R.C. v. Economical Mutual Insurance Company, 2019 CanLII 63378

Tribunal File Number: 18-005278/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:

R.C.

Applicant

and

Economical Mutual Insurance Company

Respondent

DECISION

ADJUDICATOR: Kimberly Parish

For the applicant: Carlos Ortiz, Paralegal For the respondent: Helen D.K. Friedman, Counsel

HEARD: in writing on: January 14, 2019

OVERVIEW

1The applicant was injured in an automobile accident (“accident”) on January 30, 2014, and sought benefits from the respondent pursuant to Ontario Regulation 34/10, known as the Statutory Accident Benefits Schedule - Effective September 1, 2010 (the “Schedule”)¹.

2The applicant was paid a non-earner benefit (“NEB”) by Economical Mutual Insurance Company (“Economical”) until the benefit was denied by Economical on September 23, 2014.

3The applicant filed an Application by Injured Person for Auto Insurance Dispute Resolution (“application”) with the Licence Appeal Tribunal (“Tribunal”) on June 12, 2018. A case conference was held by the Tribunal on September 20, 2018. On consent a written hearing was scheduled to determine two preliminary issues as listed below.

PRELIMINARY ISSUES

4The preliminary issues to be determined in this hearing as noted within the Order dated September 20, 2018 are:

(i) Does the Tribunal have the jurisdiction to hear the applicant’s claim for a non-earner benefit, as he previously applied for the same benefit at the Financial Services Commission of Ontario (“FSCO”)?

(ii) Is the applicant statute-barred from proceeding with his claim for non-earner benefits as he failed to commence his application within two years after the respondent’s refusal to pay the amount claimed, as required by the Schedule?

RESULT

5I find the following:

(i) The tribunal has jurisdiction to hear the applicant’s claim for non- earner benefits.

(ii) The applicant is statute-barred from proceeding with his claim for non-earner benefits as he failed to commence his application within the time limitation set out in the Schedule.

BACKGROUND

6The applicant applied for mediation at FSCO on November 13, 2015, and then filed for arbitration at FSCO on March 7, 2016 to dispute through FSCO, the non-earner benefit, one of the issues in dispute. The arbitration was assigned by FSCO to ADR Chambers and a pre-hearing took place on February 6, 2017. At the pre-hearing, an in person hearing was scheduled to take place November 14 - 17, 2017.

7On October 12, 2017 the applicant and Economical entered into a settlement of the applicant’s accident benefits claim with a full and final release provided to the applicant’s counsel on October 13, 2017. The hearing dates were vacated and FSCO closed its file.

8The applicant’s counsel advised Economical on December 19, 2017 that the applicant would not sign the full and final release.

9The applicant then filed an application with the Tribunal on June 12, 2018 and the non-earner benefit (“NEB “) was listed as one of the issues in dispute.

ANALYSIS

Does the Tribunal Have Jurisdiction to Determine Entitlement to NEBs?

10The Schedule requires that a proceeding to dispute accident benefits determination and entitlement must be commenced within two years after the insurer’s refusal to pay the benefit claimed. Prior to LAT and under the prior FSCO regime, if one applied for mediation at FSCO within that two year period, one also received a 90 day extension after the issuance of a failed Report of Mediator to apply to FSCO’s arbitration, or file a claim at Court.

11On April 1, 2016 a new process at LAT replaced the previous regime. As of that date, parties who had completed mediation at FSCO could no longer apply for a FSCO arbitration. The only option was to apply for dispute resolution at the Tribunal, which must be done within two years of the insurer’s refusal to pay the benefit claimed. The transition date as noted within sections 20 (3) and 21 (1) of Ontario Regulation 664, noted the powers and duties of the arbitrators appointed under FSCO continue as prior to the transition date for the purposes of proceeding which are continued pursuant to section 21 (1). It is also noted within section 21 (1) that a proceeding commenced prior to the transition date but not completed; is to be continued within the venue in which it was commenced.

12It is the respondent’s position that the Tribunal does not have the jurisdiction to decide this application regarding entitlement to the NEBs because the applicant filed an Application for Arbitration with FSCO and in accordance with Regulation 664, a proceeding commenced prior to the transition date and not completed is continued in the venue in which it was commenced.

