17-005449 v TD Insurance, 2018 CanLII 76697

Date: 2018-04-03

Tribunal File Number: 17-005449/AABS

Case Name: 17-005449 v TD 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:

Applicant

Applicant

and

TD Insurance

Respondent

DECISION

ADJUDICATOR: Christopher A. Ferguson

APPEARANCES

Counsel for the Applicant: Ajay Kapur

Counsel for the Respondent: Pamela Brownlee

HEARD in Writing: February 20, 2018

OVERVIEW

1This is a preliminary issue brought by the respondent (“TD”) in response to an application to the Licence Appeal Tribunal (the “Tribunal”) to determine an insured person’s entitlement to statutory accident benefits.

2The applicant was involved in an accident on February 28, 2006 (“the accident”).

3[The applicant] sought benefits pursuant to the Statutory Accident Benefits Schedule for Accidents occurring on or after November 1, 1996¹ (the ''Schedule'').

4[The applicant] filed an appeal with the Tribunal on August 16, 2017. Her appeal initially included certain costs of examinations (CoEs) as well as an appeal of TD’s denial of her application for a determination of catastrophic (“CAT”) impairment. The respondent notes that the parties had previously achieved a settlement of some other SABs claims, but not future medical benefits.

5The parties resolved [the applicant’s] claim for CoEs after her appeal was filed. As a result, [the applicant’s] appeal now includes only the respondent’s denial that she is catastrophically impaired as defined by the Schedule. There are no specific substantive claims included in her current appeal.

6TD contends that there is no basis for an appeal, and therefore no basis for a hearing, unless an application includes a dispute over denial of a specific substantive benefit. Its position is that the issue of CAT impairment cannot be determined by the Tribunal on a “stand-alone” basis.

7If TD is correct, then [the applicant’s] appeal is dismissed.

8If I find that TD is incorrect, then I will order that the matter proceed to a case conference to discuss next steps in this matter.

9[The applicant] made a request for costs and an award in the preliminary matter.

PRELIMINARY ISSUE

10Does the Tribunal have jurisdiction to make a catastrophic determination where there are no benefits in dispute remaining in the application?

FINDINGS

11The Tribunal has jurisdiction to determine the issue of whether or not the applicant is CAT impaired, regardless of the absence of an underlying dispute over entitlement to substantive benefits.

REASONS

12CAT impairment is defined in s.3.1 of the Schedule.

13Section 45 of the Schedule sets out the process that an applicant must follow to apply for a determination of CAT impairment. It also prescribes the response required of the insurer to a CAT impairment application.

14There is nothing in the Schedule that requires a claimant to make a claim for a specific, substantive benefit before they can apply to the insurer for a CAT determination.

15Applicants who are determined to be CAT impaired are entitled to up to $1M in medical rehabilitation benefits and $1M in attendant care benefits over their lifetimes, which is much higher than the maximums payable for non-CAT impaired claimants.

Determining CAT at LAT

16Section 280(1) of the Insurance Act² (“the Act”) provides that an insured person or an insurer may apply to the Tribunal to resolve a dispute over the insured person’s entitlement to statutory accident benefits (SABs) or the amount of SABs that he or she is entitled to.

17Rule 2.3³ defines “Automobile Accident Benefits Service (AABS) Claim” as an application to the Tribunal pursuant to s. 280(2) of the Act seeking resolution of a dispute involving SABs.

18In this matter, as noted, there are no outstanding claims for denied benefits in this application to the Tribunal. The applicant’s claim for CoE has been settled.

19The Tribunal regularly determines whether or not claimants are CAT impaired. The only issue in this case is whether the Tribunal can hear such appeals in the absence of a dispute over specific, substantive benefits such as medical benefits, income replacement or attendant care benefits.

20TD argues that the Tribunal has no jurisdiction in this matter because no substantive benefits have been denied. To support its argument, the TD contends that:

i. [The applicant] is seeking a declaration of CAT impairment which is “a declaratory relief”⁴. There is no “consequential relief” sought. Tribunal’s enabling statute does not provide it with the power to grant declaratory relief, which is reserved to the Superior Court and the Court of Appeal.⁵

ii. “It is well settled law, accepted by the LAT that a catastrophic determination is not a benefit and thus the denial […] does not trigger a limitation period.” There is a clear distinction to be made between the claim for CAT status and a claim for specific benefits to which an injured person is entitled if found to have suffered CAT impairment.⁶

iii. Given that there is no benefit in dispute, a catastrophic determination has no utility whatsoever and should not proceed to a hearing. This assertion is based on guidance from the Superior Court in Godin v. Sabourin⁷, in which the Court stated:

a. “declarations concerning the future ought to be approached with considerable reserve”

b. “As a general policy, the Court will not make a declaratory order or decide a case when the decision will serve no practical purpose because the dispute is theoretical, hypothetical or abstract, and the remedy of declaratory relief is not generally available where the dispute or legal right may never arise”

c. “It is a long-standing principle in Ontario that courts should not grant ‘an order on the basis of an assumed set of facts to resolve future matters’".

