PRELIMINARY ISSUE DECISION
Release date: 08/11/2021
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:
Michelle Robertson
Applicant
and
Coseco Insurance Company
Respondent
ADJUDICATOR:
Jesse A. Boyce, Vice-Chair
APPEARANCES:
For the Applicant:
Mohamed Salah Elbassiouni, Counsel
For the Respondent:
Emily Schatzker, Counsel
HEARD:
By way of written submissions
OVERVIEW
1The applicant was injured in an accident on April 18, 2017 and sought accident benefits from the respondent, Coseco, pursuant to the Statutory Accident Benefits Schedule - Effective September 1, 20101 (''Schedule''). Coseco asserts that it denied the applicant’s claim for a Non-Earner Benefit (“NEB”) on June 28, 2017 and again on March 15, 2018, which was nearly three years prior to the submission of her application to the Tribunal on April 16, 2020 disputing same. To this end, it raised the preliminary issue that the applicant’s NEB claim is statute-barred due to her failure to appeal its valid denial within the two-year limitation period.
ISSUE IN DISPUTE
2The parties agree that the preliminary issue in dispute is as follows:
i. Is the applicant’s claim for a NEB statute-barred under s. 56 of the Schedule due to a failure to appeal the denial within the limitation period?
result
3The applicant’s claim for a NEB is statute-barred under s. 56.
ANALYSIS
Section 56
4Pursuant to s. 56 of the Schedule, an application to the Tribunal in respect of a benefit shall be commenced within two years after the insurer’s refusal to pay the amount claimed. The limitation period is triggered by a clear, unequivocal denial in straightforward and clear language directed towards an unsophisticated person, as established in Smith v. Co-Operators General Ins. Co., 2002 SCC 30.2
5Here, Coseco submits that it clearly and unequivocally denied the applicant’s NEB claim on June 28, 2017. After Coseco requested a Disability Certificate (“OCF-3”) to support the applicant’s claim on January 9, 2018, the applicant submitted an OCF-3 dated February 29, 2018 which stated that she suffered a complete inability to carry on a normal life, or the NEB test. Coseco submits that it then issued a second denial letter on March 15, 2018, referencing the first denial letter, and maintained its position that the applicant was not entitled to a NEB. The letter enclosed the right to dispute forms. On these facts, Coseco asserts that the two-year limitation period expired on June 28, 2019, approximately 9.5 months prior to the applicant’s application to the Tribunal and is therefore barred by s. 56.
6The applicant submits that Coseco’s denials were not clear and unequivocal and that the first denial could not have triggered the limitation period because she never intended to apply for a NEB in 2017, as alleged. She submits that she did not apply for the benefit until she submitted her February 28, 2018 OCF-3 supporting entitlement to the NEB. Further, the applicant argues that she did not submit an OCF-10 election form until February 7, 2019 when she retained new counsel and that Coseco did not advise her current counsel of any limitations when it provided her accident benefits file. On these facts, she submits that the first denial was invalid because she did not apply and “there was no amount claimed” and that the second denial was improper because it failed to provide medical reasons. Finally, she submits that her complete inability to carry on a normal life was not discovered at the time of the denial but rather was accrued over time, that the limitation period was suspended by virtue of O. Reg. 73/20 made under the Emergency Management and Civil Protection Act and that the Tribunal should exercise its discretion to extend the limitation period under s. 7 of the Licence Appeal Tribunal Act to allow her to proceed with her NEB claim at the hearing.
The first denial was proper
7The June 28, 2017 letter from Coseco to the applicant states that the application (“OCF-1”) “did not indicate if you were unable to return to your normal activities following the motor vehicle accident.” It then references the initial call between the applicant and Coseco’s adjuster, stating: “In our telephone conversation on May 4, 2017, it was confirmed that you did not suffer a complete inability to carry on a normal life as a result of the injuries sustained in the accident. Based on the information received to date, it is our determination that you do not meet the criteria to qualify for this benefit.” The NEB section concludes with an “X” marked in the box titled “Not Eligible”.
