V.M.L. v. Aviva General Insurance Company, 2019 CanLII 94130

Tribunals Ontario Safety, Licensing Appeals and Standards Division 77 Wellesley Street West, Box 250 Toronto ON M7A 1N3 Tel: 1-844-242-0608 Fax: 416-327-6379 Website: www.slasto-tsapno.gov.on.ca

Tribunaux décisionnels Ontario Division de la sécurité des appels en matière de permis et des normes 77 rue Wellesley Ouest, Boîte no 250 Toronto ON M7A 1N3 Tél. : 1-844-242-0608 Téléc. : 416-327-6379 Site Web : www.slasto-tsapno.gov.on.ca

RECONSIDERATION DECISION

Before: Sandeep Johal, Adjudicator

Date: July 8, 2019

File: 18-001713/AABS

Case Name: V.M.L. v. Aviva General Insurance Company

Written Submissions by:

For the Applicant: Nancy Young, Counsel

For the Respondent: Leanne W. Zabudsky, Counsel

OVERVIEW

1This Request for Reconsideration was filed by the applicant. It arises out of a decision in which the Tribunal found that the applicant was statue-barred from proceeding with her appeal of the respondent’s refusal to pay an income replacement benefit (“IRB”) and the Tribunal’s decision not to extend the limitation period by way of section 7 of the Licence Appeal Tribunal Act¹(“LAT Act”).

2The applicant submits that the Tribunal made several significant errors in law and fact such that the Tribunal would have reached a different decision absent of this error.

3Pursuant to s. 17(2) of the Adjudicative Tribunals Accountability, Governance and Appointments Act, 2009, S.O. 2009, c. 33, Sched. 5, I have been delegated responsibility to decide this matter in accordance with the applicable rules of the Tribunal.

RESULT

4The applicant’s Request for Reconsideration is granted only with respect to the section 7 LAT Act determination.

5It is ordered that the parties shall be allowed to provide written submissions with respect to extending the limitation period by virtue of section 7 of the LAT Act which shall be heard in writing before me.

ANALYSIS

6The grounds for a Request for Reconsideration to be allowed are contained in Rule 18 of the Tribunal’s Common Rules of Practice and Procedure. Specifically, this request for reconsideration will not be granted unless the following criteria has been met:

a. The Tribunal acted outside its jurisdiction or violated the rules of natural justice or procedural fairness;

b. The Tribunal made a significant error of law or fact such that the Tribunal would likely have reached a different decision;

7The applicant submits that Rule 18.2(b) applies to the following as the Tribunal erred by:

i. Concluding that the respondent provided a proper notice of denial which started the limitation period.

ii. Concluding that the respondent was not required to deliver a copy of the section 44 assessment to the health care practitioner who authored the Disability Certificate.

iii. Failing to appreciate that the case law does not allow the respondent to rely upon a limitation defence when it has not complied with the Schedule.²

The Tribunal did not err under Rule 18.2(b) and in considering whether the limitation period had expired.

8In order to interfere with the original decision of the Tribunal under Rule 18.2(b) the Tribunal must not only have made an error of law or fact, but that error must be significant enough that the Tribunal likely would have come to a different conclusion. On the evidence, I am not convinced that the Tribunal made an error in fact or law in coming to its conclusion that the limitation period had expired.

9The applicant submits that her claim to the Tribunal is not statute-barred because the limitation period never began to run as a result of an improper denial. According to the applicant, the respondent was required to provide a copy of the section 44 insurer examination reports (“IE”) to the health care practitioner who authored the Disability Certificate, (the “OCF-3”). Because the respondent did not provide a copy of the IE report therefore the respondent failed to comply with the Schedule.

10To support her position, the applicant relies on the Court of Appeal decision of Allstate Insurance Company of Canada v. Klimitz³ where it was held that the insurer cannot “rely on a limitation defence” where it failed to strictly comply with the Schedule.

