Release date: 05/26/2021
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:
Tyrell Hines
Applicant
and
TD Insurance Meloche Monnex
Respondent
DECISION AND ORDER
ADJUDICATOR:
Avril A. Farlam
APPEARANCES:
For the Applicant:
Domenic Romeo, Counsel
For the Respondent:
Amanda Colarossi, Counsel
Irina Sfranciog, Counsel
HEARD by Videoconference
and written submissions
OVERVIEW
1Tyrell Hines (“applicant”) was involved in an automobile accident on September 7, 2016 (“accident”). The applicant sought benefits from TD Insurance Meloche Monnex (“respondent”) pursuant to the Statutory Accident Benefits Schedule - Effective September 1, 2010 (the ''Schedule''). 1
2The respondent paid income replacement benefits (“IRB”) of $51,535.45 to the applicant for the period September 14, 2016 to May 1, 2019 when the respondent determined that the applicant’s entitlement to IRB is subject to the exclusion set out in s. 31(1)(a)(i) of the Schedule.
3The applicant submitted an application to the Licence Appeal Tribunal - Automobile Accident Benefits Service (“Tribunal”) for dispute resolution.
4Both parties filed written submissions for this hearing. In addition, oral testimony was heard on April 21, 2021 pursuant to the Tribunal’s Order made September 16, 2020.
ISSUES
5The issues to be decided in this hearing are:
i. Is the applicant entitled to receive IRB in the amount of $368.80 weekly for the period of September 14, 2016 to date and ongoing, submitted September 14, 2016, and denied by the respondent on May 1, 2019?
ii. Is the applicant entitled to receive interest on any overdue payment of the benefit?
iii. Is the applicant entitled to an award under Regulation 664 because the respondent unreasonably withheld or delayed the payment of benefits?
iv. Is the respondent entitled to repayment of IRB in the amount of $19,177.60?
RESULT
6The applicant’s claims for IRB, interest and an award are dismissed. The applicant is liable to repay to the respondent IRB in the amount of $19,177.60 plus any interest pursuant to s. 52 (5) not already included in the $19,177.60.
LAW
7An applicant’s entitlement to IRB is subject to the exclusions set out in s. 31 (1) of the Schedule including s. 31(1)(a)(i) which provides that an insurer is not required to pay IRB to a driver of an automobile if the driver knew or ought reasonably to have known that he or she was operating the automobile while it was not insured under a motor vehicle liability policy at the time of the accident.
8The onus is on the insurer to bring itself within an exclusion in s. 31.
ANALYSIS
Did the Applicant Know or Ought Reasonably to Have Known He Was Operating the Automobile While It Was Not Insured Under A Motor Vehicle Liability Policy?
9The applicant submits he is an innocent bystander and victim of fraud. He thought he had purchased valid insurance from a broker and his vehicle was insured at the time of the accident. It was not until after the accident that he realized he had been dealing with a fraudster who had not arranged for insurance on his vehicle. The applicant also submits that the “knew or ought reasonably to have known” test must be assessed in view of what a person of the applicant’s age, education and background would reasonably know. Given that he had just turned 21 at the time of the accident, had purchased only one insurance policy previously through dealings with a registered insurance broker (“S.B.”), the “broker” was recommended by a friend, he received communications from the “broker” through text and email and the temporary insurance card he was given by the “broker” was accepted by Service Ontario, he never heard from the “broker” afterward and no requests for payment of insurance premiums were made after his initial payment, he did not know or ought not to reasonably have known that he was operating his automobile while it was not insured.
10The respondent submits that the test of “knew or ought reasonably to have known” is fact specific and that the evidence in this case establishes that the applicant meets the test.
11I find that the applicant knew and ought to reasonably have known that he was operating his automobile while it was not insured under a motor vehicle liability policy at the time of the accident. The following are my reasons.