8While I am alive to the applicant’s submission that she had not yet submitted her OCF-3 and therefore had not applied for a NEB, in my view, this letter constitutes a clear refusal to pay a benefit. Smith provides that the limitation period is triggered by a clear, unequivocal denial in straightforward and clear language directed towards an unsophisticated person. On review, and even with the knowledge that the applicant was self-represented at that time, it is difficult to find that this letter was somehow unclear or unequivocal or that it was delivered in language that the applicant would not understand. Where the applicant had not submitted medical documentation to support a potential NEB claim, Coseco was not obligated to invent a medical reason for the denial, and especially so where the applicant had purportedly agreed that she did not meet the criteria for a NEB. The notice clearly states that it is Coseco’s determination that the applicant does not meet the criteria for a NEB and the “Not Eligible” box is clearly checked. Notably, the denial letter includes all of the information that the applicant would need to dispute the determination within the two-year limitation period.
9The applicant asserts that on May 4, 2017 she advised Coseco’s adjuster that she did not intend to claim NEB and that she did not actually apply for same pursuant to s. 36 until she submitted her OCF-3 on March 3, 2018 which supported her entitlement to NEB. However, the applicant’s interpretation of s. 36 fails to appreciate that s. 36 does not provide that an application is incomplete without an OCF-3. There is nothing in s. 36 that speaks to intent. Rather, s. 36(3) provides that an applicant who fails to submit a completed OCF-3 is not entitled to a specified benefit (such as a NEB) for any period before the OCF-3 is submitted. Section 36 does not state that Coseco is precluded from denying a specified benefit claim prior to receipt of an OCF-3, and especially so where the applicant indicated that she would not be claiming the NEB, where her OCF-1 did not indicate that she met the test, and where she failed to submit medical documentation to support her claim.
10If the applicant’s interpretation was correct, then an applicant would be able to submit an OCF-1 and then delay the expiration of a limitation period indefinitely until an OCF-3 is submitted. This would run contrary to the purpose of the accident-benefits scheme under the Schedule. In this vein, I agree with Coseco that the applicant’s position is contrary to the Court of Appeal’s decision in Sagan v. Dominion, 2014 ONCA 720, where it held that the commencement of a limitation period is not contingent on the submission of an OCF-3. As the Court of Appeal held (albeit under an older version of the Schedule) an OCF-3 is to be filed with the OCF-1. The OCF-3 is not the application and does not signify intent because benefit claims can be considered in cases where there is no OCF-3 at all. Undermining the applicant’s case further is the fact that the applicant in Sagan actually claimed NEB in their OCF-1 despite their failure to file their OCF-3 with it. I also agree with Coseco that Sietzema v. Economical Mutual Insurance Company, 2014 ONCA 111 supports this principle.
11I also find that this is not a situation where Coseco pre-emptively denied a benefit that the applicant only became eligible for or “discovered” later on, in the vein of Tomec v. Economical, 2019 ONCA 882, as the applicant alleges. There is no dispute that the applicant was not working at the time of the accident and would therefore not have been entitled to income replacement. In any event, her OCF-3 which supported entitlement to both a NEB and income replacement benefits (despite not being employed) then followed in February 2018 without providing details to support either claim. The applicant also communicated via email in November 2017 acknowledging her delay in responding to Coseco, advising that she was attending treatment and stating that she wished to pursue her claim. While I appreciate that the applicant was self-represented at this time, on these facts, it is unclear how the applicant would have only discovered her claim at some later date to invite the flexibility of the limitation period that Tomec provides. Indeed, it cannot be said that her eligibility for the NEB arose or was only discovered after the two-year post-denial period elapsed when, by her own argument, she completed her application for same on March 15, 2018, or less than one year post-accident. Neither of Tomec or my reconsideration decision in P.V. and Economical Insurance, 2020 CanLII 12744 (ON LAT) are assistive to the applicant.
12For completeness, I find Coseco’s second denial of March 15, 2018—sent in response to the applicant’s OCF-3—clearly referenced the June 28, 2017 denial and right to dispute forms that were provided. I agree that this correspondence was unambiguous in confirming that the NEB denial was effective as of that date. In addition, where the OCF-3 provided limited details to support the NEB claim (the relevant section of the form is blank), I note that the March 15, 2018 letter advised the applicant that Coseco would consider updated medical documentation to support the claim while warning specifically that this reconsideration would not reset or extend the limitation period.