11The Tribunal in its decision in paragraph 17 ii-v lists its reasons for disagreeing with the applicant and confirms that the applicant is statute-barred to appeal the respondent’s denial of the IRB’s. The Tribunal stated as follows in paragraph 17:

I find that VML’s appeal for IRB’s is statute-barred for the following reasons:

i. My reading of s.37(5) of the Schedule is that it only requires an insurer to provide copies of the IE Report to persons who prepared OCF-3s requested under s.37(1). No such request was made in this case, and therefore no regulatory obligation existed to send copies of the IE Report to Mr. Dinh or Dr. Ames.⁴ Having found that Aviva did not breach s.37(5) of the Schedule there is no reason for me to apply any remedy in the form of – in effect – a limitation period extension.

ii. Even if Aviva were non-compliant, the Schedule does not prescribe a consequence or remedy for non-compliance with s.37(5). I find nothing in the regulation or the precedents submitted to me that provides any basis for finding that non-compliance with s.37(5) voids the limitation period in s.56 of the Schedule. Accordingly, I find that it is not within my authority to do so.

iii. My reading of Klimitz is that it applies to insufficient notice of denial, formed by a failure to provide a copy of the IE Report with the explanation of benefits to the insured person in that case. There is no evidence that Aviva’s explanation of benefits was deficient. I do not read Klimitz to mean that any non-compliance by an insurer with the Schedule voids the limitation period.

iv. Aviva’s explanation of benefits met all of the legal requirements for a notice of denial of benefits. It was clear, unequivocal, readily understandable to an unsophisticated person, and it included notification of VML’s right to appeal Aviva’s decision. It started the limitation period on February 3, 2016.

12In the Request for Reconsideration, the applicant relies on the Financial Services Commission of Ontario (“FSCO”) case of Nadarajah v RBC⁵ and the Divisional Court case of Aviva v. Sidhu⁶ to support her position that the respondent cannot rely upon a limitation defence when it has not complied with the Schedule. Although the Tribunal is not bound by FSCO case law, I agree with the respondent that the case law being relied upon applies to the old versions of the Schedule and not the current version where the language was amended to give the insurer the option to request an OCF-3 and if it did, then a copy must be provided to the person completing the OCF-3. On the circumstances of this case, the respondent did not request an OCF-3 and therefore the Schedule does not require the respondent to provide a copy of the IE report to the author of the unsolicited OCF-3.

13The Tribunal’s decision on the limitation period was based on a balanced and fair assessment of the submissions and evidence filed by both parties. As a result, I find that the Tribunal did not commit an error of fact or law under Rule 18.2(b) with respect to its finding that the applicant did not commence an appeal to dispute the denial of the IRB within two years. The limitation period began from the date of the denial on February 3, 2016 and the applicant had two years from that date to dispute the denial. An application to dispute the denial was filed at the Tribunal on February 21, 2018 which was outside the two-year limitation period.

Section 7 of the LAT Act

14Although the parties did not provide submissions with respect to section 7 of the LAT Act the Tribunal nonetheless provided an analysis under this section to consider whether to invoke its discretion to extend the limitation period. The Tribunal in its decision in paragraphs 22 and 23 provides its reasons for not exercising its discretion to extend the limitation period which was missed by twelve business days.⁷ The Tribunal did not find that the applicant had a reasonable reason for missing the limitation deadline and there was no bona fide intent to file the appeal on time.

15In my opinion the Tribunal erred in coming to its conclusion for the following reasons.

16In determining whether to grant an extension of time under s. 7 of the LAT Act, the Tribunal generally weighs the following four factors in order to determine whether the justice of the case requires that the extension be granted:

1. The existence of a bona fide intention to appeal within the appeal period;
2. The length of the delay;
3. Prejudice to the other party; and,
4. The merits of the appeal.

17This test was approved by the Divisional Court in Manuel v. Registrar, Motor Vehicle Dealers Act, 2002, 2012 ONSC 1492. Notably, it is also the same test that courts use to determine whether to grant an extension of time to file an appeal: see Howard v. Martin, 2014 ONCA 309, at para. 26.⁸

18The four factors are not strict elements that must each be met in order to grant an extension of time. Rather, they are a guide to assist in determining the justice of the case. Whether to grant an extension of time depends on the specific facts of each case.

