RECONSIDERATION DECISION
Before: Jesse A. Boyce, Vice-Chair
Tribunal File Number: 19-008343/AABS
Case Name: Patricia Branden v. Co-Operators General Insurance Company
Written Submissions by:
For the Applicant: Roger R. Foisy, Counsel Harpreet S. Sidhu, Counsel Daniel Berman, Counsel Rusald Laloshi, Paralegal
For the Respondent: Eric K. Grossman, Counsel Suzanne Clarke, Counsel
OVERVIEW
1Both parties in this matter made reconsideration requests arising out of a decision dated September 1, 20201, in which I determined that the applicant was entitled to an income replacement benefit (“IRB”) in the amount of $400.00 per week, plus interest, in line with the calculations provided in the ADS Report provided by the applicant. Further, I found that the applicant was not liable to repay The Co-Operators $3,369.72 in IRB amounts for the period in dispute and was not entitled to an award under s. 10 of O. Reg. 664.
2The grounds for a request for reconsideration are contained in Rule 18 of the Tribunal’s Common Rules of Practice & Procedure. A request for reconsideration will not be granted unless one or more of the criteria under Rule 18.2 are met.
3For the purposes of its request for reconsideration, Co-Operators relies on criteria 18.2(a) and 18.2(b), submitting that I acted outside of the Tribunal’s jurisdiction or violated the rules of procedural fairness and that I made a significant error of law or fact such that the Tribunal would likely have reached a different decision. To this end, Co-Operators seeks a determination that the applicant’s Long-Term Disability (“LTD”) settlement is deductible and therefore she is not entitled to the IRB quantum outlined in the ADS Report and that Co-Operators is entitled to an IRB repayment in the amount of $3,369.72 for the period July 21, 2017 to July 30, 2019. Meanwhile, in response to the applicant’s reconsideration request, outlined below, Co-Operators submits that I did not err in refusing to grant an award under s. 10 of O. Reg. 664.
4In her request for reconsideration, the applicant relies on criteria 18.2(b), submitting that I made significant errors of law and fact such that the Tribunal would have likely reached a different decision had they not been made. Specifically, the applicant asserts that I erred in declining to grant a discretionary award under s. 10 of O. Reg. 664 based on the facts she presented. She seeks an order varying the decision to find an award of up to 50% of the total benefits payable, with interest. In response to Co-Operators’ request for reconsideration, the applicant submits that I did not commit a significant error of law or fact that would have resulted in a different outcome and that Co-Operators has failed to identify an instance where I acted outside of the Tribunal’s jurisdiction or violated the rules of procedural fairness.
RESULTS
5Co-Operators’ request for reconsideration is dismissed.
6The applicant’s request for reconsideration is dismissed.
ANALYSIS
Criteria 18.2(a) not identified
7In its submissions, Co-Operators identified criteria 18.2(a) as a ground for its reconsideration request but did not offer specific submissions to explain its position that I acted outside of the Tribunal’s jurisdiction or violated the rules of procedural fairness in rendering my decision.
8I agree with the applicant that both parties agreed to a written hearing, filed written submissions, and presented their arguments in their written materials to the Tribunal and that both parties had the opportunity to address the issues in dispute. On review of my decision, I agree with the applicant that I properly considered all of the parties’ submissions and made an order that is in keeping with the Tribunal’s mandate to adjudicate such disputes, which I find is well-within the Tribunal’s jurisdiction.
9With regard to procedural fairness, while I appreciate that parties would like the Tribunal to refer to every argument or piece of evidence they offer, it is well-settled that an adjudicator is not required to do so. On review of my decision, I find that I considered the relevant evidence, legislation, and case law before me and arrived at a decision that was within the realm of possible outcomes. To this end, I agree with the applicant that, apart from taking issue with my decision to accept the applicant’s position, Co-Operators did not point to any evidence that suggests a breach of the rules of procedural fairness. Accordingly, and without specifics on this ground, I see no violation of Rule 18.2(a) that would invite reconsideration of my decision.