12The price the applicant said he paid for the so-called insurance was significantly lower than the applicant had paid for insurance before on the same vehicle less than a year earlier. The applicant testified that he had obtained valid insurance on his vehicle through S.B. in 2015. He had received correspondence from S.B. which advised him how to pay the premiums and knew to expect confirmation of the insurance coverage. The insurance policy arranged in 2015 was not in effect at the time of the accident because it had been cancelled for non-payment of premiums which were in excess of $500.00 per month. The applicant said he parked his vehicle and did not drive it while he made efforts to obtain other insurance. A friend gave him the name of a person the applicant believed to be a legitimate insurance broker (“broker”). He contacted the “broker” and ultimately a meeting was arranged by text on his phone at which the “broker” would deliver confirmation of the insurance.
13The meeting was held in an unconventional manner. The applicant arranged to meet the “broker” at or near a gas station May 31, 2016. At this meeting, in exchange for a temporary insurance card, the applicant gave the “broker” $600.00 in cash for the “first and last months payments” of $300.00 each.
14The applicant received no payment or policy documentation except the temporary insurance card. The applicant admitted he did not get a receipt for the $600.00 payment, never got any confirmation of this payment from the “broker” by email or text, never got an invoice for the insurance and doesn’t know if there was HST. The applicant said he was not given any insurance policy documents at the meeting and no payment schedule for the payments of $300.00 per month.
15The communications the applicant received from the “broker” had irregularities. The applicant received text messages from the “broker,” one of which misspelled “insurance”; and an email which misspelled “Ontario” and attached a pdf file labelled “ivan new.pdf”. The applicant said he did not know who Ivan is. The applicant admitted that he understood the June 2, 2016 temporary insurance card was good for 30 days but believed he had insurance for one year because there was a policy number on the temporary card. However, the name of the supposed insurer is shown as “Desjardins, Sales and Customer Services”. The “effective term” is “June 2, 2016 a.m., for 30 days”.
16The applicant had no contact with the “broker” between the expiry of the 30-day period and the accident. Even though he understood that the temporary card had to be replaced with another card and included the notation “Please replace it by the insurance card you will receive soon”, and even though he never received a replacement card, the applicant testified that he did not contact the “broker” about this or call the phone number shown on the temporary card. The applicant admitted that he knew he would not have insurance after 30 days unless he paid for it, based on his previous vehicle insurance being cancelled for non-payment.
17I find the applicant’s testimony to be largely not credible and do not accept his testimony that he did not know he was not insured at the time of the accident. The applicant testified that he did not check his bank account to see if the $300.00 per month was being taken out even though this was a significant amount of money to him. The applicant said he was not sure if he ever paid any premiums for insurance after the initial payment. This testimony is not credible given that the applicant had already had a previous insurance policy cancelled for non-payment, was familiar with the cost, importance of paying premiums and process for obtaining a legitimate insurance policy on his vehicle.
18Some of the text messages with the “broker” discuss the applicant’s intention to obtain licence plate stickers from Service Ontario and after he did so, the communications with the “broker” stopped until after the accident, tending to indicate that the applicant was less concerned with whether he had insurance on his vehicle than whether Service Ontario would accept the temporary insurance card as proof of insurance in order to get the stickers.
19Further, the applicant said he did not recall if he reported the “broker” to the police. He testified he was not sure if he was convicted of the charge of driving without insurance because none of the judge, the prosecutor or his legal representative told him he was convicted. This conflicts with his earlier statement under oath at an examination on October 15, 2018 when the applicant answered “yes” to the question “were you convicted of driving without insurance?”
20It is not credible that a high school educated, employed, 22 year man who had obtained insurance on the same vehicle less than one year earlier through a legitimate insurance broker and gone through the experience of having his policy cancelled for non-payment could reasonably have thought he was purchasing motor vehicle insurance through a “broker” who never provided him with a written quote, an invoice, a receipt for the cash payment, a payment schedule for monthly payments, a replacement insurance card in place of the temporary card which showed coverage expiring July 2, 2016 or any insurance policy documents. It is also not credible that being given a policy number on a temporary insurance card would lead a person to believe that they are entitled to a year’s worth of insurance without payment.
21That the “broker” did not provide any insurance broker credentials to him, communicated frequently through text messages, email and on the telephone, met him on at or near a gas station, and emailed him a pdf file referenced to “Ivan” and not his own name, are additional factors that are likely to have alerted a reasonable person of the applicant’s age, education and experience to the fact that he was not purchasing legitimate insurance from the “broker”.