19In paragraph 22i of its decision, the Tribunal stated as follows:

VLM provides no evidence or argument to suggest that Aviva’s alleged non-compliance with the Schedule had any bearing on the timing of her appeal. She provides me with no reason to believe that her late filing was in any way induced by Aviva’s handling of her file or that its alleged non-compliance with s. 37(5) prejudiced her ability to respond to its denial of her claim. This, in my opinion undermines the “bona fide intention” criterion in this case.

20In arriving at its conclusion, the Tribunal stated it was the absence of any evidence or argument (submissions) that led the Tribunal to conclude that the “bona fide intention” factor to grant an extension was undermined. In my opinion, this was a breach of procedural fairness and an error in law.

21The Tribunal made a finding on an issue that was not raised by the parties and concluded that the lack of submissions on the explanation of the delay and whether there was a bona fide intention to appeal was the reason for not exercising its discretion. When an adjudicator needs to confirm a fact or the positions of the parties on a particular issue, the Tribunal should ask for that assistance.⁹ In this case, the Tribunal did not reach out to the parties to provide them with an opportunity to comment on the section 7 analysis.

22Furthermore, when the limitation period has been missed by such a small number of days and where there is minimal prejudice to the respondent in considering s.7 of the LAT Act, then the Tribunal has an obligation to ask for submissions from the parties if none were received. By not doing so the Tribunal breached procedural fairness to the parties and in my opinion, a breach that materially affected the Tribunal’s decision.

23Furthermore, Rule 9.1 of the Common Rules of Practice & Procedure provides that the Tribunal may request additional particulars or documentation from a party “at any stage in a proceeding” as it considers “necessary for a full and satisfactory understanding of the issues in the proceeding.” The Tribunal raised the issue of s.7 of the LAT Act and when arriving at its decision not to exercise its discretion based on a lack of submissions or evidence, then the Tribunal had an obligation to seek the parties’ position on that issue. Failure to do so was an error.

24Furthermore, the Tribunal did not provide an analysis on the factors taken together to determine whether the overarching principle of the “justice of the case” requires an extension be given.¹⁰ Whether to grant an extension of time depends on the specific facts of each case.¹¹ In my opinion, the Tribunal erred when it made its conclusion without the specific facts and submissions at hand with respect to the four factors and without an analysis of whether the “justice of the case” requires an extension of the limitation period. For this and other reasons described above I find that the parties in this case must be afforded an opportunity to speak to this particular issue.

CONCLUSION

25For the reasons noted above, I grant the applicant’s Request for Reconsideration only with respect to the section 7 LAT Act determination.

26It is ordered that the parties provide written submissions in accordance with the timetable below on the issue of whether the applicant should be granted an extension of the limitation period by virtue of section 7 of the LAT Act. The continuation of the reconsideration hearing shall be heard in-writing before me.

27The timelines for submitting the submissions are as follows:

a. Applicant’s submissions are due 2 weeks from the date of this decision

b. Respondent’s submissions are due 2 weeks from the date of receipt of the applicant’s submissions

c. Applicant’s reply submissions, if necessary, are due 1 week after the receipt of the respondent’s submissions.

28The submissions of the parties shall be no more than 5 pages each exclusive of evidence and case law.

Sandeep Johal Adjudicator Tribunals Ontario – Safety, Licensing Appeals and Standards Division

Footnotes

1. 1S.O. 1999, c. 12.
2. 2Statutory Accident Benefits Schedule - Effective September 1, 2010.(“the Schedule”)
3. 32015 ONCA 698 (“Klimitz”)
4. 4I agree with Aviva that the language of the Schedule does not suggest that an insurer must send copies of the IE Report to everyone or anyone who prepared OCF-3s for the claimant. The language of s.37(5) is clear, prescriptive and exclusive.
5. 52013, P13-00010
6. 62018 ONSC 6506
7. 7Tribunal Decision dated November 7, 2018 at para. 22iii.
8. 8A.F. v. North Blenheim Mutual Insurance Company, 2017 CalLII 87546 (ON LAT)
9. 9J.R. v. Certas Home and Insurance Company, Reconsideration Decision dated February 26, 2018 at paragraph 22.
10. 10Howard v. Martin 2014 ONCA 309 at paragraph 26.
11. 11A.F. v. North Blenheim Mutual Insurance Company, 2017 CalLII 87546 (ON LAT) at paragraph 30.