Deductibility of LTD settlement
10The specific facts informing the dispute are outlined at paras. 10-17 of my decision, so I need not revisit them in their entirety. However, for the purposes of Co-Operators’ argument under Rule 18.2(b), the most pertinent facts for this issue are that the applicant issued a Statement of Claim against her LTD provider, Empire, as a result of its denial of her LTD claim post-accident. The Statement of Claim sought LTD benefits arising out of the policy; future LTD benefits to age 65; aggravated, exemplary and punitive damages in the amount of $100,000; prejudgment and post-judgment interest; costs; HST; and, “any other relief the court may deem just.” Ten months later, the applicant achieved a settlement agreement with Empire in the amount of $120,000 in exchange for relief from all of the applicant’s claims while allowing her to re-apply to Empire for LTD after two-years. Co-Operators then used the LTD settlement as grounds to deduct from the applicant’s IRB payment. In total, the parties prepared six different accounting reports to determine the applicant’s IRB quantum.
11On these facts, Co-Operators submits that I erred in addressing the deductibility of the applicant’s LTD settlement and ignored the application of A.B. v. Waite, 2018 ONSC 2151. Co-Operators asserts there is no evidence to support the contention that the applicant negotiated compensation for bad faith, interest or costs in her LTD settlement and that mention of other heads of damages in her Statement of Claim are not evidence that these were included in the settlement. As it did at first-instance, Co-Operators relies on a Calculation Sheet provided by the applicant’s former counsel as evidence of the considerations in the settlement, which it submits I “selectively ignored” while also “overemphasizing the importance of a breakdown of benefits” in her settlement. In sum, Co-Operators submits that it was error not to deduct the applicant’s LTD settlement from her IRB payment in accordance with the accounting report prepared for it by Insignia Forensic Group dated February 12, 2020.
12In response, the applicant submits that Co-Operators is offering the same arguments that it did at first instance, which does not satisfy the criteria of Rule 18.2(b). In any case, the applicant submits that I properly weighed the evidence and considered appropriate legislation and case law relevant to the issue raised, before ruling that her argument was preferred, which is not a significant error of law or fact, as alleged by Co-Operators.
13I am not persuaded that I committed a significant error of law or fact that would have resulted in a different outcome had it not been made. Firstly, while I am alive to Co-Operators’ argument that there is no evidence that the applicant’s other claims were included in the settlement—“if something looks like a duck and quacks like a duck, it is almost always a duck”—I am not convinced that I committed a significant error of fact where I relied on the Statement of Claim and the LTD Release to arrive at my conclusions at paras. 20 and 23:
[20] […] On the face of the settlement document, I agree that [the applicant] received $120,000 in exchange for all claims brought against Empire to October 18, 2020, which included non-LTD claims such as aggravated, exemplary, and punitive damages, prejudgment and post-judgment interest, legal costs, disbursements, and applicable HST.
[23] […] Based on the LTD Release, I find it clear that [the applicant] settled all past and present claims under the policy; all future claims up to October 18, 2020; and, specifically, all other claims for extracontractual damages sought in the action. It was not confined to LTD.
14Where it is the insurer’s burden to demonstrate that a deduction is warranted, I disagree that I committed an error in preferring the Statement of Claim and LTD Release offered by the applicant, as I considered those documents to be more reliable evidence of her settlement agreement. On reconsideration of the documents in evidence, addressed more below, I am not convinced that my determination should change.
15Second, in a similar vein, I disagree that I committed a significant error when I allegedly “selectively ignored” the Calculation Sheet Co-Operators relied on. Indeed, on review, I find it difficult to reconcile the claim that I ignored the Calculation Sheet where I addressed it at length in para. 23, indicating that I afforded greater weight to the documents provided by the applicant:
[23] I disagree. I find the calculation sheet provided by The Co-Operators is not compelling evidence of the settlement breakdown between [the applicant] and Empire that would allow it to properly deduct from an IRB and I afford it limited weight. On this document and the accompanying letter, I find there is no indication that this calculation sheet was actually used by [the applicant’s] previous counsel during negotiations or that it was not prepared sometime after the settlement, let alone that it constitutes evidence that [the applicant’s] settlement of her action replaced her actual LTD “received” payments. I agree with [the applicant] that the LTD Release and the Statement of Claim against Empire are the only reliable documentary evidence before the Tribunal that offer any true insight into how the LTD action was negotiated and what became [the applicant’s] settlement.