d. (citing the Court of Appeal in another case) “[…] granting a declaration on the basis of a hypothetical situation to avoid a potential future conflict [is] inappropriate” – the reason being that the court could not accurately predict the impact of future events on the status of the issue in question.

21TD goes on to cite Mandamin v. Pafco⁸ (“Mandamin”) to support the contention that when there is no claim for an underlying benefit, a determination for catastrophic impairment cannot be made.

22I do not share TD’s view of the statutory/regulatory provisions that bind the Tribunal, because:

i. Section 280(1) of the Act expressly permits parties to “apply to the Tribunal to resolve a dispute over the insured person’s entitlement to statutory accident benefits”. Rule 2.3 as noted speaks to “an application seeking resolution of a dispute involving SABs”. I read the language of the provisions as referring to any dispute over entitlement to SABs (including a dispute over CAT impairment).

ii. CAT determination directly affects entitlement to benefits, it includes requirements and a process very similar to that for specific SABs⁹, and a claim of CAT impairment can be denied like any benefit. I find these facts persuasive that the result of the CAT determination process is included in the entitlement disputes that can be appealed to the Tribunal.

iii. There is nothing in the Licence Appeal Tribunal Act or Rules, the Insurance Act or the Schedule expressly requiring either the application to an insurer for CAT determination or an appeal of an insurer’s denial of a claim to CAT impairment to the Tribunal to be accompanied by a specific substantive claim.

iv. I find that taken together, the provisions of the Act and the Schedule do not in themselves preclude an appeal of a CAT determination on a stand-alone basis.

v. I am not persuaded by the inference drawn by TD from the court’s remarks in Godin because no “declaratory remedy” is being sought here. What is being sought by [the applicant] is a decision by this Tribunal on whether or not she is CAT impaired, which directly impacts her entitlement to benefits and which arises as an issue from a denial by TD in a process set out in the Schedule. She seeks a decision inside the regulatory scheme, and TD’s own evidence with respect to the effort to resolve disputes about funding for future medical benefits suggests that the issue is anything but “fictitious”, “academic” or “moot”.

vi. The Tribunal case cited by the respondent as backing its position does nothing of the sort. ST and Economical did not address the issue of a “stand-alone CAT determination”. The decision was about the effect of a CAT determination on limitation periods on applications relating to specific SABs.

vii. I am not bound by the FSCO decision in Mandamin and will not follow it because to reach his conclusion, the arbitrator relied on the cases which I find to be inapplicable to the question of jurisdiction over a stand-alone CAT determination dispute, for the following reasons:

a. The line of authority in Mandamin, which included Machaj v. RBC,¹⁰ Do¹¹ and McLinden v. Payne,¹² all focused narrowly on the application of limitation periods to CAT determination appeals and are not persuasive on the issue of jurisdiction or authority before me.

b. None of the cases deal with any proposition that hearing a CAT determination without underlying substantive claims amounts to considering “declaratory relief”.

23I agree with [the applicant] ’s position that:

i. The Licence Appeal Tribunal Act (the “LAT Act”) s. 3(2) provides that “except as limited by this Act, the Tribunal has all the powers that are necessary and expedient for carrying out its duties.” There are no provisions preventing or limiting the Tribunal from providing any form of relief in carrying out its duties.

ii. The Tribunal has recently determined CAT impairment as a stand-alone issue in five cases,¹³ which I find sets a strong and persuasive precedent for interpreting this issue.

iii. It is reasonable that the LAT resolve this dispute over access to CAT-level impairment benefits; otherwise, [the applicant] is statute-barred from using the court system to resolve this dispute because s. 280(3) of the Insurance Act prohibits anyone from bringing any dispute about SABs to the courts (except an appeal from a Tribunal decision).

iv. TD mischaracterizes the relief sought by [the applicant] as declaratory, when it is actually consequential. [The applicant] seeks access to enhanced benefits that only catastrophically impaired applicants can access, which is an issue beyond mere “academic” interest. This reasoning is supported by the Tribunal’s decision in Applicant v. Gore.¹⁴ I repeat my view in subparagraph 22.v. above that the determination sought by [the applicant] is in fact substantive and impactful.