13While I agree with the applicant that the medical and other reasons provided by Coseco in response to the submission of her OCF-3 were tenuous under s. 36(4)—the letter acknowledges the OCF-3 supporting NEB entitlement but then relies on the fact that the OCF-1 did not indicate an inability to return to her normal activities and Coseco’s determination that it “remain[s] of the opinion” that she was not eligible—the applicant did not provide any binding authority that would support that a failure to provide fulsome medical or other reasons under s. 36(4) in a second denial that clearly references an unequivocal first denial somehow tolls or restarts the two-year limitation period. This interpretation would run contrary to the decisions in Sagan and Sietzema—a denial can be legally incorrect while still commencing the limitation period. That the applicant offered a number of other submissions, including submissions on s. 7, suggests that she agrees that this argument is moot if the first denial was clear.
14Finally, my finding that the June 28, 2017 denial letter started the two-year limitation period renders the applicant’s arguments regarding s. 64(18) and O. Reg. 73/20 made under the Emergency Management and Civil Protection Act moot as well, as the two-year period for her to appeal elapsed on June 28, 2019, which is well before the legislative suspension of limitation periods due to Covid-19 on March 16, 2020 and, in any case, some 9.5 months prior to the submission of her application to the Tribunal on April 1, 2020.
15For these reasons, I follow the binding direction provided by the Court of Appeal in Sagan and Sietzema and find that the limitation period began to run on June 28, 2017 when Coseco issued a clear and unequivocal denial of NEB that satisfied the criteria provided in Smith. The limitation period for the applicant to appeal Coseco’s denial elapsed on June 28, 2019. Her NEB claim is statute-barred under s. 56.
Section 7
16The parties also wrestled with s. 7 of the Licence Appeal Tribunal Act, which provides the Tribunal with discretion to extend the limitation period based on four criteria: a bona fide intention to appeal; the length of delay, prejudice to the other party; and the merits of the appeal.
17The applicant submits that the revocation of her former counsel’s licence to practice law in 2019 interfered with her ability to dispute the NEB denials, that Coseco “failed/refused” to advise the applicant’s current counsel that there was a denial when it provided the file in February 2020, that Coseco’s improper denials means the limitation period did not actually expire until February 21, 2021, that any prejudice to Coseco is self-inflicted because it did not schedule s. 44 examinations and that there is merit to her claim because she is seeking a catastrophic determination. She submits that she should be allowed to proceed with her claim.
18I decline to exercise the Tribunal’s discretion. First, I agree with Coseco that the applicant’s former counsel’s licence revocation is irrelevant as it occurred in August 2019, or after the expiration of the limitation period, so it is unclear how this impeded her ability to appeal. In any event, Coseco has issued three denial letters, including the most recent denial dated February 21, 2019, and the applicant still failed to appeal in time. Further, there is no dispute that the applicant’s file was delivered to current counsel on February 18, 2020 and the applicant did not appeal for two months. It is disingenuous to suggest that Coseco “failed/refused” to advise the applicant’s current counsel of any limitation issues where the request was for “approved specified benefits” and the NEB was denied from the outset and where the limitation period had already elapsed.
19Second, the 9.5-month delay is quite significant. This is not a matter of missing a limitation period by a few business days or weeks. Indeed, the applicant’s entitlement to the NEB elapsed over one year before she even initiated her application with the Tribunal, which dovetails with the prejudice that Coseco would face in not being able to schedule contemporaneous s. 44 examinations where the applicant’s OCF-3 provided no details to support her complete inability and where the applicant purportedly has a complex medical history involving fibromyalgia, depression and anxiety.
20Lastly, while I make no finding on the merits of the applicant’s substantive claims that are proceeding to a hearing, the fourth criteria almost invariably favours the applicant and especially so if catastrophic impairment is at issue. However, on balance, I find that this factor does not outweigh the other three in order to overcome the significant delay at issue, and the applicant’s inaction during that time. For these reasons, I decline to exercise the Tribunal’s discretion to extend the limitation period under s. 7.
ORDER
21The applicant’s NEB claim is statute-barred from proceeding to the substantive issue hearing scheduled to begin on October 25, 2021.
Released: August 11, 2021
Jesse A. Boyce, Vice-Chair
Footnotes
- O. Reg. 34/10, as amended.
- Smith v. Co-Operators General Ins. Co., 2002 SCC 30. ["Smith"]