16Third, I disagree that it was error to emphasize the importance of a breakdown of benefits in the applicant’s settlement. My emphasis on the importance of a breakdown of settlement benefits when seeking deduction was guided by Cromwell v. Liberty Mutual Insurance Co., 2008 CanLII 3409 (ONSC) and Vanderkop v. Personal Insurance Company of Canada, 2009 ONCA 511, cases that were provided by the applicant. While these are older cases and I recall Co-Operator’s position that these cases no longer represented good law, on review of all of the cases before the Tribunal, I am not persuaded that I committed a reversible error, as I was not pointed to definitive direction that the reasoning in either of Cromwell or Vanderkop has been overturned.
17The Schedule provides that an insurer is entitled to deduct LTD payments from IRBs payable if the applicant has been paid LTD benefits. However, on the specific facts of this case, like those in Vanderkop, I found that the applicant’s decision to settle her claim against Empire was a decision to compromise her pursuit of her action because once LTD benefits were denied by Empire, they were no longer “available” to the applicant. I disagree that I committed a significant error where I found that the applicant had applied for LTD benefits but had not been paid same, which prompted her action in Superior Court against Empire to enforce entitlement, which eventually resulted in a settlement that did not specifically articulate the allotment of funds. On these facts, I found the settlement of $120,000 did not qualify as a “gross weekly payment for loss of income … under any income continuation benefit plan” as prescribed by s. 4(2) of the Schedule. These findings led me to prefer the ADS Report provided by the applicant, as it did not deduct the LTD settlement from IRB payments. On review, I am not persuaded that this was a significant error of fact or law.
18Finally, regarding A.B. v. Waite, I did not provide an exhaustive analysis in my decision to explain why I found each specific case cited by the parties to be distinguishable or assistive. While I am alive to the finding at para. 14 of Waite that the insurer was entitled to a credit for a portion of future LTD benefits and full credit for arrears of LTD benefits, in its Post-Trial Rulings, the Superior Court was able to identify that the settlement breakdown in that case was “largely if not entirely income replacement”. The Court was also provided with specific amounts for past and future LTD benefits which aided the Court in calculating the credit owed to the insurer, specifics that I found were not before the Tribunal here. On review, I find I addressed this at para. 26:
[26] I agree with [the applicant] that a specific breakdown of the heads of damages is what is distinguishable from the facts of this case where [the applicant’s] settlement was a lump sum meant to cover all of her claims against Empire. I further agree with [the applicant] that these decisions are distinguishable because the Schedule requires a proper breakdown of amounts and a timeframe that an LTD payment was received in order to include any deduction in the calculation of IRBs, as per s. 7. Had [the applicant] settled her LTD claim for only past and future income benefits then that amount would likely be deductible from the IRB. However, I agree with [the applicant] that, for the reasons cited in Cromwell and Vanderkop, there is no way to distinguish or break down [the applicant’s] LTD lump sum settlement, which included other heads of damages, interest, costs and disbursements, despite The Co-Operators urging that it can be broken down based on the calculation sheet.
19While I did not specifically point to Waite, on review, I do not find that this was an error of law that would have resulted in a different outcome. I find that the LTD Release does not articulate the specific amounts for past or future LTD benefits, nor does it indicate that the Empire settlement was largely if not entirely for income replacement benefits in order to arrive at the calculation of a deduction, as was the case in Waite. On the specific facts of this case, I see no error.
Double recovery
20Co-Operators asserts that by not deducting the applicant’s LTD settlement from her IRB claim, that I erred by “gifting the applicant a double recovery”, defying one of the fundamental principles of common law in Ontario. It directs the Tribunal to s. 267.8 of the Insurance Act; Cobb v. Long Estate, 2017 ONCA 717; Girao v. Cunningham, 2020 ONCA 260; Carroll v. McEwan, 2018 ONCA 902; Nemchin v. Green, 2018 ONSC 2185; and Intact Insurance Company v. Marianayagam, 2016 ONSC 1479 to support its position that the applicant should not be granted double recovery.
