicated “Based on the above noted information, you do not qualify for Income Replacement Benefit” [emphasis added]. Enclosed with the letter was a document titled “Applicant’s Rights to Dispute” which provided a step by step guide if he wished to dispute the respondent’s determination, and included a warning about the 2 year time limitation period.
32Among his submissions, the applicant argues that the May 25, 2015 letter was equivocal and therefore should not trigger the limitation period because the letter noted that the respondent did not have information to support the applicant’s entitlement to IRBs and invited the applicant to submit further documentation, if any, if the respondent’s determination was incorrect. I am not persuaded by this argument. The respondent’s invitation to submit further documentation does not override or supplant the clear statement from the respondent (in bold above) that the applicant did not qualify IRBs. It does not change the clear wording that the respondent was refusing to pay IRBs.
33I agree with the respondent that its letter of May 25, 2015 complies with established caselaw in Smith and Bonilla, which it relied upon, that the two year limitation period is triggered once the insured receives a clear and unequivocal denial from the insurer.
34The applicant argues that Smith and Bonilla are distinguishable from the present case, arguing that in those cases an application for a specified benefit (i.e. a Disability Certificate supporting the benefit) was submitted before the benefits were denied. The applicant contends that he did not actually apply for IRBs until the submission of the second OCF-3 in October 2016 and that the respondent’s letter of May 25, 2015 (and its subsequent letter of September 21, 2015) pre-date the applicant’s actual application for IRBs and therefore should be deemed “blanket denials” which would not trigger the limitation. The applicant further contends that the respondent’s refusal is not valid and should not trigger the limitation period because the respondent’s refusal was legally and/or factually incorrect, and did not comply with section 36(4) of the Schedule. As well he submits that the respondent’s request in its letter of November 30, 2016 that he attend a EUO is evidence that no determination had been made on the issue of IRBs and that the limitation period for IRBs has “never been triggered”. I disagree with the applicant’s submissions.
35In Bonilla, the Court of Appeal, at paragraph 10, stated:
“It is well established in this court’s caselaw that the limitation period is triggered by a single event, which is the refusal of an insurer to pay the IRB claimed: see e.g. Bonaccorso v. Optimum Insurance Company Inc., 2016 ONCA 34, 129 O.R. (3d) 544 and Sietzema v. Economical Mutual Insurance Company, 2014 ONCA 111, 118 O.R. (3d) 713.”
36Although not directly referenced by the parties in their submissions, in the Bonilla case relied upon by the respondent the Court of Appeal also cited (per above) Bonaccorso as well as Sietzema. In those cases, the Court of Appeal held that an insurer’s refusal to pay a benefit may be premature and may include benefits the applicant has yet to apply for. The Court of Appeal in Sietzema also held than an insurer’s clear and unequivocal denial, even if legally incorrect, is sufficient to trigger the limitation period. If an applicant believes that the denial was improper, they have a right to dispute whether it was proper or not within the 2 year time limitation period.
37Having found that the respondent’s letter of May 25, 2015 was clear and unequivocal, I find that the 2 year limitation period lapsed on May 25, 2017. Since the applicant initiated his application to dispute his claim for IRBs at the Tribunal in October 2017- outside the 2 year time limitation period - he is time-barred from doing so and his application is accordingly dismissed.
CONCLUSION
38For reasons set out above, I find that:
(i) The applicant is time-barred from disputing his claim for IRBs.
(ii) Since the answer to issue one is yes, the applicant is not entitled to IRBs and his application is dismissed.
Released: October 17, 2018
___________________________
Gemma Harmison
Adjudicator
Footnotes
- In paragraph one of his initial submissions for the hearing, the applicant referred to the date of the accident as being March 23, 2015. However, the date of the accident is actually March 27, 2015 as confirmed per the applicant’s Application for Accident Benefits (OCF-1), his other OCF forms, and other documents submitted by the parties as evidence for the hearing.
- The issue as listed in the case conference order referred to the disputed period of IRBs as being at a rate of $400.00 “per month”. Since under the Schedule IRBs are a weekly benefit, and since the parties in their respective submissions each argued, if entitlement was proven, a weekly amount of IRBs, I accept that the “per month” reference in the case conference order was an inadvertent typographical error. From their submissions it is also evident that, if entitlement to IRBs was proven, the parties disagree on both the specific time period of entitlement and on the weekly amount (quantum). Accordingly, I have modified the substantive IRB dispute in this decision to more accurately reflect the issue based on the parties’ submissions.
- Although not delineated in the case conference order, the disputed period encompasses one week post-accident until the applicant returned to work. In his initial submissions for the hearing, the applicant clarified that in respect of this disputed period he is claiming entitlement to IRBs minus the amount that he was paid for non-earner benefits (NEBs). In his reply submissions, the applicant conceded that he is not entitled to receive payment of more than one specified benefit for the same time period, but argues that he can still claim for more than one specified benefit because an election form (OCF-10) was not provided by the respondent requesting that he elect a specified benefit.
- Smith v. Co-operators 2002 SCC 30
- Bonilla v. Preszler, 2016 ONCA 759
- In its submissions, the respondent claims that the November 10, 2016 correspondence was the first time the respondent had been made aware of the applicant’s job at Canada Post.