24As a result, I find that the Tribunal does have jurisdiction to determine whether or not an applicant is CAT impaired on a stand-alone basis. This dispute may proceed to a hearing.

Costs and Award

25Rule 19.1¹⁵ permits a party to request that the Tribunal order the other party to pay costs, where the requesting party “believes that another party in a proceeding has acted unreasonably, frivolously, vexatiously, or in bad faith”.

26Section 10 of Regulation 664¹⁶ permits the Tribunal to award a lump sum of up to 50% of the amount to which the insured person (i.e. the applicant) was entitled at the time of the award together with interest on all amounts then owing (including unpaid interest) if it finds that that an insurer (i.e. the respondent) has “unreasonably” withheld or delayed payments.

27[The applicant] argues that she is entitled to costs and an award, she groups the two claims together and applies the same evidence and argument to both claims, namely:

i. TD ought to have known that the Tribunal has been hearing stand-alone CAT determination cases and not raised this preliminary issue.

ii. TD’s own denial letter dated June 13, 2017 stated that [the applicant] has a right to appeal its CAT determination decision to the Tribunal.

28Noting that both parties’ submissions acknowledge that the tests for awarding costs and awards are strict, I find that the evidence and argument that [the applicant] submits do not provide me with sufficient evidence for me to determine that TD’s handling of this claim has met the tests set out in Rule 19.1 or s.10 of Regulation 664 at this time.

CONCLUSION

29TD’s request in this preliminary issue hearing is denied without costs, and without an award. [the applicant]’s appeal may proceed to a hearing.

ORDER

30The parties shall attend a case conference, to be scheduled by the Tribunal, in order to discuss how this matter should proceed.

31If the parties resolve their dispute before the scheduled case conference, the applicant shall notify the Tribunal immediately.

Released: April 3, 2018

___________________________

Christopher A. Ferguson

Adjudicator

Footnotes

1. 1O.Reg. 403/96.
2. 2Insurance Act, RSO 1990. C.I.8, s. 280(1) and (2) after April 1, 2016 (as written on the date the appeal was filed) – I note that the language of the section is identical to the language of the section before April 1, 2016 except that the words “Financial Services Commission of Ontario” are replaced by “Licence Appeal Tribunal”.
3. 3All references to a “Rule” are made to the Licence Appeal Tribunal Rules of Practice and Procedure, Version I (April 1, 2016).
4. 4“Declaratory relief” refers to a judgment or decision of a court which determines the rights of parties without ordering anything be done, deciding a substantive claim or awarding damages. By seeking a declaratory decision, the party making the request is seeking an official declaration of the status of a matter in controversy.
5. 5Licence Appeal Tribunal Act, 1999, SO 1999, c.12 Schedule G (as amended), and Courts of Justice Act, RSO 1990, c. 43, s.97.
6. 6ST and Economical (2017) 16-003034 (LAT).
7. 7Godin v. Sabourin [2016] O.J. No. 488, para.6-11.
8. 8Mandamin v. Pafco (FSCO A14-009905) at page 5.
9. 9Namely, an application by the insured person to the insurer, which makes a determination about entitlement.
10. 10Machaj v RBC, 2016 ONCA 257.
11. 11The Guarantee Co. v. Dong Do et al., 2015 ONSC 1891.
12. 12McLinden v. Payne 2010 ONSC 6868 upheld 2011 ONCA 439.
13. 13P.L.F.R. v. Intact Insurance Company, 2017, Tribunal File # 16-000145; E.W. v. Primmum Insurance Company, 2017 Tribunal File #16-003891; Applicant v. Wawanesa Mutual Insurance Company, 2017 Tribunal File #16-000004; Applicant v. Peel Mutual Insurance Company 2017, Tribunal File #16-000013, and A.K. v. State Farm Insurance Company, 2018 Tribunal File #16-002503.
14. 14Applicant v. Gore Mutual Insurance Company 2016, Tribunal File #16-001305
15. 15All references to a “Rule” are made to the Licence Appeal Tribunal Rules of Practice and Procedure, Version I (April 1, 2016)
16. 16Regulation 664, Automobile Insurance R.R.O. 1990