21In response, the applicant submits that the reconsideration process is not to be used to relitigate matters2, as Co-Operators is simply advancing the same arguments and case law on double recovery that it did at first-instance and that it has submitted new case law that was previously available but not submitted by it at first-instance.
22I agree with the applicant that none of Girao, Carroll, Nemchin or Marianayagam were submitted to the Tribunal or relied on by Co-Operators at first instance. In any event, all four cases generally stand for Co-Operators’ position, which is not challenged by the applicant and with which I agree, that the function of s. 267.8 of the Insurance Act is to balance the prevention of under-compensation and the prevention of double recovery. My reconsideration is not affected by the inclusion of these cases. With regard to Cobb, while I find that case instructive, it concerned an IRB settlement under the Schedule deducted from a jury award for past and future income loss under s. 267.8(1) and not an LTD settlement deduction from an IRB. That case also had a clear breakdown of settlement into IRB, medical benefits and “other items”.
23Instead, on the specific facts of this case, I disagree that the applicant received a gift or a double recovery when she applied for LTD and was denied by Empire, which forced her to bring a Statement of Claim, which led to the LTD settlement that Co-Operators wants to deduct from IRB. The payment made by Empire to settle the applicant’s claim against it was not a payment "under an income continuation benefit plan" but rather, it was a payment to settle a legal obligation that Empire had towards the applicant that the applicant sought to enforce through litigation. Again, the LTD Release does not clearly define the settlement. Therefore, it is unclear which of the three buckets under s. 267.8(1) Co-Operators asserts the applicant’s LTD settlement falls under that would result in double recovery, as there was no accident benefits trial, the settlement was not an income continuation benefit plan and there is no sick leave plan.
24Accordingly, while I am alive to the case law on double recovery and the principles supporting its prevention, I am not persuaded that I committed a significant error of law or fact in finding, at para. 27 of my decision, that it did not apply on the facts and evidence before me.
Section 10 Award
25In its request for reconsideration, the applicant submits that I erred in not ordering an award under s. 10 of O. Reg. 663. Specifically, she asserts that I made an error of fact when I determined that the “facts presented a genuine dispute over the applicability of [the applicant’s] LTD settlement with Empire” as it relates to her IRB calculation; that I made an error of fact when I held that there is “limited evidence that Co-Operators unreasonably withheld or delayed the payment of IRBs”; and, that I made an error of law by failing to provide an adequate explanation for the decision to not grant an award.
26In response, Co-Operators submits that there was a genuine dispute regarding the applicability of the applicant’s LTD settlement; that there is no evidence that it unreasonably withheld or delayed the payment of her IRB; and that I provided adequate reasons for my denial of an award.
27I agree and find no error. On review, my determination remains unchanged. An award under s. 10 is entirely discretionary and an award does not automatically follow when the Tribunal finds in favour of the applicant or because an insurer got a decision wrong. Indeed, as the Tribunal has held, in order to grant an award as a result of unreasonable delay or withholding of benefits, the Tribunal must find that an insurer’s conduct was “excessive, imprudent, stubborn, inflexible, unyielding or immoderate.”3 Contrary to the applicant’s submissions, I do not find that Co-Operators was inflexible or stubborn in its approach. Indeed, the fact that Co-Operators prepared four separate IRB calculations as new information became available is sufficient evidence on its own that it was not being inflexible or stubborn in its calculations and that it was responding to its insured’s claim in good faith, even if it sought a deduction and repayment.
28In any case, the applicant presents a series of factual findings that I made in the decision that she submits undermine my own statement at para. 41 that the facts presented a genuine dispute over the applicability of the applicant’s LTD settlement and whether it should be deducted from her IRB claim. As I understand it, the applicant asserts that even though I made these findings that it was an error not to restate them in my analysis on the award because the totality of the evidence suggests there was not a genuine dispute. The applicant also submits that my reliance on Cromwell and Vanderkop was a failure to recognize how Co-Operators’ rejection of same was grounds for an award. I disagree.