13The applicant filed their Application with the Licence Appeal Tribunal (“Tribunal”) on June 12, 2018 to address the non-earner benefit, and other issues in dispute.

14I find the Tribunal does have jurisdiction to determine the entitlement to NEBs. A previous settlement was not reached as the applicant did not sign the Settlement Disclosure Notice sent by the respondent. Further, the NEB was never arbitrated at FSCO.

Is the Applicant Statute Barred from Proceeding with Claim for Non-Earner Benefits?

15Effective April 1, 2016, s.s 280 (1) (2) were amended and the change required that the resolution of statutory accident benefit disputes could only be through filing an application with the Tribunal as there was no longer an option to file a claim at court.

16Section. 56 of the Schedule prescribed a two-year limitation period for commencing an application to dispute statutory accident benefits at the Tribunal which have been denied by the insurer. FSCO is no longer accepting applications for arbitration and as a result, the applicant cannot apply for arbitration at FSCO. The respondent denied the NEB September 23, 2014 which triggered the limitation period. The applicant filed an application with the Tribunal on June 12, 2018 which was beyond the two year limitation period.

Does Section 7 of the LAT Act Apply?

17Section 7 of the LAT Act states:

Despite any limitation of time fixed by or under any Act for the giving of any notice requiring a hearing by the Tribunal or an appeal from a decision or order of the Tribunal under section 11 or any other Act, if the Tribunal is satisfied that there are reasonable grounds for applying for the extension and for granting relief, it may,

(a) extend the time for giving the notice either before or after the expiration of the limitation of time so limited; and

(b) give the directions that it considers proper as a result of extending the time.

18There are four criteria which the Tribunal must consider when determining if an extension of time is to be granted:

(i) The existence of a bona fide intention to appeal within the appeal period;

(ii) The length of the delay;

(iii) Prejudice to the other party; and,

(iv) The merits of the appeal.

19I will address the four criteria which the Tribunal must consider when determining if an extension of time is to be granted under s. 7 of the LAT Act.

Bona Fide Intention to Appeal

20I find there is no existence of a bona fide intent to appeal within the appeal period. On March 7, 2016, the applicant elected within the two-year limitation period to file their Application for Arbitration with FSCO. The applicant submitted that their bona fide intention to appeal is based on him not having all of the documents requested by the respondent for the FSCO proceeding. The applicant further submitted they waited to file their application with the Tribunal after all of the documents were obtained by the applicant. However, this contradicts the documentary evidence that noted relevant documents such as; the employment file, and tax return information were not requested by the applicant until October 2018.

21The applicant submitted they filed their Application in good faith with the Tribunal eight months after FSCO closed its file October 12, 2017. It is the applicant’s further submission that after FSCO closed the file, the applicant requested all the documents previously requested by the respondent for the FSCO proceeding. I note the applicant produced no evidence that he attempted to contact FSCO to request his file be re-opened and new hearing dates be scheduled following the applicant choosing not to sign the settlement documents. From the documentary evidence produced for this hearing, the applicant requested their employment file and their income tax information in October 2018, almost four months after the Application was filed with the Tribunal. This evidence does not support the applicant’s submission that they wanted to wait to obtain the documents previously requested by the respondent from the prior FSCO proceeding before filing their Application with the Tribunal.

22The respondent refutes the applicant’s argument. The respondent submitted the applicant failed to comply with the order made within the pre-hearing letter dated February 7, 2017 which ordered on consent complete production exchange, or demonstration of best efforts within 60 days of the pre-hearing which took place on February 6, 2017. The respondent submitted that the employment file is highly relevant to the claim for the non-earner benefit and the documents were requested several months after the application was filed with the Tribunal on June 12, 2018.

23A cover letter from the respondent’s counsel dated August 29, 2016 included a list of requested documents from the applicant. Some of the documents included: copy of the complete employment file, clinical notes and records from treating clinics from January 2011 to present, CNRs of the family doctor, income tax returns from 2011 - 2016, and the pharmacies attended three years prior to the accident to present. I find the consent order dated February 7, 2017 clearly stipulated that complete production exchange, or demonstration of best efforts was to occur within 60 days of the pre-hearing. The evidence confirms the order was not complied with which I find negated the bona fide intention to appeal.

