JT v. RBC General Insurance Company, 2019 CanLII 83585

Citation: JT vs. RBC General Insurance Company, 2019 ONLAT 18-009039/AABS & 18-009047/AABS

Date: July 15, 2019

18-009047/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:

JT

Appellant

and

RBC General Insurance Company

Respondent

DECISION

ADJUDICATOR:

Christopher A. Ferguson

Written Submissions by:

For the Applicant:

JT, Self-Represented

For the Respondent:

Kevin Griffith, Counsel

HEARD in Writing:

March 25, 2019

REASONS FOR DECISION

Overview

1The applicant JT was involved in an automobile accident on January 11, 2003 (“the 2003 accident”) and sought benefits from the respondent RBC pursuant to the Statutory Accident Benefits Schedule - Effective November 1, 1996 (“the 1996 Schedule). The parties settled JT’s claims.

2JT was involved in a second automobile accident on April 30, 2010 (‘the 2010 accident”) and again sought benefits from RBC. The parties settled JT’s claims from this accident.

3JT confirmed at the case settlement conference in this matter that RBC paid the settlement amounts in full and that he has received them.

4JT claims that he is catastrophically (“CAT”) impaired. When JT sought a determination of CAT impairment, RBC denied his claim based on the basis that the above-noted settlement agreements were full and final.

5JT sought a CAT determination arising from both accidents; this decision covers both claims. For reference the file number for the claim arising from the 2010 accident is 18-009047/AABS and for the 2003 accident 18-009039/AABS.

6JT contends that the settlements do not cover his claim for CAT impairment.

7RBC asserts that before he can proceed with a CAT impairment claim, JT must repay the settlement funds he was given.

8Aviva General Insurance Company is the successor company to RBC, and I will refer to Aviva in this decision.

Preliminary Issues

9The issue to be decided by the Tribunal is:

i. Is JT required by s.9.1(8) of the Regulation¹ to repay settlement funds to Aviva before he can advance his claim for CAT impairment at the Tribunal?

RESULT

10JT must repay the settlement funds he received from Aviva before he may proceed with an appeal to the Tribunal.

ANALYSIS

Requirement to repay settlement funds before proceeding with appeal.

11Section 9.1(5) of the Regulation prescribes that an insured person may rescind a settlement agreement if the insurer has not complied with the written disclosure notice requirements set out in s.9.1(2)(3) of the Regulation.

12Section 9.1(7) of the Regulation requires an insured person to rescind by delivering a written notice to the insurer or its representative and returning any money received by the insured person as consideration for the settlement.

13Section 9.1(8) of the Regulation prescribes that no person may apply to the Tribunal with respect to benefits that were the subject of a settlement or purported settlement unless that person has returned the money that was paid in consideration of that settlement.

14Under s.9.1(10) of the Regulation, a restriction in a settlement on an insured person’s right to appeal to the Tribunal is void unless the insurer complies with prescribed written disclosure notice requirements and one of the following conditions is met:

i. The settlement agreement was entered into on or after the first anniversary of the day the accident occurred.

ii. Before entering the agreement, the insured person applied to the Tribunal and a case conference was held in accordance with the procedures and rules.

Chronology of Events

15The parties agree on the facts of this case.

16On August 8, 2007, JT signed a Full and Final Release in settlement of claims arising from the 2003 accident. Appended to the release document was the Settlement Disclosure Notice prescribed by s.9.1 of the Regulation, which was also signed by JT.

17On March 26, 2014, JT signed a Full and Final Release in settlement of claims arising from the 2010 accident. His legal representative also signed the document. Appended to the release document was the Settlement Disclosure Notice prescribed by s.9.1 of the Regulation, which was also signed by JT.

Aviva’s Position

18RBC submits that JT must repay the money paid to him under the settlement agreements because those agreements were full and final. RBC asserts that the settlement agreement releases signed by JT were “very clear that JT released all claims – that no claim arising from the accidents would survive the settlements.”

19RBC argues that “The notion that JT released only partial entitlement to benefits excluding a claim to a catastrophic determination is contrary to any reasonable interpretation of the releases. The releases speak for itself [sic]. Paragraph two of the releases described what was released as follows: ‘any and all actions, causes of action, mediations, arbitrations, litigation, claims and demands of any kind’ (emphasis added).”