29The fact that this matter proceeded to reconsideration where the parties continue to debate the issue is evidence of a genuine dispute between the parties. Further, while Cromwell and Vanderkop were instructive cases for me based on the specific facts of this case, it does not follow that Co-Operators’ reliance on other case law or its insistence that those cases are distinguishable from these facts was improper or grounds for an award. It cannot be said that either party ignored the case law; rather, as with every dispute before the Tribunal, the parties simply had differing views on interpretation.
30Next, the applicant submits that it was error to state that there was limited evidence that Co-Operators unreasonably withheld or delayed the payment of her IRBs, arguing, amongst other things, that Co-Operators never requested a copy of her statement of claim, that it was aware of the waiting period for LTD, that it took a stringent approach to deduction, that it ignored case law, that two months was too long to calculate her IRB, that it improperly reduced her IRB, etc. While I am alive to the applicant’s framing of the facts, which were certainly provided in greater detail on reconsideration than at first-instance, I am not persuaded on review that any of the conduct alleged meets the threshold of “excessive, imprudent, stubborn, inflexible, unyielding or immoderate” where Co-Operators was exercising its rights under the Schedule or where it took a different view on quantum or case law. While the applicant relies on a volume of facts, I disagree with her contention that I found that “there was some evidence of unreasonable conduct.” I still find limited basis to support that Co-Operators unreasonably withheld or delayed the payment of her benefits. Again, I find there was a genuine dispute.
31Lastly, I agree with the applicant that my reasons denying an award in the specific section dedicated to s. 10 were somewhat brief. However, I am not satisfied that this would have resulted in a different outcome or even that it truly was an error. Frankly, while I did not state it in my reasons, I found the applicant’s request at first instance for an award of 50% plus interest—being the highest discretionary amount available to the Tribunal under O. Reg. 664—was so disproportionate to the facts and evidence and, really, every s. 10 award issue that comes before the Tribunal, that it was difficult to analyze where I found a genuine dispute between the parties. Respectfully, many of the applicant’s contentions were addressed throughout my decision and its specific submissions on the s. 10 award at first-instance did not cite to any case law that would have provided support or an analogous fact scenario to bolster its request that I order a 50% award, nor did her submissions engage with the “excessive, imprudent, stubborn, inflexible, unyielding or immoderate” language the Tribunal has adopted when assessing the conduct of an insured.
32In any event, the Tribunal case cited by the applicant in his reconsideration submissions is M.P. v. Aviva General Insurance Company, 2019 CanLII 119736. Putting aside that Tribunal decisions are not binding, and that the case cited by the applicant was a decision that only featured a successful s. 10 award argued by her counsel in this matter, I am not persuaded that Co-Operators’ conduct offended any of the determinative grounds listed in para. 18 of that decision nor that my decision, considered in its entirety, did not address these factors. Indeed, on review, I do not find that Co-Operators’ exceeded the limits of what is reasonable; the applicant did not engage with the case law on “excessive, imprudent, stubborn, inflexible, unyielding or immoderate” to support her 50% request; Co-Operators continuously adjusted the applicant’s claim and considered all of the information (even if it arrived at a different quantum than the applicant after multiple attempts); and I did not hold Co-Operators’ conduct to a standard of perfection. I see no reason to depart from my initial decision not to order an award under s. 10.
33Accordingly, both parties’ requests for reconsideration are dismissed, as neither demonstrated that they satisfy the criteria under Rule 18.2(a) or (b) of the Tribunal’s Common Rules of Practice & Procedure.
ORDER
34For the reasons above, both requests for reconsideration are dismissed.
Jesse A. Boyce Vice Chair Tribunals Ontario - Safety, Licensing Appeals and Standards Division
Released: February 26, 2021
Footnotes
- Amended Decision, dated September 18, 2020.
- See, 16-000066 v. Waterloo Regional Municipalities, 2017 CanLII 19186 (ON LAT Reconsideration).
- See, for e.g., S.M. v. Unica Insurance Inc., 2020 CanLII 61460 (ON LAT Reconsideration); M.E. v. Aviva Insurance Canada, 2019 CanLII 119735 (ON LAT).