Length of the Delay

24Regarding the length of the delay, I find there have been significant delays on the part of the applicant. I do not find the applicant has provided a reasonable explanation for the delays. There has not been a reasonable explanation provided as to why it took the applicant more than two months to advise the respondent that the applicant would not sign the settlement documents. The applicant has not provided an explanation for the delay in producing documents to the respondent, and specifically not complying with the FSCO order dated February 7, 2017, and then waiting until October 2018 to request relevant documents. The December 20, 2017 letter from the respondent’s counsel to the applicant’s counsel noted the applicant’s counsel advised the respondent’s counsel the prior day that the applicant refused to sign the settlement documents. This is two months after a settlement was reached in principle on October 12, 2017. I therefore find the length of the delay does not support granting an extension of time for the applicant to pursue NEBs at the Tribunal. The applicant further submitted they filed their application with the Tribunal on June 12, 2018 after obtaining all of the documents requested by the respondent for the prior FSCO proceeding. I have already rejected this argument for reasons I have explained above.

Prejudice to the Other Party

25The third factor I must consider is the prejudice to the other party, which is the respondent. I find there would be significant prejudice to the respondent if an extension of time were to be granted to allow the applicant to proceed with their claim for NEBs at the Tribunal. I have included my reasons for reaching this conclusion below.

26The NEB was denied September 23, 2014. The applicant withdrew their application with FSCO in October 2017 but did not file their application with the Tribunal until June 12, 2018. There was a delay of eight months in filing the application with the Tribunal. I find this delay would cause significant prejudice to the respondent. The applicant has been non-compliant with the production order dated February 7, 2017.

27The applicant submitted there would be no prejudice to the respondent if an extension of time were granted by the Tribunal to allow the applicant to proceed with their dispute for NEBs at the Tribunal. I completely disagree with the applicant’s submission. There have been delays in the applicant producing documents which have been requested by the respondent which I find are relevant to the NEB in dispute. The employment file requested was requested by the applicant in October 2018 and to date it has not been produced to the respondent. I find the employment file is relevant to the claim for NEBs and the respondent has been prejudiced by not having this.

Merits of the Appeal

28The fourth and final criterion the Tribunal must consider is the merits of the appeal. I do not find the applicant has demonstrated that the merits of the case justify the Tribunal granting an extension of time to pursue the NEB dispute at the Tribunal as the merits are difficult to assess as the applicant is in non-compliance with the most basic exchange and disclosure obligations.

29The applicant relies on the Tribunal decision 16-001381 D.A. and Aviva Insurance Canada² where the adjudicator found there to be merits with NEB appeal which warranted a hearing on the substantive evidence. The adjudicator also found in that case that the applicant’s NEB claim met the criteria for granting an extension under s. 7 of the LAT Act. I find this case to be distinguishable from D.A. and Aviva as the applicant’s appeal in that case was not found to be statute barred as she filed her appeal with the Tribunal within the 90 day extended limitation period prescribed by s. 56 (2) of the Schedule. In the preliminary issue hearing before me, the applicant did not file an Application with the Tribunal until June 12, 2018 which was eight months after FSCO closed its file and 6 months after the respondent was informed that the applicant won’t sign the settlement documents. The delay in this case is much more significant than the delay in D.A. and Aviva which was five weeks after the expiry of the two-year limitation period. Lastly, in D.A. and Aviva, the respondent did not claim the appeal would result in any prejudice, nor did the respondent challenge the merits of the appeal. The respondent in the case before me raised significant prejudice if the appeal was to proceed and maintains there is no merit to the NEB.

CONCLUSION

30I find the Tribunal has jurisdiction to hear the applicant’s claim for non-earner benefits. Upon considering the criteria under s. 7 of the LAT Act, I find the applicant is still statute-barred from proceeding with his claim for non-earner benefits as he failed to commence his application within two years after the respondent’s refusal to pay the amount claimed and an extension is not warranted. This claim is dismissed.

Footnotes

1. 1O. Reg 34/10
2. 216-001381 D.A. and Aviva Insurance Canada, dated March 5, 2018, 2018 CanLII 39223 (ONLAT)