20RBC submits that it “defies common sense” to suppose that any right to claim a determination of CAT impairment was left open when the right to claim benefits that might flow from such a determination was clearly extinguished.

21Aviva acknowledges that JT may take steps to rescind the settlement agreements if he believes, as his submissions indicate, that he wasn’t provided full or accurate disclosure of his rights at settlement. However, this has no bearing on whether or not JT must repay settlement money before he can proceed with an appeal to the Tribunal in accordance with the Regulation.

JT’s Position

22JT submits that the insurer failed to disclose information, namely Practice Direction 11-D², to him before he signed the release. He characterizes this as a “deceptive practice” contemplated by s.439 of the Insurance Act.³ In his view, this permits him to proceed to the Tribunal with his appeal “for misrepresentation pursuant to s.439”.

23JT asserts that s.9.1(10) of the Regulation operates to void the restriction on his right to appeal to the Tribunal, because of the insurer’s failure to disclose Practice Direction 11-D in the Settlement Disclosure Notices.

24JT appears to argue that a CAT determination was not covered by the settlement agreements because such a determination is not a benefit.

25JT appends court documents to his submissions which he states indicate that the courts have set aside the settlement agreements he reached with the insurer, and which permit him to proceed with his appeal to the Tribunal.

Findings

26JT must repay the settlement funds he received from RBC to Aviva before he may proceed with an appeal to the Tribunal.

27The reasons for my decision are as follows:

i. There is no basis in law for JT’s apparent contention that he should be allowed to proceed with an appeal without meeting the prescribed conditions for rescission in s.9.1(7) of the Regulation. There is no basis on which I can make an exception to the repayment condition set by s.9.1(8) of the Regulation. I have no authority to allow JT’s appeal to proceed in contravention of s.9.1(7)(8) of the Regulation. Unless and until he repays the settlement money to Aviva, JT is barred from proceeding with his appeal.

ii. I agree with Aviva that JT is entitled to take steps to seek rescission of the settlement agreement, but that before he can do so, he must repay the settlement funds. The Regulation clearly does not allow him to keep settlement money while acting to terminate the agreements; on the contrary, s.9.1(9) of the Regulation anticipates these situations by requiring the insurer to hold repaid money in trust pending the determination of a dispute about the validity of a settlement agreement or the insured person’s right to rescind it.

iii. JT’s assertion that the settlement agreements do not extend to an application for a CAT determination is irrelevant. Whether or not the settlement agreement is valid, JT must repay settlement money as required by s.9(7)(8) before he can appeal to the Tribunal: there are no exceptions or exemptions to this requirement in the Regulation.

iv. JT’s assertion that the settlement disclosure notice was deficient is also irrelevant. Section 9(4) of the Regulation permits him to rescind the agreement if the settlement disclosure notice isn’t compliant with s.9(2)(3) but it does not exempt him from the repayment of settlement money prescribed by s.9(7) or from the restriction on appeals to the Tribunal in s.9(8).

v. The court documents submitted by JT do not set aside the settlement agreements and simply reflect the fact that the law requires statutory accident benefits disputes to be adjudicated by the Tribunal before the courts have jurisdiction.⁴

CONCLUSION

28Aviva’s motion is allowed. JT may not proceed with an appeal arising from either of the subject accidents before the Tribunal unless and until he repays the settlement funds he received under the settlement agreements of August 8, 2007 and March 26, 2014.

Footnotes

1. 1i.e. s.9.1(8), Regulation 664, R.R.O. 1990, Insurance Act
2. 2JT is referring to Financial Services Commission Dispute Resolution Practice Code, Practice Note 11, Part D, paragraph 2. Paragraph 2 indicates that “Mediation Services will accept an Application for Mediation if the claimant disputes the validity of the settlement, such as whether the insurer has complied with the requirements of the Settlement Regulation.”
3. 3RSO 1990, c I.8
4. 4JT filed an application with the Superior Court seeking judicial review of Aviva’s decision to deny his application for CAT determination and various benefits. In a decision dated August 10, 2018, the Court dismissed JT’s application because it lacks the jurisdiction to hear it. The Court noted that the Insurance Act prohibits any person from bringing any proceeding in any court with respect to accident benefits other than an appeal from the decision of the Tribunal. Nothing in the decision pertains to any of the requirements prescribed in the Regulation.