22The applicant’s submission that his dealings with S.B. and the “broker” were the same is not supported by the evidence. Correspondence sent from the registered broker S.B. shows a copy of the applicant’s vehicle registration was requested, not just the information about the registration, confirms payment of $526.65 per month, informs him that the insurer requires funds to be sent as soon as possible to avoid cancellation, asks the applicant to call if he has any questions and requests that the applicant confirm when the payment is made. S.B.’s insurance designations are shown on the email together with a direct phone number, cell phone number, toll free phone number and fax number. In February 2016 when his insurance policy was cancelled, he received a letter directly from the insurer. By contrast, the “broker” communicated largely by telephone and text, did not make the applicant aware of any insurance designations and did not request a copy of the vehicle’s registration. The applicant admitted he did not meet S.B. at or near a gas station in order to receive insurance documents.
23The applicant’s argument that he was young, uneducated, inexperienced and believed he had purchased legitimate insurance, especially when a government office accepted his temporary insurance card for purposes of issuing stickers for his licence plates, is unpersuasive. The applicant was an employed, high school educated, legal adult with experience in insuring his motor vehicle and losing that insurance coverage for non-payment of premiums less than one year before the accident. The applicant admitted in his testimony that he knew he needed to have an insurance broker if he did not purchase insurance directly from an insurance company, that there was a process to go through, and that insurance brokers are licensed and regulated. That the government office relied on the applicant’s temporary insurance card is not persuasive evidence that the applicant had in fact purchased insurance or that it was reasonable for the applicant to think that he had.
24Based on the totality of this evidence, on a balance of probabilities, the respondent has established that the applicant knew and ought to reasonably have known that he was operating his automobile on September 7, 2016 while it was not insured under a motor vehicle liability policy. The coverage provided by the temporary insurance card, even if it had been genuine, would have expired 30 days after June 2, 2016 or specifically on July 2, 2016. Even if it could be said that the applicant could reasonably have believed he had paid for 60 days insurance coverage, and I do not find this, the insurance would have expired on August 2, 2016. There is no reasonable basis for the applicant to believe that he had purchased insurance on his motor vehicle for one year based solely on seeing a policy number on what purported to be a temporary insurance card. As a result, the applicant knew and ought reasonably to have known that he was operating the automobile while it was not insured under a motor vehicle liability policy on September 7, 2016 and I so find.
Is the Respondent Entitled to Repayment of $19,177.60?
25Section 52 (1) (b) of the Schedule provides that a person is liable to repay to the insurer any IRB paid if the person to whom payment has been made was disqualified from receiving the benefit under Part VII. Section 31(1)(a)(i) is under Part VII.
26I have already found that the applicant was disqualified from receiving IRB under s. 31(1)(a)(i). After considering all of the evidence, submissions and cases put forward by the parties, I find that the respondent gave the 12-month notice required by s. 52 (3) by correspondence dated May 1, 2019. As a result, I also find that the applicant is liable to repay to the respondent $19,177.60 for the 12-month period prior to May 1, 2019, plus any interest pursuant to s. 52 (5) not already included in the $19,177.60.
Applicant’s Claim for Interest
27As no benefits are payable to the applicant, no interest is payable to the applicant.
Applicant’s Claim for An Award
28Section 10 of Regulation 664 provides that a special award may be granted if the respondent unreasonably withheld or delayed payments. I find that there was no payment unreasonably withheld or delayed.
29The applicant also argues that respondent’s denial was unreasonable and based on inappropriate considerations including the conviction of the applicant.
30I disagree. The respondent denied the IRB for the reasons it expressed which was not an unreasonable position given the information on file including the motor vehicle accident report and the examination under oath of the applicant. The respondent’s view that the applicant’s entitlement to IRB is subject to the exclusion set out in s. 31(1)(a)(i) of the Schedule has been borne out by the evidence at this hearing.
31For these reasons, there is no award.
ORDER
32For the reasons outlined above, the applicant’s claims for IRB, interest and an award are dismissed. The applicant is liable to repay to the respondent IRB in the amount of $19,177.60 plus any interest pursuant to s. 52 (5) not already included in the $19,177.60.
Released: May 26, 2021
Avril A. Farlam, Vice Chair